annual report 2007 - the Admiral Group plc

14 FINANCIAL REVIEWFinancial reviewKey financial highlightsGroup profit before tax again grew strongly in 2007 – moving up 24% to £182.1m from £147.3m lastyear. Earnings per share grew 22% to 48.6p from 39.8p.2007£0002006£000Underwriting profit 37,502 28,351Profit commissions 20,448 19,926Ancillary and other net income 93,363 79,262Confused.com profit 36,727 23,080Share scheme, pre-launch and other charges (5,942) (3,277)Profit before tax 182,098 147,342548.0638.4708.2825.0Underwriting£37.5mProfit commissionUnderwritingProfit commission£20.4m£28.3m£19.9m21%11%19%13%2007 20%200616%£182.1m£147.3m48%52%2004200520062007Ancillary and other£87.4mConfused.com£36.7mAncillary and other£75.9mConfused.com£23.0mGroup underwriting profits grew significantly in 2007 (by around one third) – this despite a veryslowly turning pricing environment in the UK motor market and the inclusion of a first full year’sresult for Balumba.es (the Group’s Spanish motor insurer).In UK motor, the Group reduced its share of the underwriting to 22.5% (from 25.0%) in a yearwhen this cycle possibly hit its worst point. The number customers grew significantly once again:2007 2006000s000sUK private vehicle count 1,382 1,240Spanish private vehicles 47 2Gladiator Commercial vehicles 62 43Total vehicle count 1,491 1,285Within the overall increase of 16%, UK vehicles insured grew by 11½%, and Gladiator grew by 47%.Balumba increased its customer base to end the year at 47,000 (having ended 2006, two monthsafter launch with around 2,200)October 2007 saw the successful launch of AdmiralDirekt.de – the Group’s German car insurer,based in Cologne. In the relatively short period before the end of the year, AdmiralDirekt sold9,000 policies, generating around £1.7m in premium and ancillary income. Cover for these risksstarted 1 January 2008.A more detailed split of Group profit, including geographical analysis follows below. Eachelement is discussed in the following notes.