Final Results

RNS Number : 0485H
Hampden Underwriting Plc
23 May 2011
 



23 May 2011

 

Hampden Underwriting plc

("Hampden Underwriting" or the "Company")

 

Preliminary results for the year ended 31 December 2010

 

Hampden Underwriting, which provides investors with a limited liability direct investment into the Lloyd's insurance market, announces its preliminary results for the year ended 31 December 2010.

 

Highlights

 

·    Group's third acquisition of a Lloyd's corporate member during the year

·    Premium written during the year totalled £7.9m

·    Net profit attributable to equity shareholders of £132,000

·    Earnings per share of 1.78p

·    Net assets increase to £7.9m

·    Net assets per share of £1.06

 

 

 

Commenting upon these results Chairman, Sir Michael Oliver said:

 

"As commented on by the Group's Lloyd's Advisers, Hampden Agencies in this report, a profit was achieved despite the year having been adversely affected by the widely reported losses emanating from the UK motor market coupled with the Chilean earthquake.

 

We share the view of Hampden Agencies that the loss of investment return, combined with the improvements in risk management both centrally by Lloyd's and by Managing Agents, will enable the syndicates we support to successfully manage this difficult phase of the cycle. Losses inevitably give rise to opportunities in the insurance industry and we look forward to taking full advantage of these when they arise."

 

 

 

Enquiries:

 

Hampden Underwriting

 

Jeremy Evans

020 7863 6567

Smith & Williamson Corporate Finance

 

David Jones

020 7131 4000

 



Chairman's statement

 

It is gratifying to be able to report that, as predicted when last year's half year result was announced, the year has ended satisfactorily with a full year profit, albeit smaller than last year's with a corresponding further increase in our net asset value. As commented on by the Group's Lloyd's Advisers, Hampden Agencies in this report, a profit was achieved despite the year having been adversely affected by the widely reported losses emanating from the UK motor market coupled with the Chilean earthquake.

 

2010 was nevertheless a frustrating year for the Company. Our share price remains extremely volatile with modest trades resulting in substantial swings in its fortunes. One way of addressing the problem is growth, with more shares in issue held by a broader shareholder base. Last year we pursued two opportunities which would have had a transformational effect on the size of the Company. Sadly both fell at the final fence much to the disappointment of the Board. Rest assured however, our appetite for growth remains undiminished and we continue to evaluate other opportunities as they arise.

 

The 2008 year was the first year the Company underwrote in its own right and, with its profitable outcome together with the substantial distributable reserves established through our purchase of corporate members underwriting in prior years, we had hoped to herald the payment of our first dividend. However, the first quarter of 2011 is expected to be the worst in history for catastrophe losses; namely the tragic events in New Zealand, Australia and, of course, Japan. It is still unclear as to the likely impact of these losses on our portfolio: in particular the 2010 account. Your Board debated long and hard but finally came to the conclusion that in view of this uncertainty, it would be imprudent to pay a dividend now. It was not a decision taken lightly and, as and when the market gets a better feel for the likely impact of these catastrophic events, it is certainly one that we will revisit.

 

We share the view of Hampden Agencies that the loss of investment return, combined with the improvements in risk management both centrally by Lloyd's and by Managing Agents, will enable the syndicates we support to successfully manage this difficult phase of the cycle. Losses inevitably give rise to opportunities in the insurance industry and we look forward to taking full advantage of these when they arise.

 

Sir Michael Oliver

Non-executive Chairman



Lloyd's Adviser's Report

 

Market outlook

The insurance and reinsurance industry began 2011 in robust financial health with the asset side of balance sheets having been repaired following the financial losses sustained in 2008 and the first quarter of 2009. Both insurance and reinsurance capital bases at year end 2010 were at record highs. In the United States, which remains Lloyd's principal market being responsible for around 60% of premiums underwritten, the policyholders' surplus (a measure of supply of capacity) increased by 9% to $556.9bn at year end 2010 from $511.4bn a year earlier. Similarly, global reinsurance capital reached an all time high at 31 December 2010 increasing by 17% to $470bn from $402bn a year earlier, according to Aon Benfield Analytics.

