|
|
|
2003
£m |
|
2002
£m |
|
|
| Interim dividend of 0.85 pence (2002: 0.75 pence) per ordinary share |
|
3.3 |
|
2.9 |
|
| Proposed final dividend of 1.65 pence (2002: 1.25 pence) per ordinary share |
|
6.4 |
|
4.7 |
|
|
|
|
|
9.7 |
|
7.6 |
|
|
13 Earnings and net assets per ordinary share
Earnings per share is based on the profit attributable to shareholders for the year ended 31 December 2003 of £83.3 million (2002:
£44.2 million) and the weighted average number of shares in issue during the period. Shares held by the Employee Share Ownership Trust
(ESOT) are excluded from the weighted average number of shares.
Basic and diluted earnings per share are as follows:
|
|
|
|
2003 |
|
2002 |
|
|
| Profit for the financial year |
|
|
£83.3m |
|
£44.2m |
|
| Weighted average number of shares in issue |
|
|
384.6m |
|
312.4m |
|
| Dilutive shares |
|
|
4.9m |
|
1.3m |
|
|
| Adjusted average number of shares in issue |
|
|
389.5m |
|
313.7m |
|
|
| Basic earnings per share |
|
|
21.6p |
|
14.1p |
|
| Diluted earnings per share |
|
|
21.4p |
|
14.1p |
|
|
Basic net assets per share are as follows:
|
|
|
|
2003 |
|
2002 |
|
|
| Net assets at 31 December |
|
|
£383.3m |
|
£306.8m |
|
| Adjustments for intangible assets |
|
|
(£57.0m |
) |
(£60.1m |
) |
|
| Tangible net assets at 31 December |
|
|
£326.3m |
|
£246.7m |
|
|
| Number of shares in issue at 31 December |
|
|
390.9m |
|
388.3m |
|
| Adjustment for ESOT shares |
|
|
(5.2m |
) |
(6.1m |
) |
|
| Basic number of shares after ESOT adjustment |
|
|
385.7m |
|
382.2m |
|
|
| Net assets per share |
|
|
99.3p |
|
80.3p |
|
| Tangible net asset per share |
|
|
84.6p |
|
64.5p |
|
|
14 Intangible assets
|
|
|
|
|
|
Purchased
syndicate
participations
£m |
|
|
| Cost |
|
|
|
|
|
|
| At 1 January and 31 December 2003 |
|
|
|
|
63.2 |
|
|
| Amortisation |
|
|
|
|
|
|
| At 1 January 2003 |
|
|
|
|
3.1 |
|
| Charge for the year |
|
|
|
|
3.1 |
|
|
| At 31 December 2003 |
|
|
|
|
6.2 |
|
|
| Net book value |
|
|
|
|
|
|
| At 31 December 2003 |
|
|
|
|
57.0 |
|
|
| At 1 January 2003 |
|
|
|
|
60.1 |
|
|
15 Other financial investments
|
| Group |
At valuation
2003
£m |
|
At valuation
2002
£m |
|
At cost
2003
£m |
|
At cost
2002
£m |
|
|
| Shares and other variable yield securities |
50.6 |
|
0.7 |
|
46.7 |
|
0.6 |
|
| Debt and other fixed income securities |
750.3 |
|
559.8 |
|
755.0 |
|
552.0 |
|
| Participation in investment pools |
128.3 |
|
134.3 |
|
128.6 |
|
134.0 |
|
| Deposits with credit institutions |
80.7 |
|
49.0 |
|
80.6 |
|
48.9 |
|
| Overseas deposits |
34.5 |
|
26.2 |
|
34.5 |
|
26.2 |
|
| Other |
4.0 |
|
3.9 |
|
4.0 |
|
3.9 |
|
|
|
1,048.4 |
|
773.9 |
|
1,049.4 |
|
765.6 |
|
|
| In Group owned companies |
235.7 |
|
227.0 |
|
232.1 |
|
224.8 |
|
| In aligned syndicates |
801.1 |
|
535.3 |
|
806.1 |
|
529.6 |
|
| In non-aligned syndicates |
11.6 |
|
11.6 |
|
11.2 |
|
11.2 |
|
|
|
1,048.4 |
|
773.9 |
|
1,049.4 |
|
765.6 |
|
|
Listed investments included in Group owned total are as follows:
|
|
| Shares and other variable yield securities |
50.6 |
|
0.7 |
|
46.7 |
|
0.6 |
|
| Debt and other fixed income securities |
92.5 |
|
124.1 |
|
92.8 |
|
122.3 |
|
|
|
143.1 |
|
124.8 |
|
139.5 |
|
122.9 |
|
|
As explained in note 31, some of the Group investments are charged to Lloyd’s to support the Group’s underwriting activities.
