British life assurance company Friends Provident today cheered investors as it posted first-half pre-tax profits that beat analysts' expectations.
Its shares surged after it announced a first-half operating profit before goodwill, exceptional items and tax of £135 million sterling (€191.5m), above the range analysts had forecast of between £108 million pounds and £132 million.
The firm posted record-breaking new business sales up 9 per cent to £198 million on an annual premium equivalent basis, an industry standard measure which smoothes out theimpact of one-off premiums from year to year.
Its shares surged 7.9 per cent to 137.1 pence on the news. The contribution to profits from new business jumped 21 per cent to £35 million from £29 million pounds. The profit margin on new business improved to 17.7 per cent, from 15.9 per cent in the same period last year.
The company said it was optimistic it would increase its market share in the second half of this year.
Friends Provident said it had set an interim dividend of 2.5 pence per share, an increase of two per cent over the 2002 interim dividend. Analysts and investors had feared it would announce an unchanged or even reduced dividend.