Last checked at 3 Aug 2012 07:45
3 August 2012
Direct Line Insurance Group plc
Half Yearly Results
Direct Line Insurance Group plc ("Direct Line Group") notes the publication of the financial results for the six months ended 30 June 2012 by its parent company The Royal Bank of Scotland Group plc ('RBS Interim Results'). RBS Interim Results include the results for Direct Line Group presented as a division of RBS Group (the Divisional Results).
Bondholders should note that the Divisional Results are not presented on the same basis as the historical financial information for Direct Line Group for the three years ended 31 December 2011 (1). In particular the Divisional Results do not include restructuring and other one off costs of £109m. For 2012, restructuring and other one-off costs are expected to be approximately £170m (excluding any costs relating to the new cost reduction plan set out below).
Direct Line Group also announces today a cost reduction plan targeting gross annual cost savings of £100m by end 2014 (2). The one-off restructuring costs, for all cost saving initiatives, are expected to be approximately £100m, expected to be incurred by the end of 2013.
Direct Line Group intends to announce its results for the six months ended 30 June 2012 prepared on a basis consistent with the historical financial information on 3 September 2012.
For further information, please contact:
Neil Manser Robert Bailhache
Head of Investor Relations Director of Communications
Tel: 020 8285 3134 Tel: 020 8313 8420
Notes
(1) Historical financial information for the three years ended 31 December 2011 is available on Direct Line Group's website http://www.directlinegroup.com/investors.aspx. The Historical Financial Information is not directly comparable to the Divisional Results principally because:
• a number of items, including restructuring costs, separation costs and goodwill impairment, are not included in Direct Line Group's operating profit reported in the RBS Interim Results; and
• the operating results of the activities of Tesco Personal Finance are reflected in operating profit in the Historical Financial Information as a run-off business in all periods. In RBS Group's financial results disclosures prior to 2012, the operating results of Tesco Personal Finance were included as part of the Non-Core division of the RBS Group.
Investors should consider only the Historical Financial Information as contained on the website when making any investment decision.
(2) Cost savings relate to operating costs for ongoing operations and claims handling expenses which amounted to £1,134million for the year ended 31 December 2011.