REG - Helios Underwriting - Half Year Results
28/09/2023 07:00
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RNS Number : 9083N Helios Underwriting Plc 28 September 2023
28 September 2023
Helios Underwriting plc
("Helios" or the "Company")
Interim Results for the Six Months Ended 30 June 2023
Helios Underwriting plc is an investment vehicle which provides shareholders
with participation in the Lloyd's insurance market through an actively managed
spread portfolio of syndicate capacity, announces its unaudited results for
the six months ended 30 June 2023.
· Gross written premiums increased by 28% to £160 (HY 2022 -
£124m) reflecting the increase in the capacity portfolio
· Further rate increase achieved by the Lloyd's market of 9.1% (HY
2022 7.7%) over the six month period continuing the excellent market
conditions at Lloyd's.
· 252% improvement in the underwriting result to £11.6m (HY 2022-
£3.3m) with an 88% combined ratio
· The increase of 33% in the underwriting exposure in 2023 Year of
Account to £244m of retained capacity will contribute to the underwriting
result in the future.
· Investment returns of £3.1m (HY 2022 - losses £3.5m) have been
booked in the first six months benefiting from the increased interest rates
· Operating profit is £6.0m (30 June 2022 - a loss of £3.4m)
· The net tangible asset value per share is £1.54 per share (FY
2022 - £1.52 per share)
Martin Reith, Chief Executive, provides the following overview:
"The continued improvement in market conditions presents exciting
opportunities for Helios. The portfolio is positioned to benefit from pricing
and market discipline and underwriting profits are now being recognised from
five years of improved underwriting margins. We are confident that given
market discipline, we should continue to see favorable returns across our
portfolio. The resilience of these conditions seem to be more sustainable and
we fully expect our portfolio to thrive.
"The results are a little skewed as a consequence of the recent rapid 33%
growth in our retained capacity in 2023 and a cautious approach to reserving
adopted within our portfolio. With the passage of time and as the better loss
ratio premium earns through, we are confident that our portfolio will
demonstrate outperformance against a prudent reserving strategy. The impact
of the increased yields on the Group investments will make a contribution in
the future."
Helios Underwriting plc
Martin Reith - Chief
Executive
Arthur Manners - Chief Financial
Officer +44 203 965 6441
Numis
Giles
Rolfe +44
(0)20 260 1000
Charles Farquhar
Buchanan
Helen Tarbet / George Beale
+44 (0)7872 604 453
+44
(0)20 7466 5111
Chairman's statement
Six months ended 30 June 2023
Helios Underwriting plc is the only listed vehicle where investors can own a
share in a company with a broad spread of Lloyd's syndicate participations and
where the Funds at Lloyd's (FAL) ratio is less than 50% meaning that for every
£1 of capital at work it underwrites £2 or more in capacity.
Under the direction of our new Chief Executive, Helios has plans to continue
its growth and broaden still further into insurance underwriting activities at
a time when market conditions are attractive.
These conditions give us confidence to return capital to shareholders,
initially through a share buyback programme and the Board will be reviewing
the dividend policy in the future.
SUMMARY FINANCIAL INFORMATION
6 months to 30 June
2023 2022
£000's £000's
Gross written premium 158,509 124,067
Underwriting result 11,658 3,291
Investment Income - syndicates 3,160 (3,560)
Net quota share (4,378) (383)
Net profits from portfolio 10,441 (652)
Other income 739 833
Costs (5,146) (3,612)
Operating profit / loss for the period 6,034 (3,431)
Profit/(loss) after tax 4,351 (3,264)
Earnings per share 5.71p (4.44)p
Net Tangible Asset Value per Share £1.54p £1.52p
The combined underwriting result has improved substantially as the underlying
profitability of the portfolio starts to be recognised. Given the improved
terms on property and property catastrophe business achieved at the beginning
of the year, the impact of worldwide natural catastrophes in the period has
been muted.
2023 2022 % Increase
£000's £000's
Gross premium written 160,493 124,067 28%
Net earned premium 97,316 59,990 62%
Net insurance claims & operating expenses (85,658) (56,699) 51%
Underwriting result 11,658 3,291 254%
Investment Income 3,160 (3,560)
Operating profit/loss 14,819 (269)
Combined ratio 88% 95%
The figures in the above table are gross of pre-acquition
The increase in the gross written premiums reflect the growth of the capacity
portfolio to £310m for the 2023 underwriting year. The combined portfolio
ratio of 88% is in line with the combined ratio for the Lloyds market of 85%
and has improved substantially given the contribution of the profitability
from the 2022 year.
6 months to 30th June
2021 and prior 2022 2023 Total
£000's £000's £000's £000's
Net Earned Premium 4,113 68,516 24,687 97,316
Underwriting result 1,973 13,215 (3,531) 11,658
Investment Income 1,801 1,165 195 3,160
Operating (loss) / profit 3,774 14,380 (3,336) 14,818
Quota Share Reinsurers (1,429) (3,679) 730 (4,378)
Total Group Underwriting Profit/(loss) 2,345 10,701 (2,606) 10,440
The underwriting contribution from the 2022 underwriting years reflects the
expected development of those years after recognising underwriting losses at
an early stage. 2023 to date represents an initial loss due to the higher
proportion of expenses and reinsurance costs allocated to the first six months
of the underwriting year. The future recognition of the Net Earned Premiums
from 2023 year, given the increased underwriting exposure, will benefit the
underwriting result in the future.
6 months to 30th June
2023 2022
£000's £000's
Stop loss costs (1,083) (783)
Excess of Loss costs (1,778) (812)
Operating costs (2,285) (2,017)
Total Costs (5,146) (3,612)
The excess of loss costs has increased in line with the additional funds
provided by reinsurers and by banks. Operating costs have been impacted by
the additional resources taken on to manage the larger portfolio
Financial Investments £000's Investment Return - £000's Yield
Syndicate investment assets 182,253 3,160 1.71%
Group investment assets 77,297 (19) 0.03%
259,550 3,141 1.21%
Helios's share of the syndicate investments has increased by 43% since 30 June
2022 and has generated a positive return of 1.71% in the first 6 months of the
year in comparison to a negative yield of 2.8% in the comparative period last
year. The Group funds will continue to earn interest for the balance of the
year. The Group's share of the syndicate investments is expected to continue
to increase to reflect the growth of the capacity portfolio.
Helios Retained Capacity
The positive momentum in both insurance and reinsurance pricing has continued
into 2023 as the property and property reinsurance rates increased
significantly at the beginning of the year. The improvement in underwriting
conditions over the last five years will provide a platform for better
prospects for underwriting returns over the next few years.
