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Abonner Alea Group Holdings (Bermuda) Ltd.

Alea Group Holdings (Bermuda) Ltd.

Preliminary Results for the year ended 31 December 2003 - Part 3 of 7

London (ots)

FINANCE DIRECTOR'S REPORT
Performance Management
The highlights of the consolidated financial statements are as
follows:
Summary of results                      2003            2002
 $ million
 Gross premiums written               1,300.2           931.6
 Net premiums earned                    858.5           518.1
Underwriting profit before change in 
 Claims
 Equalisation Provision                  27.7          (18.8)
 Net investment income                   52.4            46.4
 Interest expense                       (4.7)           (6.5)
 Net realised and unrealised gains 
 on investment                         (17.0)            33.9
 Change in Claims Equalisation 
 Provision                              (3.8)           (2.4)
                                    ---------      ----------
 Profit before tax                       54.5            52.6
 Tax                                   (13.5)             2.0
                                    ---------      ----------
 Profit after tax                        41.0            54.6
 Minority interest                        7.5               -
                                    ---------      ----------
 Profit attributable to 
 equity shareholders                     48.5            54.6
                                    ---------      ----------
Total net assets                      $725.4          $460.5
                                    ---------      ----------
Per share data
 Number of shares 
 in issue (m) (1)                 174,707,415     106,094,720
 Earnings per share - diluted           $0.42           $0.51
 Operating earnings per share 
 -diluted                               $0.54           $0.24
 Net asset value per share              $4.15           $4.34
Return on equity (see note 7)           9.3%           12.4%
 Return on operating equity 
 (see note 7)                           12.0%            5.8%
Operating profit reconciliation
 Underwriting profit before Claims 
 Equalisation
 Provision                              27.7           (18.8)
 Allocated investment income at 4.5%    57.8             47.0
 Interest expense                      (4.7)            (6.5)
 -------------------------         ---------       ----------
 Operating profit before tax, 
 based on longer-term 
 investment return                       80.8            21.6
 -------------------------          ---------      ----------
(1) 2002 adjusted for 19 :1 bonus share grant (comparable to 20 : 
   1 stock split)
In 2003 the Group successfully achieved its financial goals. Gross
premiums written increased to 39.6% to $1,300.2 million from $931.6
million. The Group achieved an underwriting result before claims
equalisation provision of $27.7 million which was approximately 10%
better than its expectation and achieved net investment income of
$52.4 million which was in line with expectations. Debt interest cost
was $4.7 million reflecting the reduction in LIBOR rates year on
year. The overall investment return of 3.0 % reflected the Group's
focus on fixed income securities, which in a rising interest rate
environment gave rise to net realised and unrealised losses of $17
million.
Profit before tax was $54.5 million compared to $52.6 million in
2002. Profit after tax was $41.0 million compared to $54.6 million in
2002.
The reduction in profit before and after tax was impacted by the
net movement in realised and unrealised losses in 2003 of $17.0
million compared to a net gain in 2002 of $33.9 million. Alea has a
conservative investment portfolio. The goal is to match assets and
liabilities for currency and duration whilst minimising credit risk.
This may well give rise to fluctuations in the short term performance
of the portfolio which can be significant in terms of profit
attributable to shareholders in any one period. For example, in the
period from 1 January 2004 to 11 March 2004, Alea showed a change in
invested asset value of $20.8 million comprising realised gains of
$3.2 million and change in unrealised gains of $17.6 million. The
company constantly reviews its approach to investment risk based on
market conditions.
In 2003, in accordance with the recommendations of the ABI SORP
for insurance companies listed on the London Stock Exchange, the
Group included allocated investment income using a longer term rate
of 4.5% in both 2002 and 2003 technical accounts. Use of this longer
term rate gave rise to operating profits in 2003 of $80.8 million
compared to $21.6 million in 2002.
The tax charges in both 2003 and 2002 are distorted by the
application of deferred tax assets and the profit mix between
territories. In 2002 the Group saw an overall tax credit as profits
in London allowed for the recognition of additional deferred tax
assets. In 2003 the tax charge similarly benefited from the
recognition of the remaining Alea London deferred tax asset not
previously recognised. However, a reduction in the rate at which the
Swiss deferred tax asset was recognised and unrealised investment
losses on the Bermudan portfolio have adversely affected the rate.
The actual tax rates for both 2002 and 2003 are not indicative of the
longer term rates which the Group believes should be achievable. The
Group's goal is to arrange its affairs so that Alea Bermuda provides
capacity to each insurance subsidiary within the Group and therefore
shares in the underwriting result of each entity. To the extent that
such business is profitable then this arrangement will have the
effect of reducing the Group's overall tax rate. Conversely if such
business is unprofitable then this intra-group reinsurance
arrangement could limit the amount of tax relief available on such
loss making business.
The Group made a $7.5 million gain on the purchase of the
subordinated preferred shares issued by subsidiaries which has been
included in the minority interest line of the profit and loss
account.
