DUBLIN: RSA Insurance Group’s Stephen Hester delivered a full-year profit, restored dividends and stepped up cost cuts that will result in more job losses.
Despite this shares still tumbled more than 5 per cent in London.
“RSA’s results are on balance disappointing,” said Thomas Seidl, an analyst at Sanford C Bernstein. “The key driver for that is the outlook.”
He said the company’s plans for additional cost cuts don’t resolve uncertainty over its capital.
Pre-tax profit for 2014 was £275 million from a loss of £244 million in 2013, RSA. The company declared a final dividend of 2 pence a share, after cancelling payouts in 2013. It also raised its 2016 cost-cutting target by at least £30 million and set a fresh 2017 target of more than £250 million.
Shares fell 5.3 per cent in morning trading, the biggest selloff since June.
The insurer also announced that chief financial officer Richard Houghton is stepping down in May, the latest of senior executives to depart since Mr Hester joined a year ago.
“It’s the first year of the big turnaround that we had needed to make and we can say quite clearly that the ship is turning,” said Mr Hester. “The cleanup of past weaknesses has been extensive. There are headwinds, but we feel RSA is making much better progress.”
