Helios Underwriting Plc 2023 Helios Retained Capacity Update (1574M)

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RNS Number : 1574M

Helios Underwriting Plc

10 January 2023

10th January 2023

Helios Underwriting plc

("Helios" or the "Company")

2023 Helios Retained Capacity Update

Portfolio increased by 27% year-on-year to GBP297 million

Helios, the unique investment vehicle that acquires and consolidates underwriting capacity at Lloyds', announces an update on the Company's capacity to be underwritten for 2023.

Nigel Hanbury, Chief Executive of Helios, commented:

"I am delighted that the retained capacity underwritten by Helios shareholders will have significantly increased for another successive underwriting year to GBP238m. Market discipline remains strong and we are confident that 2023 will offer superior returns. The Jan uary renewals supports this with significant pricing improvement and market dislocation in the reinsurance and retro markets respectively. Rating indices across most lines are at or above our underwriting requirements and the Board is confident the Company is well positioned to maximise market opportunities ."

Capacity Update

Helios announces that the retained underwriting capacity for the 2023 year of account will be GBP238m, a near 40% increase in the capacity underwritten since the start of 2022. The overall portfolio , including the capacity reinsured , has increased to GBP297m, adding more than 27% to the size of the portfolio since the 1 (st) January 2022.

 
             Helios - 2023 Year of Account Capacity 
 GBPm                              Retained   Reinsured   Total 
 Capacity as at 1st January 
  2023                                238.3        58.3   296.6 
 Capacity as at 1st January 
  2022                                171.1        61.6   232.7 
 % change - Increase/(Decrease)         39%        (5)%     27%

The prospects for underwriting profitability and higher investment returns have improved considerably and the Board believes this substantial increase in the retained capacity will significantly benefit the Company's shareholders for 2023 onwards.

The analysis of this increase in the Helios portfolio is as follows:

 
                                            Capacity 
                                                GBPm 
 Capacity at 1(st) January 
  2021 for 2022 YOA                            232.7 
 Capacity acquired in 2022 for 2023 
  YOA                                            5.7 
 Pre-emption capacity                           36.0 
 Disposal of capacity in the capacity 
  auction                                     (16.7) 
 Additions to Tenancy Capacity                  38.9 
 Capacity as at 1(st) January 
  2023 for 2023 YOA                            296.6 
                                           ---------

Helios has and continues to support both new and well established syndicates that offer capacity for a limited period only, referred to as Tenancy Capacity, and Helios expects to support these syndicates in the longer term.

Helios acquired three LLVs in 2022 adding GBP5.7m of capacity to the 2022 year of account and increased the retained capacity for all three open years of account.

The split of capacity between retained and reinsured for the current open years of account is currently as follows:

 
    Retained Capacity 2020 to 2023 Years of Account 
                                    2020   2021   2022    2023 
                                    GBPm   GBPm   GBPm    GBPm 
 Capacity - Position as at 
  1st Jan uary 2022                 66.5   93.4   171.1     - 
 
 Capacity acquired during 2022      5.6    5.8     5.7      - 
 
 Capacity - Expected at 1st 
  Jan uary 2023                     72.1   99.2   176.8   238.3

The increased retained capacity on the 2020 to 2022 years of account, substantially "off-risk" for the underwriting years, will contribute to the recognised profits in the future.

Split of Freehold and Leasehold Capacity by Year of Account

 
 As at 1 (st) January    2022 YOA   2023 YOA 
  - GBPm 
 Freehold capacity        144.8      147.3 
 Tenancy capacity          87.9      149.3 
 Total capacity           232.7      296.6 
 Value of capacity 
  Fund                     59.8       60.0

For further information please contact:

Helios Underwriting plc

Nigel Hanbury - Chief Executive +44 (0)7787 530 404 / nigel.hanbury@huwplc.com

   Arthur Manners - Chief Financial Officer                  +44 (0)7754 965 917

Shore Capital (Nomad and Broker)

   Robert Finlay                                                                  +44 (0)20 7601 6100

David Coaten

Buchanan (PR)

   Helen Tarbet / Henry Wilson / George Beale          +44 (0)7872 604 453

+44 (0)20 7466 5111

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 GBP297m of capacity for the 2023 account. The portfolio provides a good spread of business being concentrated in property & casualty insurance and reinsurance. For further information please visit www.huwplc.com.

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