Helios Underwriting Plc Quarterly Syndicate Mid-point Forecasts (9443H)

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RNS Number : 9443H

Helios Underwriting Plc

30 March 2020

30th March 2020

Helios Underwriting plc

('Helios' or 'the Company')

Quarterly Syndicate Mid-point Forecasts

Helios, the unique investment vehicle which acquires and consolidates private underwriting capacity at Lloyd's, announces the current mid-point forecasts in respect of its portfolio of syndicate capacity for the 2017 and 2018 years of account based on 4th quarter 2019 results.

Nigel Hanbury, Chief Executive, commented:

"As the only listed consolidator of private capital at Lloyd's, Helios offers a unique opportunity for growth and returns from exposure to the Lloyd's market through targeted acquisitions of the better quality syndicates. Our strategy is bringing results, with returns on average 3.1% better than the Lloyd's market itself.

"Given the current uncertainty we would expect the number of LLV's for sale to increase and we see opportunities to continue to build our core portfolio of capacity and achieve outperformance against the Lloyd's market as whole.

"We look forward to the future with confidence."

 
                                              Year of Account 
                                      2017     2018    2019   2020 
                                      GBPm     GBPm    GBPm   GBPm 
 Capacity - Position as at 
  15th November 2019                  56.1     59.0    55.7   62.9 
 Retained                             30.7     20.7    16.7   18.9 
 Reinsured                            25.4     38.2    39.0   44.1 
 
 Capacity acquired since 15th 
  November 2019 
 Retained                             6.6      6.8     6.6    2.2 
 Reinsured                            0.0      0.0     0.0    5.1 
 
 Capacity - Position as at 
  26 March 2020 
 Retained                             37.4     27.6    23.3   21.1 
 Reinsured                            25.4     38.2    39.0   49.1 
                                      62.7     65.8    62.2   70.2 
                                    =======  =======  =====  ===== 
 
 Mid-point forecast at 30th 
  September 2019                     -6.51%   -3.39% 
 Final result / Current mid-point 
  forecast                           -4.83%   -3.61% 
 
 Lloyd's Market Average              -7.97%   -5.71% 
 Helios out performance              3.14%    2.10% 
 

Notes

1) The table above shows the capacity as at 30(th) March 2020 splitting the capacity retained by Helios and the capacity that is ceded to quota share reinsurers. Helios acquired four limited liability vehicles during 2019 for a total consideration of GBP10.2m (GBP12.2m - 2018) and in 2020 to date a single LLV has been acquired for GBP1.2m

2) The result for the 2017 year of account and the mid point forecasts for 2018 year of account as of 4th quarter 2019 have been aggregated at syndicate level from estimates supplied by Managing Agents

3) The Helios outperformance is measured using the result on the capacity at the end of the year - including the capacity of the portfolios acquired which include participations on underperforming syndicates that will subsequently be discarded. The effect of excluding the acquired capacity and basing the Helios outperformance against the mid-point forecasts on the capacity at the start of the underwriting year - the core Helios portfolio - versus the Lloyds Market average is shown below:

 
                             2017     2018 
 Result / Current 
  mid-point forecast 
  Core Portfolio           -3.67%   -3.49% 
 Lloyd's Market 
  Average                  -7.97%   -5.71% 
 Helios out performance     4.30%    2.22% 
------------------------  -------  ------- 
 

4) The 2018 midpoint estimates have deteriorated as many syndicates have strengthened reserve estimates to take into consideration the increased level of uncertainty in certain lines of business, notably casualty for which strengthening has been reported across the market in aggregate. In addition, there has also been material strengthening reported in relation to estimates for Typhoon Jebi, consistent with the experience across the wider property and casualty industry.

   5)    The impact on Helios will be as follows: 

a. The change in the mid point estimates on the retained capacity over the year will be recognised in the Helios income statement in the year to 31(st) December 2018.

b. The overall change in the result will be recognised by Helios in cash at the close of the year of account.

For further information, please contact:

Helios Underwriting plc

   Nigel Hanbury - Chief Executive                                                     07787 530 404 / [e-mail] 
   Arthur Manners - Chief Financial Officer                                      07754 965 917 

Shore Capital

Robert Finlay 020 7408 4080

David Coaten

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 GBP70m of capacity for the 2020 account. The portfolio provides a good spread of business being concentrated in property insurance and reinsurance. For further information please visit www.huwplc.com.

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 [e-mail] or visit www.rns.com.

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March 30, 2020 02:00 ET (06:00 GMT)