 

The insurance pricing cycle is a classic supply-led cycle with demand playing a more limited role other than in catastrophe exposed reinsurance lines. Demand has been impacted by economic recession and low growth recoveries in developed markets with net written insurance premiums in the United States falling by 6.9% between 2007 and 2009, the first three-year decline since 1930 to 1933. However, demand has now begun to recover with a rise in net written premiums of 0.9% in 2010.

 

Currently, most lines of business remain challenging with pure underwriting margins being squeezed and capital providers being dependent on reserve releases and investment returns to generate their return on equity. Excess capital remains a major obstacle to a sustainable market turn.

 

We now expect that turn to be closer with the first quarter of 2011 going down in history as the worst quarter ever for the global insurance and reinsurance markets.  Aon Benfield estimates the reinsurance market is expected to face a bill of $52.6bn which compares with $40.6bn for the whole of 2010. Of these losses, the most notable were the New Zealand earthquake in February, estimated to cost $10bn, and the Japanese earthquake on 11 March where estimated insured losses range from $25bn to $45bn, albeit 20% or less than the total economic losses of $200bn-$300bn. The Japanese earthquake is likely to be the most expensive insured earthquake loss in history being larger than the 1994 Northridge earthquake in California, which in 2010 dollars cost insured losses of $22.5bn.

 

Loss affected international treaty reinsurance programmes have, or are expected to pay, increased rates at renewal with rises being seen of up to 50% on Japanese earthquake only cover. In the United States, at the June and July renewals this year, we expect rate increases of up to 10% on cat exposed treaty reinsurance compared with the 6% to 10% reductions seen at 1 January, using Guy Carpenter numbers. The expected rate increases are a combination of increased demand and a higher cost of capital due to version 11 of the RMS catastrophe model for US wind risks which better reflects the impact of Hurricane Ike in 2008 on modelled loss exposures. Encouragingly, the market for direct and facultative property covers in the United States, where Lloyd's is a major player, has begun to recover with Willis reporting rate increases of up to 5%.

 

Among the largest rate rises being seen are in UK private motor where the market moved into loss in 2009 and 2010 but has now responded with the AA reporting record rate increases in the 12 months to end of March 2011 of 40%.

 

We are now in the challenging phase of the insurance cycle with reserve releases expected to reduce, no sign of any improvement in the low investment returns and competitive market conditions in many classes of business. In the face of challenging market conditions, the Lloyd's market has proved resilient and, in particular, the portfolio of syndicates on which Hampden Underwriting participates.

 

We remain of the view that the long term loss of investment return, combined with the improvements in risk management both centrally by Lloyd's and by managing agents, will enable the syndicates supported by Hampden Underwriting to successfully manage this phase of the cycle. In the short term, there are undoubtedly opportunities to charge higher rates on loss affected business, although it is not yet clear how sustainable rate rises will be given the level of excess capital in the industry. Against this backdrop, we remain patient waiting for a more significant change in the pricing cycle and to be able to take advantage of the more broad-based opportunities which will undoubtedly arise.

 

Lloyd's competitive position remains resilient

Lloyd's operating results continue to be excellent using both the three-year and annual reporting measures. The 2008 three-year account result announced on 30 March 2011 was a 10.3% return on capacity despite catastrophe losses from Hurricane Ike and significant underwriting losses from UK motor. Lloyd's annually accounted results for 2010 totalled a pre-tax profit of £2,195m, despite claims from the Chilean earthquake, the first New Zealand earthquake, Australian floods and the Deepwater Horizon oil rig in the Gulf of Mexico.

 

The traditional method for performance comparisons of competing insurance businesses is an analysis of the combined ratio, which is the ratio of net incurred claims plus net operating expenses to net earned premiums. In 2010, Lloyd's combined ratio was the second best in its peer group at 93%, with Lloyd's average combined ratio of 87.4% being the same as its nearest competitor, Bermudian reinsurers, over the period 2006 to 2010.