Helios has increased its retained capacity to £244.5m for the 2023
underwriting year, an increase of 42% to take advantage of the current market
conditions. The proportion of the capacity reinsured has been reduced while
the capital provided by the reinsurers has remained steady. The quota share
reinsurers fund their share of the capital requirements and pay Helios a fee
and a profit commission. The strategy of building a portfolio of underwriting
capacity that can be accessed by alternative sources of capital is expected to
be developed in the future as we regard this as an attractive opportunity to
increase the fee income generated from the portfolio.
£m 2023 Capacity Capacity Value
2023 YOA 310.8 62.6
Expected Pre-emptions 14.5 6.3
Increase in NTAV per share 6.2p
Helios has received preliminary indications of pre-emptions for the 2023 year
of account from the syndicates supported of £14.5m which are subject to
approval by Lloyd's. The value of the capacity portfolio, using the 2022
weighted average prices, including the value of the expected pre-emptions for
2023 (using the 2022 weighted average capacity prices) could increase to £69m
- an increase of 10%.
Wild-fire Defense Syndicate
Helios became the cornerstone FAL provider in a new SIAB 1996 which commenced
underwriting from July this year underwriting £6m of capacity for 2023 year
of account. WDS provides insurance cover to commercial businesses located in
California for the risks of wildfire. Their intervention techniques have saved
may properties from destruction and provide much needed cover in this
challenging environment.
Acquisitions in 2023 to date
Four acquisitions have been completed to date increasing the portfolio by £8m
of capacity.
£m 2023 Capacity Humphrey's Valuation Total Consideration** Discount
Nameco 606 2.0 1.6 1.5 5.8%
Nameco 1208 1.8 1.0 0.7 25.0%
Park Farm UW* 2.3 3.4 3.2 6.3%
Chorlton UW* 2.1 2.1 2.0 10.0%
Total 8.2 8.1 7.4 11.1%
*Completed after 30(th) June 2023
** includes the cash consideration plus the proprietors loans assumed by the
group
Our strategy of building a portfolio of syndicate capacity continues to rely
on the flow of LLVs for sale at reasonable prices. The discounts achieved to
the Humphrey Valuations have decreased as both Vendor expectations of future
value have increased and as other purchasers have realised the value of the
potential future profitability of these capacity portfolios.
Capital Position as at 30(th) June 2023
Underwriting capital 30 June 2023 31 December 2022
£m £m
Quota share reinsurance panel 22.3 27.8
Excess of loss funds at Lloyd's 46.4 41.2
Helios own funds 62.4 58.3
Solvency credits 21.2 0.7
Total 152.3 128.0
Total Capacity 310.8 296.7
Economic capital requirement 128.6 126.4
Capital Ratio 41% 42%
Surplus Capital 23.7 1.6
The improvement in the Solvency position of the capacity portfolio, increasing
the solvency credits to £21m as profits have been recognized within the
supported syndicates. Surplus solvency credits of £10m have recently been
released to improve the free cash position of the Company.
Return of Capital to Shareholders
Helios is committed to returning capital to shareholders. The Board has
already announced a share repurchase program and is actively considering other
mechanisms to achieve this goal. This will also potentially include the review
and increase of our dividend policy.
The Company has allocated £1million recently for the buyback of its shares as
the share price is below tangible book value. The Board believes that while
the share price remains at these levels it is in shareholders' interests to
continue to buy back shares in the market.
The net tangible asset value per share is £1.54p per share (Dec 2022 -
£1.52p per share). The net assets include a deferred tax provision of £14m
on the value of the capacity portfolio.
Financial results summary
Six months ended 30 June 2023
6 months to 30 June 2023 6 months to 30 June 2022
£'000 £'000
Underwriting profits 10,441 (652)
Other Income
Fees from reinsurers 720 442
Corporate reinsurance recoveries - 307
Goodwill on bargain purchase - -
Investment income 19 84
Total Other Income 739 833
Costs
Pre-acquisition (184) -
Stop loss costs (1,931) (1,224)
Operating costs (3,031) (2,388)
Total Costs (5,146) (3,612)
Operating profit before impairments of goodwill 6,034 (3,431)
and capacity
Amortisation of goodwill 302 638
Tax (1,985) (214)
Revaluation of syndicate capacity - -
Income tax relating to the components of other - (257)
Comprehensive income
Profit/(loss) for the period/year 4,351 (3,264)
Period to 30 June 2023
Underwriting Year Helios retained capacity at Portfolio mid point forecasts Portfolio Expected Profits Helios Earned before tax Helios Profits Helios Profits to be earned in the future
30 June 2023 at 30 June 2023 to 31 Dec 2022 to 30th June 2023
£m £'000 £'000 £'000 £'000
2021 102.3 4.90% 5,016 711 2,346 1,959
2022 180.9 5.68% 10,272 (7,088) 10,701 6,659
2023 234.2 N/A (2,606)
10,441 8,618
Impact on NTAV 12.8p 8.5p
Financial results summary continued
Six months ended 30 June 2023
Summary Balance Sheet
The summary Group balance sheet excludes items relating to syndicate
participations. See Note 16 for further information.
30 June 2023 31 December 2022
£'000 £'000
Intangible assets 61,236 59,375
Funds at Lloyd's 77,297 73,771
Other cash 2,020 10,254
Other assets 6,958 6,909
Total assets 147,511 150,309
Deferred tax 13,921 11,228
Borrowings 15,000 15,000
Other liabilities 7,732 3,839
Total liabilities 36,653 30,067
Syndicate equity 6,292 (5,123)
Total equity 117,150 115,119
Summary Group Cash Flow
The summary group cash flow sheet excludes items relating to syndicate
participations. See Note 16 for further information.
