JLT Towers Re’s organic revenue growth was 6 percent in H1 2014, while the enlarged business delivered an unchanged trading profit margin of 30 percent, according to interim results from the JLT Group.
This has been cited as good progress, following the integration of Towers Watson Re, with revenue for the combined JLT Towers Re for the period standing at £110 million.
Historically, approximately 70 percent of the firm’s reinsurance revenues have been booked in the first six months of the calendar year and JLT has stated that it expects a similar pattern going forward for the merged business.
In North America, high levels of client and people retention have been noted and, in London, JLT has reported that “both teams are fully merged and operating out of one building”.
The focus for the enlarged business is on building new business opportunities for 2015 and beyond and JLT stated that it is “very encouraged both by the support of cedants and the strength of the developing pipeline”.
JLT has also claimed that the full year margin is expected to be broadly flat on the prior year. This is due, in part, to the “sharp decline” in the reinsurance rating environment, given that JLT Towers Re earns a much higher proportion of commission income than the rest of the group.
‘We are confident that we can deliver year-on-year financial progress, but we are more cautious over the outlook for the remainder of the year given the marked decline in the insurance and reinsurance rating environment over the last quarter,” said Dominic Burke, chief executive of JLT Group.
“The strong organic revenue growth we achieved in the period, despite these challenges, demonstrates the success of our strategy of focusing on our areas of specialisation and higher growth economies.’
