Key points
Return on adjusted net tangible assets (RoNTA) before FX and IPO costs of 20.7% (2013: 24.2%)
Profit after tax increased by 39.7% to £139.0m (2013: £99.5m)
Gross written premiums of £1,302.1m (2013: £1,185.7m), an increase of 9.8%. The increase at constant exchange rates was 15.0%
Full year combined ratio of 89.5% despite challenging rating environment (2013: 85.4%)
Investment return for the period increased by 38.4% to £75.7m (2013: £54.7m), representing a return of 2.9%
Total value creation of £139.2m driven by strong operating performance (2013: £91.3m)
Adjusted net tangible assets increased to £775.4m or 194.0pps (2013: £661.2m/168.6pps), after payment in September 2014 of an interim dividend of £25.0m
Final dividend declared of 12.5pps plus a special dividend of 12.5pps, bringing total dividend for the year including the interim dividend of 6.25pps to 31.25pps
Recommended cash offer of 305 pps for the Company from Fairfax Financial Holdings Limited
Mark Cloutier, Group CEO of Brit PLC, said:
'Brit has had another successful year delivering on our financial targets and moving towards our goal of being the leading global speciality insurer. The return on adjusted net tangible assets before FX and IPO costs of 20.7% is driven by strong underwriting and investment performances, coupled with a continued focus on strict cost control. Our underlying underwriting performance once again excelled and coupled with a relatively benign period in terms of major losses, resulted in a combined ratio of 89.5%. Investment performance has been strong, with the portfolio producing an annualised return of 2.9% as our "income focused" portfolio benefitted from falling bond yields and tightening credit spreads in the first half of the year. As a result of our strong performance during the year I am also very pleased to announce a final dividend of 12.5p per share, in line with our guidance. The Group's robust capital position has also facilitated a special dividend of 12.5p per share.
On 17 February we were pleased to announce that the Boards of Fairfax and Brit have reached agreement regarding the terms of a recommended cash offer of 305pps for Brit PLC. Our business is complementary to their group's current offering and the deal represents an exciting opportunity to continue our story on an even stronger footing. Our position as a market-leading global specialty insurer and reinsurer and our major presence in Lloyd's make us an attractive addition to Fairfax's global footprint. There is very little crossover in our respective international operations, thus allowing Fairfax to further diversify its portfolio while enabling Brit to leverage Fairfax's existing relationships and expertise in the international insurance and reinsurance markets. The combination will enable us to enhance our global product offering and provide us with expanded underwriting opportunities and distribution channels. We believe this is a great fit for both companies, our employees, customers and trading partners as well as representing an attractive financial return for shareholders following our successful IPO in April 2014.
We have a fantastic team here at Brit and I am particularly delighted to announce today the appointment of Matthew Wilson as Deputy Group CEO and Chief Underwriting Officer. Underwriting performance is at the core of our strategy and Matthew's leadership over the past 5 years has been a key factor in the significant transformation that has occurred at Brit. I look forward to working closely with Matthew in his new role as we start an exciting new chapter for the Brit Group.'
