Helios Underwriting flags fall in capacity fund value

(Sharecast News) - Helios Underwriting, a publicly-traded company offering access to a portfolio of Lloyd's of London syndicates, updated the market on the value of its capacity portfolio on Friday, following the 2024 Lloyd's capacity auctions. The AIM-traded firm said the value of its capacity fund was expected to decline to £75m as of 31 December, compared to £82.4m at the end of 2023.

It said the reduction reflected £14m in cash realised from the sale of capacity in certain syndicates.

Despite that, the company benefited from £15.6m in free capacity via pre-emptions, up from £14.7m in 2023, which added £3.4m to the portfolio's value.

Helios supported the newly-established Fidelis Syndicate - syndicate 3123 - which began operations in July.

The company allocated £13m of capacity to the syndicate for the 2025 underwriting year, with a weighted average auction price of 28p per pound sterling of capacity.

It said the average price per pound of capacity across Helios's portfolio after the auctions was 45p, slightly down from 47p in 2022.

The sale of £38m of capacity yielded a small profit of £1.8m above the balance sheet valuation, increasing available cash and tangible net assets by £14m while reducing balance sheet exposure to capacity value.

Pro forma net assets per share as of 30 June were expected to rise by 8% to 206p, reflecting the impact of the auctions and the company's share buyback in July.

Helios said it would publish its updated net asset value per share as of 30 September in early December.

"The freehold capacity portfolio has continued to deliver value to shareholders and we have realised £14m of capacity value to increase the tangible assets of the company," said chairman Michael Wade.

"An increase in the net asset value per share of 15p to 206p is expected, representing an increase of 8% over the reported net asset value as at 30 June, and this demonstrates the strength of our portfolio."

At 0956 GMT, shares in Helios Underwriting were down 1.35% at 183p.

Reporting by Josh White for Sharecast.com.