RSA Insurance H1 Profit Plunges On Lower Premiums - Quick Facts

(RTTNews) - UK insurer RSA Insurance Group plc (RSANY.PK, RSA.L, RSA) reported Thursday that its first-half pre-tax profit plunged to 69 million euros from 250 million euros last year.

Profit after tax was 6 million pounds, compared to 190 million pounds a year ago. The company meanwhile, reported loss per share of 0.2 pence, compared to profit of 22.1 pence a year ago.

Total net written premiums declined to 3.93 billion pounds from 4.65 billion pounds in the prior year. On an underlying basis, premiums dropped 3 percent.

The company noted that foreign exchange movements, notably the strengthening of Sterling during the first half, drove reported premiums down 16 percent.

Further, the firm said its Board is currently targeting restarting dividend payments with the 2014 full year results.

Looking ahead, the company said its guidance of up to a 10 percent reduction in premiums during 2014 is unchanged. However, given the strengthening of Sterling during the first half, the reduction on a reported exchange rate basis is likely to be greater.

Also, given a fuller period effect of the announced disposals, written premiums are likely to fall further, but more modestly, in 2015.

The company expects underwriting profits to improve in the second half.

The company's medium targets remain unchanged: return on tangible equity of 12-15 percent; tangible equity to be 35-45 percent of net written premiums; dividend payout ratio of 40-50 percent over time.