The Specialist broker THB Group today revealed a 20% increase in turnover and 29% growth in its THB UK operation as it published its interim results for the six months to 30 April 2009.
But Group CEO Frank Murphy also used the results to argue that he believed some carriers were holding back the hard market by under-pricing to maintain market share.
The increase in turnover was in part due to a strong performance by divisions within the Lloyd’s broker Thompson Heath & Bond Ltd including teams from the PWS International business acquired in January last year. THB UK, the group’s non-broking operation, also contributed to the uplift in turnover, driven particularly by progress in its risk management business.
However the effects of the soft market plus the impact of interest rate reductions on investment income held back the overall result.
Underlying profit before tax, after adjusting for amortisation of intangibles and exceptional costs, for the six months to 30 April 2009 was £2.4m (2008: £3.1m). Underlying fully diluted earnings per share were 5.16p (2008: 6.78p).
Earnings per share were down by 21% however shareholders will still receive a dividend payment in August.
Chief Executive Frank Murphy said:
“We are very pleased with the progress made by THB UK and the strong contribution from the PWS acquisition. However the slowdown in global economic activity plus the series of interest rate cuts by US and UK central banks in response to the economic crisis have had a material effect on operating profit in the period.
“We are not immune to the impact of the global recession and indeed the continued decline in insurance markets was forecast in our Annual Report. As such, we continue to focus on making the right decisions, including cost control, to ensure we remain in a strong position when rates harden. Undoubtedly THB has been held back by external factors in the short term but overall is in very good shape going forward.”
