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LONDON (Alliance News) - Catlin Group Ltd Tuesday reported a 13% rise in pretax profit as improved investment return more than offset a fall in the specialist insurer's net underwriting contribution.
The group's annual results stand to be its last as a public company, having retained a listing on the London Stock Exchange since 2004, in the wake of a GBP2.79 billion takeover bid by XL Group PLC last month. Under the terms of the offer, which has been recommended by Catlin's board, shareholders will receive 388 pence in cash and 0.130 new XL shares for each Catlin share they hold, plus dividends.
In a statement, the specialist insurer said it made a USD488 million pretax profit in 2014, compared with USD432 million in the prior year.
Net underwriting contribution, the insurer's losses and loss expenses and policy acquisition costs subtracted from net premiums earned, fell to USD991 million from USD1.00 billion, in what was a benign year for catastrophe events. The net underwriting contribution was its second best in the past five years, only behind the performance in 2013.
Investment return improved to 2.6% from 1.5%, representing a 79% increase to USD241 million, with USD31 million due to gains on loans made to Box Innovation Group, the parent of telematics auto insurer Insure the Box.
Catlin made good on its intention to declare a 22 pence per share final dividend, meaning the total for the year will rise by 4.8% to 32.5 pence, while it also reiterated that it expects to pay a special dividend of about 12 pence per share on the completion of the sale of its stake in Box Innovation Group.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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