LONDON (Alliance News) - FBD Holdings PLC Tuesday reiterated earnings per share guidance of between 120 and 130 cent for the full-year, excluding any exceptional events that may arise, alongside a trading update in which it revealed that gross written premium to date is ahead of the previous year by approximately 3%.
In its first-quarter interim management statement, the Ireland property and casualty insurer said both policy volume and average premiums have increased compared with the corresponding period a year earlier.
FBD said the increase in policy volume is primarily from growth in car insurance and in business insurance, with growth being achieved in online sales through both FBD and the No Nonsense brand, through FBD's sales office network and through brokers.
The recently launched car insurance product for the broker market, sold under the Clan Insurance brand, has delivered as expected, it said.
FBD is continuing its policy of focusing "considerable resources" on growing its business within the farming sector.
"FBD continues to demonstrate underwriting discipline by only increasing volume where returns are adequate. Overall, the group expects that its share of the insurance market is likely to have increased further year to date," FBD said in the statement.
FBD said increased economic activity leads to higher claims frequency, adding that there is invariably a time lag before this is fully reflected in market premiums, particularly if activity grows faster than anticipated by the insurance market.
While this will have a short term impact on profitability in 2014 and the early part of 2015, FBD said it has taken "appropriate" rating action, and continues to monitor trends to ensure that risks are adequately priced.
FBD said the February 12 windstorm that hit Ireland is likely to cost it EUR7.8 million, net of reinsurance.
Underwriting expenses and longer-term investment return are both in line with FBD's expectations.
Actual investment return is better than expected, although it is not at the "exceptionally high level" achieved in 2013, FBD said.
Meanwhile, FBD said the operating environment for its pensions and investment consulting business remains "challenging" but its financial services businesses are "broadly in line" with expectations.
The trading performance of the property and leisure joint venture is ahead of 2013, FBD said, with strong operating results, particularly in Ireland. The joint venture has entered into an agreement with Taylor Wimpey, the UK residential developer with operations in Spain, for the sale of a small segment of the development land in La Cala.
FBD shares were untraded early Tuesday. They were last quoted at 17.08 pence.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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F.b.d.hldgs (FBH)
Taylor Wimpey (TW.)