Helios Underwriting Plc Material Capacity Increase (0057H)
01 December 2020 - 6:00PM
UK Regulatory
TIDMHUW
RNS Number : 0057H
Helios Underwriting Plc
01 December 2020
Helios Underwriting plc
("Helios" or the "Company")
Material Capacity Increase
Helios, the unique investment vehicle which acquires and
consolidates underwriting capacity at Lloyd's is pleased to
announce an update on the Company's capacity portfolio and its
value for 2021 year of account.
Nigel Hanbury, Chief Executive of Helios, commented:
"I am delighted that the capacity portfolio will underwrite
GBP110m for the 2021 underwriting year, a 60% increase on the size
of the portfolio in January 2019 and an increase in the capacity
retained by Helios' shareholders of 18 3 % to GBP5 9 m ."
Capacity Update
Helios announces that the underwriting capacity for Helios for
the 2021 year of account will be GBP110m a 60 % increase in the
capacity underwritten at the start of 2020.
Helios - 2021 Year of Account Capacity
GBPm Retained Reinsured Total
Capacity as at 1st January
2021 58.7 51.5 110.3
Capacity as at 1st January
2020 20.7 48.4 69.1
% Increase 183% 7% 60%
Helios will only slightly increase the level of capacity
reinsured in 2021 thereby increasing its retained capacity to
approximately GBP59m , an increase of 183% over the retained
capacity for 2020 underwriting year. Given the much improved
underwriting pricing going into 2021, the prospects for
underwriting profitability have substantially improved and th is
increase in the retained capacity should benefit the Company's
shareholders. The reinsurance of the "on-risk" open year of account
both mitigates the downside risk and provides the necessary
underwriting capital for that proportion of the portfolio.
Following the recent announcement of the acquisition of four
LLVs, the split of capacity between retained and that reinsured for
the current open years of account is as follows:
2018 to 2020 Years of Account
2018 2019 2020
GBPm GBPm GBPm
Capacity - Position as
at 1st Jan 2020 64.5 61.1 69.1
----- ----- -----
Retained 26.3 22.1 20.7
Reinsured 38.2 39.0 48.4
Capacity acquired during
2020
Retained 9.8 9.2 10.1
Reinsured 0.0 0.0 0.8
Capacity - Position as
at 1st Dec 2020
Retained 36.1 31.3 30.9
Reinsured 38.2 39.0 49.1
74.3 70.3 80.0
===== ===== =====
The increased retained capacity on the 2018 to 2020 years of
account, substantially "off-risk" underwriting years, is expected
to contribute to the recognised future profits of the Company .
Capacity Value
The value of the capacity fund as at 31 (st) December 2020 using
the weighted average prices of capacity from the 2020 Lloyd's
capacity auctions has increased to GBP30.8m ( 31 (st) December
2019: GBP26.3m).
Capacity Value
of Capacity
GBPm GBPm
2020 Capacity at 31 Dec 2019 69.11 26.35
Capacity acquired with LLV's
in 2020 10.88 4.93
Capacity r evaluation having
included p re-emptions 10.69 0.85
Net increase in capacity
after disposals at the capacity
auction 19.58 -1.30
2021 Capacity at 31 Dec 2020 110.26 30.83
========= =============
2019 2020
Capacity with v alue 57.84 82.76
Free c apacity 11.27 27.49
69.11 110.26
========= =============
A summary of the movements in capacity and its value are:
Helios acquired five LLVs during 2020 with capacity of GBP10.9m,
which were valued at 2019 capacity prices at GBP4.9m.
The syndicates supported by Helios offered free capacity of
GBP10.7m by way of pre-emptions to support the improved
underwriting market. The overall change in average prices from 2019
together with the value of the pre-emptions taken up have increased
the value of the portfolio by GBP0.8m .
Helios continued to manage the capacity portfolio discarding
unwanted syndicates and taking positions on new syndicates, in
particular syndicate 4242 and syndicate 2010 , taking additional
capacity of GBP12.8m in total on these two syndicates. In addition,
GBP2.4m of capacity was sold at the auctions to raise additional
net cash of GBP1.3m.
For further information please contact:
Helios Underwriting plc
Nigel Hanbury - Chief Executive 07787 530404 / nigel.hanbury@huwplc.com
Arthur Manners - Chief Financial Officer 07754 965 917
Shore Capital
Robert Finlay/David Coaten 020 7408 4090
Buchanan
Helen Tarbet/ Henry Wilson /George Beale 020 7466 5000
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 GBP110m of capacity
for the 2021 account. The portfolio provides a good spread of
business being concentrated in property insurance and reinsurance.
For further information please visit www.huwplc.com.
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END
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