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Investing.com -- Sabre (NASDAQ:SABR) stock rose 6% after the insurance company reported better-than-expected first-half profit despite a significant drop in written premiums.
The insurer posted first-half profit after tax that beat consensus expectations by 7.4%, though it was down 5.5% compared to Jefferies’ estimates. This positive performance came despite Gross Written Premium missing forecasts by 4.5% and declining 20% YoY, with May-June premiums remaining flat compared to the previous year.
Sabre’s strong profit was supported by a 29.6% higher-than-expected investment income and slightly better underwriting performance. The company reported an undiscounted loss ratio of 54.9%, which was 1.0 percentage point better than market expectations, while its net insurance margin of 19.0% exceeded forecasts by 0.2 percentage points.
The insurer’s post-dividend solvency ratio strengthened to 181%, up 10 percentage points from year-end 2024, providing a solid capital cushion despite challenging market conditions.
However, Sabre now expects full-year gross written premiums to be "slightly lower" compared to 2024 due to weaker market conditions experienced in the first half. The company also anticipates that forward-looking claims inflation will remain in the mid-to-high single digits.
The group’s policy count decreased by 6.8% from year-end 2024, reflecting the challenging premium environment. Sabre maintained its interim dividend at 3.4p per share, in line with market expectations.
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