TIDMFBH
RNS Number : 9903G
FBD Holdings PLC
12 August 2016
FBD HOLDINGS PLC
12 August 2016
FBD HOLDINGS PLC
Half Yearly Report
For the six months ended 30 June 2016
KEY HIGHLIGHTS
-- Gross Written Premium of EUR181m down 2%, largely driven by a reduction in broker business
-- Improved risk selection and price adequacy is driving a lower current year loss ratio
-- No further prior year loss development
-- Combined Operating Ratio ("COR") of 101%
-- EUR3.7m loss before tax in first half of 2016
-- Strong further progress with our turnaround setting FBD
firmly on track for full year profitability in 2017:
o Senior management appointments, including new Chief Financial
Officer and Chief Commercial Officer
o Insurance and Holdings Boards streamlined for greater
oversight and control
o A number of new Board appointments
o Strong focus on Irish farm and small business sectors with a
complementary single brand consumer strategy
o Further pricing and underwriting actions taken
o Launch of new IT policy administration system in June and
further roll-out well underway
2016 2015
FINANCIAL SUMMARY EUR000s EUR000s
Gross written premium 180,845 184,778
Underwriting loss (1,595) (103,466)
Loss before taxation (3,652) (96,416)
Cent Cent
Basic loss per share (9) (244)
Net assets per share 607 512
-- Gross written premium down EUR4m with a EUR10m reduction in business written through brokers
-- Average premium rate increases of 11%, offset by an 7%
decline in policy volume from direct operations
-- COR of 101% compared to a reported 167% for the same period last year
-- Net loss before tax of EUR3.7m from continued and discontinued operations
-- Annualised total investment return of 1.9%
-- Capital levels within target range of 110%-130% of Solvency Capital Requirement ("SCR")
Fiona Muldoon, Group Chief Executive, said:
"These results demonstrate that we are returning the business to
profitability. There is increasing stability in our reserves with
no further prior year development recorded since the strengthening
that occurred one year ago. As expected, there was a net loss of
EUR3.7m in the first half of 2016. We are firmly on track to
deliver full year profitability in 2017. We remain focussed on our
customer base in the Irish farm and small business sectors, backed
up by a single brand consumer strategy. We will continue to serve
that market in difficult trading circumstances.
We believe that structural reforms are necessary to tackle
injury claims inflation and address the impact claims costs are
having on the affordability of insurance for farmers, businesses
and other consumers. The re-pricing of certain risk classes will
need to continue for a further period to allow FBD to fully restore
profitability for its shareholders. While FBD notes the various
government and industry initiatives underway to identify the cause
of claims and cost inflation, we believe there must be substantial
reform to tackle these issues. In the absence of such reform we
believe Irish insurance customers will bear the cost of much higher
premiums than those seen in other countries."
A presentation will be made to analysts at 9am today, a copy of
which will be available on our Group website www.fbdgroup.com.
Enquiries Telephone
FBD
Fiona Muldoon, Group Chief Executive +353 1 409 3208
John O'Grady, Group Chief Financial
Officer
Peter Jackson, Head of Investor
Relations
Kathryn Speedie, Corporate Communications
Officer
Powerscourt
Rory Godson/Jack Hickey +353 83 448 8339
About FBD Holdings plc ("FBD")
FBD is one of Ireland's largest property and casualty insurers,
looking after the insurance needs of farmers, consumers and
business owners. Established in the 1960s by farmers for farmers,
FBD has built on those roots in agriculture to become a leading
general insurer serving the needs of its direct agricultural, small
business and consumer customers throughout Ireland. It has a
network of 33 branches nationwide.
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.
The following details relate to FBD's ordinary shares of EUR0.60
each which are publicly traded:
Listing Irish Stock Exchange UK Listing Authority
Listing Category Premium Premium (Equity)
Trading Venue Irish Stock Exchange London Stock Exchange
Market Main Securities Main Market
Market
ISIN IE0003290289 IE0003290289
Ticker FBD.I or EG7.IR FBH.L
OVERVIEW
Strong progress has been made in the first half of 2016, The
turnaround strategy puts the Group on track to restore
profitability in 2017. The claims environment continues to be
difficult and the re-pricing of certain risk classes will need to
continue for a further period. The uncertainty in the claims
environment requires a robust response from all stakeholders in the
insurance market. FBD notes the various government and industry
initiatives that are being undertaken to get to the root cause of
claims and cost inflation. FBD continues to implement all necessary
steps under its control to return the business to
profitability.
The Group recorded a loss before tax from continuing and
discontinued operations of EUR3.7m to June 2016 (2015:
EUR96.4m).
UNDERWRITING
Premium income
The Group continues to focus on its core farm and small business
customers, along with a single brand consumer strategy. It
continues to reduce its exposure to business written through
brokers.
Overall, gross written premium has declined by EUR4.0m to
EUR180.8m (2015: EUR184.8m), with increased premium from direct
operations of EUR6.3m (+3.9%) offset by a EUR10.3m (-47.4%)
reduction in business written through brokers. Excluding broker
business, average rates across the book are up 10.6%, while policy
volume has declined by 6.7%. However, certain classes of insurance
have seen more substantial increases year on year (Motor +18.7%).
The Group began to raise rates in 2014 and the cumulative effect of
increases across all classes of business since that date is
27%.
Claims
Net claims incurred amounted to EUR114.8m (2015: EUR215.8m).
This includes EUR5.0m (2015: EUR4.6m) relating to the Group's MIBI
levy obligation. In 2016 the movement on prior year reserves was
negligible.
The comparable claims incurred figure for 2015 includes a charge
of EUR88m for strengthening prior year claims reserves and
increasing the margin for uncertainty.
Claims Environment
The claims environment continues to be challenging, with
significant uncertainty still evident. There is significant
volatility in relation to award levels and continued inflationary
pressure on the cost of claims.
However, a number of unexpectedly large High Court awards were
reduced by the Court of Appeal in the period. While these were not
FBD cases, it is hoped they will contribute to the stabilisation of
the claims settlement environment. The Court of Appeal has set out
principles and guidelines to assess damages to ensure they are
proportionate to the injuries, and the existing cap on general
damages of EUR450,000. Recent High Court judgments have referenced
these guidelines, indicating a more moderate view on award levels
is being adopted by some judges.
There still remain a number of factors that are increasing the
cost of claims. These include the following:
Increase in Court Awards
The change in Circuit Court jurisdiction from EUR38k to EUR60k
has heightened claimants' expectations and had a negative
retrospective impact on existing claims.
Legal Costs
Despite the enactment of the Legal Services Regulation Act the
Office of the Legal Cost Adjudicator is not yet established and
there is still no publication of the adjudication of assessment of
legal costs. As a result, the process of agreeing plantiffs' legal
costs following settlements is very protracted and contentious,
leading to higher costs for both sides.
