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CSN - Chesnara News Story

310.77p 12.8  4.3%

Last Trade - 1:40pm

Mid Cap
Market Cap £447.2m
Enterprise Value £356.8m
Revenue £539.3m
Position in Universe 497th / 1834

UPDATE 1-Chesnara profit rises; warns low interest rates to hit cash generation

Thu 29th August, 2019 8:18am
(Adds CEO comments, details from statement)
    Aug 29 (Reuters) - Pension and life insurance administrator
Chesnara Plc  CSN.L   posted higher first-half profit, as its
Dutch and UK units benefited from better investment market
conditions, but it warned low interest rates will strain its
cash generation.
    Pretax profit more than doubled to 66.6 million pounds
($81.76 million) for the six months ended June, the company said
on Thursday, driven by its UK and Scildon businesses. 
    Scildon provides risk and investment-linked products in the
Netherlands that are sold to high-net-worth customers through
    Chesnara's shares jumped 6.4% to be among the top gainers on
the FTSE small-cap index  .FTSC  in early trade, on track to
recoup some of the near 20% year-to-date drop as of Wednesday's
    However, divisional cash generation plummeted to 2.4 million
pounds, a fraction of the 53.1 million pounds reported a year
    "We foresee a sustained period of low interest rates and
this will continue to put a degree of downward pressure on our
cash generation," the company said.
    Phoenix  PHNX.L , Chesnara's larger rival, had said in
August that the money coming into its open book business had
been reduced by Brexit-related worries.
    Chesnara's Chief Executive Officer John Deane, however, said
the company did not need to make any immediate changes to its
structure regardless of the possible form of Brexit. 
    With Prime Minister Boris Johnson planning to suspend
Britain's parliament for more than a month before Brexit, many
believe that a no-deal departure is more likely.
    Chesnara's economic value earnings (EcV) net of tax, a
measure adopted by European insurance companies to make their
results more meaningfully comparable, rose to 645.1 million
pounds from 626.1 million pounds a year earlier. 
    That also came in above the 640 million pounds estimated by
Peel Hunt analysts.
($1 = 0.8145 pounds)

 (Reporting by Muvija M and Noor Zainab Hussain in Bengaluru;
Editing by Bernard Orr and Sriraj Kalluvila)
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