Direct Line Insurance Group PLC said Monday that pretax profit fell in 2020 and declared both a final dividend and a share buyback.
The FTSE 100 non-life insurer made a pretax profit of 451.4 million pounds ($624.6 million), down from GBP509.7 million a year prior. The company attributed the fall to a drop in operating profit, and GBP39.4 million of restructuring and one-off costs after investing in cost-saving initiatives.
Gross written premiums fell to GBP3.18 billion from GBP3.20 billion. Direct Line's combined operating ratio --the proportion of revenue eaten up by losses and expenses-- came to 91.0%, compared with 92.2% in the previous year. A ratio below 100% indicates profitable underwriting.
The insurer's solvency capital ratio, an important measure of balance-sheet strength, stood at 191% after taking dividends into account, improving from 165% at the end of 2019.
The board declared a final dividend of 14.7 pence, having cancelled and paid as a special dividend last year's final dividend to conserve cash amid the coronavirus pandemic.
The company said it would buyback up to GBP100 million of shares, and added it would continue to target a combined operating ratio of 93% to 95% over 2021.
Write to Joe Hoppe at joseph.hoppe@wsj.com
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March 08, 2021 at 02:33PM
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Direct Line declares dividend, buyback - MarketWatch
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