Admiral Group Plc (LSE:ADM) reported a sharp fall in interim profits on the back of a “more turbulent cycle than usual, and high levels of inflation.”
However pre-tax profit still beat the pre-pandemic 2019 levels and the FTSE 100 insurer declared a further special dividend.
Pre-tax profit was down 48% to £251.3mln in the six months ended June 30, although that figure was 19% higher than 2019 - the last pre-pandemic reporting year. Turnover rose 6% to £1.85bn.
The board declared an interim dividend of 60.0p per share, made up of a normal dividend of 44.2p and a special dividend of 15.8p.
It also announced a further special dividend of 45.0p, reflecting the final payment of the phased return of the proceeds from the sale of the Penguin Portals comparison businesses.
According to a statement, “various macroeconomic and other factors have influenced Admiral’s businesses and markets during 2022.”
That includes higher inflation, supply chain pressures and labour shortages - although it reassured investors it continues to manage these challenges.
Admiral added the most important issue is inflation as it impacts used car prices, repair costs and wages and the cost of bodily injury claims.
These same issues were echoed by Sabre a few weeks ago.
“Admiral has delivered a solid set of results and good customer growth in the first half of the year. We are happy with this progress against the backdrop of a more turbulent cycle than usual, and high levels of inflation,” said chief executive Milena Mondini de Focatiis.
“Although, as expected, profit has decreased against last year, the unique conditions of the pandemic years make 2019 a better comparison.”
Admiral shares gained 4.3%.