R&q Insurance Share Discussion Threads

[speedsgh] 11/12/2018 12:01

Update on the Acquisition of GLOBAL Reinsurance Corporation of America -

Randall & Quilter Investment Holdings Ltd. ("R&Q" or "the Company") announced on 19 September 2018 that it had signed a definitive agreement to acquire GLOBAL U.S. Holdings Incorporated, the 100% parent of GLOBAL Reinsurance Corporation of America, a New York domiciled reinsurance company in run-off. The acquisition is conditional upon regulatory consent for the change of control. At the time of that announcement the Company indicated that it expected receipt of change of control approval and to complete the acquisition before the end of 2018.

The Company remains confident of achieving change of control approval of Global Re US and the Board now anticipates that regulatory approval is likely to occur early in 2019.

As a consequence of the applicable accounting requirements, the benefits of the acquisition will therefore now be accounted for in the first half of 2019, rather than the full year 2018. The Board's current assessment is that, as a consequence, while the Group's profit before tax for 2018 will be below current market expectations, that for 2019 will be correspondingly above current market expectations.

Ken Randall, Group Chairman and Chief Executive Officer said "We have always stressed the difficulty of predicting the exact timing of legacy deals. The acquisition of Global Re remains on track and the new business pipeline for legacy is very encouraging. Moreover, Accredited, our programme management business in the USA and Europe, continues to attract a lot of interest. By 31 December 2018, we anticipate having signed contracts with managing general agents which are expected to generate future gross written premiums of around $500m per annum. Both of the Accredited companies have a strong pipeline of further opportunities for execution in 2019. As we have previously indicated, earned commissions on programme business will begin to have a material impact on the Group's results from the second half of 2019 and beyond".

[jonwig] 28/11/2018 06:46

The Equity Development forum is this evening. A video should appear a few days afterwards.

[lord gnome] 30/10/2018 11:18

Just noticed that the shares go ex-div (sic) at close of play today, so I guess that may also be having some effect on the share price. All things being equal, they should open 3 -4p down tomorrow.

[lord gnome] 30/10/2018 11:12

Totally impenetrable. But I can read the rising share price so I guess that those who know what it means must like it.

[jonwig] 30/10/2018 08:25

As usual, reading today's announcement needs a dictionary!
Today's offering, "facultative reinsurance":

[lord gnome] 13/10/2018 14:20

Yes, it’s notable that the biggest fallers last week were stocks that had enjoyed the biggest rises (by and large) as investors sought to lock in some profits in case of a wider downturn. I am happy to hold these but didn’t buy the dip as I have other fish to fry and seek to shuffle the pack of my holdings.
RQIH is thinly traded and prone to bounce about a bit. Over the longer term, quality will out.

[jonwig] 13/10/2018 07:44

@ Lord G - some commentators have said that the biggest fallers this week were the biggest recent risers (tech in US, etc.). So a mood of fear and lots of profit taking.

Because RQIH is pretty illiquid, you can see the reasoning. I'd no interest in buying the dip here, as I haven't been a buyer of anything recently. It looks like one to hold through a bear market though, as distressed companies will be queueing up to sell their unwanted insurance bits and bobs at well under true value.

[lord gnome] 12/10/2018 13:35

What a difference a day makes, and what a recovery. All buys today, and the price is being chased ever higher. Who knows something the rest of us don't? Have these been tipped somewhere?

[speedsgh] 12/10/2018 13:19

RQIH are presenting at Equity Development Investor Forum November 2018...

[jonwig] 12/10/2018 06:56

The ED note has an interesting description of Program Underwriting as "fronting" (p6). I always thought of fronting as illegally putting yourself down as main driver to get cheap car cover for your kids.

Anyway, this is a good explanation:

[lord gnome] 11/10/2018 12:11

This is being caned along with most other AIM stocks. Brutal or what? Never mind, quality will out once normality is restored.

[red ninja] 10/10/2018 22:10

Mmm the fund buying seemed to help push it over £2 so not really surprised it fell when fund buying ended.
Still this seems a good stock to hold in apost Brexit world

[lord gnome] 09/10/2018 14:18

Up like a rocket and down like its stick. How very disappointing. I can think of several reasons for the rise, but none for the fall. Happy to hold, but what a trading opportunity I have missed here.

[edmonda] 09/10/2018 08:07

Cant guarantee every growth stock is a winner, speedsgh, unfortunately. But 22 years of reviewing many more winners than disappointments.

Anyway, please digest and form your own view: after the cracking interims (underlying operating profits +40%)a full research note is now out highlighting the ongoing growth opportunity, low PER (11x) and high 4.7% yield on distribution.

Freely accessible here:

[speedsgh] 09/10/2018 07:56

Have to admit that I am not a great fan of Equity Development. They were big champions of FRP, say no more. Haven't read today's RQIH note yet; look fwd to digesting later.

[jonwig] 09/10/2018 07:46

Good to see. ED used to do a lot of insurance research.

[speedsgh] 09/10/2018 07:33

New research note from Equity Development...

Benefitting from refocus on core operations -

[speedsgh] 01/10/2018 12:48

Nice to see patience finally being rewarded here. Just re-rating in response to the Global Re US acquisition or wonder if the strong share price might presage a new fundraising?


from the recent Interims...

"The Board anticipates trading in the second half of 2018 to be strong and, should the acquisition of Global Re US receive regulatory approval and be completed prior to year-end, expects the full year results will be substantially in excess of market expectations."

"Both legacy and program management pipelines remain strong and the wider industry challenges and resultant changes suggest that demand will continue to grow in both segments."

"The proceeds from these disposals, together with the £47m placing and open offer in November 2017 have been deployed"

[jonwig] 28/9/2018 10:08

Standard Life Aberdeen have declared a notifiable interest: 6,586,434 shares, 5.23%. Previously below threshold.

The only other recent notification was from Phoenix Asset Management last year: 24,390,734 shares, almost 24%.

[lord gnome] 21/9/2018 15:42

A good end to a good week.

[speedsgh] 21/9/2018 15:20

197p paid this pm. Within spitting distance of 200p.

[red ninja] 20/9/2018 11:23

Numis say ADD with new target 210p as of 19/9/18.

[topvest] 19/9/2018 11:32

Possibly, but they do so seem to have put some good deals together which is shown by the share price rise. Have faith in the quality of management here.

[speedsgh] 19/9/2018 10:24

I wonder what the chances are of RQIH tapping the market for further funds?

"The proceeds from these disposals, together with the £47m placing and open offer in November 2017 have been deployed."

[speedsgh] 19/9/2018 10:20

jonwig - Yes, 2014 was a difficult year for them (see below). However, as a stock that hopefully has a relatively low beta to the market & might be considered acyclical & offers shareholders a handsome & steadily growing 'distribution' (I wish they would pay it out as a dividend as opposed to return of capital!), I am inclined for now to continue to hold on. As their results today indicate, their strategy appears to have put them in the right place at the right time. Let's hope they can continue to execute it profitably.

I do find that knowing when to sell/reduce a position is invariably the hardest part, especially a profitable position. There is of course no right answer. One just has to do what hopefully works for oneself.


Nov 2014 Trading Update [profit warning] -

from 2014 Final Results:
"2014 was a challenging year overall, primarily for the reasons detailed in our November trading update. The deterioration in net provisions for asbestos claims in R&Q Re US, the significant legal expenses associated with the recently successfully concluded arbitration of a large life settlement claim in former Syndicate 102, and the failure to secure a number of anticipated service contract wins in the now restructured US service operations were the main contributory factors."