Helios sees 45% GWP growth in H1’24 amid ‘excellent’ Lloyd’s market conditions

Helios Underwriting has reported that gross written premiums (GWP) increased to £230 million in the first half of 2024 on the back of 65% growth of the capacity portfolio to £512 million for the 2024 underwriting year.

The investment company, who provides investors with exposure to Lloyd’s via an actively managed portfolio of syndicate capacity, has announced a solid set of results for H1 2024, noting that the specialist Lloyd’s re/insurance marketplace continues to report “excellent performance and the outlook for 2025 is also positive.”

Year-on-year, GWP rose 45% from £159 million in H1 2023, while net earned premium increased 34% to £130 million from £97 million.

As the underlying profitability of the growing portfolio continues to be recognised, the underwriting results remain robust, with Helios generating an underwriting result of £10.9 million in H1 2024, which is down slightly on H1 2023’s £11.7 million.

Alongside the growth of the capacity portfolio in 2024, a 39% year-on-year rise in net insurance claims and operating expenses to £119 million contributed to the decline in the underwriting result, with the combined ratio rising from 88% to 92%. Although, the pro forma combined ratio hit 88%, which excludes the impact of the growth of the portfolio.

The firm explains that the earnings from the increased capacity for 2024 year of account will be a drag on overall profitability this year due to nature of the recognition of underwriting profits for an underwriting year.

Retained capacity and underwriting exposure for the 2024 year of account increased 62% to £397 million, which will contribute to the underwriting result in the future.

On the asset side of the balance sheet, group investment returns of £2.7 million, compared with £0.0 million in H1 2023, have been booked in the first six months benefiting from the higher yields seen since last year. Investment income from syndicates increased from £3.2 million to £5.8 million.

Net profits from the portfolio rose from £10.4 million in H1 2023 to £12.6 million in H1 2024, as other income increased to £4.6 million.

Operating profit for the six month period increased to £6.5 million from £6 million a year earlier, as profit after tax jumped to £5.7 million from £4.4 million.

The company also highlights further rate increase achieved by the Lloyd’s market of 1.5% over the six-month period.

Michael Wade, Executive Chairman, commented: “The Lloyd’s market is experiencing exceptionally good market conditions, as increased underwriting discipline combines with strong growth and sustainable price increases. Helios’ financial performance so far this year reflects the strength of our proposition as well as the overall health of the Lloyd’s market.

“In the first half of the year, we have expanded our retained Lloyd’s syndicate capacity participation to £397m, whilst cash levels remain strong at £35m. We remain confident that our spread Lloyd’s syndicate portfolio strategy will continue to generate attractive returns for shareholders.

“This year we were also delighted to welcome John Chambers and Katie Wade to our Board as Independent Non-Executive Directors, both of whom bring different backgrounds and perspectives that will expand the breadth and depth of expertise of the Board.

“We remain satisfied with our 2024 Lloyd’s syndicate portfolio and will be re-positioning our balance for 2025, reducing new syndicate participations, as we manage the underwriting cycle. We are making good progress in reducing prospective operational costs and attracting fee earning Third Party capacity alongside our syndicate participations.”

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