Thursday 28 February 2019 4:47 pm

Insurer Hastings adds more customers as it grows profits and revenue

Follow Joe Curtis
Hastings’ share price ticked upwards today as it profit and revenue climbed in 2018 even as customer growth slowed.

The figures

Profit after tax rose three per cent year on year to £130.6m as revenue rose five per cent to £756.4m, compared to 2017’s £715.6m.

Gross written premiums also climbed three per cent to £958.3m.

Customer policies grew to 2.71m, up 2.5 per cent from 2.64m last year, less than half the six per cent growth rate of 2017.

Cashflow improved 42 per cent year on year to £167.7m as Hastings trimmed net debt by £24m to £230.9m.

Basic earnings per share rose by 0.6p to 19.9p while Hastings proposed a final dividend of 9p per share, amounting to £59.3m, and 0.5p higher than 2017.

The insurer's share price climbed 2.2 per cent to 223.8p.

Why it's interesting

Growing customer numbers helped the insurer beat higher costs of £7m from Beast from the East and Storm Emma, though expenses rose due to a higher rate of Motor Insurers’ Bureau underwriting levies.

Still, Hastings boss Toby van der Meer said the insurer would hike its target dividend payout rate by as much as 15 per cent going forward, seeking to pay investors between 65 per cent and 75 per cent of earnings in future.

He told City A.M.: “Historically we have put between 50 per cent and 60 per cent of profits back out to shareholders – now that today things are in a very comfortable position we will pay more of our profits back to shareholders.”

The company is also investing around £20m a year in digital initiatives – including measures to tackle fraud.

Read more: Pearson seals £500m pension insurance deal with L&G

Over 2018 Hastings managed to use digital fraud tracking to helpo shut down 99 criminal gangs in 2018.

The “ghost broking rings” targeted young drivers on social media with digital fraud tracking, pretending to broker deals for car insurance before disappearing with their cash.