27 Jun 2005 07:00
Kiln PLC27 June 2005 Kiln plc AGM Trading Statement Kiln plc, the specialist Lloyd's insurance group, is holding its Annual GeneralMeeting today at which chairman Nick Cosh will make a statement on currenttrading and market conditions. Kiln produced record profits in 2004, in spite of the unusually high level ofhurricane and windstorm activity in the second half of the year, and the goodtrading conditions that prevailed in 2004 are continuing in 2005. In the absenceof a major catastrophe, the prospects for 2005 appear to be good,notwithstanding the above average loss activity so far, including WindstormErwin. The Kiln portfolio of renewal business remains resilient, with rating levels at98.4% of the equivalent price twelve months ago. The renewal retention level forour flagship Syndicate 510 during the first quarter remained satisfactoryalthough the Kiln underwriters cut back the amount of new business they wereprepared to accept by some 38%. This is in line with the company's strategy ofunderwriting for profit and is to be expected at a time when there is somedeterioration in underwriting conditions; it is encouraging to note the qualityof our core portfolio remains good, both in terms of pricing and stability. Current rating levels for various classes of renewal business being accepted bySyndicate 510 as a percentage of those 12 months ago are shown below. Rate changes in Syndicate 510 by class of business June 2005/2004 %Accident & Health 99.9Property 97.4Reinsurance 98.4Marine 100.9Aviation 99.2 Premium income written by all Kiln managed syndicates to 31 May 2005 was £436.3million. This is an increase of 6% from £410.5 million at the same time lastyear, measured on the basis of traditional Lloyd's year of account premiumincome monitoring at 100% syndicate level. Kiln owns 40% of the syndicatecapacity in 2005 (2004: 39%). At 31 May 2005, Kiln had written 62% of its totalcapacity for the year, compared with 60% at the same time last year. Risk count for the first quarter of 2005 is down 8% on last year, reflecting thecontinuing disciplined approach to underwriting for profit rather than volume.We have submitted our business plans to Lloyd's, and are planning to reduce ourcapacity at Lloyd's to £630.5 million in 2006, down 10% from £703.6 million in2005. Kiln does not believe that the implementation of IFRS will have a significantimpact on the fundamental economics of its business, its capital solvency or onits ability to pay dividends and the company will provide the market with thedetail relating to this on 30 June 2005. Kiln will announce its interim results for the six months to 30 June 2005 on 13September 2005. Kiln chairman, Nick Cosh, said: "The stable rating environment and the healthy level of premiums written,combined with the strong potential profits that we have in the pipeline, meanthat our expectations for the year remain in line with analysts' forecasts underUK GAAP." 27 June 2005 Enquiries: Kiln plc 020 7886 9000 Edward Creasy, Chief Executive Officer Kate Rogers, Head of Corporate Communications College Hill 020 7457 2020 Tony Friend Roddy Watt This information is provided by RNS The company news service from the London Stock Exchange