Reinsurance News

Howden Group’s 2021 organic growth hits new high

20th January 2022 - Author: Luke Gallin

Howden Group Holdings has reported record organic growth of 19% for the full-year 2021, alongside a 48% rise in revenue to roughly £1.2 billion, and a 50% increase in EBITDA to £335 million.

Organic growth of 19% marked a notable improvement on the 6% posted for 2020. While revenue of almost £1.2 billion compared with revenue of £777 million a year earlier, as EBITDA spiked from £223 million in 2020.

The international insurance group characterises 2021 as a transformational year for strategic acquisitions, including A-Plan (UK), completing Align Financial Holdings (US) and signing Aston Lark. All of this bolstered the firm’s international footprint and transformed the UK broker platform.

As well as mergers and acquisitions (M&A), Howden Group has welcome almost 1,500 people globally, taking its employee headcount to 10,500, while the number of employee shareholders has increased to 2,000.

During 2021, the company also welcomed Hg Capital through an initial £500 million investment alongside long-term investors General Atlantic and CDPQ, with these committing to an additional £300 million to support the takeover of Aston Lark.

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Howden Group also launched its Climate Risk and Resilience unit last year, and worked with the Danish Red Cross to bring to market the first volcano catastrophe bond.

Additionally, Howden Group says that it further accelerated the digitisation processes and distribution through the launch of NOVA and success of Rethink.

The company’s Chief Executive Officer (CEO), David Howden, commented: “This financial year has been characterised by signing some of the largest and most transformational acquisitions in our history: Align Financial Holdings in the US cemented DUAL’s position as the only MGA group operating across 19 countries with a diverse product spread and over $2bn GWP.

“28 years after we were founded in the UK, our patient, long-term approach to wait for the right partners to build out the business in our home market has paid off. Joining with A-Plan and Aston Lark will take us to a leading position in the UK broker market.

“From early days we were committed to Continental Europe, opening our first office in Spain just 5 years after we launched the Group. Today, we have offices in 16 countries and act for 32% of the CAC, 37% of the DAX and 63% of the Eurostoxx, and this year we have deepened our foundations with start-up operations, strategic acquisitions and by attracting significant talent right across the region. We are well positioned to replicate our leading position in the UK across Continental Europe, making us the strongest European broker.

“Last year we also announced the strategic expansion of our reinsurance business into treaty as we look to build the credible challenger in reinsurance broking as we have done in insurance broking.”

Looking forward, the firm says it is in a good position and as it enters 2022, is confident in its ability to serve clients against the backdrop of a hard market.

Howden added: “Furthermore, our ambitions have always been to build a truly international business and we already operate from 45 countries. This international reach, along with our entrepreneurial model, has enabled us to attract over the last 24 months more than 500 senior individuals, from Sydney to Seville, who want to come and be empowered to build their careers and a business together.

“It is this ability to attract, develop and empower talent that is the real driving force of our results this year, and the bed rock of our long-term organic performance demonstrated by record organic growth of 19%. It shows that our people are delivering expertise, innovation and service in existing and new markets, which is why clients are choosing us.

“Clients are also choosing us because of our commitment to invest in innovation, data and technology. This means better results for clients, insurers and broker partners as the cost of the transaction is reduced and the use of the Group’s data enables better access to capacity.

“Our people continue to develop standout risk solutions to meet the growing needs of our diversifying and global client base and I am particularly proud of how we are helping clients respond to climate change risks. We have done this through world-first products, a dedicated Climate Risk and Resilience division and a new capital markets advisory service.

“Alongside our now 2,000+ employee shareholders, Hg Capital joined General Atlantic and CDPQ as a third minority investor and all three have made long term capital commitments. We have also used our ability to access debt markets at highly competitive prices, whilst maintaining a conservative senior leverage level. In total we have raised £3bn of equity and debt funding this year to invest in our growth ambitions. Together, we are building a business for the future to become the credible alternative of scale for clients and a magnet for industry talent in all of our markets.

“At Howden Group, we are industrialists with a highly rated, sustainable business supported by a unique capital model and culture ideally placed to service our clients, people, partners and markets for the long-term. As such, we look forward to 2022 and beyond with great excitement.”

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