6 months to 30 June 2023 6 months to 30 June 2022
£'000 £'000
Opening Balance (free cash) 10,254 16,178
Income
Acquired on acquisition 9 -
Distribution of profits (net of tax retentions) 3,091 2,422
Transfers from Funds at Lloyds' 2,499 5,277
Investment income 375 55
Borrowings - 15,000
Expenditure
Operating costs (inc Hampden / Nomina fees) (2,988) (1,409)
Reinsurance Cost (3,408) (857)
Acquisition of LLV's (1,569) -
Transfers to Funds at Lloyds' (6,067) (21,886)
Tax (236) 293
Dividends paid - (2,034)
Closing balance 1,960 13,039
Financial results summary continued
Six months ended 30 June 2023
Net tangible asset per share
6 months to 30 June 2023 Year to 31 December 2022
£'000 £'000
Net tangible assets 55,915 55,743
Value of capacity (WAV) 61,548 59,967
117,463 115,710
Shares in issue - on the market 76,218 76,218
Shares in issue - total of on the market and JSOP shares 77,318 77,318
Net tangible asset value per share £ - on the market £1.54p £1.52p
Net tangible asset value per share £ - on the market and JSOP shares £1.52p £1.50p
Interim condensed consolidated statement of comprehensive income
Six months ended 30 June 2023
6 months ended 6 months ended
Note 30 June 2023 30 June 2022
Unaudited Unaudited
£'000 £'000
Gross premium written 4 158,509 124,067
Reinsurance premium ceded (49,587) (35,291)
Net premium written 4 108,922 88,776
Change in unearned gross premium provision 5 (34,899) (46,338)
Change in unearned reinsurance premium provision 5 15,782 15,945
(19,117) (30,393)
Net earned premium 3,4 89,805 58,383
Net investment income 6 3,141 (3,476)
Other underwriting income 720 442
Revenue 93,666 55,349
Gross claims paid (42,895) (28,627)
Reinsurers' share of gross claims paid 10,437 7,153
Claims paid, net of reinsurance (32,458) 21,474
Change in provision for gross claims 5 (15,696) (17,146)
Reinsurers' share of change in provision for gross claims 5 (1,953) 3,879
Net change in provision for claims 5 (17,649) (13,267)
Net insurance claims and loss adjustment expenses 4 (50,107) (34,741)
Expenses incurred in insurance activities (34,969) (22,310)
Other operating expenses (2,556) (1,729)
Operating expenses (37,525) (24,039)
Operating profit/(loss) before impairments of goodwill and capacity 4 6,034 (3,431)
Amortisation of goodwill 302 638
Profit/(loss) before tax 6,336 (2,793)
Income tax charge 7 (1,985) (214)
Income and deferred tax charge as a result of change in tax rates 7 - -
Profit/(loss) for the period 4,351 (3,007)
Other comprehensive income
Deferred tax relating to change in tax rates on revaluation of capacity - (257)
Other comprehensive income/(loss) for the period, net of tax - (257)
Total other comprehensive income/(loss) for the period - (3,264)
Profit/(loss) for the period attributable to owners of the Parent 4,351 (3,264)
Total comprehensive income/(loss) for the period attributable to owners of the 4,351 (3,264)
Parent
Earnings/(loss) per share attributable to owners of the Parent
Basic 8 5.71p (4.44)p
Diluted 8 5.55p (4.44)p
The profit attributable to owners of the Parent and earnings per share set out
above are in respect of continuing operations.
The notes are an integral part of these Financial Statements.
Interim condensed consolidated statement of financial position
Six months ended 30 June 2023
At 30 June At 31 December 2022
Note 2023 Unaudited
Unaudited £'000
£'000
Assets
Intangible assets 61,236 59,375
Financial assets at fair value through profit or loss 259,550 226,013
Reinsurance assets:
- reinsurers' share of claims outstanding 5 89,625 80,726
- reinsurers' share of unearned premium 5 33,308 21,333
Other receivables, including insurance and reinsurance receivables 165,315 147,676
Deferred acquisition costs 26,696 24,991
Prepayments and accrued income 8,088 5,076
Cash and cash equivalents 28,200 25,300
Total assets 672,018 590,490
Liabilities
Insurance liabilities:
- claims outstanding 5 305,382 272,015
- unearned premium 5 135,286 114,663
Deferred income tax liabilities 13,921 11,312
Borrowings 15,000 15,000
Other payables, including insurance and reinsurance payables 76,475 54,893
Accruals and deferred income 8,804 7,488
Total liabilities 554,868 475,371
Equity
Equity attributable to owners of the Parent:
Share capital 11 7,774 7,774
Share premium 11 98,268 98,268
Revaluation reserve 11 11,350 11,350
Other reserves - treasury shares 11 (110) (110)
Retained earnings (132) (2,163)
Total equity 117,150 115,119
Total liabilities and equity 672,018 590,490
The Financial Statements were approved and authorised for issue by the Board
of Directors on 27 September 2023, and were signed on its behalf by:
Martin Reith
Chief Executive
The notes are an integral part of these Financial Statements.
Interim condensed consolidated statement of changes in equity
Six months ended 30 June 2023
Attributable to owners of the Parent
Consolidated Share Share Revaluation reserve Other reserves Retained Total
capital premium £'000 earnings £'000
Note £'000 £'000 £'000
At 1 January 2023 7,774 98,268 11,350 (110) (2,163) 115,119
Total comprehensive income for the year: - - - - - -
Profit for the year - - - - 4,351 4,351
Other comprehensive income, net of tax - - - - - -
Total comprehensive income for the year - - - - 4,351 4,351
Transactions with owners: - - - - - -
Dividends paid 9 - - - - (2,320) (2,320)
Company buy back of shares 11 - - - - - -
Share issue - - - - - -
Total transactions with owners - - - - (2,320) (2,320)
At 30 June 2023 7,774 98,268 11,350 (110) (132) 117,150
At 1 January 2022 6,931 86,330 9,348 (110) 3,188 105,687
Total comprehensive income for the year:
Loss for the year - - - - (3,007) (3,3007)
Other comprehensive income, net of tax - - (257) - - (257)
Total comprehensive income for the year - - (257) - (3,007) (3,264)
Transactions with owners: - - - - - -
Dividends paid 9 - - - - (2,034) (2,034)
Company buy back of shares 11 - - - - - -
Share issue - - - - - -
Total transactions with owners - - - - (2,034) (2,034)
At 30 June 2022 6,931 86,330 9,091 (110) (1,853) 100,389
The notes are an integral part of these Financial Statements.
