HomeServe Insurance Reports High Profits despite Flooding in the UK

Despite the recent events in the United Kingdom, HomeServe Plc has just reported its profit from the core business for the first 6 months of 2009, which turned out to be high enough.
Let us remind that HomeServe Plc specialises on emergency home insurance, covering such issues as broken boilers and washing machines. The insurance provider claimed that despite the recent floods in the UK, North West of England in particular, it expects to achieve its annual pre-tax profit of £98 million due to increases in policy and customer numbers.
Earlier this week, the Association of British Insurers (ABI) claimed that the insurance industry in Great Britain might face severe losses of up to £100 million as a result of the floods in the north west of England.
Mr. Richard Harpin, chief executive of HomeServe Plc, however, clearly stated that the company’s core business will not be affected by flooding in England. On Tuesday, November 24th, the shares of HomeServe grew by 8.6%, and reached 1,651 pence per share on the London Stock Exchange.
Mr. Harpin added that HomeServe did participate in flood restoration as it was part of the emergency services insurance policy recently sold by the insurance provider. HomeServe, said Mr. Harpin, enjoys high levels of new insurance policy sales and insurance policy renewals in the second half of 2009 as well. He mentioned that the firm expects the level of sales in the second half of the year to stay the same as in the first half.
HomeServe’s adjusted pre-tax profit for the first 6 months of 2009 amounted to £18.9 million, which is approximately 14% up from £16.5 million in 2008. Company’s revenue increased by 25%, to £135 million, while its net loss amounted to £24.6 million due to the sale of Emergency Services.