Investment duration
The table below sets out, by currency, the duration of the Group’s share of the managed syndicate debt securities together with the Group’s
own debt portfolio at 31 December:
|
| Syndicates |
Balance
2003
£m |
|
Balance
2002
£m |
|
Duration
2003
£m |
|
Duration
2002
£m |
|
|
| Sterling |
212.1 |
|
124.3 |
|
2.7 |
|
1.5 |
|
| US dollar |
377.3 |
|
280.5 |
|
2.5 |
|
1.7 |
|
| Canadian dollar |
18.7 |
|
11.8 |
|
2.2 |
|
2.6 |
|
| Euro |
38.4 |
|
7.7 |
|
3.1 |
|
1.4 |
|
|
|
646.5 |
|
424.3 |
|
2.6 |
|
1.7 |
|
|
|
| Corporate |
|
|
|
|
|
|
|
|
|
| Sterling |
92.5 |
|
124.1 |
|
0.3 |
|
4.8 |
|
|
An indication of the potential impact on these funds of changes in the yield curve due to unexpected changes in underlying interest rates
is given below:
|
|
|
|
Syndicate |
|
|
|
|
|
|
|
| Shift in yield (basis points) |
Sterling
% |
|
US$
% |
|
CAN$
% |
|
Euro
% |
|
Corporate
Sterling
% |
|
Net
(reduction)
increase
in value
£m |
|
|
| 100 |
(2.4% |
) |
(3.3% |
) |
(2.2% |
) |
(3.0% |
) |
(0.3% |
) |
(19.4 |
) |
| 75 |
(1.8% |
) |
(1.9% |
) |
(1.6% |
) |
(2.2% |
) |
(0.2% |
) |
(12.2 |
) |
| 50 |
(1.2% |
) |
(1.2% |
) |
(1.1% |
) |
(1.5% |
) |
(0.2% |
) |
(8.2 |
) |
| 25 |
(0.6% |
) |
(0.6% |
) |
(0.5% |
) |
(0.7% |
) |
(0.1% |
) |
(4.1 |
) |
| -25 |
0.6% |
|
0.6% |
|
0.5% |
|
0.7% |
|
0.1% |
|
4.2 |
|
| -50 |
1.2% |
|
1.3% |
|
1.1% |
|
1.5% |
|
0.2% |
|
8.5 |
|
| -75 |
1.8% |
|
1.9% |
|
1.6% |
|
2.2% |
|
0.2% |
|
12.5 |
|
| -100 |
2.5% |
|
2.6% |
|
2.2% |
|
3.0% |
|
0.3% |
|
17.0 |
|
|
Using Standard & Poor’s and Moody’s as ratings sources, the credit ratings of the Group’s share of the debt and other fixed income securities
is set out below:
|
|
|
|
|
|
|
|
|
|
|
2003
£m |
|
2002
£m |
|
|
| Government/Government Agency |
481.0 |
|
319.4 |
|
| AAA/Aaa |
|
|
|
|
|
|
|
|
100.3 |
|
110.8 |
|
| AA/Aa |
|
|
|
|
|
|
|
|
60.5 |
|
52.3 |
|
| A |
|
|
|
|
|
|
|
|
88.4 |
|
56.4 |
|
| BBB/Baa |
|
|
|
|
|
|
|
|
8.8 |
|
9.6 |
|
|
|
|
|
|
|
|
|
|
|
739.0 |
|
548.5 |
|
|
| In non-aligned syndicates |
|
|
|
|
|
|
|
|
11.3 |
|
11.3 |
|
|
|
|
|
|
|
|
|
|
|
750.3 |
|
559.8 |
|
|
|
| Company |
At valuation
2003
£m |
|
At valuation
2002
£m |
|
At cost
2003
£m |
|
At cost
2002
£m |
|
|
| Participations in investment pools |
12.2 |
|
3.5 |
|
