Wet summer expected to have hit RSA
More Than parent company RSA will report figures on Thursday after a tough first half that saw the group hit by a £50 million claims bill from the UK's record summer rainfall and a difficult motor insurance market.RSA warned that the wettest June on record had seen it fork out £40 million for weather-related claims in the month, while it expected another £10 million in July. It also revealed a £35 million impact from claims relating to two earthquakes in Italy in May.
RSA said its combined operating ratio, which shows claims and expenses as a percentage of premium income - where a figure below 100% means a profit is being made - had been affected by the recent claim losses and was now expected to be "better than" 96%, against 95% previously.
The group's claim woes have been compounded by troubles in the UK motor insurance sector. It said the market was "dysfunctional" as it suffered a 17% slump in motor insurance premiums in the first quarter after putting up rates and walking away from low margin business due to fraud and the impact on profitability of price comparison websites.
Analysts are expecting RSA to report a 36% plunge in operating profits to £297 million in the first half. Pre-tax profits of £227 million are pencilled in.
Meanwhile, Ladbrokes - the UK's second biggest bookmaker - sought to reassure in June that a better performance in its 2,000-shop estate had kept it on course to meet City expectations for the first half. But this has not prevented shares from falling 8% in the past month.
Analysts are expecting Ladbrokes to report half-year earnings, excluding high rollers, of £103.4 million - up from £97.6 million the year before. The group has been hit by news of the online betting unit delay because the sector is one of the fastest growing areas of the betting industry.
James Hollins, analysts at Investec Securities, said Ladbrokes was lagging behind William Hill online. He added: "The perception of the group's online division requires a material improvement in both investors' and consumers' minds."
Ladbrokes chief executive Richard Glynn has put faith in a two-year £50 million investment in digital to return the arm to profits growth in 2013.
His plans include expanding into new territories such as Denmark and Spain and turning around its struggling poker division. It has also been heavily involved in marketing its sportsbook, casino and games offer.
Meanwhile, Ladbrokes - the UK's second biggest bookmaker - sought to reassure in June that a better performance in its 2,000-shop estate had kept it on course to meet City expectations for the first half. But this has not prevented shares from falling 8% in the past month.
Analysts are expecting Ladbrokes to report half-year earnings, excluding high rollers, of £103.4 million - up from £97.6 million the year before. The group has been hit by news of the online betting unit delay because the sector is one of the fastest growing areas of the betting industry.
James Hollins, analysts at Investec Securities, said Ladbrokes was lagging behind William Hill online. He added: "The perception of the group's online division requires a material improvement in both investors' and consumers' minds."
Ladbrokes chief executive Richard Glynn has put faith in a two-year £50 million investment in digital to return the arm to profits growth in 2013.
His plans include expanding into new territories such as Denmark and Spain and turning around its struggling poker division. It has also been heavily involved in marketing its sportsbook, casino and games offer.
© 2013 Press Association