FTSE 100 movers: Admiral surges on results; Rio Tinto goes ex-div
London’s FTSE 100 was up 0.7% at 8,342.91 in afternoon trade on Thursday.
Admiral Group surged to the top of the index as it posted a better-than-expected 32% rise in half-year pre-tax profits to £310m, driven by an improved current year underwriting performance and claims releases.
It also declared an interim dividend of 71p a share including a special payout of 19.7p a share, up 39%. Analysts had forecast profit of £304m and dividend of 67.3p.
Danni Hewson, head of financial analysis at AJ Bell said: "Insurer Admiral is reaping the rewards today of having steered its ship successfully through choppy waters when the inflationary storm was at its height.
"Unlike its competitors, Admiral hiked premiums as it passed on extra costs to customers. While this lost it business at the time, it now means the company is better positioned to be competitive, assisted by an easing in claims cost inflation which is helping it to attract more customers.
"This is the very essence of taking painful decisions in the short term for the long-term benefit of the company and shareholders are applauding today’s better-than-expected results, buoyed by a bumper increase in the first-half dividend.
"The prudent way Admiral is running its insurance operations is also reflected in a lower combined ratio - or in other words it is paying out proportionately less in claims than it is attracting in premiums."
DCC also rose as RBC Capital Markets upgraded the shares to ‘outperform’ from ‘sector perform’ and lifted the price target to 5,800p from 5,700p following recent weakness.
It noted that shares have been weak year-to-date, underperforming the sector by around 16% despite in-line results and no real new news.
"Whilst we expect trading in Healthcare and especially Technology to remain tough, there is recovery potential over time," RBC said.
"Consensus also appears to be factoring in no organic profit growth in Energy for this year, which looks conservative, even factoring in a tough comparative."
On the downside, Rio Tinto, Hikma and Anglo American were all down as they traded without entitlement to the dividend.
FTSE 100 - Risers
Admiral Group (ADM) 3,042.00p 8.26%
Standard Chartered (STAN) 757.80p 3.30%
Burberry Group (BRBY) 684.80p 2.76%
Intermediate Capital Group (ICG) 2,120.00p 2.51%
Beazley (BEZ) 746.00p 2.47%
M&G (MNG) 211.60p 2.22%
Pershing Square Holdings Ltd NPV (PSH) 3,610.00p 2.15%
Diageo (DGE) 2,521.50p 2.09%
DCC (CDI) (DCC) 5,285.00p 2.03%
InterContinental Hotels Group (IHG) 7,466.00p 2.02%
FTSE 100 - Fallers
Rio Tinto (RIO) 4,752.00p -2.08%
Hikma Pharmaceuticals (HIK) 2,054.00p -1.63%
United Utilities Group (UU.) 1,003.50p -1.08%
Anglo American (AAL) 2,180.00p -0.82%
Airtel Africa (AAF) 111.20p -0.80%
Severn Trent (SVT) 2,567.00p -0.77%
Flutter Entertainment (DI) (FLTR) 16,075.00p -0.77%
Barratt Developments (BDEV) 545.80p -0.62%
SEGRO (SGRO) 898.40p -0.60%
Berkeley Group Holdings (The) (BKG) 5,310.00p -0.38%