Collapse of Setanta Insurance
The Supreme Court has recently granted leave to appeal the
MIBI/Setanta decision of the Court of Appeal regarding
responsibility for the settlement of claims arising out of the
failed insurer, and this is likely to be heard towards the end of
the year. FBD notes the Departments of Finance and Transport's
initiatives to tackle the cost of claims and provide clarity around
who pays when an insurer collapses. FBD believes that the Insurance
Compensation Fund is the correct vehicle for the payment of claims
as a result of the insolvency of an insurer. Transferring any
liability onto the MIBI will only serve to increase the cost of
premiums for all policyholders and to increase the solvency
requirements of insurers, (which is also ultimately passed on to
insurance customers). The recent failure of Enterprise, which was
regulated in Gibraltar, underpins the urgent need to address this
issue.
Uncertainties in the Claims Environment
There are still a number of uncertainties prevalent in the
claims environment, most notably the updating of the book of
quantum by the Injuries Board and the expected introduction of
periodic payment orders (PPOs). We believe structural reform in the
claims environment is required to tackle injury claims inflation
and address the impact claims costs are having on the affordability
of insurance. In the absence of reform , all insurance customers
will continue to pay higher premiums.
Potential Reforms to Reduce the Cost of Claims
A less confrontational approach to personal injury litigation is
required, for example court-appointed experts (rather than
competing experts appointed by both sides) would lower costs.
Equally mediation and pre-action protocols could be used to speed
up cases with lower costs and an earlier resolution for both
parties.
Measures need to be taken to introduce a more effective and
objective method of assessing claims, particularly whiplash, and
benchmarking their value against other countries.
The Injuries Board legislation needs to be reformed to
strengthen the Boards powers to compel co-operation and ensure that
claimants receive their compensation faster and without unnecessary
litigation and cost.
A strong internal vigilance is continuously required to identify
and deal with claims fraud and exaggeration. FBD is committed to
improving its processes in this regard.
Claims Settlement
The pace of claims settlement, which had slowed significantly
from 2014 into 2015, has increased somewhat in the past nine
months, though it remains below historic norms. In contrast to the
first half of 2015, settlement activity for medium size claims has
increased, following the removal of the uncertainty around the
discount rate applying to catastrophic injury awards.
Weather, Claims Frequency and Large Claims
Weather in the first half of 2016 was relatively benign and
there were no events of note.
Motor injury frequency continued to decline as the underwriting
and risk selection actions taken by the Group come into effect.
Large claims (greater than EUR1.0m) were higher than historic
averages in the first half of 2016. The net cost of such claims for
2016 was EUR6.4m (2015: EUR4.0m).
Expenses
The Group's expense ratio was 25.5% (2015: 27.3%). Net expenses
reduced by EUR3.3m to EUR38.8m (2015: EUR42.1m) as the benefit of
the voluntary redundancy programme launched in the second half of
2015 starts to emerge.
The rollout of the Group's new policy administration system
commenced at the end of June 2016. Depreciation of the system will
commence in the second half of 2016, and will be approximately
EUR3.0m in the second half of 2016 (EUR6.0m in a full year).
General
FBD's combined operating ratio was 101.0%, leading to an
underwriting loss of EUR1.6m (2015: EUR103.5m).
Investment Return
FBD's total investment return for the first six months of 2016
was an annualised 1.92% (2015: 1.1%), with 0.06% (2015: 1.2%)
recognised in the income statement and 1.86% (2015: -0.1%)
recognised in the statement of other comprehensive income. The
decision by the citizens of the UK to leave the EU led to a sharp
increase in volatility in June. FBD's low risk allocation protected
its investment assets from this volatility. In the first half the
portfolio saw strong returns as it benefited from the decision in
2015 to increase the allocation to corporate bonds.
FINANCIAL SERVICES
The Group's financial services operations include premium
instalment services and life, pension and investment broking (FBD
Financial Solutions), less holding company costs. These generated a
solid performance in a tough environment, delivering a profit of
EUR0.5m (before restructuring charges) (2015: EUR1.1m).
In 2015 the Group carried out a review of FBD Financial
Solutions and concluded that there was further opportunity for FBD
in the life and pensions area. However, the Group identified a need
to transform the operating model to generate greater long term
value. Earlier this year FBD Financial Solutions entered into a
preferred provider arrangement with New Ireland, one of Ireland's
largest life companies. This arrangement enables FBD to provide a
customer focussed life and pensions advisory service to customers,
reduce expenses and make the business more profitable. The life and
pensions transformation project is on target and is expected to
generate a profit from 2017 onwards.
On 23 May 2016 FBD divested its 70% shareholding in Passage East
Ferry Company for a total consideration of EUR2.7m, realising a
profit on disposal of EUR1.9m. The Passage East Ferry Company was a
non-core asset, and the proceeds realised will be used for general
corporate purposes.
Loss per share
The diluted loss per share was 9 cent per ordinary share,
compared to a loss of 243 cent per ordinary share in 2015.
STATEMENT OF FINANCIAL POSITION
Capital position
Ordinary shareholders' funds at 30 June 2016 amounted to
EUR210.5m (December 2015: EUR215.9m) The reduction in shareholders'
funds is mainly attributable to the following:
-- Losses in the period of EUR3.1m
-- The increase in the defined benefit pension scheme obligation
of EUR10.8m after tax driven mainly by a 1% reduction in the
discount rate, recognised in the statement of other comprehensive
income. The action taken by the Group in 2015 to restructure and
de-risk its defined benefit scheme limited the impact of the
decrease in the discount rate. Prior to the restructuring of the
scheme, the impact of a 1% reduction in the discount rate would
have been significantly more material
-- Mark to market gains on the Group's Available for Sale
investments of EUR8.0m after tax recognised in the statement of
other comprehensive income
-- Share based payments of EUR0.4m.
Net assets per ordinary share are 607 cent, compared to 623 cent
per share at December 2015.
Solvency
Solvency II became effective from 1 January 2016. The Group's
economic capital is within its target range of 110-130% of SCR.
Investment Allocation
This table shows the assets of the Group.
30 June 2016 31 December 2015
Underwriting investment assets EURm % EURm %
Deposits and cash 336 34% 398 40%
Corporate bonds 491 50% 432 43%
Government bonds 100 10% 101 10%
Equities 21 2% 24 2%
Unit trusts 24 2% 25 3%
Investment property 15 2% 15 2%
-------- ------ ---------- --------
Underwriting investment assets 987 100% 995 100%
------ --------
Own land & buildings 16 16
Working capital & other assets 110 117
Reinsurers' share of provisions 77 80
Plant and equipment 58 56
-------- ----------
Total assets 1,248 1,264
-------- ----------
Investment Background
ECB led quantitative easing continues to drive yields and
investment returns lower. The uncertainty created by "Brexit" and
rising political risk globally exacerbates the low rate dynamics
prevalent in investment markets. The continuing low interest rates
in the Eurozone present challenging conditions to generating
positive returns over the medium term. These structural issues, in
tandem with high valuations for risk assets underpins our low
allocation to such assets. Uncertainty about the outlook for global
growth and elevated political risks, justifies our cautious
strategy.