12.2 |
|
3.5 |
|
|
Back to top
16 Other investments |
|
|
|
|
|
Subsidiary
undertakings
£m |
|
|
| At 1 January and 31 December 2003 |
|
|
|
|
205.4 |
|
|
The principal undertakings of Amlin plc at 31 December 2003 which are consolidated in these financial statements, all of which operate
in the UK and are registered in England and Wales, are listed below:
|
| Subsidiary undertakings |
Principal activity |
|
Amlin Underwriting Limited
Amlin Investments Limited
Amlin Corporate Services Limited
Amlin Corporate Member Limited
AUT (No 2) Limited
AUT (No 6) Limited
AUT (No 7) Limited
AUT (No 8) Limited
Delian Beta Limited
Delian Delta Limited
|
Lloyd’s managing agency
Investment company
Group service company
Corporate member at Lloyd’s
Corporate member at Lloyd’s
Corporate member at Lloyd’s
Corporate member at Lloyd’s
Corporate member at Lloyd’s
Corporate member at Lloyd’s
Corporate member at Lloyd’s
|
|
All principal subsidiary undertakings are wholly owned.
17 Debtors arising out of direct insurance operations
|
|
|
|
2003
£m |
|
2002
£m |
|
|
| Amounts owed by policyholders |
|
|
10.5 |
|
93.9 |
|
| Amounts owed by intermediaries |
|
|
123.6 |
|
141.3 |
|
|
|
|
|
134.1 |
|
235.2 |
|
|
| 18 Tangible assets |
| Group |
Leasehold
land and
buildings
£m |
|
Motor
vehicles
£m |
|
Computer
equipment
£m |
|
Fixtures,
fittings and
leasehold
improvements
£m |
|
Total
£m |
|
|
| Cost |
|
|
|
|
|
|
|
|
|
|
| At 1 January 2003 |
1.9 |
|
0.3 |
|
9.9 |
|
5.5 |
|
17.6 |
|
| Additions |
- |
|
0.1 |
|
1.4 |
|
- |
|
1.5 |
|
| Disposals |
- |
|
(0.1 |
) |
- |
|
- |
|
(0.1 |
) |
|
| At 31 December 2003 |
1.9 |
|
0.3 |
|
11.3 |
|
5.5 |
|
19.0 |
|
|
| Accumulated depreciation |
|
|
|
|
|
|
|
|
|
|
| At 1 January 2003 |
0.1 |
|
0.1 |
|
6.3 |
|
2.1 |
|
8.6 |
|
| Charge for the year |
- |
|
0.1 |
|
2.9 |
|
1.1 |
|
4.1 |
|
| Disposals |
- |
|
(0.1 |
) |
- |
|
- |
|
(0.1 |
) |
|
| At 31 December 2003 |
0.1 |
|
0.1 |
|
9.2 |
|
3.2 |
|
12.6 |
|
|
| Net book value |
|
|
|
|
|
|
|
|
|
|
| At 31 December 2003 |
1.8 |
|
0.2 |
|
2.1 |
|
2.3 |
|
6.4 |
|
|
| At 1 January 2003 |
1.8 |
|
0.2 |
|
3.6 |
|
3.4 |
|
9.0 |
|
|
The assets held under finance leases and hire purchase contracts included in the above had no net book value, in either the current or
previous year.
