Delays contribute to challenging H1 for R&Q

Randall & Quilter (R&Q), the specialist non-life insurance investor, service provider and underwriting manager, posted a loss for the first half of the year but its chairman remains hopeful for a stronger second half.

London-listed R&Q posted a £600,000 loss for the six months ending June 30, 2014 compared with a £3 million pre-tax profit in the same period of 2013.

Its gross written premiums grew to £16.8 million in the first half of 2014, compared with £4.2 million in the first half of 2013.

R&Q posted a total group income of £35.1 million, compared with £26.2 million in the first half of 2013.

Its insurance investments division achieved a higher operating result of £1.6 million, compared with £800,000 in the first half of 2013. The investor’s insurance services division saw its profit fall to £3.8 million, down from £6.3 million in the first half of 2013, as a strong performance in UK operations was offset by a lower result in the US.

R&Q’s underwriting management division saw an operating loss of £700,000 compared with an operating profit of £100,000 in the same period of 2013.

The investor said that Syndicate 1991 nearly doubled in capacity to £150 million with support from all previous capital providers as well as Qatar Re, which joined for the 2014 year of account. It also added that it had been an active period for acquisitions, including a Bermuda captive, a Black Lung Trust, an Isle of Man insurer, a broker runoff and a retrospective reinsurance.

Ken Randall, chairman and chief executive officer said: "We anticipated that 2014 was going to be challenging from a financial perspective, most especially in the first half which is always impacted by the second half income bias in our service businesses, the timing of the actuarial reviews of our run-off portfolios and April bonus payments. Delays in the completion of certain anticipated legacy transactions due to extended regulatory and counterparty processes, together with time and expenses incurred on the Accredited acquisition process also affected the result.

“Whilst financial performance was weak in the first half, as flagged in the AGM trading update, 2014 has seen many positive developments. We have progressed a number of legacy insurance transactions in the first six months of the year, using our newly enhanced and flexible legacy platforms, and the newly refinanced bank facility provides valuable additional long term investment capacity for our healthy ongoing pipeline.”