Admiral shares jump as thousands of staff each get a £3,600 windfall

 
Oliver Gill
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Admiral celebrated its 25th birthday on 2 January 2018

Almost 10,000 Admiral staff have today been handed a £3,600 special bonus each.

Shares in the Cardiff-based insurer leapt over six per cent this morning after it posted 43 per cent jump in full-year profits.

Chief executive David Stevens said it was "great to be back in the groove" of posting a 23rd year of record profits. Last year was only the second time the firm had reported a year-on-year fall in earnings.

Dividends were hiked by 11 per cent to 114p per share. The firm's 9,600 staff will receive their bonus in the form of shares.

In common with other motor insurers, Admiral's profits were hit hard by the UK government's decision to slash the discount rate – a move that hiked payouts for personal injury claims.

While the government has yet to revise this reference rate, it is expected to implement legislative changes allowing it to return to what insurers believe is a more reasonable rate.

Read more: Insurers facing £2bn boost after discount rate U-turn

Stevens said: "Beyond the pure financials, there’s also a lot going on that helps build the longer-term prosperity of the group – notably our investment in widening our product range (van, travel, loans in 2017) in a way that helps us attract more customers, and understand and serve better both new and existing customers."

Admiral's post dividend solvency ratio, the amount of capital it holds to cover risks, fell from 212 per cent to 205 per cent.

International operations expanded at a faster rate than in the UK. Overseas customer numbers grew by 20 per cent to 1.03m, UK clients were up 12 per cent to 4.62m.

Read more: Admiral shares dive as profits take further discount rate hit

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