Profits jump at insurer to £1.9m

FISHER International, the insurance and financial services group is planning further growth following a 121 per cent rise in pre-tax profit from £0.87 million sterling in 1995 to £1.93 million in 1996.

The current year has started well and is in line with expectations, said chairman, Sir Timothy Kitson. "We anticipate further benefits from the acquisitions made in 1996 both in terms of profit contribution and broadening the base of our business."

Further acquisitions are anticipated and the group is looking for "a positive outcome in the current year".

The latest results were boosted by a nine months contribution from the loss adjusting firm, Miller Knight, and from the "claims handling business of Robert Bishop (Southern), which were acquired. The results show a contribution of £1.28 million from these. Excluding these, the operating profit contracted from £1.04 million to £0.92 million.

Chief executive, Mr Kevin Kenny, explained that the integration of these businesses adversely affected the results of the continuing operation. Some 12 branches were closed and he estimated the cost at £0.4 million, so the underlying trend was healthy.

The loss adjusting side of the business produced "excellent results", according to the chairman. The purchase of Miller Knight resulted in "significant benefits" as it was merged with its existing Fishers Loss Adjusters. This integration has now been completed.

The claims handling and inspection services showed a rise in turn over from £9.2 million to £17.1, million while profits grew from £0.65 million to £1.51 million. Claytons business was expanded through the purchase of the Robert Bishop business. Sheppard Motor Engineering had a difficult year and suffered from the loss of a major client, the chairman noted. However, the British vehicle inspection business "performed extremely well".

The insurance business saw a rise in premiums from £14.8 million to £19.6 million while profits increased from £0.2 million to £0.4 million. The number of policy holders increased by 35 per cent to 540,000.

The increase from 2.5 per cent to 17.5 per cent in insurance premium tax will have a "significant negative impact" on the repair insurance market, a major part of its historic business. This will primarily affect the 1998 results but there will be some impact this year, the chairman has warned.

Overall, Fisher's sales grew from £24.0 million to £36.7 million last year. Reflecting real growth, earnings per share went up from 0.63p to 1.38p. A final dividend of 0.34p net per share has been declared, making a total of 0.50p compared with 0.32p.

Profits this year are expected to rise from £1.9 million to £2.5 million which implies a growth in earnings per share from 1.38p to around 1.7p.