Admiral Group (ADM)

[idpickering]

Half-year report.

Comment from Milena Mondini de Focatiis, Group Chief Executive Officer

“The Group has once again delivered a solid performance and strong growth in the context of a challenging market, although we believe that the cycle is turning. In the first half of the year, profit was £234 million, turnover was up 21 per cent to £2.2 billion and our Group customer base grew 4 per cent.

“Inflation persists, but we have navigated the cycle well, maintaining pricing discipline and a focus on medium-term profitability. We recognise that these are challenging times for many people and we are committed to being there for them when they need us the most, delivering good service and competitively priced products while also actively managing our costs.
“Our UK Motor business delivered a profit of £298 million in the first half of 2023. As we increased prices well ahead of the market last year, our active vehicle base reduced over the period, but we are on a strong footing to leverage improving market conditions.

“We continue to enhance our capabilities, particularly in data and technology, and we are innovating to further develop our core competences and enrich our customer proposition.

“We are making good progress on our diversification strategy, with our non-UK Motor products delivering 19 per cent customer growth, and our UK Household business and European Motor business delivering profits of £8.7 million and £4.7 million, respectively. It was also another positive and profitable period for Admiral Money, with the business taking a cautious approach whilst growing loans balances by 31 per cent.

“I am pleased to say that we remain strongly capitalised and, thanks to the hard work of my colleagues across all of our markets, we now serve even more customers, and are very well-positioned for a more encouraging outlook.”

Dividend

The Board has declared an interim dividend of 51.0 pence per share (2022 interim: 60.0 pence per share, plus 45.0 pence per share special dividend from the sale of Penguin Portals) representing a normal dividend (65% of post-tax profits) of 38.0 pence per share and a special dividend of 13.0 pence per share. The interim dividend will be paid on 6 October 2023. The ex-dividend date is 7 September 2023 and the record date is 8 September 2023.

https://www.investegate.co.uk/announcem ... rt/7698241

Ex div 07 Sep 23, paid 06 Oct 23.

Ian (No holding).

[Dod101]

I think these results are quite good and moving in the right direction again. The UK profit is up and the international losses are down. They also have a very strong Balance Sheet and Solvency Ratio. See what the full year brings in due course.

Dod

[seagles]

I receive regular e-mails from Simply Wall Street. I find most of them useful. I was wondering whether others feel the following is relevant here?

Admiral Group
ADM
Share Price 7 Day 1 Year
24.90 4.8% 23.9%

Upcoming dividend of UK£0.51 per share at 4.1% yield
Eligible shareholders must have bought the stock before 07 September 2023.

Payment date: 06 October 2023.
Payout ratio is a comfortable 62% but the company is paying out more than the cash it is generating.
Trailing yield: 4.1%.
Lower than top quartile of British dividend payers (6.3%).
Lower than average of industry peers (4.8%).

Here is the link to the company report. Received yesterday.

[Dod101]

I receive regular e-mails from Simply Wall Street. I find most of them useful. I was wondering whether others feel the following is relevant here?

Admiral Group
ADM
Share Price 7 Day 1 Year
24.90 4.8% 23.9%

Upcoming dividend of UK£0.51 per share at 4.1% yield
Eligible shareholders must have bought the stock before 07 September 2023.

Payment date: 06 October 2023.
Payout ratio is a comfortable 62% but the company is paying out more than the cash it is generating.
Trailing yield: 4.1%.
Lower than top quartile of British dividend payers (6.3%).
Lower than average of industry peers (4.8%).

Here is the link to the company report. Received yesterday.

Thanks for that. I wonder who they count as Admiral's industry peers? There is only Direct Line I think and their dividend is currently suspended. Certainly Aviva for instance is not a peer in the sense as being in the same business. Motor and household insurance is a relatively small proportion of their business.

They say that they are paying out more than the cash it is generating but that is surely not surprising considering that their special dividend is coming from a release of their reserves and not from current trading profits.

The comments by Simply Wall Street are surely relevant in the sense that they relate to company news from Admiral.

Dod

[monabri]

I receive regular e-mails from Simply Wall Street. I find most of them useful. I was wondering whether others feel the following is relevant here?

Admiral Group
ADM
Share Price 7 Day 1 Year
24.90 4.8% 23.9%

Upcoming dividend of UK£0.51 per share at 4.1% yield
Eligible shareholders must have bought the stock before 07 September 2023.

Payment date: 06 October 2023.
Payout ratio is a comfortable 62% but the company is paying out more than the cash it is generating.
Trailing yield: 4.1%.
Lower than top quartile of British dividend payers (6.3%).
Lower than average of industry peers (4.8%).

Here is the link to the company report. Received yesterday.