 

Hampden Underwriting's performance

Hampden Underwriting's first underwriting year through the Hampden Corporate Member is the 2008 Account with underwriting capacity of £5.1m and a further £3.6m from the three Nameco acquisitions (Nameco 321, Nameco 365 and Nameco 605). Hampden Underwriting has also added four smaller bespoke participations on MAP Syndicate 6103, Hiscox Syndicate 6104, Amlin Syndicate 6106 and ICAT Syndicate 4242, all of which give additional exposure to US catastrophe business which remains well rated. For 2011 an additional bespoke participation was added on Ark Syndicate 6105 which provides exposure to composite classes, excluding casualty reinsurance.

 

2008 account

Hampden Underwriting's portfolio result including capacity acquired through the Nameco purchases is a profit of 8.7% of capacity before Members' fees. This result is a satisfactory performance given that 2008 marked the third worst year on record for insured catastrophe losses and the exposure to UK motor losses, the latter being the main reason for the underperformance by 1.6 percentage points compared with the Lloyd's average. In UK motor there was an escalation in the frequency and severity of bodily injury claims. Here, claims costs have exceeded previous estimates due in part to recession based fraudulent claims but mainly because of the growth of accident management companies which have added to the costs of settling non-fault claims.

 

2009 account

US catastrophe reinsurance exposure came off risk at the end of June 2010 and insurance exposure on 31 December 2010. The non-catastrophe classes remain immature where rating conditions are more challenging and UK motor remains in loss. However, this account is benefiting from the benign calendar year for catastrophe losses and, despite most of the losses from the Chilean earthquake and the Deepwater Horizon rig explosion falling back to 2009, early estimates for the 2009 Account are encouraging with Hampden Underwriting's portfolio averaging a mid-point profit of 12.7% of capacity compared with the Lloyd's Market Average of 9.2% before Members' fees, a healthy outperformance of the Lloyd's average of 3.5 percentage points.

 

2010 account

The 2010 Account has already been affected by a number of natural catastrophes occurring both in calendar year 2010 and in 2011. Significant losses include the Chilean earthquake and Deepwater Horizon energy loss (both also affected 2009), two New Zealand earthquakes, Australian floods, the Gryphon oil and gas installation in the North Sea, April tornados in the United States and the largest so far being the Japanese earthquake and tsunami.

 

Given the number of major losses impacting the 2010 Account and forecasts of an active 2011 hurricane season to which some insurance business remains exposed, we expect the 2010 Account to move into loss, although at this stage, given the Account is still on risk and the Japanese earthquake loss is subject to material uncertainty, we are not providing a formal estimate.

 

Earthquake losses typically deteriorate due to latent damage as previously undamaged buildings become unsafe; an added uncertainty is the exposure to Contingent Business Interruption losses from non-Japanese businesses adversely affected by interruptions in the supply of components and finished products. To put the Japanese earthquake loss into context we expect it to settle within the modelled Realistic Disaster Scenario for a Tokyo earthquake (the modelled loss for 2010 was $53bn excluding Contingent Business Interruption) where there is a greater concentration of exposures; the Hampden Underwriting Business Plan RDS in 2010 for a Tokyo earthquake was 9.6% of capacity, net of reinsurance. During 2010 margins remained under pressure in the non-catastrophe exposed accounts and UK motor is again expected to be in loss. A first full set of early estimates from Managing Agents will be available at the end of May as at Quarter 5 on the 2010 Account.

 

2011 account

Hampden Underwriting's portfolio for 2011 provides a good spread of business across managing agents and classes of business with motor and liability providing a balance to the catastrophe exposed reinsurance and property business, as well as contributing to lower capital requirements due to Lloyd's credits for diversification.

 

28.6% of the capacity is in the three syndicates rated A by Hampden Agencies Ltd ("HAL"), being Syndicates 386, 609 and 2791, with Syndicate 2791 being the largest holding at 17.3% of capacity. 56.4% of the portfolio is in syndicates rated B, including the Kiln Syndicate 510 which makes up 15.8% of the portfolio and has a good track record of outperforming the market. 15.0% of the capacity is allocated to C rated syndicates.

