Morning business news - August 27Tuesday 27 August 2013 10.21
FBD HOLDINGS' HALF YEARLY PROFITS HIT BY LOWER RETURNS ON INVESTMENTS - Insurer FBD Holdings has reported an operating profit of just over €24m for the first half of 2013. That is down marginally on the €28m reported this time last year. Pre-tax profits for the six months to the end of June came in at just over €19m.
FBD's chief executive Andrew Langford said the lower profits this year were down to lower returns on investments. "Interest rates in global investment markets are at an all time low. Our investment return was lower. That's an issue that all insurers face but it was probably better for us than most other insurers,'' he stated.
Mr Langford described the claims level as ''satisfactory'' after reporting an unusually high number of personal injury claims in the first quarter. "We didn't have the same number in the second quarter and we hope that over time they will even out. For example, in the second quarter of last year we didn't have any serious claims," he explained.
The company increased its market share as well as its gross written premium, which is up to almost €176m, despite an overall reduction in individual insurance premiums. "The average price in the first six months was lower than the same time last year. We've grown customer numbers which led to growth in revenue and market share," Mr Langford said.
He said the adjustments in premiums following the new European directive on non-discrimination against the sexes had been revenue neutral. "We also introduced a telematics system which allows drivers measure their driver ability. Better drivers get rewarded. Younger drivers can gain premium rebates of up to 30% if they prove they are a good driver,'' he said.
MORNING BRIEFS - Broadcaster UTV Media has posted pre-tax profits of £6.1m sterling for the six months to the end of June, down from £10.7m the same time last year. Revenues for the six months fell to £55.2m from £61.6m, while the company has maintained its interim dividend at 1.75 pence per share. UTV owns a number of radio stations in Ireland including FM104, Q102 and LMFM.
*** Argentina's president is proposing a voluntary bond swap on its foreign debt. This follows a court ruling in the US on Friday requiring Buenos Aires to pay over $1.3 billion to hedge funds that refused to take a haircut after the country defaulted on its debt in 2002. President Cristina Fernandez told the nation in a televised address that the bond swap would allow Argentina to keep paying the 90% of creditors who agreed to restructure the country's sovereign debt after the record $100 billion default. That could trigger a renewed debt crisis in the South American nation.
*** Australian surf and streetwear brand Billabong has reported an annual loss of $860m - triple the losses reported this time last year. The company has announced that a refinancing deal will be concluded within weeks. Sales are continuing to decline particularly in key markets including the US.