JLT reports 3% profit rise and 7% organic growth

Jardine Lloyd Thompson (JLT) made a profit after tax of £59.2m in the first half of 2013, up 3% on the £57.2m it made in the same period last year.

The London-listed broking group’s risk and insurance segment, which houses its core broking business, reported organic growth of 7%, beating rivals Willis (5.1%) and Aon (3%).

Total revenue was up 10% to £487.2m (H1 2012: £441.7m).

The improvement came despite £8m of one-off costs (H1 2012: £4.4m). This included £3.9m of acquisition and integration costs and £3.8m relating to its two-year business transformation programme, which the company embarked on in January 2013.

JLT expects the programme to cost it £18m, but generate £12m of annual cost savings once complete.

JLT chief executive Dominic Burke (pictured) said: “This set of results illustrates how our continuing investments are enabling us to maintain our track record of strong organic growth. Despite the weak insurance rating environment and mixed economic outlook, our clear strategy and momentum give us confidence in our ability to deliver year-on-year financial progress.”

Thistle loss

The risk and insurance division’s trading profit increased 3% to £82.7m (H1 2012: £80.3m). Revenues increased 7% to £372.2m (H1 2012: £346.6m).

The risk and insurance trading margin (trading profit as a percentage of revenues) fell by one percentage point to 22% (H1 2012: 23%).

However, JLT’s managing general agency, Thistle UK, made a trading loss of £1.3m (H1 2012: trading profit of £100,000). This was despite a 2% increase in revenue to £15.4m.

JLT did not give a reason for the unit’s deteriorating performance.