Overall earnings per share were 42 cents compared to 51 cents in
2002. Operating earnings per share were 55 cents compared to 24 cents
in 2002. Net assets per share were $4.15 compared to $4.34 as at year
end 2002 adjusting for the 19 to 1 bonus share grant (comparable to
20 : 1 stock split). The reduction in book value per share was
primarily a function of the dilution effect of the listing on the LSE
on 19 November 2003.
Return on Equity
In calculating its return on equity, the Group has used the
following formula:
Operating profits after tax divided by
(Shareholders' equity including subordinated preferred at each of 1
July 2003 + 31 December 2003 excluding capital raised between 1 July
2003 and 31 December 2003)/2 + Adjusted Proceeds (as set out below)
Adjusted Proceeds are the net proceeds of the offering $221.2
million after the $42.5 million purchase of the subordinated
preferred equity plus $1.9 million equity capital raised in the
second half year primarily alongside the offering. The total $223.1
million proceeds were available for six weeks from 19 November 2003
to give additional weighted capital of $25.7 million in 2003.
On the above basis the Group achieved a return on equity of 9.3%
during 2003 (2002: 12.4%). The actual profits are distorted by
changes in realised and unrealised gains period on period which
benefited the return on equity ratio in 2002 and adversely affected
the return on equity in 2002. Operating return on
equity increased 106.8% to 12.0% from 5.8% in 2002.
Underwriting performance
Gross premiums written increased by 39.6% to $1,300.2 million from
$931.6 million in 2002. Net premiums written increased by 44% to
$1,028.7 million from $708.2 million in 2002. Each operating segment
grew substantially:
Alea London           + 62.5% (40.0% excluding Bristol West)
 Alea North America    + 19.4%
 Alternative Risk      + 76.8%
 Alea Europe           + 28.0%
 Total                 + 45.3%
The amount of business retained increased to 79.1% of gross
premiums written compared to 76.0% in 2002. This small change masked
two significant factors. A reduction in the percentage of premiums
allocated to the Max Re contract, 7.6% of gross premiums written
compared to 12.2% in 2002, was offset by the growth in reinsurance
connected with AAR, where only 50.7% of gross premiums earned were
retained net which is wholly in line with our expected business model
for that line of business. Both of these factors are expected to
continue to contribute to the retention ratio in 2004.
Net premiums earned increased by 65.7% influenced by the sharp
increase in premiums written in 2002 which were translated into
earned premiums in 2003. In all operating segments except Alea Europe
where the majority of premiums incept on 1 January each year, the
time lag between the written premium growth achieved
in 2002, and how long it takes to earn those premiums through the
income statement increased the earned growth rates compared to the
written growth rates as follows:
Alea London           + 84.6% (57.3% excluding Bristol West)
 Alea North America    + 32.7%
 Alternative Risk      + 343.9%
 Alea Europe           + 23.5%
The growth in AAR is a function of the low earned premiums base in
2002 of only $22.0 million.
As the Group's business mix continued to develop the quantum of
unearned premium reserves continued to increase. Gross unearned
premium reserves as at 31 December 2002 were 53% of gross premiums
written in 2003 compared to 51% in 2002 and 54% of net premiums
written in 2003 compared to 53% in 2002.
Combined ratio
The core combined ratio comprises claims incurred net of
reinsurance to net premiums earned (NPE) plus expenses before
adjusting for the change in deferred acquisition costs less fee
income less other technical charges as a percentage of net premium
written (NPW). The expense ratio was 4.8 points lower at 31.5% in
2003 compared to 36.3% in 2002. Technical charges as a percentage of
NPW are measured separately to derive the final combined ratio.
2003        2002
 $'millions
 NPW                                    1,028.7       708.2
 NPE                                      858.5       518.1
Claims incurred, net of reinsurance      528.7       321.9
Net operating expenses                   285.5       204.0
 Other technical income                    -2.4        -5.7
 --------------------                   -------     -------
283.1       198.3
 Change in deferred acquisition costs      40.8        58.5
 --------------------                   -------     -------
 Total net written expenses               324.0       256.8
 --------------------                   -------     -------
2003       2002
 Claims incurred net of reinsurance 
 to NPE ratio                             61.6%      62.1%
 Total net written expenses to NPW        31.5%      36.3%
 ------------------------                ------    -------
 Core combined ratio                      93.1%      98.4%
 Other technical charges to NPW            1.8%       2.3%
 ------------------------                ------    -------
 Combined ratio                           94.9%     100.7%
 ------------------------                ------    -------
Impact of prior year reserve developments on incurred claims ratio
Prior year developments increased the claims incurred net of
reinsurance loss ratio by 2.2 points in 2003 compared to 4.4 points
in 2002 and are summarised by segment and underwriting year as
follows:
Impact on loss ratio
 By Segment                    Group
Alea London                     0.2
 Alea Alternative Risk           0.2
 Alea North America              2.6
 Alea Europe                    -0.8
 Total                           2.2
Impact on loss ratio
 By underwriting year          Group
1999 & prior                    1.0
 2000                            1.8
 2001                           -0.5
 2002                           -0.1
 Total                           2.2
Further details of the underlying events which gave rise to these
developments are set out in the Operating Review. In all operating
segments the Group was pleased to note that where substantial reserve
increases were required, the segment had usually already non-renewed
the relevant policies as it positioned itself to towards its target
customer and product segments. The Group is particularly pleased with
the positive performance of Alea Europe and the continuing immaterial
development in the Alea London 1999 and prior portfolio. Reserve
development in North America was disappointing but limited to a small
number of contracts which form part of the transition which the
segment made in 2001 and 2000 from the portfolio originally available
to it to the desired business classes made up of a shorter duration,
less volatile blend of lower limit exposures.