Interim condensed consolidated statement of cash flows
Six months ended 30 June 2023
At 30 June 2023 Unaudited At 30 June 2022 Unaudited
£'000 £'000
Note
Cash flows from operating activities
Profit/(loss) before tax 6,336 (2,793)
Adjustments for:
- Interest received (227) (78)
- Investment income (3,502) 3,503
- Amortisation of goodwill (302) 638
Changes in working capital:
- change in fair value of financial assets held at fair value through profit 512 (617)
or loss
- Increase in financial assets at fair value through profit or loss (30,214) (32,609)
- Increase in other receivables (18,147) (47,556)
- Increase in other payables 18,926 23,005
- net increase in technical provisions 27,941 59,933
Cash generated from operations 1,323 2,150
Income tax paid/(received) (237) (252)
Net cash inflow from operating activities 1,086 1,898
Cash flows from investing activities
Interest received 227 78
Investment income 3,502 (3,503)
Acquisition of subsidiaries, net of cash acquired (1,239) -
Net cash inflow/(outflow) from investing activities 2,490 (3,425)
Cash flows from financing activities
Net proceeds from issue of ordinary share capital - -
Proceeds from borrowings - 15,000
Repayment of borrowings - -
Dividends paid to owners of the Parent - (2,034)
Net cash inflow from financing activities - 12,966
Net increase in cash and cash equivalents 3,576 11,439
Cash and cash equivalents at beginning of period 24,624 24,625
Cash and cash equivalents at end of period 28,200 36,064
Cash held within the syndicates' accounts is £26,240,000 (30 June 2022:
£23,085,000) of the total cash and cash equivalents held at the end of the
period £28,200,000 (30 June 2022: £36,064,000). The cash held within the
syndicates' accounts is not available to the Group to meet its day-to-day
working capital requirements.
Cash and cash equivalents comprise cash at bank and in hand.
The notes are an integral part of these Financial Statements.
Notes to the financial statements
Six months ended 30 June 2023
1. General information
The Company is a public limited company quoted on AIM. The Company was
incorporated in England, is domiciled in the UK and its registered office is
40 Gracechurch Street, London EC3V 0BT. The Company participates in insurance
business as an underwriting member at Lloyd's through its subsidiary
undertakings.
These condensed consolidated financial statements do not comprise statutory
accounts within the meaning of section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2022 were approved by the
board of directors on 25 May 2023 and delivered to the Registrar of Companies.
The report of the auditors on those accounts was unqualified, did not contain
an emphasis of matter paragraph and did not contain any statement under
section 498 of the Companies Act 2006.
2. Accounting policies
Basis of preparation
These Financial Statements have been prepared in accordance with United
Kingdom Accounting Standards (UK GAAP), including FRS 102 "The Financial
Reporting Standard applicable in the UK and Republic of Ireland", FRS 103
"Insurance Contracts", FRS 104 "Interim Financial Reporting", and the
Companies Act 2006 and Schedule 3 of the Large and Medium sized Companies and
Groups (Accounts and Reports) Regulations, relating to insurance.
The 31 December 2022 and 30 June 2022 Financial Statements were prepared under
International Financial Reporting Standards (IFRSs) and the prior period
figures have been amended to reflect the changes in the reporting framework
(see note 17).
The Condensed Consolidated Interim Financial Statements are prepared for the
six months ended 30 June 2023.
The Condensed Consolidated Interim Financial Statements for the six months
ended 30 June 2023 and June 2022 are unaudited, but have been subject to
review by the Group's auditors.
The Condensed Consolidated Interim Financial Statements incorporate the
Financial Statements of Helios Underwriting plc, the Parent Company, and its
directly and indirectly held subsidiaries (see note 10).
The underwriting data on which these Condensed Consolidated Interim Financial
Statements are based upon has been supplied by the managing agents of those
syndicates which the Group supports. The data supplied is the 100% figures for
each syndicate. The Group has applied its share of the syndicate
participations to the gross figures to derive its share of the syndicate's
transactions, assets and liabilities.
Going concern
The Group has net assets at the end of the reporting period of £117,150,000
(31 December 2022: £115,119,000).
The Company's subsidiaries participate as underwriting members at Lloyd's on
the 2021, 2022 and 2023 years of account, as well as any prior run-off years,
and they intend to continue this participation in the 2024 year of account.
The Directors have a reasonable expectation that the Group have adequate
resources to meet their underwriting and other operational obligations for the
foreseeable future. Accordingly, they continue to adopt the going concern
basis of accounting in preparing the Financial Statements.
Significant accounting policies
The Condensed Consolidated Interim Financial Statements have been prepared
under the historical cost convention as modified by the revaluation of the
financial assets at fair value through the Statement of Comprehensive Income.
The 31 December 2022 and the 30 June 2022 Financial Statements were prepared
in accordance International Financial Reporting Standards (IFRSs). The 30
June 2023 Financial Statements have been prepared in accordance with United
Kingdom Accounting Standards (UK GAAP), including FRS 102 "The Financial
Reporting Standard applicable in the UK and Republic of Ireland", FRS 103
"Insurance Contracts" and FRS 104 "Interim Financial Reporting".
The reason for this change in reporting framework is that it is not possible
for the directors to obtain financial information in respect of the underlying
syndicate participations that would be required to comply with IFRS 17
"Insurance Contracts" which is effective under IFRS for accounting periods
beginning on or after 1 January 2023. (see note 17).
The same accounting policies, presentation and methods of computation are
followed in these Condensed Consolidated Interim Financial Statements as were
applied in the preparation of the Group Financial Statements for the year
ended 31 December 2022 except the following as a result of the conversion from
IFRS to UK GAAP:
- positive goodwill which is taken to the Consolidated Statement
of Financial Position (CSOFP) is now amortised over the its estimated useful
life of three years (see note 17).
- goodwill on bargain purchases which was taken straight to the
Consolidated Statement of Comprehensive Income (CSOCI) under IFRS is now
capitalised and taken the CSOFP and amortised over its estimated useful life
of three years (see note 17).
Notes to the financial statements
Six months ended 30 June 2023
3. Segmental information
Martin Reith and Nigel Hanbury are the Group's chief operating
decision-makers. They determine its operating segments based on the way the
Group is managed, for the purpose of allocating resources and assessing
performance.
The Group has three segments that represent the primary way in which the Group
is managed, as follows:
• syndicate participation;
• investment management; and
• other corporate activities.
6 months ended 30 June 2023 Unaudited Syndicate Investment Other Total
participation management corporate £'000
£'000 £'000 activities
£'000
Net earned premium 94,183 - (4,378) 89,805
Net investment income 3,160 (19) - 3,141
Other income - - 720 720
Net insurance claims and loss adjustment expenses (50,107) - - (50,107)
Expenses incurred in insurance activities (34,925) - (44) (34.969)
Other operating expenses - - (2,556) (2,556)
Amortisation of goodwill - - 302 302
Profit before tax 12,311 (19) (5,956) 6,336
6 months ended 30 June 2022 Unaudited Syndicate Investment Other Total
participation management corporate £'000
£'000 £'000 activities
£'000
Net earned premium 58,767 - (383) 58,384
Net investment income (3,561) 85 - (3,476)
Other income - - 442 442
Net insurance claims and loss adjustment expenses (34,740) - (1) (34,741)
Expenses incurred in insurance activities (21,650) - (660) (22,310)
Other operating expenses - - (1,729) (1,729)
Amortisation of goodwill - - 637 637
Loss before tax (1,184) 85 (1,693) (2,793)
The Group does not have any geographical segments as it considers all of its
activities to arise from trading within the UK.
