Financial News

  • 8 August 2014, 5:51

RSA Back In The Black Under Stephen Hester

RSA Insurance Group - formerly Royal and Sun Alliance - has returned to profit.

The company, which operates in the UK as More Than, posted an interim pre-tax profit of 69m on Thursday, following a 494m loss in the second half of last year.

Before that loss, RSA's pre-tax profit in the first half of 2013 was 250m.

The London-headquartered insurer was hit by three profit warnings in the second half of 2013, and an accounting scandal in Ireland for which it is facing a significant fine.

As a result, its chief executive Stephen Lee stepped down and was replaced in February by former Royal Bank of Scotland boss, Stephen Hester.

Mr Hester praised the company's progress as being "ahead of our expectations" and thanked its shareholders, who have not received a dividend payment with this set of results.

Despite the company returning to the black, analysts reacted cautiously on Thursday.

Thomas Dorner, insurance analyst at Citi, said there were "a number of disappointing features" and raised concerns over a continued deterioration in the company's Ireland operation.

The share price was up nearly 2% in mid-morning trading.

Half-year results were also posted on Thursday by Aviva, a rival insurer of RSA. It saw a 4% rise in pre-tax profits to 1.52bn.

Legal and General's results on Wednesday saw pre-tax profit up 7% to 636m, as its chief executive Nigel Wilson told Sky News it was a "leading player".

All three insurers have pointed to the strong pound as negatively affecting their profits.

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