TIDMHSTG
RNS Number : 1069F
Hastings Group Holdings plc
25 October 2018
Hastings Group Holdings plc
Trading update for the 9 months ended 30 September 2018
25 October 2018
Hastings Group Holdings plc ('the Group', or 'Hastings'), the
technology driven insurance provider, today provides an update on
its trading performance for the 9 months ended 30 September
2018.
Hastings has delivered another period of profitable trading with
higher average premiums and continued net revenue growth. Customer
numbers are 4% higher than the prior year and the Group continues
to invest in its digital capabilities and future growth
initiatives.
Trading highlights
-- Whilst market conditions have remained competitive during the
third quarter, with falling average market premiums, Hastings has
maintained its commitment to underwriting discipline, resulting in
average written premium inflation of 2% for the 9 months ended 30
September 2018. For the quarter, customer policy numbers were
broadly flat, due to a combination of applying premium rate
increases and the 0.5% growth in car customers being offset by a
small reduction in home.
-- Live customer policies were 2.70 million as at 30 September
2018, a 4% year on year increase.
-- Market share of UK private car insurance of 7.5% as at 30 September 2018.
-- Gross written premiums up 5% to GBP955.0m for the 12 months
ended 30 September 2018 and up 3% to GBP738.5m for the 9 months
ended 30 September 2018.
-- Net revenue increased by 9% to GBP751.3m for the 12 months
ended 30 September 2018 and increased by 7% to GBP574.1m for the 9
months ended 30 September 2018.
Operational highlights
-- Ongoing investment into the Group's technology programme,
including the continued successful rollout of Guidewire, additional
investment in the Group's market leading anti-fraud capability and
development of new underwriting and retail pricing models to
support profitable growth in 2019 and beyond.
-- Lloyds Bank General Insurance, Integra and RSA have joined
the Group's panel of home underwriters whilst the Group continues
rolling out its home underwriting proposition on a test and learn
basis.
-- Became a founder member of the Smart Mobility Living Lab's
three year shared research programme, alongside Aviva, BP and
Honda. The programme will develop, test and validate the impact of
new road transport technologies, ensuring the Group is at the
forefront of technological advancement.
-- The Group further enhanced its digital proposition, rolling
out mobile app and online portal enhancements for customers, and
completed testing of a new digital claims notification system.
-- Continued investment in the Group's colleague agenda, with
improved shifts, additional wellbeing activities and strengthened
diversity programme, including participation in the 30% Club
mentorship scheme in support of senior management gender
diversity.
-- Board strengthened through the appointment of Elizabeth G.
Chambers as an independent non-executive director.
Group performance
9 months ended 12 months ended
================================== ==================================
30 September 30 September Growth 30 September 30 September Growth
2018 2017 2018 2017
======================= ============ ============ ====== ============ ============ ======
Gross written premiums
(GBPm) 738.5 714.3 3% 955.0 910.5 5%
Net revenue (GBPm) 574.1 538.3 7% 751.3 688.3 9%
========================= ============ ============ ====== ============ ============ ======
As at
==================================
30 September 30 September Growth
2018 2017
======================= ============ ============ ====== ============ ============ ======
Live customer policies
(million) 2.70 2.60 4%
UK Private car market
share (%) 7.5% 7.2% 30 bps
========================= ============ ============ ====== ============ ============ ======
Outlook
The Group expects to maintain its disciplined pricing strategy
in the ongoing competitive market that is likely to continue for
the rest of the year. Despite the pricing actions taken during the
year, claims inflation is expected to continue to exceed premium
inflation and the Group's loss ratio for the full year is expected
to be at the lower end of the target range of 75% to 79% and trend
towards the middle of the target range for the year ending 31
December 2019.