|
| Company |
|
|
|
|
|
|
|
|
|
|
Leasehold
land and
buildings
£m |
|
|
| Cost |
|
|
|
|
|
|
| At 1 January and 31 December 2003 |
|
|
|
|
1.9 |
|
|
| Accumulated depreciation |
|
|
|
|
|
|
| At 1 January 2003 |
|
|
|
|
0.1 |
|
| Charge for the year |
|
|
|
|
- |
|
|
| At 31 December 2003 |
|
|
|
|
0.1 |
|
|
| Net book value |
|
|
|
|
|
|
| At 31 December 2003 |
|
|
|
|
1.8 |
|
|
| At 1 January 2003 |
|
|
|
|
1.8 |
|
|
|
| 19 Ordinary share capital |
|
| Authorised ordinary shares of 25p each |
|
|
Number |
|
£m |
|
|
| At 1 January and 31 December 2003 |
|
|
562,000,000 |
|
140.5 |
|
|
|
| Allotted, called up and fully paid: |
|
|
Number |
|
£m |
|
|
| At 1 January 2003 |
|
|
388,323,251 |
|
97.1 |
|
| Scrip dividend alternative shares issued |
|
|
1,461,247 |
|
0.4 |
|
| Share options exercised |
|
|
1,087,418 |
|
0.2 |
|
|
| At 31 December 2003 |
|
|
390,871,916 |
|
97.7 |
|
|
The scrip dividend shares were issued at a reference share price of 112.2 pence per share for the final 2002 dividend, at which 1,018,449
shares were issued, and 137.5 pence per share for the interim 2003 dividend, at which 442,798 shares were issued. The share options were
issued for a total consideration of £884,282 at an average of 81.3 pence per share.
20 Share options
Details of the Amlin Executive Share Option Schemes are set out in the Directors’ remuneration report. At 31 December
2003 the following options over new shares, which are potentially exercisable between three and 10 years after grant, or earlier in special
circumstances such as redundancy, were outstanding under these executive schemes:
|
| Usual first month of exercise |
|
|
Option price
per share |
|
Number
of shares |
|
|
| June 2003 |
|
|
77.7p |
|
845,476 |
|
| November 2002 |
|
|
81.0p |
|
135,552 |
|
| May 2005 |
|
|
81.3p |
|
3,272,404 |
|
| October 2002 |
|
|
85.4p |
|
1,011,413 |
|
| May 2000 |
|
|
112.2p |
|
1,032,888 |
|
| May 2004 |
|
|
115.1p |
|
1,235,521 |
|
| September 2001 |
|
|
115.6p |
|
593,586 |
|
| April 2006 |
|
|
118.0p |
|
2,451,000 |
|
|
|
|
|
|
|
10,577,840 |
|
|
The following changes in new shares under option pursuant to these executive schemes took place during the year:
|
|
|
|
|
|
Number
of shares |
|
|
| At 1 January 2003 |
|
|
|
|
9,077,946 |
|
| Granted on 23 April 2003 (2002: 3,326,700) |
|
|
|
|
2,456,000 |
|
| Exercised during the year (2002: 52,134) |
|
|
|
|
(797,506 |
) |
| Lapsed during the year (2002: 81,507) |
|
|
|
|
(158,600 |
) |
|
| At 31 December 2003 |
|
|
|
|
10,577,840 |
|
|
In addition to the above executive options, the following employee Sharesave options over new shares were outstanding at 31 December 2003:
|
| Savings period |
Usual first month
of exercise |
|
Option price
per share |
|
Number
of shares |
|
|
| 5 years |
December 2004 |
|
82.5p |
|
316,274 |
|
| 3 years |
July 2004 |
|
97.8p |
|
305,130 |
|
| 5 years |
July 2006 |
|
97.8p |
|
64,833 |
|
| 3 years |
December 2005 |
|
84.0p |
|
589,500 |
|
| 5 years |
December 2007 |
|
84.0p |
|
192,786 |
|
|
|
|
|
|
|
1,468,523 |
|
|
The following changes in new shares under option pursuant to the Sharesave scheme took place during the year:
|
|
|
|
|
|
Number
of shares |
|
|
| At 1 January 2003 |
|
|
|
|
1,840,333 |
|
| Exercised during the year (2002: 143,719) |
|
|
|
|
(289,912 |
) |
| Lapsed during the year (2002: 216,121) |
|
|
|
|
(81,898 |
) |
|
| At 31 December 2003 |
|
|
|
|
1,468,523 |
|
|
The trustee of the Group’s Employee Share Ownership Trust (ESOT) held 5,209,922 Amlin ordinary shares as at 31 December 2003 (2002:
6,098,302), of which 5,132,686 shares (2002: 6,095,275) were reserved to meet potential future exercises of executive options, in addition
to the options over new shares detailed above. The ESOT shares are valued at the lower of cost and net realisable value. The market value
of Amlin plc ordinary shares at 31 December 2003 was 128.0p per share (2002: 119.0p).
