Insurance company Homeserve raises profits as CEO sells shares
Richard Harpin to sell shares worth £68 million
By CFOworld.co.uk | CFO UK | Published 12:45, 23 November 10
In a statement on Tuesday, home insurance company Homeserve announced that its CEO, Richard Harpin, will be selling around 30% of his shares, worth approximately £68 million. Harpin will retain a 12 percent stake in the company, and "has committed to a lock-up of 12 months with respect to this holding."
The reason given by the company was the "the proceeds of the Placing will be used to diversify Mr Harpin's financial portfolio as part of prudent financial planning."
In a separate announcement, Homeserve reported a 13 percent increase in half year pre-tax profits to £21.3 million, and a 19 percent growth in revenue to £171 million. The pre-tax profit figure excludes £0.6m of acquisition and integration costs, resulting from the acquisition of National Grid Energy Services (NGES) in the US during the period.
Dividend per share was increased by 1 pence to 3.3 pence.
The company provides insurance cover for domestic emergencies such as burst pipes to 4.6 million households in the USA, UK, France and Spain. The number of policies increased 14 percent over the same period last year; customer base was up 11 percent.
The company said that it continues to invest in both the UK and the international business and they are seeing a return on international investment with growing customer numbers and increased profit growth.
According to Harpin, "whilst recognising the global economic uncertainties, all business areas continue to perform well and we remain confident of delivering another year of strong profits growth... Our balance sheet remains strong and the business continues to be highly cash generative."
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