RSA share price: FY underlying EPS rise 42%

on Feb 23, 2017
Updated: Oct 21, 2019

RSA Insurance (LON:RSA) has updated investors on its full-year performance this morning.

**Highlights from the company statement:**
Underlying EPS 39.5p, up 42%. Operating profit £655m, up 25%.
Record underwriting profit and combined ratio (£380m, up 73%, 94.2% vs 96.9%).
Final dividend 11p/share (16p total for 2016, up 52%).
Statutory net profit £20m, impacted by non-capital charges for Legacy disposal.
Stephen Hester, RSA Group Chief Executive, commented:
“In 2016 RSA took major strides forward, moving seamlessly from ‘successful turnaround’ to organic outperformance. Our improvements are both strategic and operational. They are delivering high quality sustainable results.

Our ambition now is to drive RSA’s performance towards ‘best in class’ levels. Industry and financial market conditions will remain tough. We plan to outperform through continuing self-help measures on customer service, underwriting and costs.”
2016 Trading results
· Group operating profit £655m up 25% (2015: £523m): Scandinavia £311m; Canada £140m; UK £259m.
· Record1 Group underwriting profit of £380m, up 73% (2015: £220m). Core Group combined ratio of 93.8% (2015: 96.0%). Scandinavia 86.2%; Canada 94.9%; and the UK 95.4%.

· Record1 Group current year underwriting profit of £271m (2015: £129m): Core Group attritional loss ratio 1.4pts better than last year, weather and large losses 0.3pts worse. Group prior year underwriting profit of £109m (2015: £91m).
· Core Group premiums of £6.3bn up 6%, although down slightly on an underlying basis2.
· Investment income £369m (2015: £403m), fell 8% reflecting impact of disposals and low bond yields, partly offset by FX translation benefits.
· Non-capital charge of £204m for disposal of legacy liabilities3; Other non-operating charges3 of £261m (c.90% non-capital in nature);
· Post tax statutory profit of £20m reflecting the non-capital accounting charges above (2015: £244m benefited from disposal gains).
· Underlying earnings per share1 (EPS) 39.5p up 42% (2015: 27.8p).
· Final dividend of 11p/ordinary share proposed, bringing total 2016 dividends to 16p/ordinary share (up 52%).
As of 07:36 GMT, Thursday, 23 February, RSA Insurance Group plc share price is 496.80p.

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