No major customers exceed 10% of revenue.
Net earned premium within 2023 other corporate activities totalling
£4,378,000 (2022: £383,000 - 2020, 2021 and 2022 years of account)
represents the 2021, 2022 and 2023 years of account net Group quota share
reinsurance premium payable to HIPCC Limited - Cell 6. This net quota share
reinsurance premium payable is included within "reinsurance premium ceded" in
the Consolidated Statement of Comprehensive Income of the period.
Notes to the financial statements
Six months ended 30 June 2023
4. Operating profit before impairments of goodwill and capacity
Underwriting year of account*
6 months ended 30 June 2022 2020 and prior Pre- Corporate Other Total
£'000 2021 2022 Sub-total acquisition reinsurance corporate £'000
£'000 £'000 £'000 £'000 £'000 £'000
Gross premium written 930 11,407 111,730 124,067 - - - 124,067
Reinsurance ceded (96) (2,410) (31,178) (33,684) - (383) (1,224) (35,291)
Net premium written 834 8,997 80,552 90,383 - (383) (1,224) 88,776
Net earned premium 3,306 35,444 21,240 59,990 - (383) (1,224) 58,383
Other income (2,315) (941) (304) (3,560) - 442 84 (3,034)
Net insurance claims and loss adjustment expenses 578 (20,389) (15,237) (35,048) - - 307 (34,741)
Operating expenses (843) (9,826) (10,982) (21,651) - - (2,388) (24,039)
Operating profit before impairments of goodwill and capacity 726 4,288 (5,283) (269) - 59 (3,221) (3,431)
Quota share adjustment (150) (1,621) 1,388 (383) - 383 - -
Operating profit before impairments of goodwill and capacity after quota share 576 2,667 (3,895) (652) - 442 (3,221) (3,431)
adjustment
Underwriting year of account*
6 months ended 30 June 2023 2021 and prior Pre- Corporate Other Total
£'000 2022 2023 Sub-total acquisition reinsurance corporate £'000
£'000 £'000 £'000 £'000 £'000 £'000
Gross premium written 1,606 25,982 132,905 160,493 (1,984) - - 158,509
Reinsurance ceded (1,410) (4,786) (37,624) (43,820) 542 (4,378) (1,931) (49,587)
Net premium written 196 21,196 95,281 116,673 (1,442) (4,378) (1,931) 108,922
Net earned premium 4,113 68,516 24,687 97,316 (1,202) (4,378) (1,931) 89,805
Other income 1,801 1,165 195 3,161 (39) 720 19 3,861
Net insurance claims and loss adjustment expenses 629 (36,119) (15,244) (50,734) 627 - - (50,107)
Operating expenses (2,768) (19,182) (12,974) (34,924) 430 - (3,031) (37,525)
Operating profit before impairments of goodwill and capacity 3,775 14,380 (3,336) 14,819 (184) (3,658) (4,943) 6,034
Quota share adjustment (1,429) (3,679) 730 (4,378) - 4,378 - -
Operating profit before impairments of goodwill and capacity after quota share 2,346 10,701 (2,606) 10,441 (184) 720 (4,943) 6,034
adjustment
Pre-acquisition relates to the element of results from the new acquisitions
before they were acquired by the Group.
* The underwriting year of account results represent the Group's share
of the syndicates' results by underwriting year of account before corporate
member level reinsurance and members' agents charges.
Notes to the financial statements continued
Six months ended 30 June 2023
5. Insurance liabilities and reinsurance balances
Movement in claims outstanding
Gross Reinsurance Net
£'000 £'000 £'000
At 1 January 2023 272,015 80,726 191,289
Increase in reserves arising from acquisition of subsidiary undertakings 5,316 1,530 3,786
Movement of reserves 15,696 (1,953) 17,649
Other movements 12,355 9,322 3,033
At 30 June 2023 305,382 89,625 215,757
Movement in unearned premium
Gross Reinsurance Net
£'000 £'000 £'000
At 1 January 2023 114,663 21,333 93,330
Increase in reserves arising from acquisition of subsidiary undertakings 1,690 301 1,388
Movement of reserves 34,899 15,782 19,117
Other movements (15,966) (4,108) (11,857)
At 30 June 2023 135,286 33,308 101,978
Included within other movements are the 2020 and prior years' claims reserves
reinsured into the 2021 year of account on which the Group does not
participate and currency exchange differences.
Movement in claims outstanding
Gross Reinsurance Net
£'000 £'000 £'000
At 1 January 2022 186,653 53,433 133,220
Increase in reserves arising from acquisition of subsidiary undertakings - - -
Movement of reserves 17,146 3,879 13,267
Other movements 37,984 15,762 22,222
At 30 June 2022 241,783 73,074 168,709
Movement in unearned premium
Gross Reinsurance Net
£'000 £'000 £'000
At 1 January 2022 59,611 10,538 49,073
Increase in reserves arising from acquisition of subsidiary undertakings - - -
Movement of reserves 46,338 15,945 30,393
Other movements (8,440) (2,491) (5,949)
At 30 June 2022 97,509 23,992 73,517
Included within other movements are the 2019 and prior years' claims reserves
reinsured into the 2020 year of account on which the Group does not
participate and currency exchange differences.
6. Net investment income
6 months ended 6 months ended
30 June 2023 Unaudited 30 June 2022 Unaudited
£'000 £'000
Investment income 3,502 (3,503)
Realised (losses)/gains on financial assets at fair value through profit or (100) 12
loss
Unrealised (losses)/gains on financial assets at fair value through profit or (512) (61)
loss
Investment management expenses 24 (2)
Bank interest 227 78
Net investment income 3,141 (3,476)
Included within Investment income are investment gains of £3,160,000 (2022:
£3,560,000 investment losses) from Syndicate participations.
Notes to the financial statements continued
Six months ended 30 June 2023
7. Income tax charge
Analysis of tax charge/(credit) in the period
6 months ended 30 June 2023 Unaudited
£'000 6 months ended 30 June 2022 Unaudited
£'000
Income tax credit 1,985 214
The income tax expense is recognised based on management's best estimate of
the weighted average annual income tax rate expected for the full financial
year. The estimated average annual tax rate used is 23.50% (2022: 19.00%).
8. Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to
ordinary shareholders after tax by the weighted average number of ordinary
shares outstanding during the period.