 

The ratings are intended to indicate HAL's view of expected performance of a syndicate over a cycle, "A" being superior, "B" being above average and "C" being average.

 

Portfolio risk management

HAL manages the portfolio risk by diversification across classes of business, syndicates and managing agents as well as controlling the downside, in the event of a major loss, by monitoring the aggregate losses estimated by managing agents to Realistic Disaster Scenarios ("RDS"). HAL considers risk in the context of potential return and seeks to actively manage catastrophe exposure, dependent on market conditions.

 

Lloyd's first utilised RDS in 1995 to evaluate exposure at both syndicate and market level. These scenarios continue to be refined and updated to take account of loss experience and exposure values. For 2011 the largest loss modelled is a Florida windstorm totalling $125bn, which compares with only $60bn in 2005 indicating additional conservatism.

Exposure management is a critical component of being able to manage the insurance cycle.

 

Top 10 Syndicate Holdings

 

Syndicate

Managing Agent

2011 Syndicate capacity

 

 £'000

2011

Group portfolio capacity

£'000

2011

Group portfolio

 

% of total

Class

2791

Managing Agency Partners Ltd

504,896.1

1,514.8

17.3

Reinsurance

510

R.J. Kiln & Co. Ltd

923,222.4

1,383.4

15.8

US$ Property

623

Beazley Furlonge Ltd

215,214.7

1,037.3

11.8

US$ Non-Marine Liability

609

Atrium Underwriters Ltd

274,810.1

682.5

7.8

Energy

33

Hiscox Syndicates Ltd

900,000.6

636.4

7.3

US$ Property

958

Omega Underwriting Agents Ltd

279,999.7

629.7

7.2

Reinsurance

218

Equity Syndicate Mangement Ltd

486,248.9

587.9

6.7

Motor

386

QBE Underwriting Ltd

364,999.8

304.1

3.5

Non-US$ Non Marine Liability

2121

Argenta Syndicate Management Ltd

200,000.0

273.9

3.1

US$ Property

557

R.J. Kiln & Co Ltd

60,000.5

261.0

3.0

Reinsurance

Subtotal



7,311.0

83.5


Portfolio Total


8,760.8

100.0


 

The two largest classes of business are reinsurance and US$ property insurance. As rating levels continue to be more attractive in reinsurance than insurance, the weighting of reinsurance remains higher than insurance. These classes include business exposed to catastrophes and therefore the next two largest classes, being US casualty and motor, provide balance to these exposures.

 



Consolidated statement of comprehensive income

Year ended 31 December 2010

 



Year ended

Year ended



31 December

31 December



2010

2009


Note

£'000

£'000

Gross premium written


7,887

8,610

Reinsurance premium ceded


(1,436)

(1,753)

Net premiums written


6,451

6,857

Change in unearned gross premium provision


462

(8)

Change in unearned reinsurance premium provision


(122)

116



340

108

Net earned premium


6,791

6,965

Net investment income

3

368

375

Other underwriting income


4

24

Other income


116

337



488

736

Revenue


7,279

7,701

Gross claims paid


(4,582)

(2,836)

Reinsurance share of gross claims paid


729

472

Claims paid, net of reinsurance


(3,853)

(2,364)

Change in provision for gross claims


(398)

(1,457)

Reinsurance share of change in provision for gross claims


58

170

Net change in provision for claims


(340)

(1,287)

Net insurance claims and loss adjustment expenses


(4,193)

(3,651)

Expenses incurred in insurance activities


(2,425)

(2,513)

Other operating expenses


(533)

(552)

Operating expenses


(2,958)

(3,065)

Operating profit before tax

4

128

985

Income tax credit/(expense)


4

(261)

Profit attributable to equity shareholders


132

724





Earnings per share attributable to equity shareholders




Basic and diluted

5

1.78p

9.77p

The profit/(loss) attributable to equity shareholders and earnings per share set out above are in respect of continuing operations.