The assets, liabilities, income and costs of the ESOT are incorporated into the consolidated financial statements. The ESOT waives the right
to dividends in excess of 0.01p per share per interim or final dividend in respect of its total shareholding.
Back to top
21 Reserves
|
| Group |
Share
premium
account
£m |
|
Own
shares
£m |
|
Merger
reserve
£m |
|
Capital
redemption
reserve
£m |
|
Profit and
loss account
£m |
|
|
| At 1 January 2003 |
148.2 |
|
(2.8 |
) |
41.9 |
|
2.7 |
|
19.7 |
|
| Issue of share capital for scrip dividend |
1.4 |
|
- |
|
- |
|
- |
|
- |
|
| Issue of share capital on exercise of options over new shares |
0.6 |
|
- |
|
- |
|
- |
|
- |
|
| Exercise of options over shares held by ESOT |
- |
|
0.4 |
|
- |
|
- |
|
(0.1 |
) |
| Retained profit for the financial year |
- |
|
- |
|
- |
|
- |
|
73.6 |
|
|
| At 31 December 2003 |
150.2 |
|
(2.4 |
) |
41.9 |
|
2.7 |
|
93.2 |
|
|
The cumulative amount of goodwill written off to reserves is £45.7 million (2002: £45.7 million).
|
| Company |
|
|
Share
premium
account
£m |
|
Own
shares
£m |
|
Capital
redemption
reserve
£m |
|
Profit and
loss account
£m |
|
|
| At 1 January 2003 (restated) |
148.2 |
|
(2.8 |
) |
2.7 |
|
132.0 |
|
| Issue of share capital for scrip dividend |
1.4 |
|
- |
|
- |
|
- |
|
| Issue of share capital on exercise of options over new shares |
0.6 |
|
- |
|
- |
|
- |
|
| Exercise of options over shares held by ESOT |
- |
|
0.4 |
|
- |
|
(0.1 |
) |
| Retained loss for the financial year |
- |
|
- |
|
- |
|
(16.9 |
) |
|
| At 31 December 2003 |
150.2 |
|
(2.4 |
) |
2.7 |
|
115.0 |
|
|
22 Reconciliation of movements in equity shareholders’ funds
|
|
|
|
Group
2003
£m |
|
Restated
Group
2002
£m |
|
Company
2003
£m |
|
Restated
Company
2002
£m |
|
|
| Profit (loss) attributable to shareholders |
83.3 |
|
44.2 |
|
(7.2 |
) |
(4.6 |
) |
| Less dividends |
(9.7 |
) |
(7.6 |
) |
(9.7 |
) |
(7.6 |
) |
|
| Retained profit (loss) for the financial year |
73.6 |
|
36.6 |
|
(16.9 |
) |
(12.2 |
) |
| Issue of share capital |
2.6 |
|
136.2 |
|
2.6 |
|
136.2 |
|
| Movement in shares held by ESOT |
0.4 |
|
- |
|
0.4 |
|
- |
|
| Realised loss on disposal of shares by ESOT |
(0.1 |
) |
- |
|
(0.1 |
) |
- |
|
| Shares to be issued |
- |
|
(0.4 |
) |
- |
|
(0.4 |
) |
|
| Net increase (decrease) to shareholders’ funds |
76.5 |
|
172.4 |
|
(14.0 |
) |
123.6 |
|
|
| Equity shareholders’ funds at 1 January 2003 (as reported) |
309.6 |
|
137.2 |
|
380.6 |
|
257.0 |
|
| Adjustment for shares held by ESOT |
(2.8 |
) |
(2.8 |
) |
(2.8 |
) |
(2.8 |
) |
| Adjustment for ESOT reserves |
- |
|
- |
|
(0.6 |
) |
(0.6 |
) |
|
| Equity shareholders’ funds at 1 January 2003 (as restated) |
306.8 |
