Shares in Direct Line Group (LON:DLG) have fallen deep into negative territory this morning as the blue-chip company announced that its chief executive will step down next year. The company separately updated investors on its half-year performance, revealing falls in gross written premium and profit.
As of 10:28 BST, Direct Line’s share price had fallen 2.50 percent to 335.30p, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.92 percent lower at 7,677.64 points. The group’s shares have lost more than 11 percent of their value over the past year, as compared with about a 3.4-percent gain in the Footsie.
Direct Line CEO to step down
Direct Line announced in a statement today that Paul Geddes will step down as Chief Executive Officer in the summer of 2019, at which point he will have served in the role for a decade.
“During his tenure Paul has been leading the management team which very successfully separated the business from The Royal Bank of Scotland Group, floated it on the London Stock Exchange and turned it into a successful FTSE 100 company,” the group’s chairman Mike Biggs commented, adding that the company had ‘a well-developed succession process’.
Reuters quoted Shore Capital analyst Paul De’Ath as noting that the news of Geddes’ departure was “likely to be another negative for the shares”.
Group posts half-year results
Direct Line separately updated investors on its half-year performance this morning, reporting that its gross written premium had dipped five percent to £1.6 billion, while its profit before tax had come in 13.9 percent lower at £293.8 million. The group, however, reaffirmed its financial targets for 2018 and over the medium term and hiked its interim dividend per share by 2.9 percent to 7.0p.