 



Consolidated statement of financial position

At 31 December 2010

 



31 December

31 December



2010

2009


Note

£'000

£'000

Assets




Intangible assets

6

1,274

1,216

Financial investments

7

13,841

10,441

Reinsurance share of insurance liabilities:




- reinsurers' share of outstanding claims


2,592

1,581

- reinsurers' share of unearned premiums


425

349

Other receivables, including insurance receivables


6,039

4,910

Prepayments and accrued income


901

873

Deferred income tax assets


12

12

Cash and cash equivalents


3,320

2,111

Total assets


28,404

21,493

Liabilities




Insurance liabilities




- claims outstanding


13,104

7,301

- unearned premiums


3,377

3,402

Other payables, including insurance payables


2,819

2,215

Accruals and deferred income


577

226

Current income tax liabilities


-

106

Deferred income tax liabilities


655

503

Total liabilities


20,532

13,753

Shareholders' equity




Share capital

8

741

741

Share premium

8

6,261

6,261

Retained earnings

8

870

738

Total shareholders' equity


7,872

7,740

Total liabilities and shareholders' equity


28,404

21,493

 



Consolidated statement of cash flows

Year ended 31 December 2010

 


Year ended

Year ended


31 December

31 December


2010

2009

Cash flow from operating activities

£'000

£'000

Results of operating activities

128

985

Interest received

(31)

(47)

Investment income

(315)

(179)

Income tax receipt

68

159

Recognition of negative goodwill

(116)

(206)

Profit on sale of intangible assets

-

(133)

Amortisation of intangible assets

246

217

Change in fair value of investments recognised in the statement of comprehensive income

(21)

(88)

Changes in working capital:



Increase in other receivables

(1,157)

(2,616)

Increase in other payables

955

1,613

Net increase in technical provisions

4,691

4,472

Net cash inflow from operating activities

4,448

4,177

Cash flows from investing activities



Interest received

31

47

Investment income

315

179

Purchase of intangible assets

(26)

(67)

Proceeds from disposal of intangible assets

-

135

Purchase of financial investments

(3,400)

(6,310)

Acquisition of subsidiary, net of cash acquired

(159)

19

Net cash outflow from investing activities

(3,239)

(5,997)

Cash flows from financing activities



Net proceeds from issue of ordinary share capital

-

-

Net cash inflow from financing activities

-

-

Net increase/(decrease) in cash, cash equivalents and bank overdrafts

1,209

(1,820)

Cash, cash equivalents and bank overdrafts at beginning of year

2,111

3,931

Cash, cash equivalents and bank overdrafts at end of year

3,320

2,111

Acquisition of subsidiary



- cash or cash equivalent paid

(379)

(497)

- cash acquired

220

516

Acquisition of subsidiary, net of cash acquired

(159)

19

 



Statement of changes in shareholders' equity

Year ended 31 December 2010

 


Ordinary

Share

Retained



share capital

premium

earnings

Total


£'000

£'000

£'000

£'000

At 1 January 2009

741

6,261

14

7,016

Profit for the year

-

-

724

724

At 31 December 2009

741

6,261

738

7,740

At 1 January 2010

741

6,261

738

7,740

Profit for the year

-

-

132

132

At 31 December 2010

741

6,261

870

7,872






 



Notes to the Financial Statements

 

1. Accounting policies

The principal accounting policies adopted in the preparation of the financial information set out in this announcement are set out in the full financial statements for the year ended 31 December 2010 (the "Financial Statements").

 

Basis of preparation

The Financial Statements have been prepared in accordance with International Financial Reporting Standards ("IFRS"), incorporating International Financial Reporting Interpretations Committee ("IFRIC") interpretations endorsed by the European Union ("EU") and with those parts of the Companies Act 2006, applicable to companies reporting under IFRS. The Financial Statements have been prepared under the historical cost convention.

 

The preparation of Financial Statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from these estimates. The Group participates in insurance business through its Lloyd's corporate members. Accounting information in respect of syndicate participations is provided by the syndicate managing agents and is reported upon by the syndicate auditors.

