The Group is well capitalised with a proven approach to reserving, and with solvency ratios in both the UK and Gibraltar which carry an appropriate margin over minimum solvency statutory requirements.
“We believe passionately that a business succeeds because people enjoy working for it. Enthusiasm is infectious, transmitting from our staff to our customers and to those thinking about coming to work for us.” Alistair Lyons CBE
translate into Quality Awards. Whilst quality cannot be achieved without effective training, it is also a mindset that depends upon people wanting to achieve a quality outcome.
In April of last year we welcomed Gillian Wilmot to our Board as a Nonexecutive Director, bringing us extensive marketing experience gained across a broad range of consumer-facing businesses. However, her subsequent appointment as Chief Executive of the privately owned credit retail business Buy-as-you-View results in her no longer being regarded as an Independent Director under the Combined Code, as I am also Chairman of that business. As a consequence she will not offer herself for re-election as a Director of Admiral at the forthcoming Annual General Meeting and we are currently seeking a new Non-executive Director with equivalent skills and experience. I would like to take this opportunity to thank Gillian for her contribution during her time with us.
Here in a nutshell are the highlights: Made a record core profit of £122.1m, up 21% from £100.6m in 2004
Why did the market deteriorate a bit 2004 v 2003? Well, largely because there weren’t any major movements in price. And there was a modest amount of claims inflation, albeit probably less than expected. The lower-thanexpected claims inflation is down to two phenomena: first, a gradual decline in overall frequency, which has been happening for a number of years. This is probably caused by a combination of factors including: the increase of speed cameras, more traffic congestion and therefore people driving slower, growth in low-cost air travel which lets people travel abroad for holidays rather than driving in the UK and a growth in the number of households where the number of cars exceeds the number of drivers.
Of the 10%, 5% is ceded to Axis Re Europe under a contract covering 2005 and 2006 and 5% to Cologne Reinsurance Company (Dublin) Limited (part of Gen Re) for 2005 only.
A.3.2 – As noted in the Chairman’s statement Gillian Wilmot’s appointment as Chief Executive of the privately owned credit retail business Buy-asyou -View in August 2005 results in her no longer being regarded as an independent Director under the Combined Code, the Chairman also being Chairman of that Company. As a consequence she will retire and not offer herself for re-election as a Director of Admiral at the forthcoming Annual General Meeting. The Nomination Committee has instigated a search for a new Non-executive Director with equivalent skills and experience.
Details of the Chairman’s other commitments are included in the Chairman’s biography. The Chairman does perform a number of other Non-executive roles outside of the Group but the Board is satisfied that these are not such as to interfere with the performance of the Chairman’s duties within the Group. Since the last annual report the Chairman was appointed Chairman of Higham Group Plc on 1 July 2005. During 2005 he resigned as a Non-executive Director of the Department of Transport.
In fulfilment of the Chairman’s obligations under the new Combined Code, the Chairman would give feedback to the Board on issues raised with him by major shareholders, although to date there have been no such issues. This is supplemented by monthly feedback to the Board on meetings between management and investors. External analyst reports are circulated to all the Directors.
The Risk Management Committee The Committee’s members include the three Executive Directors, the Compliance Officer and the Group Company Secretary.
One of the Committee’s principal responsibilities is to ensure that the risk management policy approved by the Board is implemented throughout the Group. The Committee is expected to: assess the nature and extent of the risks facing the Group and ensure appropriate controls are in place to mitigate risks in line with the Risk Appetite Policy to empower all managers throughout the business to take responsibility for the management of risks in their areas and improve risk management decision making consider the likelihood of occurrence of the risks identified and assess the Company’s ability to manage these risks prepare relevant and useful risk management information for use by the Audit Committee and Board
Over the last fifteen years Tusk has supported more than 30 projects in 15 African countries. Last year Tusk supported 21 different projects in 11 African countries. It’s support comes in many different guises such as provision of 4x4 vehicles, wildlife clinics, rhino and cheetah sanctuaries, and chimpanzee enclosures.
The Directors are proposing a final dividend of £38.7m (14.9p per share), payable on 25 May 2006.
Under applicable law and regulations, the Directors are also responsible for preparing a Directors’ Report, Directors’ remuneration report and corporate governance statement that comply with that law and those regulations.
Cash flows from investing activities: Purchases of property, plant and equipment and software (3,999) (1,394) Proceeds from sales of property, plant and equipment – 16
The Group has applied all IFRS and interpretations adopted by the EU at 31 December 2005, including all amendments to extant standards that are not effective until later accounting periods. In particular, the Group has early adopted the amendments to IAS 39: The Fair Value Option in these financial statements.
The value in use calculations use cash flow projections based on financial budgets approved by management covering a three year period. Cash flows beyond this period are considered, but not included in the calculation.
Trade and other receivables are stated at their nominal amount (discounted if material) unless they are impaired. Impairment losses are recognised through the income statement.
(all £000) At 31 December 2004 Note UK GAAP Impact IFRS
Total operating expenses (i) (36,936) 3,906 (33,030) Share scheme charges 4,144 – 4,144
Cash and cash equivalents includes cash in hand, deposits held at call with banks and other shortterm deposits with original maturities of three months or less.
Awards under the UFSS are not eligible for dividends and hence the fair value of free shares to be awarded under this scheme has been revised downwards to take account of these distributions. The unadjusted fair value is based on the share price at the date on which awards were made (being £3.62).
Corporation tax payable 2,738 5,246 Amounts owed to subsidiaries 14,971 51
Retained profit for the period – – – 56,557 56,557 Issues of share capital 251 (247) – – 4 Share issue expenses – (2,354) – – (2,354)