Hurricane Matthew impact “less than it might have been” for Lloyd’s insurer Lancashire
Hurricane insurer Lancashire's share price spiralled up over eight per cent today after blowing away analysts with its third quarter results.
Announcing a $150m (£121m) special dividend, the Lloyd's insurer said that the impact of Hurricane Matthew – the worst in the Atlantic for nine years – wasn't quite as bad as it had expected.
"As an insured event affecting the US, the level of insured damage was less than it might have been in other circumstances," said chief executive Alex Maloney.
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Gross written premiums fell by 10 per cent in the third quarter to $108m and were one per cent behind the nine month performance of 2015 at $544m.
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Nevertheless, together with the bumper pay-out to shareholders, the results smashed market expectations.
RBC had predicted a $0.70 per share special dividend, compared with $0.75p per share announced. Meanwhile it had anticipated pre-tax profit for the quarter of $33.6m – well below the $42.9m reported by Lancashire.
The special dividend took the total that the Bermuda-domiciled company had returned to shareholders to $2.7bn since inception. The firm launched on the Aim in 2005.
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Eamonn Flanagan, an analyst at Shore Capital was even more gushing at the announcement, calling it "a terrific third quarter performance which was well ahead of our and the market’s forecasts".
"These figures demonstrate both the underwriting prowess of the group and its highly disciplined focus on capital discipline," Flanagan said.