|
134.4 |
|
377.2 |
|
253.6 |
|
|
| Equity shareholders’ funds at 31 December 2003 |
383.3 |
|
306.8 |
|
363.2 |
|
377.2 |
|
|
23 Technical provisions
|
|
|
|
|
|
Provision for
unearned
premiums
£m |
|
Claims
outstanding
£m |
|
Total
£m |
|
|
| Gross |
|
|
|
|
|
|
|
|
| At 1 January 2003 |
|
|
354.8 |
|
957.4 |
|
1,312.2 |
|
| Exchange adjustments |
|
|
(22.3 |
) |
(56.0 |
) |
(78.3 |
) |
| Movement in the provisions |
|
|
97.1 |
|
98.1 |
|
195.2 |
|
|
| At 31 December 2003 |
|
|
429.6 |
|
999.5 |
|
1,429.1 |
|
|
| Reinsurance amount |
|
|
|
|
|
|
|
|
| At 1 January 2003 |
|
|
(34.0 |
) |
(337.4 |
) |
(371.4 |
) |
| Exchange adjustments |
|
|
2.1 |
|
21.4 |
|
23.5 |
|
| Movement in the provisions |
|
|
2.6 |
|
50.6 |
|
53.2 |
|
|
| At 31 December 2003 |
|
|
(29.3 |
) |
(265.4 |
) |
(294.7 |
) |
|
| Net |
|
|
|
|
|
|
|
|
| At 31 December 2003 |
|
|
400.3 |
|
734.1 |
|
1,134.4 |
|
|
| At 1 January 2003 |
|
|
320.8 |
|
620.0 |
|
940.8 |
|
|
The claims outstanding balance is further analysed between notified outstanding claims and incurred but not reported claims (IBNR) below:
|
|
|
|
|
|
|
|
2003
£m |
|
2002
£m |
|
|
| Notified outstanding claims |
|
|
|
|
618.0 |
|
619.2 |
|
| Claims incurred but not reported |
|
|
|
|
381.5 |
|
338.2 |
|
|
| Claims outstanding |
|
|
|
|
999.5 |
|
957.4 |
|
|
Included in the above are balances that remain outstanding as a result of the terrorist attacks of 11 September 2001. The gross loss estimate
by class of business, and the net loss estimates, compared with the estimated positions at 31 December 2002, are summarised below:
|
| Class of business |
Paid
US$m |
|
Outstanding
US$m |
|
IBNR
US$m |
|
Ultimate
2003
US$m |
|
Ultimate
2002
US$m |
|
Movement
US$m |
|
|
| Direct and facultative property |
66.0 |
|
4.2 |
|
- |
|
70.2 |
|
72.4 |
|
(2.2 |
) |
| Property reinsurance and risk excess of loss |
225.9 |
|
66.7 |
|
3.0 |
|
295.6 |
|
303.7 |
|
(8.1 |
) |
| Direct airline operators and other aviation risks |
3.4 |
|
97.0 |
|
78.8 |
|
179.2 |
|
179.5 |
|
(0.3 |
) |
| Reinsurance of aviation risks |
0.7 |
|
23.3 |
|
4.4 |
|
28.4 |
|
26.3 |
|
2.1 |
|
| Other |
13.0 |
|
15.5 |
|
0.2 |
|
28.7 |
|
29.8 |
|
(1.1 |
) |
|
| Total gross loss |
309.0 |
|
206.7 |
|
86.4 |
|
602.1 |
|
611.7 |
|
(9.6 |
) |
| Reinsurance recoveries |
(267.0 |
) |
(124.5 |
) |
(60.6 |
) |
(452.1 |
) |
(454.3 |
) |
2.2 |
|
|
| Total net loss |
42.0 |
|
82.2 |
|
25.8 |
|
150.0 |
|
157.4 |
|
(7.4 |
) |
|
| Amlin Group share |
|
|
|
|
|
|
100.4 |
|
105.6 |
|
(5.2 |
) |
|
In addition to the IBNR noted above, a further US$9.0 million of general IBNR is included in the ultimate reserve. Amlin’s Group share of the
general IBNR is US$6.3 million.