The Group is confident of the underlying momentum of the
business and continues to work towards its target of 3 million live
customer policies during 2019 and ongoing growth beyond. This will
be delivered through a combination of the launch of enhanced price
comparison website pricing, additional anti-fraud capabilities,
initiatives to enhance customer service and retention, the roll out
of the new home panel and an enhancement of the direct and
multi-car product offering. These growth initiatives will be
enabled by investment in Guidewire and digital which are also
expected to generate operational efficiencies.
Longer term, the Board and management remain confident in the
Group's growth opportunities driven by its' competitive advantages
of agile pricing, analytics and anti-fraud capabilities, combined
with the ongoing investment in data and technology.
Toby van der Meer, Chief Executive Officer of Hastings Group
Holdings plc, commented:
"We have 2.7 million customers, an increase of 4% from last
year, which we achieved whilst remaining true to our pricing
discipline and increasing premiums in a competitive market.
"We remain well positioned in a very large market with 31
million cars on the road, growing consumer adoption of digital
channels and continued media and regulatory focus on consumer
switching.
"Our focus remains on continuing to profitably grow our
successful, technology led business with sophisticated and
disciplined pricing at its core. As always, my thanks go to my
3,300 colleagues for what they do for each other and our customers
every day."
For more information, please contact:
Hastings Group
Richard Hoskins
Chief Financial Officer
T: +44 (0)1424 738244 ir@hastingsplc.com
John Armstrong
Head of Investor Relations
T: +44 (0)1424 738244 ir@hastingsplc.com
Instinctif Partners
Giles Stewart/Lewis Hill
T: +44 (0)207 457 2020 hastings@instinctif.com
About Hastings
Founded in 1996 in Bexhill-on-Sea on the Sussex coast, the
Hastings Group is one of the leading general insurance providers to
the UK market, with 2.7 million live customer policies and
employing over 3,300 colleagues at sites in Bexhill, Leicester,
Gibraltar and London.
Hastings provides refreshingly straightforward products and
services to UK car, bike, van and home insurance customers with
around 90% of policies directly underwritten by its Gibraltar based
insurer, Advantage Insurance Company Limited.
Hastings Direct is a trading name of Hastings Insurance Services
Limited, the Group's UK broker, which also trades via 'Hastings
Premier', 'Hastings Essential', 'Hastings Direct SmartMiles',
'People's Choice' and 'insurePink'.
The Group operates as an integrated insurance provider with two
businesses. The Group's Retail business, Hastings Insurance
Services Limited, is responsible for the end customer pricing,
fraud management, product design, distribution and management of
the underlying customer relationships. The Group's Underwriting
business, Advantage Insurance Company Limited, engages in risk
selection, underlying technical pricing, reserving and claims
handling.
Retail is supported by, and benefits from, Underwriting's
prudent approach to risk and reserving and also benefits from a
panel of insurance partners who provide additional underwriting
capacity. The Group's integrated model deliberately separates
underlying product manufacturing from its distribution.
Forward-looking statements
This trading update may contain forward--looking statements
about current expectations, intentions or forecasts of future
events, including statements about market trends and our strategy,
investments, future operations, industry forecasts and regulatory
framework. Forward--looking statements include statements about
expectations, beliefs, plans, objectives, intentions, assumptions
and other statements that are not statements of historical fact.
Words or phrases such as "anticipate", "believe", "continue",
"ongoing", "estimate", "expect", "intend", "may", "plan",
"potential", "predict", "project", "target", "seek" or similar
words or phrases, or the negatives of those words or phrases, may
identify forward--looking statements, but the absence of these
words does not necessarily mean that a statement is not
forward--looking.
Forward-looking statements are subject to known and unknown
risks and uncertainties and are based on potentially inaccurate
assumptions that could cause actual results to differ materially
from those expected or implied by the forward--looking statements.
Our actual results could differ materially from those anticipated
in our forward-looking statements for many reasons, including the
factors described in the section entitled "Managing our risks" in
our 2017 Annual Report. In addition, even if our actual results are
consistent with the forward-looking statements, those results or
developments may not be indicative of results or developments in
subsequent periods.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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