FBD's Investment Allocation
During the first half FBD further increased its allocation to
corporate bonds and reduced exposure to term deposits.
OUTLOOK
From an economic perspective, the recent "Brexit" decision
introduces business and trading uncertainty for all indigenous
Irish businesses, including FBD and our core customers in farming
and other small businesses. While the ultimate outcome of this
historic vote is difficult to quantify at this stage, it may have
negative effects for business and business confidence in Ireland,
particularly in the medium term. FBD is Irish and conducts all its
business in Ireland, with Irish consumers and Irish businesses. FBD
will not therefore be directly materially affected in the near term
by currency exposures or trade flows.
Despite rate hardening, industry profitability continues to be
challenging, and the Group believes that the industry may continue
to be loss making for 2016.
The Group will continue to simplify its strategy. FBD will
dedicate its resources primarily to its direct farm, small business
and consumer customers, and will concentrate on those markets where
it has developed a significant competitive advantage.
The Group is committed to taking whatever action is required to
return the business to profitability. The Group intends to maintain
underwriting discipline and to deliver sustainable shareholder
value through growth in book value.
The Group believes substantial reform is necessary to tackle
claims inflation and the cost of claims for the benefit of all
insurance users. In the absence of reform these costs are passed
onto insurance customers through higher premiums.
The Group continues to target a sub-100% combined operating
ratio by Q4 2016 (excluding catastrophic weather events), and a
full year's underwriting profitability in 2017.
FBD HOLDINGS PLC
Condensed Consolidated Income Statement
For the half year ended 30 June 2016
Half year Half year Year ended 31/12/15 (audited)
ended ended
Notes 30/06/16 30/06/15
(unaudited) (unaudited)
EUR000s EUR000s EUR000s
Revenue 3 198,179 203,864 401,889
-------------- -------------- -------------------------------
Income
Gross premium written 180,845 184,778 363,263
Reinsurance premiums (25,415) (25,954) (50,497)
-------------- -------------- -------------------------------
Net premium written 155,430 158,824 312,766
Change in provision for unearned
premiums (3,410) (4,402) 388
-------------- -------------- -------------------------------
Net premium earned 152,020 154,422 313,154
Net investment return 271 5,405 20,260
Financial services income 3,888 6,800 12,634
-------------- -------------- -------------------------------
Total income 156,179 166,627 346,048
Expenses
Net claims and benefits (109,827) (211,245) (341,260)
Underwriting expenses 4 (38,790) (42,062) (85,725)
Movement in other provisions (4,998) (4,581) (11,581)
Financial services expenses (3,346) (5,729) (9,130)
Restructuring and other costs (1,266) - (11,415)
Finance costs (3,255) - (1,357)
Revaluation of property, plant and
equipment - - 175
Pension curtailment - - 28,340
Result before taxation (5,303) (96,990) (85,905)
Income taxation credit 542 12,052 11,277
-------------- -------------- -------------------------------
Result for the period from
continuing operations (4,761) (84,938) (74,628)
Discontinued operations
Result for period from discontinued
operations including profit/(loss)
from sale 1,651 574 1,061
Result for the period (3,110) (84,364) (73,567)
-------------- -------------- -------------------------------
Attributable to:
Equity holders of the parent (3,031) (84,392) (73,685)
Non-controlling interests (79) 28 118
(3,110) (84,364) (73,567)
-------------- -------------- -------------------------------
Half year Half year
ended ended 30/06/15 Year ended 31/12/15 (audited)
30/06/16 (unaudited)
(unaudited)
Notes
Loss per share Cent Cent Cent
Basic 8(a) (9) (244) (213)
------------- ----------------- -------------------------------
Diluted 8(a) (9) (244) (213)
------------- ----------------- -------------------------------
FBD HOLDINGS PLC
Condensed Consolidated Statement of Comprehensive Income
For the half year ended 30 June 2016
Half year Half year Year ended
ended 31/12/15
30/06/15 (audited)
ended (unaudited)
30/06/16
(unaudited)
EUR000s EUR000s EUR000s
Result for the period (3,110) (84,364) (73,567)
-------------- -------------- ------------
Items that will or may
be reclassified to profit
or loss in subsequent periods:
Net (loss)/gain on available
for sale assets 9,161 (671) (1,762)
Taxation credit/(charge)
relating to items that
will or may be reclassified
to profit or loss in subsequent
periods (1,145) 168 698
Items that will not be
reclassified to profit
or loss in subsequent periods:
Actuarial gain/(loss) on
retirement benefit obligations (12,320) 3,354 15,914
Taxation (charge)/credit
relating to items not to
be reclassified in subsequent
periods 1,540 (419) (1,989)
-------------- -------------- ------------
Other comprehensive income/(expense)
after taxation (2,764) 2,432 12,861
-------------- -------------- ------------
Total comprehensive expense
for the period (5,874) (81,932) (60,706)
-------------- -------------- ------------
Attributable to:
Equity holders of the parent (5,795) (81,960) (60,824)
Non-controlling interests (79) 28 118
(5,874) (81,932) (60,706)
-------------- -------------- ------------
FBD HOLDINGS PLC
Condensed Consolidated Statement of Financial Position
At 30 June 2016
ASSETS 30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
Property, plant and equipment 74,351 67,392 72,617
Investment property 14,550 20,799 14,550
Investment in joint venture - 47,647 -
Loans 752 1,001 832
Deferred taxation asset 12,938 17,170 13,139
Financial assets
Available for sale investments 548,010 239,587 489,837
Investments held for trading 88,571 146,705 94,375
Deposits with banks 305,676 451,472 371,333
------------- ------------- -----------
942,257 837,764 955,545
------------- ------------- -----------
Reinsurance assets
Provision for unearned premiums 14,821 16,208 15,332
Claims outstanding 62,484 48,144 64,751
------------- ------------- -----------
77,305 64,352 80,083
------------- ------------- -----------
Retirement benefit asset - - 9,110
Current taxation asset 4,557 8,793 8,813
Deferred acquisition costs 25,695 29,128 27,545
Other receivables 63,891 67,091 59,506
Cash and cash equivalents 31,606 25,196 22,244
------------- ------------- -----------
Total assets 1,247,902 1,186,333 1,263,984
------------- ------------- -----------
FBD HOLDINGS PLC
Condensed Consolidated Statement of Financial Position
(continued)
At 30 June 2016
EQUITY AND LIABILITIES 30/06/16 30/06/15 31/12/15 (audited)
Notes (unaudited) (unaudited)
EUR000s EUR000s EUR000s
Equity
Ordinary share capital 7 21,409 21,409 21,409
Capital reserves 18,964 19,371 18,553
Other reserves 18,232 - 18,232
Retained earnings 151,875 136,704 157,670
Shareholders' funds - ordinary equity interests 210,480 177,484 215,864
Preference share capital 2,923 2,923 2,923
------------- ------------- -------------------
Equity attributable to equity holders of the parent 213,403 180,407 218,787