The improvement in the gross and net loss positions during the year is principally due to the settlement of one large property risk excess
of loss programme. Reserves for other classes impacted are reasonably stable.
Key assumptions made in estimating the losses from 11 September 2001 include:
- the terrorist attacks leading to the collapse of the World Trade Center towers in New York were one occurrence;
- the Washington and Pittsburgh losses were two further distinct occurrences;
- there will be no material failures of reinsurance security;
- all reinsurers will reinstate reinsurance cover in accordance with the relevant contract provision;
- there will be no material contractual disputes with any reinsurers;
- there will be no subrogation recoveries or financial support from third parties, including the US government or associated agencies; and
- war exclusions on policies do not apply and all of the occurrences were caused by terrorist action.
The estimates, and the assumptions and methodology from which they are derived, do not, and may not be taken to constitute an admission
that the Group is liable either in respect of a particular class of business or under a particular contract of insurance or reinsurance.
A number of insurance companies and Lloyd’s syndicates, including Syndicate 2001, are currently in dispute with the leaseholder of the
World Trade Center, Silverstein Holdings, as to whether the terrorist attack and destruction of the buildings constitutes one or two insured
occurrences. Based on legal advice received, Amlin believes the attacks on the World Trade Center are one occurrence. However, this matter
is subject to court proceedings which have commenced in the United States and there is, therefore, potential for additional loss. In the event
that the World Trade Center losses were judged to be two occurrences and two total losses to the excess layers underwritten, it is estimated
that the Group’s loss could increase by up to approximately £22 million. However, given our legal advice and the high excess point of the layer
which we insured, we believe that this is unlikely.
Back to top
24 Provisions for other risks, charges and deferred tax
a) Spread portfolio and other provisions
|
|
|
|
|
|
|
|
|
|
Provisions
for spread
underwriting losses
£m |
|
|
| At 1 January 2003 |
|
|
|
|
|
|
2.9 |
|
| Utilised during the year |
|
|
|
|
|
|
(1.7 |
) |
| Additions |
|
|
|
|
|
|
1.8 |
|
|
| At 31 December 2003 |
|
|
|
|
|
|
3.0 |
|
|
Included in the provision above is £0.4 million (2002: £1.0 million) as the estimated loss attributable to the Group in respect of its
underwriting through Stace Barr Angerstein PLC and its subsidiary, SBA Underwriting Limited, the accounts of which are not yet available.
b) The deferred tax (liability) asset is attributable to timing differences arising on the following:
|
|
Underwriting
results
£m |
|
Provisions
for losses
£m |
|
Unrelieved
trading losses
carried forward
£m |
|
Other
timing
differences
£m |
|
Total
£m |
|
|
| At 1 January 2003 |
5.1 |
|
0.5 |
|
11.2 |
|
1.6 |
|
18.4 |
|
| Deferred tax charge for the year |
(45.8 |
) |
0.5 |
|
4.0 |
|
6.0 |
|
(35.3 |
) |
|
| At 31 December 2003 |
(40.7 |
) |
1.0 |
|
15.2 |
|
7.6 |
|
(16.9 |
) |
|
