HomeBussinessProfits of €32m at FBD despite rising cost of claims

Profits of €32m at FBD despite rising cost of claims

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The business said it will pay a special dividend to shareholders of €1 for each of its 40 million shares.

FBD’s profit for the first half of the year is down from €39.5m the same time last year, though it remains well above the period before that. Insurance income rose by 9.3pc to €213m, from €194.5m, in the same period last year. The company said almost two-thirds of an average premium increase in the period related to customers increasing their insurance cover and changing business mix rather than higher prices.

Higher weather-related payouts this year, including after Storm Isha, and more frequent and bigger motor insurance claims helped push up its cost of insurance payouts to €37m.

Non-insurance costs were up slightly at 27.7pc, impacted by inflationary pressure on staff and IT costs as well as investment in increased operating capacity to support revenue growth.

On the back of the latest profits, FBD announced a special dividend of €1 per share. It’s the second special dividend following a similar payout to investors in the first half of 2023.

The first half also saw a rise in investment income – an important source of revenue for insurers that manage large funds in order to meet the cost of claims and growth in the number of policies including in its key Farmer, Business and Retail customer segments .

FBD Group CEO Tomás Ó Midheach said the first half had produced a “strong, consistent performance”.

“Our customer-focused strategy has established a strong momentum, as seen in the increase in number of new customers over the period and in the retention rates of our loyal customers,” he said.

FBD’s shareholders include the farmer-backed investment group Farmers Business Developments Ltd (20pc), and FBD Trust which was established in 1974 to advance the interests of Irish farm families (12pc). Businessman Eamon Waters’ family office investment firm Sretaw Private Equity has a 10.9pc stake in the insurer and is headed by former FBD boss Fiona Muldoon.

In its financial statements, FBD Group included a provision of €1,500,000 for its contribution to UCD Agricultural Science Centre for investment in new agricultural research and education facilities at UCD Lyons Farm. This payment is expected to be made in the coming year.

This is in addition to the €2,500,000 provision included in the financial statements at December 31, 2023, for FBD’s contribution to the ESG initiative to develop the Padraig Walshe Centre for Sustainable Animal and Grassland Research in Moorpark. This payment is expected to be made in the coming year.

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