Non-controlling interests - 361 451
------------- ------------- -------------------
Total equity 213,403 180,768 219,238
------------- ------------- -------------------
Liabilities
Insurance contract liabilities
Provision for unearned premiums 181,483 184,250 178,584
Claims outstanding 739,033 715,297 748,144
------------- ------------- -------------------
920,516 899,547 926,728
Other provisions 12,361 7,920 10,938
Convertible debt 50,647 - 50,036
Retirement benefit obligation 3,202 50,900 -
Deferred taxation liability 1,851 5,266 2,990
Payables 45,922 41,932 54,054
-------------
Total liabilities 1,034,499 1,005,565 1,044,746
------------- ------------- -------------------
Total equity and liabilities 1,247,902 1,186,333 1,263,984
------------- ------------- -------------------
FBD HOLDINGS PLC
Condensed Consolidated Statement of Cash Flows
For the half year ended 30 June 2016
Half year Half year ended 30/06/15 Year
ended (unaudited) ended 31/12/15 (audited)
30/06/16
(unaudited)
EUR000s EUR000s EUR000s
Cash flows from operating
activities
Result before taxation for continued
and discontinued operations (3,652) (96,416) (84,789)
Adjustments for:
Loss/(profit) on disposal of
investments held for trading 4,999 (1,130) (535)
Loss on investments available for
sale 1,428 2,870 5,493
Interest and dividend income (3,806) (6,144) (13,123)
Depreciation of property, plant and
equipment 4,232 4,323 8,392
Share-based payment expense/(credit) 411 615 (203)
Revaluation of investment property - - (3,450)
Revaluation of property, plant and
equipment - - (175)
Profit on the sale of investment
property - - (8,915)
(Decrease)/increase in insurance
contract liabilities (3,433) 118,873 130,320
Increase in other provisions 1,423 - 3,018
Effect of foreign exchange rate
changes - (840) (485)
Joint venture trading result - (480) (1,461)
Profit on disposal of (1,915) - -
discontinued operation
-------------- -------------------------- ---------------------------
Operating cash flows before movement
in working capital (313) 21,671 34,087
(Increase)/decrease in receivables
and deferred acquisition costs (4,647) (6,918) 1,004
(Decrease)/increase in payables (7,156) 4,791 (30,408)
--------------------------
Cash (used in)/ generated from
operations (12,116) 19,544 4,683
Interest and dividend income
received 5,923 4,222 12,339
Income taxes refunded 4,257 152 126
-------------- -------------------------- ---------------------------
Net cash (used in)/generated from
operating activities (1,936) 23,918 17,148
-------------- -------------------------- ---------------------------
Cash flows from investing
activities
Purchase of investments held for
trading (6,506) (69,256) (32,561)
Sale of investments held for trading 7,312 40,109 55,149
Realisation of investments held - - -
to maturity
Purchase of available for sale
investments (211,231) (95,938) (408,318)
Sale of available for sale
investments 160,792 77,786 136,202
Purchase of property, plant and
equipment (6,502) (9,090) (18,209)
Sale of property, plant and - - -
equipment
Sale of investment property - 18,259
Decrease/(increase) in loans and
advances 80 (30) 139
Decrease in deposits invested with
banks 65,656 43,437 123,577
Cash inflow from sale of
discontinued operation (net) 1,930 - 48,500
Net cash provided by/(used in)
investing activities 11,531 (12,982) (77,262)
-------------- -------------------------- ---------------------------
Cash flows from financing
activities
Ordinary and preference dividends
paid (113) (11,780) (11,950)
Dividends paid to non-controlling
interests (120) (150) (150)
Proceeds from issue of convertible
bond - - 68,268
Net cash (used in)/generated from
financing activities (233) (11,930) 56,168
-------------- -------------------------- ---------------------------
Net increase/(decrease) in cash and
cash equivalents 9,362 (994) (3,946)
Cash and cash equivalents at the
beginning of the period 22,244 26,190 26,190
Cash and cash equivalents at the end
of the period 31,606 25,196 22,244
-------------- -------------------------- ---------------------------
FBD HOLDINGS PLC
Condensed Consolidated Statement of Changes in Equity
(UNAUDITED)
For the half year ended 30 June 2016
Ordinary Capital Other Retained Attributable Preference Non-controlling Total
to
share reserves reserves earnings Ordinary share interests equity
capital shareholders capital
EUR000s EUR000s EUR'000 EUR000s EUR000s EUR000s EUR'000 EUR000s
--------- --------- --------- --------- ------------- ----------- ---------------- ---------
Balance at 1
January 2016 21,409 18,553 18,232 157,670 215,864 2,923 451 219,238
Result after
taxation - - - (3,031) (3,031) - (79) (3,110)
Other
comprehensive
income - - - (2,764) (2,764) - - (2,764)
Total
comprehensive
income for the
period 21,409 18,553 18,232 151,875 210,069 2,923 372 213,364
Recognition of
share based
payments - 411 - - 411 - - 411
Dividend paid to
non-controlling
interests - - - - - - (120) (120)
Disposal of
subsidiary
undertaking
(note 5) - - - - - - (252) (252)
--------- --------- --------- --------- ------------- ----------- ---------------- ---------
Balance at 30
June 2016 21,409 18,964 18,232 151,875 210,480 2,923 - 213,403
--------- --------- --------- --------- ------------- ----------- ---------------- ---------
Balance at 1
January 2015 21,409 18,756 - 230,444 270,609 2,923 483 274,015
Result after
taxation - - - (84,392) (84,392) - 28 (84,364)
Other
comprehensive
income - - - 2,432 2,432 - - 2,432
Total
comprehensive
income for the
period 21,409 18,756 - 148,484 188,649 2,923 511 192,083
Recognition of
share based
payments - 615 - - 615 - - 615
Dividend paid on
ordinary shares - - - (11,780) (11,780) - - (11,780)
Dividend paid to
non-controlling
interests - - - - - - (150) (150)
--------- --------- --------- --------- ------------- ----------- ---------------- ---------
Balance at 30
June 2015 21,409 19,371 - 136,704 177,484 2,923 361 180,768
--------- --------- --------- --------- ------------- ----------- ---------------- ---------
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 1 Statutory information
The half yearly financial information is considered
non-statutory financial statements for the purposes of the
Companies Act 2014 and in compliance with section 340(4) of that
Act we state that:
-- the financial information for the half year to 30 June 2016
has been prepared to meet our obligation to do so under the listing
rules of the main securities market of the Irish Stock Exchange and
S.I. No. 277 of 2007;
-- the financial information for the half year to 30 June 2016
does not constitute the statutory financial statements of the
company;
-- the statutory financial statements for the financial year
ended 31 December 2015 have been annexed to the annual return and
delivered to the Registrar;
-- the statutory auditors of the company have made a report
under section 391 Companies Act 2014; and
-- the matters referred to in the statutory auditors' report
were unqualified, and did not include a reference to any matters to
which the statutory auditors drew attention by way of emphasis
without qualifying the report.
