Confused.com posts a profit rise and assures Admiral’s investors
Confused.com today posted its first rise in profits for four years, boosting shares at its parent group Admiral.
The price comparison site, which has struggled to beat off competition from rivals such as Comparethemarket.com and Gocompare.com, delivered a pre-tax profit of £344.6 million in 2012, up 2 per cent year-on-year.
The recovery helped insurer Admiral increase group profits by 15 per cent to £344.6 million and ease investor concerns over its long-term future. However, one blackspot continues to be the company’s overseas business, which posted a £24.5 million loss.
Chief executive Henry Engelhardt, pictured, was in an upbeat mood as he celebrated the landmark occasion. “Twenty years ago, Admiral launched on a grey Saturday in Wales — the seventh of what ultimately became a couple of dozen Direct Line clones,” he said.
“We’ve done the heavy lifting: the first 20 years. We’ve put the hole in the ground and we’ve got the cranes in place. All that’s left to do is to build the metaphorical skyscraper.”
Admiral, which also owns the Diamond and Elephant brands, has been under pressure to prove it will be able to withstand forthcoming regulatory changes to the UK motor insurance market.
These include a ban on referral fees from personal injury lawyers that comes into force next month. The competition watchdog is also investigating how insurers provide replacement vehicles for customers whose cars are damaged, amid worries current practices lead to inflated costs.
The company said it earned about £32.2 million from personal injury and car hire referral fees last year. Experts now expect it to diversify by branching into the legal sector to replace the loss of third party fees.
Admiral shares rose by 57p to £13.24 as the company increased its final dividend by 25 per cent to 45.5p. The dividend will result in a near £40 million payout for Engelhardt and fellow directors.
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