Last checked at 22 Aug 2022 07:00
22 August 2022
Helios Underwriting plc
('Helios' or'the 'Company')
Quarterly Syndicate Mid Point Forecasts
Retained Capacity Increased; Profits Continue to Outperform against Lloyd's Market Average
Helios, the unique investment vehicle which acquires and consolidates private underwriting capacity at Lloyd's, announces the current mid-point forecasts in respect of its portfolio of syndicate capacity for the 2020 and 2021 years of account based on 2nd quarter 2022 estimates.
Nigel Hanbury, Chief Executive, commented:
"As the only listed consolidator of private capital at Lloyd's, Helios offers a unique opportunity for investors: growth and returns from exposure to the Lloyd's market through our strategy of acquiring the capacity of the better performing syndicates. Over recent years, our strategy has yielded superior results, with returns on average 5.1% better than the Lloyd's market itself.
"We have increased the retained capacity to £172m in recognition of market discipline and a harder market. We remain confident that we shall deliver improved results when compared to the Lloyd's market as a whole, and we look forward to creating further shareholder value as the benefits of the larger retained capacity flows through to the income statement."
| Year of Account |
| |||
| 2020 | 2021 | 2022 |
| |
| £m | £m | £m |
| |
Capacity - Position as at 18th August 2022 |
|
|
|
| |
Retained | 66.5 | 93.5 | 171.9 |
| |
Reinsured | 49.1 | 51.5 | 60.8 |
| |
| 115.6 | 145.0 | 232.7 |
| |
|
|
|
|
| |
Mid-point forecast at 31st March 2022 | 1.01% | 1.90% |
|
| |
Current mid-point forecast | 1.84% | 2.40% |
|
| |
|
|
|
|
| |
Lloyd's Market Average | 0.25% | 4.25% |
|
| |
Helios out performance | 1.59% | (1.85%) |
|
| |
Commentary
The mid-point forecast for 2020 year is continuing to improve, increasing the profit for the underwriting year to 1.84% notwithstanding the impact of the investment losses incurred on syndicate asset portfolios during this first six months of the year. The trend of outperformance against Lloyd's market average has increased to 1.59% (March 2022 - 1.01%), which demonstrates the quality of the portfolio which we have built.
The mid-point estimate for the 2021 year has improved to 2.40%. The underperformance against the Lloyd's market has narrowed since March 2022 to 1.85% (March 2022 - underperformance of 2.30%). We continue to expect the gap in relative performance to narrow over the next 15 months as it has done in the past. The syndicates supported by third party capital have been more conservative in their published estimates over the 36 months to the close of the year of account due to the transparency of each syndicate's ' result and the overall result of these syndicates has improved whilst the estimates of the aligned syndicates has remained unchanged.
Notes
1) The table above shows the capacity as at 18th August 2022 splitting the capacity retained by Helios and the capacity that is ceded to quota share reinsurers.
2) The mid-point forecasts for 2020 and 2021 years of account as of 2nd quarter 2022 have been aggregated at syndicate level from estimates supplied by managing agents.
3) The impact on Helios will be as follows:
a. The change in the mid point estimates on the retained capacity over the year will be recognised in the Helios income statement in the year to 31st December 2022.
b. The overall change in the result will be recognised by Helios in cash at the close of the year of account.
For further information, please contact:
Helios Underwriting plc
Nigel Hanbury - Chief Executive 07787 530 404 / nigel.hanbury@huwplc.com
Arthur Manners - Chief Financial Officer 07754 965 917
Shore Capital
Robert Finlay 020 77408 4080
David Coaten
Henry Willcocks
Buchanan
Helen Tarbet / Henry Wilson / George Beale +44 (0)7872 604 453
+44 (0)20 7466 5111
About Helios
Helios provides a limited liability direct investment into the Lloyd's insurance market and is quoted on the London Stock Exchange's AIM market (ticker: HUW). Helios trades within the Lloyd's insurance market writing approximately £233m of capacity for the 2022 account. The portfolio provides a good spread of business being concentrated in property insurance and reinsurance. For further information please visit www.huwplc.com.