Wins in reinsurance boosts growth at JLT but profits dip as it ‘transforms’
JLT Group enjoyed strong growth in its reinsurance segment in the first halve of 2018 but its profits were hit by the costs associated with its global transformation programme, which it claims will eventually benefit the business to the tune of £40 million a year.
The broker’s overall revenues for the period to June 30, 2018, increased by 3 percent to £713.5 million. Within this, it specialty book enjoyed growth of 4 percent, its reinsurance book 6 percent and its employee benefits business 4 percent.
Within specialty, it said that a new leadership and management structure in is driving closer co-ordination and increasing global opportunities. Strong performances were delivered in Latin America, Australia and in the global energy specialty.
Within reinsurance, new business wins across the UK, European and US markets were achieved, alongside the launch of its new economic capital modelling software, ANSER.
Within employee benefits, it said it won several global mandates from large multi-national clients, accompanied by good organic revenue growth in Brazil and Asia.
Its ‘underlying’ pre-tax profit increased by 10 percent to reach £108.8 million but its actual profit for the period decreased by 9 percent to £89.4 million because of the exceptional costs of the global transformation programme. It said the programme delivered benefits of £6.1m in the period and remains on track to deliver annualised benefits of £40 million by 2020 for a one-off cost of £45 million.
Dominic Burke, its group CEO, said: “The Group’s results for the first six months of 2018 represent a robust trading performance. The strategic initiatives we are implementing are already generating tangible benefits for our clients and for the Group. We are trading with real momentum as we move into the second half and we expect to report continued strong organic revenue growth and further financial progress for the full year.”
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