Brit Plc, a Lloyd’s of London insurer, posted a 4.5 percent increase in premiums and said it would pay its first dividend following its initial public offering in March. The shares gained.
Premiums before reinsurance expenses rose to £701.2 million ($1.178 billion) from £671.2 million [$1.127 billion] in the year- earlier period, the company said in a statement today. Brit said it plans to pay an interim dividend of 6.25 pence [10.5 cents] a share.
Brit, which provides insurance and reinsurance, focusing on property, casualty and energy coverage, raised £240 million [$403 million] in its share sale in March. Private-equity companies Apollo Global Management LLC and CVC Capital Partners Ltd. together hold about 73 percent of the stock, according to data compiled by Bloomberg.
“The underwriting environment is undeniably becoming increasingly challenging,” CEO Mark Cloutier said in the statement. Brit is “well-positioned to continue to deliver attractive returns” because of a “disciplined approach to underwriting,” he said.
The shares rose 2 percent to 250 pence [$4.20] at 8:56 a.m. in London trading. The stock has gained 4.2 percent since the IPO at 240 pence apiece.
Pretax profit fell to £61.5 million [$103.26 million] from £75.4 million [$126.5 million], the company said. Foreign exchange and IPO costs were £34.5 million [$57.89 million].
Premiums may decline in property reinsurance, while prices in the direct insurance business, which accounts for about 75 percent of Brit’s underwriting, “is showing more resilience,” the company said.
The combined ratio rose to 88.3 percent from 86.2 percent, indicating that the company was paying out more in claims and costs relative to premiums than in the year-earlier period.