Insurance firm Esure’s shares fell 21 per cent despite reporting a 15.2 per cent rise in first-half profits in its first set of results since floating in March.
The owner of the Sheilas’ Wheels brand said pre-tax profits for the six months to the end of June grew to £56.9 million, from £49.4m a year earlier, as gross written premiums rose 6.7 per cent to £265.4m.
But the dividend of 2.5p disappointed the market and the shares fell 65.5p to 246p against a flotation price of 290p.
The firm’s combined operating ratio – a key measure of profitability in the insurance sector – improved to 89.6 per cent, compared with 94.4 per cent a year ago. A figure above 100 per cent would show that more is being paid out in claims than received in premiums.
Founder and chairman Peter Wood said shareholders will receive an interim dividend of 2.5p a share on 17 October, representing a payout ratio of 70 per cent.
He added: “Our first interim results as a listed company show continued volume and profit growth with improvements in our combined operating ratio and underwriting performance.
“Our strategy has enabled us to adapt well to our changing marketplace and has stood us in good stead.”