Diluted earnings per share is calculated by dividing the net profit
attributable to ordinary equity holders of the Company by the weighted average
number of ordinary shares outstanding during the period, plus the weighted
average number of ordinary shares that would be issued on the conversion of
all the dilutive potential ordinary shares into ordinary shares.
Earnings per share has been calculated in accordance with IAS 33 "Earnings per
share".
The earnings per share and weighted average number of shares used in the
calculation are set out below:
6 months ended 30 June 2023 Unaudited
6 months ended 30 June 2022Unaudited
Profit/(loss) for the year after tax attributable to ordinary equity holders 4,351,000 (3,007,000)
of the parent
Basic - weighted average number of ordinary shares* 76,218,203 67,786,212
Weighted average number of ordinary shares for diluted earnings per share* 77,889,630 68,889,212
Basic earnings/(loss) per share 5,71p (4.44)p
Diluted earnings/(loss) per share 5.55p (4.44)p
* Diluted loss per share is not permitted to be reduced from the basic loss
per share.
9. Dividends paid or proposed
It was proposed and agreed at the AGM on 29 June 2023 that a dividend of 3p
would be payable. The Dividend was paid post period end on 14 July 2023
totalling £2,320,000 and has been accrued in these financial statements.
10. Investments in subsidiaries
30 June 31 December
2023 2022
£'000 £'000
Total 66,722 65,546
Notes to the financial statements continued
Six months ended 30 June 2023
10. Investments in subsidiaries (continued)
Direct/indirect 30 June 2023 31 December 2022 Principal activity
interest ownership ownership
Nameco (No. 917) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Devon Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No. 346) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Pooks Limited Direct 100% 100% Lloyd's of London corporate vehicle
Charmac Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
RBC CEES Trustee Limited((ii)) Direct 100% 100% Joint Share Ownership Plan
Nottus (No 51) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Chapman Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Llewellyn House Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Advantage DCP Limited Direct 100% 100% Lloyd's of London corporate vehicle
Romsey Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Helios UTG Partner Limited((i)) Direct 100% 100% Corporate partner
Salviscount LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Inversanda LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Fyshe Underwriting LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Nomina No 505 LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Nomina No 321 LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Nameco (No. 409) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No. 1113) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Catbang 926 Limited Direct 100% 100% Lloyd's of London corporate vehicle
Whittle Martin Underwriting Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 408) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 084 LLP Indirect 100% 100% Lloyd's of London corporate vehicle
Nameco (No 510) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 544) Limited Direct 100% 100% Lloyd's of London corporate vehicle
N J Hanbury Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1011) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1111) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 533 LLP Indirect 100% 100% Corporate partner
North Breache Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
G T C Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Hillnameco Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 2012) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1095) Limited Direct 100% 100% Lloyd's of London corporate vehicle
New Filcom Limited Direct 100% 100% Lloyd's of London corporate vehicle
Kemah Lime Street Capital Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1130) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 070 LLP Indirect 100% 100% Corporate partner
Nameco (No 389) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 469 LLP Indirect 100% 100% Corporate partner
Nomina No 536 LLP Indirect 100% 100% Corporate partner
Nameco (No 301) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1232) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Shaw Lodge Limited Direct 100% 100% Lloyd's of London corporate vehicle
Queensberry Underwriting Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 472 LLP Indirect 100% 100% Corporate partner
Nomina No 110 LLP Indirect 100% 100% Corporate partner
Chanterelle Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Kunduz LLP Indirect 100% 100% Corporate partner
Exalt Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1110) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Clifton 2011 Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nomina No 378 LLP Indirect 100% 100% Corporate partner
Gould Scottish Limited Partnership Indirect 100% 100% Corporate partner
Harris Family UTG Limited Direct 100% 100% Lloyd's of London corporate vehicle
Whitehouse Underwriting Limited Direct 100% 100% Lloyd's of London corporate vehicle
Risk Capital UTG Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 606) Limited Direct 100% 100% Lloyd's of London corporate vehicle
Nameco (No 1208) Limited Direct 100% 100% Lloyd's of London corporate vehicle
(i) Helios UTG Partner Limited, a subsidiary of the Company, owns 100%
of Salviscount LLP, Inversanda LLP, Fyshe Underwriting LLP, Nomina No 505 LLP,
Nomina No 321 LLP Nomina No 084 LLP, Nomina No 533 LLP, Nomina No 070 LLP,
Nomina No 469 LLP, Nomina No 536 LLP, Nomina No 472 LLP, Nomina No 110 LLP,
Kunduz LLP. Nomina No 348 LLP and Gould Scottish Limited Partnership. The cost
of acquisition of these LLPs is accounted for in Helios UTG Partner Limited,
their immediate parent company.
(ii) RBC CEES Trustee Limited was an incorporated entity
in year 2017 to satisfy the requirements of the Joint Share Ownership.
Notes to the financial statements continued
Six months ended 30 June 2023
11. Share capital and share premium
Number of Ordinary share Partly Share Total
shares (i) capital paid ordinary premium £'000
£'000 share capital £'000
£'000
Ordinary shares of 10p each and share premium at 31 December 2022 77,737,372 7,664 110 98,268 106,042
Ordinary shares of 10p each and share premium at 30 June 2023 77,737,372 7,664 110 98,268 106,042
(i) Number of shares
30 June 2023 31 December 2022
Allotted, called up and fully paid ordinary shares:
On the market 76,218,203 76,218,203
Company buy back of ordinary shares held in treasury 419,169 419,169
76,637,372 76,637,372
Uncalled and partly paid ordinary share under the JSOP scheme (ii) 1,100,000 1,100,000
77,737,372 77,737,372
(ii) The partly paid ordinary shares are not entitled to dividend
distribution rights during the year.
12. Related party transactions
A number of subsidiary companies have entered into quota share reinsurance
contracts for the 2021, 2022 and 2023 years of account with protected cell
companies of HIPCC Limited.
Nigel Hanbury, a Director of Helios Underwriting plc and its subsidiary
companies, is also a director and majority shareholder in HIPCC Limited.
Hampden Capital plc, a substantial shareholder in Helios Underwriting plc, is
also a substantial shareholder in HIPCC Limited - Cell 6. Under quota share
agreements between Cell 6 and certain Helios subsidiaries, the Group accrued a
net reinsurance premium payable of £1,736,000 (31 December 2022: £1,921,000
recoverable) during the period.
In addition, HIPCC provide stop loss, portfolio stop loss and HASP reinforce
policies for the company.