 

International Financial Reporting Standards

The following standards and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2010.

 

The adoption of these standards does not have a material impact on the Group's Financial Statements.

New and amended standards adopted by the Group

- IFRS 3 (revised) "Business Combinations" and consequential amendments to IAS 27 "Consolidated and Separate Financial Statements", IAS 28 "Investments in Associates" and IAS 31 "Interests in Joint Ventures".

- IAS 27 (revised) requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses.

- IAS 36 (amendment) "Impairment of Assets" (effective 1 January 2010).

 

New and amended standards and interpretations mandatory for the first time for the financial year beginning 1 January 2010 but not currently relevant to the Group (although they may affect the accounting for future transactions and events)

- IFRS 2 (amendment) "Group Cash-settled Share-based Payment Transactions" (effective 1 January 2010).

- IFRIC 17 "Distribution for Non-cash Assets to Owners" (effective on or after 1 July 2009).

- IFRIC 18 "Transfers of Assets From Customers" (effective for transfers of assets received on or after 1 July 2009).

- IFRIC 9 "Reassessment of Embedded Derivatives" and IAS 39 "Financial Instruments: Recognition and Measurement" (effective 1 January 2009).

- IFRIC 16 "Hedges of a Net Investment in a Foreign Operation" (effective 1 July 2009).

- IAS 38 (amendment) "Intangible Assets" (effective 1 January 2010).

- IAS 1 (amendment) "Presentation of Financial Statements" (effective 1 January 2010).

- IFRS 5 (amendment) "Non-current Assets Held for Sale and Discounted Operations" (effective 1 January 2010).

 

At the date of preparation of these consolidated financial statements a number of standards and other interpretations had been published by the International Accounting Standards Board but were not yet effective and have therefore not been adopted in these consolidated financial statements. These are:

- IFRS 9 "Financial Instruments".

- IAS 24 (revised) "Related Party Disclosures".

- IFRS 7 "Financial Instruments: Disclosures".

- IAS 12 "Income Taxes".

- IAS 32 "Financial Instruments: Presentation".

- IFRIC 19 "Extinguishing Financial Liabilities with Equity Instruments".

- IFRIC 14 (revised) "The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction".

 

The Directors do not anticipate that the adoption of these standards will have a material impact on the Group Financial Statements.

 

2.         Segmental information

 

Primary segment information

The Group has three primary segments which represent the primary way in which the Group is managed:

- syndicate participation;

- investment management; and

- other corporate activities.

 




Other



Syndicate

Investment

corporate



participation

management

activities

Total

Year ended 31 December 2010

£'000

£'000

£'000

£'000

Net earned premium

6,791

-

-

6,791

Net investment income

365

3

-

368

Other underwriting income

4

-

-

4

Other income

-

-

116

116

Net insurance claims and loss adjustment expenses

(4,193)

-

-

(4,193)

Expenses incurred in insurance activities

(2,425)

-

-

(2,425)

Amortisation of syndicate capacity

-

-

(158)

(158)

Other operating expenses

(156)

-

(219)

(375)

Results of operating activities

386

3

(261)

128

 

 




Other



Syndicate

Investment

corporate



participation

management

activities

Total

Year ended 31 December 2009

£'000

£'000

£'000

£'000

Net earned premium

6,965

-

-

6,965

Net investment income

228

147

-

375

Other underwriting income

24

-

-

24

Other income

-

-

337

337

Net insurance claims and loss adjustment expenses

(3,651)

-

-

(3,651)

Expenses incurred in insurance activities

(2,513)

-

-

(2,513)

Amortisation of syndicate capacity

-

-

(217)

(217)

Other operating expenses

(57)

-

(278)

(335)

Results of operating activities

996

147

(158)

985

 

Secondary segment information

The Group does not have any secondary segments as it considers all of its activities to arise from trading within the UK.

