Admiral makes record profit

Admiral announced a record H1 pre-tax profit of £126.9m up 21% ahead of H1 2009, with turnover up 33% to £720.5m, driven mainly by the UK motor insurance market.

In the UK prices were pushed up 14% and Admiral still won 23% more customers giving it a 37% increase in premium.

H1 financial highlights (2009 in brackets)

• Turnover £720.5m (£540.1m)
• Net revenue £296.4m (£243.1m)
• Number of customers 2.37m (1.92m)
• Combined ratio 89.3% (89.0%)
• Pre-tax profit £126.9m (£105.5m)

UK driving force

Henry Engelhardt, group chief executive, said: “The UK car insurance business continues to be the driving force behind our success and in the first half of 2010 we shifted up yet another gear. We increased premium rates by around 14% in the first half and increased customer numbers by 23% year-on-year.

“The combined effect was an increase in total premiums written of 37%. These results demonstrate the strength of our UK model, which combines competitive prices with great service.”

Spanish practices

“Of course there are challenges; our operations outside the UK and the Confused price comparison business are not as strong.

“Yes, Balumba, our insurance operation in Spain, made its first half-yearly profit (€25,000), but it still has work to do as an underwriter to build a sustainable, profitable, growing business. In sum we now insure more than 150,000 vehicles outside the UK covering four countries.

“In the first part of next year we plan to launch an insurance operation in France as the final part of our five-year strategic plan. We also have three fledgling price comparison businesses outside the UK, two of which launched this year.

Staff bonus

“All in all we’re pleased with the numbers for the first half of 2010. As a result, every member of staff will receive £1,500 of free shares in the Group, worth over £6m in total.”