Admiral pays out special divi as interim profits surge

15th Aug 2024 07:04

(Sharecast News) - Shares in Admiral surged on Thursday as the UK insurance group posted a better-than-expected 32% rise in half-year pre-tax profits to £310m, driven by an improved current year underwriting performance and claims releases.

It also declared an interim dividend of 71p a share including special payout of 19.7p a rise of 39%. Analysts had forecast profit of £304m and dividend of 67.3p. Admiral shares were up 7% in early London trade.

Admiral said it had picked up more customers by not hiking prices as much as competitors. Customer numbers rose 12% to 10.5 million, with UK motor insurance clients growing 15% to 5.5 million.

Insurance companies have hammered customers over the last two years with higher premiums.

"The UK Insurance business generated strong year-on-year growth in customers (+17%) and turnover (+57%). The increase in turnover is due to the significant rate increases in 2022 and 2023 in response to the elevated claims inflation experienced over the past few years," the company said.

Admiral said it cut rates "modestly" around the start of 2024 as market rates were still increasing, leading to an "improved competitive position and significant growth in UK Motor customer numbers".

UK Insurance profit was £363 million, up 20% due to higher average premiums along with continued significant releases of prior period claims reserves

Reporting by Frank Prenesti for Sharecast.com