Jardine Lloyd Thompson Satisfied with Flat but Creditable Performance
Insurance broker Jardine Lloyd Thompson reported flat first-half underlying pre tax earnings and reiterated its downbeat 2006 forecast.
Pre-tax profit before exceptional items and impairment charges was pounds 47.1 million, compared with pounds 47.3 million in the same period last year.
In the half, higher investment income offset lower trading profit.
However, the company has struggled to cope with falling insurance prices in its main markets, a weak US dollar and high costs.
Chief executive Dominic Burke said: "We expected 2006 to be a challenging year. In light of the very difficult trading conditions we think we have delivered a very creditable performance."
The company - which has an operation at Birmingham's City Plaza - also said it was closing its defined benefit pension scheme and moving to a defined contribution arrangement.
In the half, its underlying trading profit fell nine per cent to pounds 38.3 million, reflecting a slide in trading margin to 15 per cent from 17 per cent a year earlier. This decline was offset by a jump in investment income to pounds 8.9 million from pounds 6.7 million.
JLT shares dropped 2.4 per cent in early trading to 356p, the biggest faller on the FTSE non-life insurance index.
Analysts said the cautious forecast and the prospect for further margin erosion meant JLT was still some way from turning itself around.
Mr Burke reiterated that JLT's performance in 2006 was unlikely to show anything more than a modest improvement on 2005.
It said it expected a further deterioration in the trading margin in its core Risk Solutions business unit, which fell to 14 per cent from 18 per cent during the same period last year. …