This half yearly financial report has not been audited but has
been reviewed by the auditors of the Company.
Note 2 - Accounting policies
Basis of preparation
The annual financial statements of FBD Holdings plc are prepared
in accordance with International Financial Reporting Standards
("IFRSs") as adopted by the European Union. The condensed set of
financial statements included in this half-yearly financial report
has been prepared in accordance with IAS 34 'Interim Financial
Reporting', as adopted by the European Union.
Going concern
The Directors are satisfied that the Group has sufficient
resources to continue in operation for a period of not less than
twelve months from the date of this report. Accordingly, they
continue to adopt the going concern basis of accounting in
preparing the condensed financial statements.
Consistency of accounting policy
The accounting policies and methods of computation used by the
Group to prepare the interim financial statements for the six month
period ended 30 June 2016 are the same as those used to prepare the
Group Annual Report for the year ended 31 December 2015 except as
described below.
The following new and revised Standards and Interpretations have
been adopted in these financial statements in the current
period:
-- Annual Improvements 2012-2014 Cycle
-- Clarification of Acceptable Methods of Depreciation &
Amortisation (Amendments to IAS 16 and IAS 41)
-- Disclosure Initiative (Amendments to IAS 1)
The adoption of these standards has not had any significant
impact on the amounts reported in this interim report.
Critical accounting estimates and judgements in applying
accounting policies.
The critical accounting estimates and judgements used by the
Group in applying accounting policies are the same as those used to
prepare the Group Annual Financial Statements for the year ended 31
December 2015. While there have been some changes in estimates of
amounts in the current financial period these changes do not have a
significant impact on the results for the period.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Risks and uncertainties
The principa risks and uncertainties faced by the Group are
outlined on pages 21-23 of the Group's Annual Financial Statements
for the year ended 31 December 2015 and remain unchanged.
Reclassification
The comparative information for discontinued operations has been
reclassified to result for the period from discontinued operations
within the condensed consolidated income statement.
Note 3 - Segmental information
(a) Operating segments
The principal activities of the Group are underwriting of
general insurance business and financial services. For management
purposes, the Group is organised in two operating segments -
underwriting and financial services. These two segments are the
basis upon which information is reported to the chief operating
decision maker, the Group Chief Executive, for the purpose of
resource allocation and assessment of segmental performance.
Discrete financial information is prepared and reviewed on a
regular basis for these two segments.
The following is an analysis of the Group's revenue and results
from continuing operations by reportable segments:
Half year ended 30/06/2016 Financial
Underwriting Services Total
EUR000s EUR000s EUR000s
Revenue 193,740 4,439 198,179
--------------- ---------- --------
Result before taxation (4,579) (724) (5,303)
Income taxation credit 572 (30) 542
--------------- ---------- --------
Result after taxation (4,007) (754) (4,761)
--------------- ---------- --------
Financial Total
Half year ended 30/06/2015 Services
Underwriting
EUR000s EUR000s EUR000s
Revenue 197,163 6,701 203,864
-------------- ---------- ---------
Result before taxation (98,061) 1,071 (96,990)
Income taxation credit/(charge) 12,257 (205) 12,052
-------------- ---------- ---------
Result after taxation (85,804) 866 (84,938)
-------------- ---------- ---------
Financial
Year ended 31/12/2015 Services Total
Underwriting
EUR000s EUR000s EUR000s
Revenue 389,255 12,634 401,889
-------------- ---------- ---------
Result before taxation (90,265) 4,361 (85,904)
Income taxation credit/(charge) 10,924 352 11,276
-------------- ---------- ---------
Result after taxation (79,341) 4,713 (74,628)
-------------- ---------- ---------
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
The accounting policies of the reportable segments are the same
as the Group accounting policies. Segment profit represents the
profit earned by each segment. Central administration costs and
Directors' salaries are allocated based on actual activity.
Restructuring costs and income taxation are direct costs of each
segment. Segment profit is the measure reported to the chief
operating decision maker, the Group Chief Executive, for the
purposes of resource allocation and assessment of segmental
reporting. There has been no material change to the assets by
reportable segment from the disclosure in the 2015 Annual
Report.
(b) Geographical segments
The Group's operations are located in Ireland.
Note 4 - Underwriting result
Half year Half year
ended
30/06/16
(unaudited)
ended Year
30/06/15 ended
31/12/15
(audited)
(unaudited)
EUR000s EUR000s EUR000s
Gross premium written 180,845 184,778 363,263
-------------- --------------- ------------
Net premium earned 152,020 154,422 313,154
Net claims incurred (114,825) (215,826) (352,841)
-------------- --------------- ------------
37,195 (61,404) (39,687)
-------------- --------------- ------------
Gross management expenses (40,830) (45,552) (92,307)
Deferred acquisition costs (1,850) 700 (882)
Reinsurers' share of expenses 5,643 5,964 12,799
Broker commissions payable (1,753) (3,174) (5,335)
-------------- --------------- ------------
Underwriting expenses (38,790) (42,062) (85,725)
-------------- --------------- ------------
Underwriting result (1,595) (103,466) (125,412)
The Group's half yearly results are not subject to any
significant impact arising from the seasonality of operations.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 5 - Discontinued operations
Half year Half year
ended
30/06/16
(unaudited)
ended Year
30/06/15 ended
31/12/15
(audited)
(unaudited)
EUR000s EUR000s EUR000s
Passage East Ferry Company
Ltd result for the period
including profit on sale 1,651 94 393
Joint venture result for
the period including loss
on sale - 480 668
-------------- --------------- ------------
1,651 574 1,061
-------------- --------------- ------------
On 23 May 2016 the Group disposed of its 70% interest in the
Passage East Ferry Company Limited. Total consideration received
for the disposal of the 70% interest was EUR2,662,800. A profit on
disposal of EUR1,914,000 has been recorded during the half year
ended 30 June 2016. In addition a loss of EUR263,000 for the period
up to the date of disposal, including EUR79,000 attributable to
non-controlling interests, has been recorded in the half year ended
30 June 2016.
On 24 August 2015, the Group announced it had entered a
conditional agreement for the divestment of its stake in its joint
venture, FBD Property Leisure Ltd, through a sale of the Group's
entire shareholding to Farm Business Developments plc, the other
shareholder in FBD Property & Leisure Ltd, and the redemption
of all of its loan notes in FBD Property & Leisure Ltd. The
sale was approved by shareholders on 23 October 2015. Total
consideration received for the sale of the joint venture was
EUR48,500,000. Full details of the loss on disposal and the Group's
share of the joint ventures profit up to date of disposal are
available in Note 7 (d) of the Group Annual Report for the year
ended 31 December 2015.
