Insurer Amlin (LSE: AML) raises its half-year payout.
Amlin (LSE: AML) advanced 10p, or 3%, to 391p in early London trading after the Lloyd's catastrophe insurer published its half-year results.
Amlin reported six-month net earned premiums up 7% to £988 million and profits before tax of £185 million, which compared favourably to a £192 million loss for 2011. The FTSE 250 member said the figures were bolstered by an "excellent" underwriting return, "limited catastrophe activity" and a "low frequency of large losses".
The comparable figures for last year were blighted by claims for £314 million, which covered earthquakes in New Zealand and Japan, as well as flooding in Australia and tornadoes in the United States.
The dividend was lifted 4% to 7.5p per share. Net tangible assets increased 6% to 257p per share.
Charles Phillips, Amlin's chief executive, said:
"This is a welcome return to profit and the strength of our underwriting results underline the quality and diversity of our business. The improving trading environment is creating many opportunities for profitable growth, for which we have both the capital and underwriting capability to take advantage."
Amlin added that it expected the remainder of 2012 to "confirm a return of attractive levels of profitability". The group said underwriting conditions in the reinsurance market were "good", key areas of its insurance business were "improving", and that shareholders should expect "positive earnings momentum".
At present, Amlin's twelve-month dividend is 23.3p per share, which supports a 6% income. On the face of it, that yield looks attractive, especially as the group has lifted its dividend steadily from 15p per share since the credit crunch erupted during 2007.
Amlin's income credentials are also rubber-stamped by having ace dividend investor Neil Woodford on the shareholder register.
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> Maynard does not own any share mentioned in this article.
