Admiral Group Lifts Dividend By 20% to Yield 6.8%


LONDON -- The shares of Admiral soared 73 pence to 1,340 pence this morning after the motor insurer lifted its annual dividend by 20%.

A 90.6 pence per share payout was declared for 2012, up from 75.6 pence per share for 2011.

The 2012 payout comprised of a 42.7 pence per share ordinary dividend and a 47.9 pence per share special dividend. Admiral has declared a special dividend every year since the company joined the stock market during 2004.

The dividend news accompanied full-year results that showed total premiums up 1% to 2.2 billion pounds and pre-tax profits up 15% to 345 million pounds. Admiral revealed U.K. profits advancing 19% and losses within its overseas divisions widening by 15 million pounds.

The group's comparison site,, lifted its profits by 2 million pounds to 18 million pounds.

Henry Engelhardt, Admiral's chief executive, said:

2012 was Admiral's 20th and most successful year to date. Looking back over the last 20 years, I want to thank everyone who has helped us to create such a robust business.

In sum, 2012 was the year of the kangaroo: it bounced around a little bit but it turns out to be pretty big, strong and energetic, with the babies protected in the mother's pouch.

Based on today's figures, Admiral is valued at 14 times earnings and offers a 6.8% income. Be aware, though, that the juicy yield is based on the combined value of Admiral's latest special and ordinary dividend, and that the total 2012 payout represented 95% of the group's earnings.

Of course, whether the share price valuation, this morning's results, references to kangaroos and the prospects for the wider motor insurance sector all combine to make Admiral a buy remains your decision.

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