 

3.         Net investment income

 


Year ended

Year ended


31 December

31 December


 2010

 2009


£'000

£'000

Investment income at fair value through income statement

315

179

Realised gains on financial investments at fair value through income statement

137

169

Unrealised gains/(losses) on financial investments at fair value through income statement

21

88

Investment management expenses

(136)

(108)

Bank interest

31

47

Net investment income

368

375

 

4.         Operating profit before tax

 


Year ended

Year ended


31 December

31 December


 2010

 2009


£'000

£'000

Operating profit before tax is stated after charging:



Directors' remuneration

65

65

Amortisation of intangible assets

246

217

Auditors' remuneration:



- audit of the Parent Company and Group Financial Statements

24

20

- audit of subsidiary company Financial Statements

3

3

- services relating to taxation

5

5

- other services pursuant to legislation

15

11

- other services

9

-

 

5.         Earnings per share

 

Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

 

The Group has no dilutive potential ordinary shares.

 

Earnings per share have been calculated in accordance with IAS 33.

 

Reconciliation of the earnings and weighted average number of shares used in the calculation is set out below.

 


Year ended

Year ended


31 December

31 December


 2010

 2009

Profit/(loss) for the period

£132,000

£724,000

Weighted average number of shares in issue

7,413,376

7,413,376

Basic and diluted earnings/(loss) per share

1.78p

9.77p

 

6.         Intangible assets

 


Syndicate


capacity


£'000

Cost


At 1 January 2010

1,649

Additions

26

Disposals

-

Acquired with subsidiary undertaking

304

At 31 December 2010

1,979

Amortisation


At 1 January 2010

433

Charge for the year

246

Disposals

-

Acquired with subsidiary undertaking

26

At 31 December 2010

705

Net book value


As at 31 December 2010

1,274

As at 31 December 2009

1,216

 

7.         Financial investments

 

Financial assets at fair value through Statement of Comprehensive Income

 

As at 31 December 2010, the Group held the following financial instruments carried at fair value on the statement of financial position:

 

The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

 

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

 

The Group has no level 3 investments.

Assets measured at fair value

 


2010

Level 1

Level 2


£'000

£'000

£'000

Shares and other variable yield securities

1,149

1,149

-

Debt securities and other fixed income securities

8,502

8,502

-

Participation in investment pools

504

504

-

Loans guaranteed by mortgage

77

-

77

Holdings in collective investment schemes

76

-

76

Deposits with credit institutions

55

-

55

Funds held at Lloyd's

3,473

3,473

-

Other

5

-

5

Total - market value

13,841

13,628

213





 

 


2009

Level 1

Level 2


£'000

£'000

£'000

Shares and other variable yield securities

583

583

-

Debt securities and other fixed income securities

5,413

5,413

-

Participation in investment pools

201

201

-

Loans guaranteed by mortgage

37

-

37

Holdings in collective investment schemes

-

-

-

Deposits with credit institutions

119

-

119

Funds held at Lloyd's

4,088

4,088

-

Other

-

-

-

Total - market value

10,441

10,285

156

 

The Directors consider any credit risk or liquidity risk not to be material.

 

8.         Share capital and share premium

 


Ordinary

Preference



share

share



capital

capital

Total

Authorised

£'000

£'000

£'000

29,500,000 ordinary shares of 10p each and 100,000 preference shares of 50p each at 1 January 2010

2,950

50

3,000

29,500,000 ordinary shares of 10p each and 100,000 preference shares of 50p each at 31 December 2010

2,950

50

3,000






Ordinary




share

Share



capital

premium

Total

Allotted, called up and fully paid

 £'000

£'000

£'000

7,413,376 ordinary shares of 10p each and share premium at 1 January 2010

741

6,261

7,002

7,413,376 ordinary shares of 10p each and share premium at 31 December 2010

741

6,261

7,002

 

9.  Financial statements

 

The financial information set out in this announcement does not constitute statutory accounts but has been extracted from the Group's Financial Statements which have not yet been delivered to the Registrar. The Group's annual report and Financial Statements will be posted to shareholders shortly. Further copies will be available from the Company's registered office: Hampden House, Great Hampden, Great Missenden, Buckinghamshire HP16 9RD and on the Company's website www.hampdenplc.com.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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