HIPCC Limited acts as an intermediary for the reinsurance products purchased
by Helios. An arrangement has been put in place so that 51% of the profits
generated by HIPCC (being Nigel Hanburys share) in respect of the business
relating to Helios will be repaid to Helios for the business transacted for
the 2021 and subsequent underwriting years.
13. Ultimate controlling party
The Directors consider that the Group has no ultimate controlling party.
Notes to the financial statements continued
Six months ended 30 June 2023
14. Acquisition of Lloyd's Limited Liability Vehicles
During the period, the company has acquired the following Lloyd's Limited
Liability Vehicles either directly, or indirectly:
Helios Acquisitions
2023 Capacity Purchase price Fair value of asset acquired Goodwill recognised
Date of acquisition
Nameco (No 606) Limited 2 June 2023 2,024,096 1,175,131 1,112,121 63,010
Nameco (No 1208) Limited 12 June 2023 1,776,807 - 87,000 (87,000)
Total Acquisitions Completed 3,800,903 1,175,131 1,112,208 (23,990)
15. Syndicate participations
The syndicates and members' agent pooling arrangements ("MAPA") in which the
Company's subsidiaries participate as corporate members of Lloyd's are as
follows:
Allocated capacity per year of account
Syndicate or Managing or members' agent 2023 2022 2021
MAPA number
£ £ £
33 Hiscox Syndicates Limited 14,862,935 14,862,935 14,837,949
218 IQUW Syndicate Management Limited 17,624,778 7,427,997 7,428,004
318 Cincinnati Global Underwriting Agency Limited 862,407 992,637 992,635
386 QBE Underwriting Limited 2,966,471 2,897,646 2,634,241
510 Tokio Marine Kiln Syndicates Limited 27,562,480 33,536,417 23,760,440
557 Tokio Marine Kiln Syndicates Limited - 3,485,330 3,485,330
609 Atrium Underwriters Limited 17,661,850 13,153,869 12,653,790
623 Beazley Furlonge Limited 28,099,719 22,713,565 19,890,751
727 S A Meacock & Company Limited 2,834,522 2,323,378 2,255,711
1176 Chaucer Syndicates Limited 2,854,340 2,854,339 2,854,347
1200 Argo Managing Agency Limited 54,999 10,050,000 -
1729 Asta Managing Agency Limited 20,083,504 1,211,467 189,401
1902 Asta Managing Agency Limited 10,688,300 10,000,002 -
1955 Arch Managing Agency Limited 12,500,000 - -
1969 Apollo Syndicate Management Limited 12,170,742 5,675,170 459,001
1971 Apollo Syndicate Management Limited 10,000,001 6,467,147 -
1985 Asta Managing Agency Limited 16,874,190 - -
1988 Asta Managing Agency Limited 15,000,000 - -
2010 Lancashire Syndicates Limited 7,713,238 10,499,418 9,864,905
2121 Argenta Syndicate Management Limited 140,000 10,134,894 5,577,177
2288 Astra Managing Agency Limited - - -
2525 Asta Managing Agency Limited 2,141,973 1,721,029 1,601,833
2689 Asta Managing Agency Limited 2,686,871 10,100,276 534,813
2791 Managing Agency Partners Limited 11,677,739 9,850,281 9,850,285
4242 Asta Managing Agency Limited 10,749,622 12,937,527 8,933,909
4444 Canopius Managing Agents Limited 21,176 20,000 182,189
5183 Asta Managing Agency Limited 5,000,000 - -
5623 Beazley Furlonge Limited 17,631,646 6,894,032 4,769,792
5886 Asta Managing Agency Limited 26,929,794 22,989,002 12,432,907
6103 Managing Agency Partners Limited 3,263,814 3,447,515 3,072,388
6104 Hiscox Syndicates Limited - 1,758,333 1,781,360
6107 Beazley Furlonge Limited 132,363 1,649,683 1,649,378
6117 Argo Managing Agency Limited 230,404 2,957,188 2,104,208
6133 Apollo Syndicate Management Limited - - -
Total 300,479,878 241,611,077 153,796,744
Notes to the financial statements continued
Six months ended 30 June 2023
16. Group-owned net assets
The Group statement of financial position includes the following assets and
liabilities held by the syndicates on which the Group participates. These
assets are subject to trust deeds for the benefit of the relevant syndicates'
insurance creditors. The table below shows the split of the statement of
financial position between Group and syndicate assets and liabilities:
30 June 2023 31 December 2022
Group Syndicate Total Group Syndicate Total
£'000 £'000 £'000 £'000 £'000 £'000
Assets
Intangible assets 61,236 - 61,236 59,375 - 59,375
Financial assets at fair value through profit or loss 77,297 182,253 259,550 73,771 152,242 226,013
Reinsurance assets:
- reinsurers' share of claims outstanding 60 89,565 89,625 60 80,666 80,726
- reinsurers' share of unearned premium - 33,308 33,308 - 21,333 21,333
Other receivables, including insurance and reinsurance receivables 1,790 163,525 165,315 3,103 144,573 147,676
Deferred acquisition costs - 26,696 26,696 - 24,991 24,991
Prepayments and accrued income 5,168 2,920 8,088 3,746 1,330 5,076
Cash and cash equivalents 1,960 26,240 28,200 10,254 15,046 25,300
Total assets 147,511 524,507 672,018 150,309 440,181 590,490
Liabilities
Insurance liabilities:
- claims outstanding - 305,382 305,382 - 272,015 272,015
- unearned premium - 135,286 135,286 - 114,663 114,663
Deferred income tax liabilities 13,921 - 13,921 11,228 84 11,312
Borrowings 15,000 - 15,000 15,000 - 15,000
Other payables, including insurance and reinsurance payables 2,170 74,305 76,475 157 54,736 54,893
Accruals and deferred income 5,562 3,242 6,484 3,682 3,806 7,488
Total liabilities 36,653 518,215 552,548 30,067 445,304 475,371
Equity attributable to owners of the Parent
Share capital 7,774 - 7,774 7,774 - 7,774
Share premium 98,268 - 98,268 98,268 - 98,268
Revaluation reserve 11,350 - 11,350 11,350 - 11,350
Other reserves (110) - (110) (110) - (110)
Retained earnings (6,424) 6,292 (132) 2,960 (5,123) (2,163)
Total equity 110,858 6,292 117,150 120,242 (5,123) (115,119)
Total liabilities and equity 147,511 524,507 672,018 150,310 440,181 590,491
Notes to the financial statements continued
Six months ended 30 June 2023
17. Changes arising from the conversion from IFRS to UK GAAP
The 31 December 2022 and the 30 June 2022 Financial Statements were prepared
in accordance with International Financial Reporting Standards (IFRSs). The
30 June 2023 Financial Statements have been prepared in accordance with United
Kingdom Accounting Standards (UK GAAP), including FRS 102 "The Financial
Reporting Standard applicable in the UK and Republic of Ireland", FRS 103
"Insurance Contracts" and FRS 104 "Interim Financial Reporting".
