FBH Fbd Holdings Plc

 

TIDMFBH 
 
RNS Number : 1205L 
FBD Holdings PLC 
30 April 2010 
 

FBD Holdings plc 
Interim Management Statement 
30 April 2010 
 
 
Correction 
 
 
 
 
The following amendment has been made to the 'Interim Management Statement' 
announcement released today at 9:30 under RNS No 1181L. 
 
The earlier version omitted the analysts' expectations for operating earnings 
per share. 
 
 All other details remain unchanged. 
 
The full amended text is shown below. 
 

 
FBD Holdings plc ("FBD" or the "Group") is issuing the following interim 
management statement covering the period from the year end to 31 March 2010, 
which will be read by the Chairman at the Annual General Meeting to be held in 
Dublin at 12 noon today. 
 
 
Performance and outlook for 2010 
 
Underwriting: 
Premium rates have continued to harden in the Irish insurance market in the 
first quarter of 2010, particularly for home and business insurance.  Motor 
rates have been slower to increase and are not yet at the point where it would 
be prudent to grow our volumes.  Gross premium written increased in the first 
quarter, the first such increase since the first half of 2007.  Although policy 
volume continued to decline, the rate of decline decreased significantly and was 
outweighed by the impact of rate increases. 
 
After eight years of constantly falling premium income in the non-life insurance 
market in Ireland, industry revenue is likely to be static or show marginal 
growth in 2010.  Despite understandable consumer sensitivity to increases in 
premium, rate increases are required to provide the industry with an adequate 
return on capital, particularly in light of the unprecedented severe weather 
claims as a result of the flooding and freezes over the winter months. 
 
Although three months is a relatively short period, it is encouraging that the 
incidence of large claims was lower in the first quarter than in the 
corresponding period of the previous year.  Non-weather related property claims 
frequencies have improved, partly attributable to the implementation of claims 
management initiatives.  The cost to FBD of claims arising due to the freezing 
conditions in the month of January amounted to EUR12.0m, net of reinsurance. 
 
In response to changing consumer behaviour, FBD continued to successfully 
develop its multi channel distribution strategy.  Examples include the success 
of our local office network in protecting and developing farming and commercial 
business, the growth of No Nonsense and significant take up of the on-line 
renewal facility.  FBD continues to increase its penetration in key urban areas, 
in particular Dublin. 
 
The Group has continued to focus on efficiency and productivity improvements, 
implementing savings in both staff and non-staff costs and delivering 
initiatives to reduce the cost of claims. 
 
Non-Underwriting: 
The property and leisure markets in Ireland and Spain continue to be challenging 
and this will be compounded by the recent volcanic ash disruption and poor 
weather conditions, which have affected occupancy and pre-bookings.  Excess 
supply exists in the hotel market, particularly in Ireland and the timing of 
recovery is dependent on a reduction in industry capacity.  Sales of units in La 
Cala have exceeded expectations, with a positive cash flow impact and a marginal 
profit benefit. 
 
FBD Financial Services produced a solid result for the quarter, well ahead of 
the previous year in a weak market for retail investment and life assurance 
products.  FBD Brokers continue to develop new market segments while providing 
enhanced customer value. 
 
Group: 
FBD Group has maintained a strong capital base and balance sheet and continues 
its strategy of prudent reserving.  Given the Group's conservative portfolio of 
investment assets and the reduction in volatility in international markets, 
investment fluctuations were not significant in the quarter. 
 
 
Conclusion 
While economic uncertainty remains, volatility has reduced significantly in the 
Irish economy.  Barring exceptional claims events, the Board believes that the 
Group will deliver 2010 operating earnings per share in line with the consensus 
of analysts' expectation.* 
 
The Board believes that FBD will continue to outperform its peers in delivering 
superior returns to shareholders.  FBD has demonstrated its capacity to deliver 
operating profits in difficult market conditions and is well positioned to 
deliver long-term profitable growth, particularly in an environment where 
premium rates are hardening. 
 
 
* The consensus of analysts' expectations is operating earnings per share of 97 
cent in the year to 31 December 2010. 
 
About FBD Holdings plc 
FBD is Ireland's second largest property and casualty insurer looking after the 
insurance needs of private individuals, farmers and business owners.  The Group 
has developed complementary financial service businesses and has hotel and 
leisure property interests that include four hotels in Ireland and two resorts 
in southern Spain.  The Group was established in the 1960s and is quoted on the 
Irish and London stock exchanges. 
 
 
Forward Looking Statements 
Some statements in this announcement are forward-looking.  They represent 
expectations for the Group's business, and involve risks and uncertainties. 
These forward-looking statements are based on current expectations and 
projections about future events.  The Group believes that current expectations 
and assumptions with respect to these forward-looking statements are reasonable. 
 However, because they involve known and unknown risks, uncertainties and other 
factors, which are in some cases beyond the Group's control, actual results or 
performance, may differ materially from those expressed or implied by such 
forward-looking statements. 
 
For Reference 
            Telephone 
 
FBD 
Andrew Langford, Group Chief Executive                                 01 409 
3208 
Cathal O'Caoimh, Group Finance Director                                 01 409 
3208 
 
Murray Consultants 
Joe Murray 
 01 498 0300 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 IMSKMGFDRGDGGZG 
 

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