Message to staff and customers in relation to financial position of Quinn Insurance and the Quinn Group.
The Quinn Group, Seán and the Quinn family are extremely pleased with the phenomenal support that they have all received from staff, customers and suppliers in the current difficulties.
In response to some of the recent press coverage relating to the overall financial position of both Quinn Insurance and Quinn Group we felt it important to make the following facts clear:
· On an overall basis the Quinn Group has borrowings of €1.2bn with annual cash profits of between €300m and €500m over the past five years.
· There is no issue in terms of the Group's liquidity as it has circa €70m of surplus cash. In addition profitability is strong with cash profits of €47m generated in the first quarter.
· Quinn Insurance has ample liquidity with almost €1 billion in cash reserves as well as other assets, and was extremely profitable with circa €18m in profits in March alone.
· Due to the impact of investment losses which were in excess of €220m over the last two years, Quinn Insurance's solvency has been impacted, and the Company requires circa €100m to restore this solvency ratio to the Financial Regulator's requirement of 150%.
· As regards the guarantees issued by Quinn Insurance subsidiaries these can, given appropriate time, be withdrawn by the Group lenders with no impact on the overall Group borrowing of €1.2bn. There is no cash requirement to achieve this. In other words, rectifying this situation only requires an increase in net indebtedness of €100m.
· Due primarily to equity losses of circa €3 billion outside of the Quinn Group, the Quinn family owe Anglo Irish Bank €2.8 billion. This debt is secured on the Families International property portfolio and their shareholding in Quinn Group. If Quinn Insurance can be removed from administration than there will be no difficulty in repaying both the Group and Family debt as well as continuing to provide long-term employment for all concerned.