Sabre Insurance reports rise in first-half profit

(Sharecast News) - Sabre Insurance posted a 26% rise in first-half pre-tax profit to £25.5m on Thursday, and doubled its interim dividend, as the motor insurer delivered strong underwriting margins and reaffirmed its trajectory towards long-term profit growth under its 'Ambition 2030' plan. The London-listed group reported a net insurance margin of 19%, within its 18% to 22% target range, while the net loss ratio improved to 54.9% from 59.7% a year earlier.

Profit after tax rose to £18.9m from £15.1m.

The combined operating ratio improved to 82.6%, down from 86.0%.

"We have continued to write measured but healthy volumes of business at our target loss ratios through the continued soft part of the market pricing cycle," said chief executive Geoff Carter.

"Focussing on margins not volumes will help protect us against any external macro shocks."

He added that the company remained well positioned to return to growth as the market hardens, which Sabre still expected to occur later in the year.

"We remain confident of delivering a strong profit in 2025, in-line with 2024, and an attractive dividend," Carter said.

"Sabre is well placed to achieve strong levels of absolute profit growth in the years ahead."

Gross written premium declined to £100.3m from £125.7m, reflecting Sabre's strategy of prioritising profitability over volume while market pricing remains subdued.

The group maintained cautious claims inflation assumptions, estimating mid-to-high single-digit increases.

Sabre increased its interim dividend to 3.4p per share from 1.7p last year, and launched a £5m share buyback in July.

The solvency coverage ratio stood at 194.3% pre-dividend and 180.9% post-dividend, up from 191.9% and 185.2% respectively in the prior-year period.

Strategic initiatives under the Ambition 2030 programme remained on track, the board said.

Sabre launched its direct motorcycle insurance product in the first half, and said it expected to begin testing differentiated car insurance pricing later in the year.

The company said it was targeting profit before tax of at least £80m by 2030.

It noted that the FCA's recently published 'Roadmap for Retail Insurance' provided a clearer regulatory outlook, with Sabre not expecting any material financial impact.

"We are pleased with this significant reduction in regulatory uncertainty," the company said.

Looking ahead, Sabre reiterated its full-year guidance, forecasting continued delivery of its net insurance margin target, while premium volumes were expected to remain slightly below 2024 levels due to ongoing soft market conditions.

At 1053 BST, shares in Sabre Insurance Group were up 5.96% at 157.04p.

Reporting by Josh White for Sharecast.com.