RSA share price surges after upbeat quarterly update

on Nov 3, 2016
Updated: Oct 21, 2019

Shares in RSA Insurance (LON:RSA) have climbed into positive territory in today’s session, slightly outperforming the broader market, as the blue-chip insurer delivered an upbeat quarterly update. The group’s chief executive Stephen Hester further noted that Brexit provided ‘an attractive tailwind’ for the company.

As of 10:17 GMT, RSA’s share price had climbed 0.37 percent to 546.00p, slightly outperforming the benchmark FTSE 100 index which has slipped marginally into the red and is currently 0.11 percent worse off at 6,837.73 points. The group’s shares have gained just under 32 percent over the past year, and are up by nearly 29 percent in the year-to-date.
RSA announced in a statement today that its core net underwritten premiums in the year-to-date had climbed six percent in the third quarter, while slightly down on an underlying basis. The group further noted that its profitability for the reported period on underwriting, operating and after-tax measures was strong and ahead of expectations.

“We are very pleased with RSA’s continuing progress towards our ‘Best in Class’ ambitions,” chief executive Stephen Hester commented in the statement, referring to the insurer’s aim to close the gap to the best in class players in each of its core markets, UK, Scandinavia and Canada by 2018. Hester further noted that the UK’s vote to leave the European Union provided the company with “an attractive tailwind from overseas earnings translation, in the context of an otherwise challenging environment”.

“While Q4 can be a bumpy underwriting period, RSA is on track for strong operating earnings increases for 2016 overall,” he concluded.
Reuters, however, quoted Barrie Cornes at Panmure Gordon as commenting that while RSA’s share price has rallied well, “on the downside we believe that in doing so it has materially reduced the possibility that the company will be bid for”. Last year, Swiss rival Zurich Insurance made a move on the London-listed group but subsequently dropped the bid due to problems at its own business.
As of 10:47 GMT, Thursday, 03 November, RSA Insurance Group plc share price is 496.80p.

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