Trading Update

RNS Number : 1375B

Randall & Quilter Inv Hldgs Ltd

28 February 2014

 



Randall & Quilter Investment Holdings Ltd

Trading Update

28 February 2014

Randall & Quilter Investment Holdings LTD (AIM:RQIH), the specialist non-life insurance investor, service provider and underwriting manager, today provides an update on trading for the year ended 31 December 2013 ahead of the announcement of its final results, which is expected on 30 April 2014.

The Directors currently expect that the Group's pre-tax result for the year ending 31 December 2013 will be in line with management expectations, subject to completion of customary actuarial review procedures.

The Group's Insurance Services business is expected to have performed broadly in line, with good progress in the UK offsetting some income deferral in the US. Outside of the syndicate participations, the Insurance Investments Division looks to have performed well with better than anticipated investment income and a stronger contribution from acquisition activity.

The Group's participation in Syndicate 1991 continued the trend first commented on in the interim results announcement, with limited earned premium development in the syndicate's first year of operation. The 2014 Group result is likely to reflect the slow earned premium development on Syndicate 1991, which has now been much expanded for the 2014 underwriting year.

The performance of the Insurance Investments Division outside of the syndicate participations will continue to be dependent on acquisition activity as investment income continues to look challenging and the contribution from reserve releases from the existing portfolio is likely to continue to trend lower, simply as a function of the reduced level of non US reserves where most savings have typically occurred.

We continue to develop a good pipeline of attractive run-off acquisition opportunities and a number of specific projects are being worked on, including some more significant portfolio transfers. The lengthy regulatory process and transaction time needed to complete such deals will mean that a number of the currently identified opportunities are likely to complete in the second half of the year. Together with the customary weighting of reserve releases following second half year actuarial reviews and certain service company income patterns, especially on the contingent side of the business, the Group's 2014 profit is therefore likely to emerge substantially in the latter part of the year.

Operationally, a number of significant achievements have been made, not least successfully doubling the capacity of Syndicate 1991 in the 2014 underwriting year with an expanded third party capital base, the consolidation activity of our owned insurance companies and the Group's redomicile to Bermuda. 

Whilst the Group's ongoing investment in building a significant management presence in the "active" Lloyd's market will continue to be felt in the current financial year, the Board remains confident that its strategy will deliver strong profit growth over the medium term, helped by a continuing focus on the re-engineering of its niche service business and buoyant legacy acquisition activity.

Enquiries to:

Randall & Quilter Investment Holdings Ltd                    www.rqih.com

Tom Booth                                                                          Tel: + 1 441 247 8330

Numis Securities Limited

Stuart Skinner/Robert Bruce (Nominated Adviser)             Tel: [phone]

Charles Farquhar (Broker)                                                  Tel: [phone]

Shore Capital Stockbrokers Limited

Dru Danford/Stephane Auton                                             Tel: [phone]

FTI Consulting

Edward Berry / Tom Blackwell                                           Tel: [phone]

Notes to Editors:

About R&Q

Since formation, Randall & Quilter has pursued a buy and build strategy to create a comprehensive range of investment activities and services in the global non-life insurance market and is focused on the following three core areas:

·     Insurance Investments;

·     Insurance Services; and

·     Underwriting Management

The Group:

·     provides a range of services to both the live and legacy (re)insurance markets to support growing businesses and address problematic run-off issues.

·     has a team of up to 350 insurance professionals based in the UK, USA, Bermuda, and Continental Europe with wide service capability in both the 'live' and 'run-off' market;

·     has a current portfolio of 14 insurance companies and captives in run-off (from the UK, US and Continental Europe) with net assets of c.£96.4m as at 30 June 2013

·     owns a Bermuda Class 3A insurance company which currently supports the Group's four syndicate participations;

·     has launched Syndicate 1991 which commenced underwriting from January 1, 2013 with a Capacity of £150m for 2014, provides 'turnkey' management services to Lloyd's syndicate 1897, manages two RITC ('run-off') syndicates and owns and operates 3 MGA business units; and

·     acquires and manages a portfolio of insurance receivables, with a carrying cost of c. £8.9m as at 30 June 2013;

The Group was founded by Ken Randall, Executive Chairman and Chief Executive, and Alan Quilter, Chief Operating Officer and Deputy Group Chief Executive.

Website: http://www.rqih.com/

 

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