Resources In Insurance Group PLC Trading Update: Change to Financial Year End (8287H)
25 Juni 2013 - 3:15PM
UK Regulatory
TIDMRIIG
RNS Number : 8287H
Resources In Insurance Group PLC
25 June 2013
25 June 2013
RESOURCES IN INSURANCE GROUP PLC
("RiIG", the "Group" or the "Company")
Trading Update: Change to Financial Year End
The Board of RiIG, a leading provider of claims management and
consultancy solutions to the UK insurance profession, is pleased to
provide the market with a trading update as well as confirmation of
a change to its financial year end.
Key Points:
-- Change in financial year end to 31 March
-- Trading for the 15 months to 31 March 2013 has continued to be disappointing
-- Additional working capital secured via Executive Chairman,
John French and significant shareholder, Bob Morton
Since the year end:
-- Non-weatherrelated services are having a positive impact on performance
-- Strong new business in-flow and GBP760,000 contract extension
The audited results for the 15 months period to 31 March 2013
will be published no later than 30 August 2013.
Whilst continuing to deal with weather related claims, new
services now dominate current and on-going trading. Reflecting the
changing pattern of the business, the Board has therefore decided
to amend the financial year end from December to March.
Having seen a positive trend over the last 4 years with losses
decreasing from GBP1.3m in the year to 31 December 2008 to a loss
of GBP174,445 for 2011, the 15 months to 31 March 2013 was
disappointing in terms of overall result. This was principally due
to the very low volume of weather related claims experienced by the
insurance sector as a whole during late 2011 and early 2012. The
lack of activity in Property / Weather related services in H1 2012
seriously impacted our position with losses of GBP696,581 as
previously reported. This was an industry wide issue and the Group
sought to realign quickly. Whilst recognising and adapting the
proven model and entering the wider financial services sector the
second half of 2012 saw some recovery and gave the Group the
foundation to build into 2013, although losses in the 9 months to
31 March 2013 are expected to be slightly less than in the 6 months
to 31 June 2012.
To support the uplift in trading primarily through new business,
the Board has secured additional working capital via the provision
of loan capital from the Company's Executive Chairman, John French
and through a significant shareholder, Bob Morton. Through Spread
Trustee Company Limited, and on behalf of The French Settlement,
John French has made GBP221,500 of loan capital available and Bob
Morton has made some GBP135,000 available as loan capital via Hawk
Investment Holdings Limited. The interest on the loans is 1 per
cent per month, payable monthly with an expiry date of 2 January
2014. As Hawk Investment Holdings Limited is connected to Bob
Morton, a substantial shareholder and John French is a director of
the Company, the loans are considered to be related party
transactions pursuant to Rule 13 of the AIM Rules for Companies.
The Company's directors, having consulted with the Company's
nominated adviser, Zeus Capital, consider that the terms of the
loans are fair and reasonable insofar as the Company's shareholders
are concerned.
2013 has started strongly. The Group has seen an increased
volume of business wins within the traditional General Insurance
sector that has benefited all operating divisions. Whilst the
general market remains flat with regards to outsourced claims
management solutions the model of insourcing resource and solutions
has seen positive responses. In addition the move into the wider
Financial Services market in H2 2012 has enabled the Group to build
and expand on offerings not just to the retail banks in the PPI
space but also to large Financial services organisations handling
complex and non- complex customer complaints. The model is proving
extremely popular.
Highlights for 2013 include:
-- Contract with Global Recruitment Operation - 12 Months -
valued GBP1.4m to provide complaints handlers to Financial Services
organisation.
-- Extension of current PPI contract with leading Global Retail
Bank - Impacting July to December 2013 - valued circa
GBP760,000.
-- Negotiations well advanced for the further provision of PPI
complaints handlers to major UK retail bank value circa
GBP760,000.
-- General Insurance contracts with a number of UK and Global
insurers for the provision of managed teams of Personal Injury,
Property and Motor handlers.
-- The Placement business division - APT handling the majority
of the Group's own recruitment needs improving the balance sheet
and now handling volume placement requirements for a number of
organisations.
-- Signing of a contract to provide Surge (increased work flow)
support via the Verify division to one of the largest Global Loss
Adjusting and Claims Management operations. This strategic alliance
is further being developed.
-- Growing interest in consulting services including Audit and
Review of Supply Chains as insurers seek to understand and minimize
frictional costs. A number of Audit programmes have been secured
and will impact in H2 2013.
Additional new business proposals are being generated across all
areas of the business. The Group also continues to actively explore
the creation of relationships with other companies serving the
sector with compatible services to its own with a view to
collaborating on areas of mutual interest. In this respect
exploratory discussions are taking place with a number of potential
parties.
Commenting, Executive Chairman John French, said:
"The freak break in the traditional weather pattern for late
2011 and early 2012 resulted in a negative impact on our overall
recovery following the positive changes introduced in previous
years. However, we are now benefiting from the positive impact of
our expanding and more recently developed services. We are also
seeing a steady improvement in trading with revenues beginning to
rise as a result of new business from existing and new clients and
we fully expect this to continue as the year progresses."
For further information:
Resources in Insurance Group plc
John French, Executive Chairman
www.riig.co.uk
Nominated Adviser/Joint Broker +44 (0) 7836 722 482
Zeus Capital Limited
Ross Andrews / Andrew Jones +44 (0) 161 831 1512
Joint Broker
Peterhouse Corporate Finance Limited
Jon Levinson +44(0) 207 469 0935
Financial PR
Yellow Jersey PR Limited
Dominic Barretto/Anna Legge +44 (0)7768 537 739 / +44 (0)7747
788 221
This information is provided by RNS
The company news service from the London Stock Exchange
END
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