Thanks for that. I wonder who they count as Admiral's industry peers? There is only Direct Line I think and their dividend is currently suspended. Certainly Aviva for instance is not a peer in the sense as being in the same business. Motor and household insurance is a relatively small proportion of their business.

They say that they are paying out more than the cash it is generating but that is surely not surprising considering that their special dividend is coming from a release of their reserves and not from current trading profits.

The comments by Simply Wall Street are surely relevant in the sense that they relate to company news from Admiral.

Dod

Surprisingly, Direct Line Group is not listed.

Source: https://simplywall.st/stocks/gb/insuran ... oup-shares


Declaration - I subscribe to SimplyWallStreet. I use it a basic screening tool. They actually offer a free version which allows viewing of their analysis of a company ( Worldwide) for the price of an email address....you are not spammed by them so it's probably a useful Freeby. The free version is limited to 5 company reports per month. I subscribe to the middle ground plan but on an annual basis.

https://simplywall.st/plans

[Dod101]

That is a very strange list of underwriters to compare with Admiral. Admiral is after all basically only a motor and household insurer. The others as far as I know which have ben quoted by SWS write everything from motor insurance to hurricane cover in the US. They are not to my mind in any sense peers of Admiral except that they are all insurers.

Anyway it is not worth arguing about. I am happy with the way that Admiral seems to be on top of the issues which emerged a year or so ago; unlike Direct Line which made a real hash of them. I have always felt that Admiral had a better grip of its issues.

Dod

[seagles]

Received the following from Simply Wall Street. Interesting 15.5% over the year but 14% over 90 days.

Admiral Group
ADM
Share Price 7 Day 1 Year
23.23 -2.4% 15.5%

Now 20% undervalued

Over the last 90 days, the stock is up 14%.
The fair value is estimated to be UK£29.05, however this is not to be taken as a buy recommendation but rather should be used as a guide only.
Revenue has grown by 14% over the last 3 years. Earnings per share has declined by 18%.
For the next 3 years, revenue is forecast to grow by 7.5% per annum. Earnings is also forecast to grow by 9.2% per annum over the same time period.

[monabri]

https://www.bbc.com/news/uk-wales-67652754.amp

"Admiral has bought competitor More Than's home and pet insurance business in a deal worth as much as £115m.
The agreement with owners RSA Insurance will see about 300 of that firm's staff transfer to Admiral."

"The move into home and pet insurance is part of a strategy to diversify its operations.
Motor insurance's profits have been hit by the rising costs of vehicle repairs and replacements."

"The company will pay RSA £82.5m up front, and up to a further £32.5m, depending on how many policies ultimately go to Admiral."

[Dod101]

Admiral is a well run company and it will be interesting to know how much of the RSA business they retain, given their fairly exacting standards. I guess that is why they are sensibly paying a modest upfront amount followed by a further payment presumably in a year or so’s time.

Dod

[monabri]

Explains why the sp dropped today!

https://www.sharecast.com/news/news-and ... 11090.html

[tjh290633]

Final Results: https://www.investegate.co.uk/announcem ... rt/8074974

Final Dividend

The Board has proposed a final dividend of 52.0 pence per share (2022 final: 52.0 pence per share) representing a normal dividend (65% of post-tax profits) of 35.4 pence per share and a special dividend of 16.6 pence per share. The final dividend will be paid on 7 June 2024. The ex-dividend date is 9 May 2024 and the record date is 10 May 2024.

Slight reduction in dividend for the full year.

TJH

[Dod101]

Final Results: https://www.investegate.co.uk/announcem ... rt/8074974

Final Dividend

The Board has proposed a final dividend of 52.0 pence per share (2022 final: 52.0 pence per share) representing a normal dividend (65% of post-tax profits) of 35.4 pence per share and a special dividend of 16.6 pence per share. The final dividend will be paid on 7 June 2024. The ex-dividend date is 9 May 2024 and the record date is 10 May 2024.

Slight reduction in dividend for the full year.

TJH

Thanks for that but I was more interested in the financial results than the dividend. They seem good and the losses on overseas business seem to be more or less under control so that is good. This continues to be well run operation and I am more than happy to hold.

Dod

[Gerry557]

It sounded like the US operations were being considered for canning but might be given more time.

[idpickering]

Notice of AGM and Annual Report and Accounts.

Admiral Group plc ("the Company") announces that its Annual General Meeting ("AGM") will be held at 1.30pm on Thursday 25 April 2024 at the Company's registered office of Tŷ Admiral, David Street, Cardiff, CF10 2EH.

The Company has today published and posted to shareholders its Annual Report and Accounts for the year ended 31 December 2023 (the "Annual Report"), together with the Notice of the AGM (the "Notice"). The Company further announces that its Annual Report has also been prepared in accordance with European Single Electronic Format (“ESEF”) reporting requirements.

https://www.investegate.co.uk/announcem ... ts/8102926

Ian (No holding).