Note 6 - Dividends
Half year Half year Year
ended
30/06/16
(unaudited) ended ended
30/06/15 31/12/15
(unaudited) (audited)
EUR000s EUR000s EUR000s
Paid in Period:
2014 final dividend of 34.0
cent (2013: 33.25 cent)
per share on ordinary shares
of EUR0.60 each - 11,780 11,780
Dividend of 8.4 cent per
share on 14% non-cumulative 113 -
Preference shares of EUR0.60
each
Dividend of 4.8 cent per
share on 8% non-cumulative
preference shares of EUR0.60
each - - 169
113 11,780 11,949
------------- -------------- ------------
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 7 - Ordinary share capital
Half year Half year Year
ended
30/06/16
(unaudited)
ended ended
30/06/15 31/12/15
(unaudited)
(audited)
Number EUR000s EUR000s EUR000s
(i) Ordinary shares
of EUR0.60 each
Authorised:
At beginning and
end of period 51,326,000 30,796 30,796 30,796
------------ ------------- -------------- -----------
Issued and fully
paid:
At beginning and
end of period 35,461,206 21,277 21,277 21,277
------------ ------------- -------------- -----------
(ii) 'A' Ordinary
shares of EUR0.01
each
Authorised:
At beginning and
end of period 120,000,000 1,200 1,200 1,200
------------ ------------- -------------- -----------
Issued and fully
paid:
At beginning and
end of period 13,169,428 132 132 132
Total Ordinary
Share Capital 21,409 21,409 21,409
------------- -------------- -----------
The number of ordinary shares of EUR0.60 each held as treasury
shares at 30 June 2016 was 813,084.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 8 - Loss per EUR0.60 ordinary share
The calculation of the basic and diluted earnings per share
attributable to the ordinary shareholders is based on the following
data:
Half year Half year Year
ended ended ended
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
Earnings/(loss)
Result for the period (3,110) (84,364) (73,567)
Non-controlling interests 79 (28) (118)
Preference dividends - - (169)
------------- ------------- -------------
Result for the period -
attributable to equity shareholders (3,031) (84,392) (73,854)
Adjustments to exclude profit
from discontinued operations (1,651) (574) (1,061)
Result for the purpose of
basic and diluted
earnings per share (excluding
discontinued operations) (4,682) (84,966) (74,915)
-------------
Number of shares 30/06/16 3 30/06/15 31/12/2015
Weighted average number
of ordinary shares for
the purpose of basic earnings
per share 34,648,122 34,648,122 34,648,122
Effect of dilutive potential
of share options
outstanding - - -
------------- ------------- -------------
Weighted average number
of ordinary shares for
the purpose of diluted earnings
per share 34,648,122 34,648,122 34,648,122
------------- ------------- -------------
Earnings/(loss) per share Restated Restated
From continuing and discontinued Cent Cent Cent
operations
Basic earnings/(loss) per
share (9) (244) (213)
------------- ------------- -------------
Diluted earnings/(loss)
per share (9) (244) (213)
------------- ------------- -------------
Restated Restated
From discontinued operations Cent Cent Cent
Basic earnings/(loss) per
share 5 1 3
------- ----------- -----------
Diluted earnings/(loss)
per share 5 1 3
------- ----------- -----------
Restated Restated
From continuing operations Cent Cent Cent
Basic earnings/(loss) per
share (14) (245) (216)
------- ----------- -----------
Diluted earnings/(loss)
per share (14) (245) (216)
------- ----------- -----------
The 'A' ordinary shares of EUR0.01 each that are in issue have
no impact on the earnings per share calculation.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 9 - Capital Commitments
Half year Half year Year
ended ended ended
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
Capital commitments at
period end authorised by
the Directors but not provided
for in the Financial
Statements:
Contracted for 3,704 1,400 8,083
------------- ------------- -----------
Not contracted for - 1,900 -
------------- ------------- -----------
The above capital commitments relate to an investment in the
underwriting policy administration system that commenced in 2013.
Rollout of the new system commenced in late June 2016.
Note 10 - Retirement Benefit Plan Assets/(Obligation)
The Group operates a funded defined benefit retirement scheme
for qualifying employees. During the year ended 31 December 2015
the Group completed a review of the defined benefit pension scheme
with the primary goals to reduce the IAS19 deficit and the inherent
volatility of the scheme. The outcome of the review was as
follows:
-- The defined benefit scheme ceased for future accrual of benefits.
-- The link to future salary increases was replaced with deferred pension increases.
-- FBD will no longer fund for future discretionary pension increases.
-- Current employees within the scheme were offered membership
in a new defined contribution arrangement for future service.
-- Current employees within the scheme were provided with the
option to take an enhanced transfer value of their past benefits
into the new defined contribution scheme. A significant majority
took up this option.
-- The investments in the scheme were significantly de-risked to
reduce the volatility of the IAS19 balance sheet position.
The Group recognised a pension curtailment gain of EUR28.3m for
the year ended 31 December 2015.
Full details of this scheme are available in Note 31 of the
Group Annual Report for the year ended 31 December 2015.