The reason for this change in reporting framework is that it is not possible
for the directors to obtain financial information in respect of the underlying
syndicate participations that would be required to comply with IFRS 17
"Insurance Contracts" which is effective under IFRS for accounting periods
beginning on or after 1 January 2023.
Under IFRS any goodwill on bargain purchases is credited immediately to the
Consolidated Statement of Comprehensive Income (CSOCI). Any positive
goodwill is taken to the Consolidated Statement of Financial Position (CSOFP)
and subject to an annual impairment review. Under UK GAAP, both goodwill on
bargain purchases and positive goodwill are taken to the CSOFP and amortised
over their estimated useful life.
The directors have concluded an estimated useful life of three years for both
elements of goodwill to be amortised over, which is in line with the usual
life of a Lloyd's underwriting year of account.
The prior period figures have been adjusted to reflect the changes in the
accounting framework as per below:
Total other comprehensive loss £'000
Total other comprehensive (loss)/income for the period - as originally (3,902)
reported at 30 June 2022 under IFRS
Impact of IFRS to UK GAAP conversion - bargain purchase goodwill amortisation 670
Impact of IFRS to UK GAAP conversion - positive goodwill amortisation (32)
Total other comprehensive loss for the period - at 30 June 2022 under UK GAAP (3,264)
Total equity £'000
Total equity - as originally reported at 31 December 2022 under IFRS 117,178
Impact of IFRS conversion to UK GAAP - total bargain purchases goodwill booked (4,182)
to 31 December 2022
Impact of IFRS conversion to UK GAAP - cumulative bargain purchase goodwill 3,108
amortisation to 31 December 2022
Impact of IFRS conversion to UK GAAP - cumulative positive goodwill (985)
amortisation to 31 December 2022
Total equity - at 31 December 2022 under UK GAAP 115,119
Goodwill intangible assets £'000
Positive goodwill intangible assets - as originally reported at 31 December 1,468
2022 under IFRS
Impact of IFRS conversion to UK GAAP - positive goodwill amortisation to 31 (985)
December 2022
Positive goodwill intangible assets - as reported at 31 December 2022 under UK 483
GAAP
Impact of IFRS conversion to UK GAAP - bargain purchase goodwill booked to 31 (4,182)
December 2022
Impact of IFRS conversion to UK GAAP - bargain purchase goodwill amortisation 3,108
to 31 December 2022
Bargain purchase goodwill amortisation to 31 December 2022 under UK GAAP (1,074)
Goodwill intangible asset - at 31 December 2022 under UK GAAP (591)
Notes to the financial statements continued
Six months ended 30 June 2023
18. Event after the financial reporting period
Acquisitions of LLV's since the period end
Since the Financial reporting period, the company has acquired the following
entities either directly, or indirectly:
Helios Acquisitions
2023 Capacity Purchase price Humphrey Valuation Discount to Humphreys (%)
m £m
Chorlton Underwriting Limited 2.1 2.0 2.1 10.0%
Park Farm Underwriting Limited 2.3 3.2 3.4 6.3%
Total 4.4 5.2 5.5
Notes to the financial statements continued
Six months ended 30 June 2023
Directors, Registered office and advisers
Directors
Michael John Wade (Non-Executive Chairman) appointed 29 June 2023
Martin Robert Davidson Reith (Chief Executive Officer)
Nigel John Hanbury (Executive Deputy Chairman)
Andrew Hildred Christie (Non-Executive Director)
Arthur Roger Manners (Finance Director)
Edward Fitzalan-Howard (Non-Executive Director)
Thomas John Libassi (Non-Executive Director)
Company secretary
Martha Bruce
Shakespeare Martineau
No 1 Colmore Square
Birmingham B4 6AA
Company number
05892671
Registered office
40 Gracechurch Street
London EC3V 0BT
Statutory auditors
PKF Littlejohn LLP
15 Westferry Circus
Canary Wharf
London E14 4HD
Nominated adviser and broker
Numis Sercurities Limited
45 Gresham Street
London EC2V 7BF
Lloyd's members' agent
Hampden Agencies Limited
40 Gracechurch Street
London EC3V 0BT
Registrars
Neville Registrars Limited
Neville House
Steelpark Road
Halesowen B62 8HD
INDEPENDENT REVIEW REPORT TO HELIOS UNDERWRITING PLC
Conclusion
We have been engaged by the group to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
June 2023 which comprises the Interim Condensed Consolidated Income Statement,
the Interim Condensed Statement of Comprehensive Income, the Interim Condensed
Statement of Financial Position, the Interim Condensed Statement of Changes in
Equity, the Interim Condensed Statement of Cash Flows, and related notes. We
have read the other information contained in the half-yearly financial report
and considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2023 is not prepared, in all
material respects, in accordance with FRC's Financial Reporting Standard 104
and AIM Rules for Companies.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity", issued for use in the United Kingdom.
A review of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with International
Standards on Auditing (UK) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
As disclosed in note 2, the annual financial statements of the group are
prepared in accordance with UK GAAP. The condensed set of financial statements
included in this half-yearly financial report has been prepared in accordance
with FRC's Financial Reporting Standard 104, "Interim Financial Reporting".
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that management have
inappropriately adopted the going concern basis of accounting or that
management has identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410, however future events or conditions may cause the group to
cease to continue as a going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report
in accordance with the AIM Rules for companies.
In preparing the half-yearly financial report, the directors are responsible
for assessing the group's ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the group
or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the review of financial information
In reviewing the half-yearly report, we are responsible for expressing to the
group a conclusion on the condensed set of financial statements in the
half-yearly financial report. Our conclusion, including our Conclusions
relating to going concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis for conclusion paragraph of
this report.
Use of our report
This report is made solely to the company's directors, as a body, in
accordance with the terms of our engagement letter dated 29 August 2023. Our
review has been undertaken so that we might state to the company's directors
those matters we have agreed to state to them in a reviewer's report and for
no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone, other than the company and the company's
directors as a body, for our work, for this report, or for the conclusions we
have formed.
PKF Littlejohn LLP
15 Westferry Circus
Statutory Auditor
Canary
Wharf
27 September 2023
London E14 4HD
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