REG - Helios Underwriting - Helios Underwriting 2024 Preliminary Results

Helios UnderwritingAnnouncement

29/05/2025 07:00

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RNS Number : 4996K  Helios Underwriting Plc  29 May 2025

29 May 2025

 

Helios Underwriting PLC

 

("Helios" or the Company)

 

Helios Underwriting Announces 2024 Preliminary Results

Significant increase in NAV and dividend with strong two years earnings
visibility

 

Helios the only publicly traded company offering instant access to a diverse
portfolio of syndicates at Lloyd's of London, the world's largest insurance
market, announces that its audited financial results for the year ended 31
December 2024 will be released on Monday 2(nd) June 2025.

The results are being announced later than expected as a consequence of the
additional review procedures required for the change in accounting
framework.  The key financial highlights are set out below and these set of
results will reflect the adoption of the previously announced changes (on
20(th) May 2025)  to Helios's accounting framework, which sees the Company
report as an investment entity under IFRS rather than as an insurance group
under UK GAAP.

Key financial highlights

·    11% increase in net asset value (NAV) to £2.43 per share (2023:
£2.19*)

·    Dividend and total expected return of capital of 20 pence per share
in 2025 (2024: 12p per share)

·    A total cash dividend of 10 pence per share recommended for
shareholder approval (2023:6p)

·    Total shareholder return on opening shareholder funds of 16.8% (2023:
34%*)

·    Profit before tax of £20.9m (2023: £36.3m*), driven by material
revaluations of investments held at fair value, previously described as
capacity value revaluation

·    Retained underwriting profit of £31.4m (2023: £31.6m)

·    Capacity portfolio for 2025 £491m (2024: £519m)

·    Retained capacity for 2025 £332.8m (2024: £403.5m)

·    Sale of £16m of capacity during the year reducing the risk of
capacity value fluctuation

·    Reduction in net debt by 11% to 46% (2023: 52%) as part of ongoing
deleveraging

·    £40m of underwriting profits expected to be received in 2026 from
the 2023 year of account.

*Re-stated financial statements reporting as an investment entity

The introduction of investment entity accounting under IFRS 10 will change the
reporting of the financial statements and will result in three significant
impacts to the results as part of the movement in the fair value of
investments:

·    Capacity revaluations as an input to fair value of investments -
amounts included will now appear as part of the pre-tax profits and the 2023
revaluation of £17m will increase the restated 2023 pre-tax profits.

·    Provision for deferred taxation on capacity value - no provision on
the increase on capacity value will be required, as unit of account in the
Company is the investments in the Helios LLVs rather than the capacity held
through those LLVs. No allowance has been made for deferred tax on the
unrealised gains from the investments in the Helios LLVs on the basis that the
Company will be eligible for Substantial Shareholding Exemption (SSE) should
it realise those gains through future disposals. The provision for deferred
tax related to capacity revaluation included in 2023 in the UK GAAP reported
statements was £20m.

·    Pipeline profits - a proportion of the profits based on the mid-point
estimates provided by the syndicate managers in excess of the GAAP recognised
profits for the open years of account are to be included.

These changes used in the valuation methodology for investment entity
accounting are more in line with the valuation methodology generally used in
the Lloyds' market.

Interim Executive Chairman, John Chambers, commented:

"The excellent 2024 financial performance of Helios reflects the strength of
our unique proposition, our continued strategic delivery and favourable
underwriting conditions. As a result, we have been able to continue to unlock
shareholder returns, highlighted by an 11% increase in NAV and a recommended
dividend of 10 pence per share.

"Whilst our profit before tax was impacted by an expected rise in costs
resulting from unsecured loan notes and stop-loss protection, as well as
one-off operating costs incurred in 2024, we're delighted to be reporting our
results as an investment entity under IFRS, to better reflect the Company's
business activities and its true performance."

"The period has been characterised by an increasingly disciplined approach to
the allocation of capital - prioritising established syndicates with
profitable track records over new syndicates - while making headway in
bringing our operational leverage down to a more sustainable level going
forward.

"We believe that the best years of this insurance cycle remain ahead of us
from a returns perspective with the work done by the portfolio team in
increasing the quality of the syndicate portfolio expected to show through in
future years while the Lloyd's three-year accounting structure provides the
Company with good visibility for the next two years, where we expect to see a
similar level of capital returned to Shareholders."

Capital Markets Event

The Company will be holding a Capital Markets Event on Tuesday 21(st) October
2025 for shareholders and other stakeholders to meet the Helios management
team, to have an update on six-month results to 30(th) June 2025 and to share
insights on the strategy for both Helios and the Helios Capacity Portfolio.

For further information, please contact:

Helios Underwriting plc

John Chambers - Interim Executive Chairman
 

Arthur Manners - Chief Financial Officer

44 (0)203 965 6441

Deutsche Numis (Nomad and
Broker)

Giles Rolls / Charles Farquhar          +44 (0)20 7260 1000

 

FTI Consulting

Ed Berry
 
+44 (0)7703 330 199

Nathan Hambrook-Skinner                +44 (0)7977 817 092

Christian
Harte
+44 (0)7974 288 763

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