The amounts recognised in the Statement of Financial Position
are as follows:
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited*)
EUR000s EUR000s EUR000s
Fair value of plan assets 122,000 146,600 115,600
Present value of defined benefit
obligation (125,210) (197,500) (106,490)
------------ ------------ -----------
Net retirement plan asset/(obligation) (3,210) (50,900) 9,110
------------ ------------ -----------
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 11 - Financial Instruments
(a) Financial assets
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
(i) At amortised cost
Investments held to maturity - -
Deposits with banks 305,676 451,472 371,333
------------ ------------ ----------
305,676 451,472 371,333
------------ ------------ ----------
(ii) At fair value
Available for sale investments
- unquoted investments 844 843 844
Available for sale investments
- quoted debt securities 547,166 238,744 488,993
------------ ------------ ----------
Available for sale investments 548,010 239,587 489,837
------------ ------------ ----------
Investments held for trading
- quoted shares 21,643 19,310 25,671
Investments held for trading
- quoted debt securities 43,038 102,373 44,082
Investments held for trading
- UCITs 23,890 25,022 24,622
Investments held for trading - - -
- unquoted debt securities
------------ ------------ ----------
Investments held for trading 88,571 146,705 94,375
------------ ------------ ----------
(iii) At cost
Cash and cash equivalents 31,606 25,196 22,244
Fair value measurement
The following table compares the fair value of financial assets
with their carrying values:
30/06/16 30/06/16 30/06/15 30/06/15 31/12/15 31/12/15
(unaudited) (unaudited) (unaudited) (unaudited) (audited) (audited)
Fair Carrying Fair Carrying Fair Carrying
value value value value value value
EUR000s EUR000s EUR000s EUR000s EUR000s EUR000s
Financial assets
Loans 752 752 1,161 1,001 998 832
Financial investments 942,257 942,257 837,764 837,764 955,545 955,545
The carrying amount of the following financial assets and
liabilities is considered a reasonable approximation of their fair
value:
-- Other receivables
-- Cash and cash equivalents
-- Payables
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
The following tables provide an analysis of financial
instruments that are measured subsequent to initial recognition at
fair value, grouped into Levels 1 to 3 based on the degree to which
the fair value is observable.
-- Level 1 fair value measurements are those derived from quoted
prices (unadjusted) in active markets for identical assets or
liabilities.
-- Level 2 fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices).
-- Level 3 fair value measurements are those derived from
valuation techniques that include inputs for the asset or liability
that are not based on observable market data (unobservable inputs).
Among the valuation techniques used are net asset or net book value
or the net present value of future cash flows based on conservative
operating projections.
30 June 2016 (unaudited) Level Level Level Total
1 2 3
EUR000s EUR000s EUR000s EUR000s
Assets
Investment property - 14,550 - 14,550
Loans - 752 - 752
Other receivables - 63,891 - 63,891
Financial assets
Investments held for trading
- quoted shares 21,643 - - 21,643
Investments held for trading
- quoted debt securities 43,038 - - 43,038
Investments held for trading
- UCIT Funds 23,890 - - 23,890
AFS*investments - quoted
debt securities 547,166 - - 547,166
AFS* investments - unquoted
investments - - 844 844
Deposits with banks 305,676 - - 305,676
Cash and cash equivalents 31,606 - - 31,606
-------- -------- -------- ----------
Total assets 973,019 79,193 844 1,053,056
-------- -------- -------- ----------
Liabilities
Payables - 45,922 - 45,922
Convertible debt - 50,647 - 50,647
--- ------- -------
Total liabilities - 96,569 - 96,569
--- ------- -------
* Available for sale
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
30 June 2015 (unaudited) Level Level Level Total
1 2 3
EUR000s EUR000s EUR000s EUR000s
Assets
Investment property - 20,799 - 20,799
Loans - 1,161 - 1,161
Other receivables - 67,091 - 67,091
Financial assets
Investments held for trading
- quoted shares 19,310 - - 19,310
Investments held for trading
- quoted debt securities 102,373 - - 102,373
Investments held for trading
- UCIT Funds 25,022 - - 25,022
AFS* investments - quoted
debt securities 238,744 - - 238,744
AFS* investments - unquoted
investments - - 843 843
Deposits with banks 451,472 - - 451,472
Cash and cash equivalents 25,196 - - 25,196
-------- -------- -------- --------
Total assets 862,117 89,051 843 952,011
-------- -------- -------- --------
Liabilities
Payables - 41,932 - 41,932
--- ------- -------
Total liabilities - 41,932 - 41,932
--- ------- -------
* Available for sale
30 December 2015 (audited) Level Level Level Total
1 2 3
EUR000s EUR000s EUR000s EUR000s
Assets
Investment property - 14,550 - 14,550
Loans - 998 - 998
Other receivables - 59,506 - 59,506
Financial assets
Investments held for trading
- quoted shares 25,671 - - 25,671
Investments held for trading
- quoted debt securities 44,082 - - 44,082
Investments held for trading
- UCITs 24,622 - - 24,622
AFS* investments - quoted
debt securities 488,993 - - 488,993
AFS* investments - unquoted
investments - - 844 844
Deposits with banks 371,333 - - 371,333
Cash and cash equivalents 22,244 - - 22,244
-------- -------- -------- ----------
Total assets 976,945 75,054 844 1,052,843
-------- -------- -------- ----------
Liabilities
Payables - 54,054 - 54,054
Convertible debt - 50,036 - 50,036
-------- -------- -------- ----------
Total liabilities - 104,090 - 104,090
-------- -------- -------- ----------
* Available for sale
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
A reconciliation of Level 3 fair value measurement of financial
assets is shown in the table below
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
Opening balance Level 3 financial assets 844 948 948
Additions - - -
Disposals - (103) (103)
Unrealised gains/(losses) recognised in Consolidated Income Statement
- - -
Realised (losses)/gains recognised in Consolidated Income Statement - (2) (1)
------------ ------------ ----------
Closing balance Level 3 financial assets 844 843 844
------------ ------------ ----------
Available for sale investments grouped into Level 3 consist of a
number of small unquoted investments. The values attributable to
these investments are derived from a number of valuation techniques
including net asset or net book value or the net present value of
future cash flows based on conservative operating projections. A
change in one or more of these inputs could have an impact on
valuations. The maximum exposure the Group has in relation to Level
3 valued financial assets at 30 June 2016 is EUR844,000 (30 June
2015: EUR843,000; 31 December 2015: EUR844,000).
(b) Financial liabilities
The Group had no financial liabilities at 30 June 2016, 30 June
2015 or 31 December 2015 except for those disclosed in Note 11
(a).
Note 12 - Transactions with related parties
For the purposes of the disclosure requirements of IAS 24, the
term "key management personnel" (i.e. those persons having
authority and responsibility for planning, directing and
controlling the activities of the Group) comprises the Board of
Directors and Company Secretary of FBD Holdings plc and the members
of the Executive Management Team. Full disclosure in relation to
the compensation of the Board of Directors and details of
Directors' share options are provided in the Report on Directors'
Remuneration in the 2015 Annual Report. An analysis of share-based
payment to key management personnel is also included in Note 38 of
the 2015 Annual Report.
Note 13 - Contingent liabilities and contingent assets
There were no contingent liabilities or contingent assets at 30
June 2016, 30 June 2015 or 31 December 2015.
Note 14 - Information
This half yearly report and the Annual Report for the year ended
31 December 2015 are available on the Company's website at
www.fbdgroup.com.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Note 15 - Alternative performance measures (APM's)
The Group uses the following alternative performance measures:
Loss ratio, expense ratio, combined operating ratio, annualised
investment return and net asset value per share.
Loss ratio (LR), expense ratio (ER) and combined operating ratio
(COR) are widely used as a performance measure by insurers, and
give users of the financial statements an understanding of the
underwriting performance of the entity.
Annualised investment return is used widely as a performance
measure to give users of financial statements an understanding of
the performance of an entities investment portfolio.
Net asset value per share (NAV) is a widely used performance
measure which provides the users of the financial statements the
book value per share.
The calculation of the APM's is based on the following data:
Half year Half year Year
ended ended ended
30/06/16 30/06/15 31/12/15
(unaudited) (unaudited) (audited)
EUR000s EUR000s EUR000s
Loss ratio
Net claims and benefits 109,827 211,245 341,260
Movement in other provisions 4,998 4,581 11,581
Total claims incurred 114,825 215,826 352,841
Net premium earned 152,020 154,422 313,154
Loss ratio (total claims/Net
premium earned) 75.5% 139.8% 112.7%
-------------
Expense ratio
Other underwriting expenses 38,790 42,062 85,725
Net premium earned 152,020 154,422 313,154
------------- ------------- -----------
Expense ratio (underwriting
expenses/Net premium earned) 25.5% 27.2% 27.4%
------------- ------------- -----------
Combined operating ratio % % %
Loss ratio 75.5% 139.8% 112.7%
Expense ratio 25.5% 27.2% 27.4%
------------- ------------- -----------
Combined operating ratio 101.0% 167.0% 140.1%
------------- ------------- -----------
Annualised investment return EUR000s EUR000s EUR000s
Investment return recognised
in consolidated income
statement 271 5,405 20,260
Investment return recognised
in statement of comprehensive
income 9,161 (671) (1,762)
---------- ---------- ------------
Total investment return 9,432 4,734 18,498
Average underwriting investment
assets 984,244 871,598 905,577
1.9%* 1.1%* 2.0%
-------- ---------- ----------
*Annualised
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
Net asset value per share
(NAV per share) EUR000s EUR000s EUR000s
Shareholders' funds - equity
interests 210,480 177,484 215,864
------------- ------------- -------------
Number of shares
Weighted average number
of ordinary shares 34,648,122 34,648,122 34,648,122
------------- ------------- -------------
Cent Cent Cent
------------- ------------- -------------
Net asset value per share 607 512 623
------------- ------------- -------------
Note 16 - Approval of Half Yearly Report
The half yearly report was approved by the Board of Directors of
FBD Holdings plc on 11 August 2016.
FBD HOLDINGS PLC
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
For the half year ended 30 June 2016
RESPONSIBILITY STATEMENT
The Directors are responsible for preparing the Half Yearly
Financial Report in accordance with the Transparency (Directive
2004/109/EC) Regulations 2007, the related Transparency Rules of
the Central Bank of Ireland and with IAS 34, Interim Financial
Reporting as adopted by the European Union.
We confirm that to the best of our knowledge:
a) the Group condensed set of interim financial statements have
been prepared in accordance with IAS 34 "Interim Financial
Reporting" as adopted by the European Union;
b) the interim management report includes a fair review of the
important events that have occurred during the first six months of
the financial year, and their impact on the condensed set of
interim financial statements and the principal risks and
uncertainties for the remaining six months of the financial
year;
c) the interim management report includes a fair review of
related party transactions that have occurred during the first six
months of the current financial year and that have materially
affected the financial position or the performance of the Group
during that period, and any changes in the related parties'
transactions described in the last Annual Report that could have a
material effect on the financial position or performance of the
Group in the first six months of the current financial year.
On behalf of the Board
Michael Berkery Fiona Muldoon
Chairman Group Chief Executive
11 August 2016
Independent review report to FBD Holdings plc
Report on the condensed consolidated interim financial
statements
Our conclusion
We have reviewed the condensed consolidated interim financial
statements, defined below, in the half-yearly report of FBD
Holdings plc for the six months ended 30 June 2016. Based on our
review, nothing has come to our attention that causes us to believe
that the condensed consolidated interim financial statements are
not prepared, in all material respects, in accordance with
International Accounting Standard 34 as adopted by the European
Union and the Transparency (Directive 2004/109/EC) Regulations 2007
and the Transparency Rules of the Central Bank of Ireland.
This conclusion is to be read in the context of what we say in
the remainder of this report.
What we have reviewed
The condensed consolidated interim financial statements, which
are prepared by FBD Holdings plc, comprise:
-- the condensed consolidated statement of financial position as at 30 June 2016;
-- the condensed consolidated income statement and condensed
consolidated statement of comprehensive income for the period then
ended;
-- the condensed consolidated statement of cash flows for the period then ended;
-- the condensed consolidated statement of changes in equity for
the period then ended; and
-- the explanatory notes to the condensed consolidated interim financial statements.
As disclosed in note 2, the financial reporting framework that
has been applied in the preparation of the full annual financial
statements of the group is applicable law and International
Financial Reporting Standards (IFRSs) as adopted by the European
Union.
The condensed consolidated interim financial statements included
in the half-yearly report have been prepared in accordance with
International Accounting Standard 34, Interim Financial Reporting,
as adopted by the European Union and the Transparency (Directive
2004/109/EC) Regulations 2007 and the Transparency Rules of the
Central Bank of Ireland.
What a review of condensed consolidated interim financial
statements involves
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity, issued by the Auditing Practices Board for use in
the United Kingdom and Ireland. A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK and
Ireland) and, consequently, does not enable us to obtain assurance
that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
We have read the other information contained in the half-yearly
report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the condensed consolidated interim financial statements.
Our responsibilities and those of the directors
The half-yearly report, including the condensed consolidated
interim financial statements, is the responsibility of, and has
been approved by, the directors. The directors are responsible for
preparing the half-yearly report in accordance with the
Transparency (Directive 2004/109/EC) Regulations 2007 and the
Transparency Rules of the Central Bank of Ireland.
Our responsibility is to express to the company a conclusion on
the condensed consolidated interim financial statements in the
half-yearly report based on our review. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of complying with the Transparency (Directive 2004/109/EC)
Regulations 2007 and the Transparency Rules of the Central Bank of
Ireland and for no other purpose. We do not, in giving this
conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent
in writing.
PricewaterhouseCoopers
Chartered Accountants
Dublin
11 August 2016
Notes:
1. The maintenance and integrity of the FBD Holdings plc website
is the responsibility of the directors; the work carried out by the
auditors does not involve consideration of these matters and,
accordingly, the auditors accept no responsibility for any changes
that may have occurred to the financial statements since they were
initially presented on the website.
2. Legislation in the Republic of Ireland governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFVRTEILLIR
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August 12, 2016 02:00 ET (06:00 GMT)
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