Expenses
All expenses are allocated to individual business segments;
however the Group monitors expenses for each profit and corporate
cost centre. Because of the business model which the Group has
adopted, ensuring that each local unit also incorporates some
elements of group oversight and development, Corporate Centre costs
are incurred in most of the locations in British Pounds, Swiss Francs
and United States Dollars and are recharged to the various profit
centre by cross charging mechanisms. In a rapidly growing environment
the physical quantum of internal expense movement year on year is not
meaningful. Instead the Group manages its expense base against the
operational plans required to meet the next stage of development.
Measured against net premiums earned the net internal expense
ratio improved 3.5 points to 10.2% compared to 13.7% in 2002 as the
premium base of the Group expanded more rapidly than the
administrative infrastructure. Measured against net premiums written
the internal expense ratio improved 1.5 points to 8.5 % compared to
10.0% in 2003.
Reserves
The Group's provisions for gross claims outstanding excluding
claims equalisation reserves increased by 24% to $1,398.6 million
from $1,126.9 million. Net loss reserves (defined as the gross claims
outstanding less the reinsurers' share of claims outstanding)
increased by 38% to $672.0 million from $488.1 million. The ratio of
gross loss reserves to gross premiums earned reduced to 126% in 2003
from 167% in 2002 as would be expected with a growing portfolio of
business.
Invested assets and cash were 123.9% of gross claims reserves and
257.8% of net claims reserves, compared to 109.5% and 251.5% in 2002.
These ratios were already strong by industry standards in 2002 before
the public offering and demonstrate the strength and simplicity of
the overall balance sheet.
The evaluation of required claims outstanding both gross and net
of reinsurers' share is the most critical element of the Group's
underwriting performance. The provision for claims outstanding is
made on an individual case basis and is based on the estimated
ultimate cost of all claims notified but not settled by the balance
sheet date, together with the provision for related claims handling
costs and net of salvage and subrogation recoveries. The provision
also includes the estimated cost of claims incurred but not reported
at the balance sheet date based on statistical methods together with
an assessment of any related reinsurance recoveries. The Group
follows robust quarterly processes worldwide to assess the amounts it
believes it requires and employs independent consultants to consider
these provisions on an annual basis. The last independent review was
carried out by Deloitte & Touche as at 30 June 2003 as part of the
public offering. Estimates of technical provisions for claims and
related recoveries inevitably contain significant inherent
uncertainties because significant periods of time may elapse between
the occurrence of an incurred loss, the claim triggering the
insurance or reinsurance, the reporting of that claim to the Group
and the Group's payment of the claim and receipt of related
reinsurance recoveries. Accordingly the cost of such claims cannot be
known with certainty at the balance sheet date. Subsequent
information and events may result in the ultimate liability being
less than, or greater than, the amount provided. Adjustments to the
amount of the provisions are reflected in the financial statements
for the periods in which the adjustments are made.
Reinsurance recoverables
Reinsurance recoverables are analysed between the three large
aggregate excess contracts with Inter-Ocean, Overseas Partners, and
Max Re which are each significant contracts and other smaller
reinsurances.
Inter-Ocean contract
The Inter-Ocean contract is an Adverse Loss Development and Aggregate
Excess of Loss Reinsurance Agreement dated 18 May 2000 among
Inter-Ocean Reinsurance Company Ltd. and Alea London Limited, Alea
Europe Ltd and Alea (Bermuda) Ltd that provides cover to Alea Europe
Ltd and Alea (Bermuda) Ltd of up to $125 million cover in excess of
$500 million with 75% of losses in excess of $625 million up to $700
million with respect to underwriting years 1987 through 1999 with a
maximum recoverable of $218.8 million for certain non life reserves,
and cover to Alea London, Alea Europe and Alea (Bermuda) Ltd in
excess of a loss ratio retention of 59% of net earned premium up to a
maximum limit of 20% of net earned premium but not exceeding $107.8
million and subject to certain other retentions and sub-limits.
OPL contract
The OPL contract is an Adverse Loss Development Reinsurance Agreement
between Alea London Limited and Overseas Partners Ltd. dated 31
December 1999 that provides cover of up to $85 million for business
incepting on or prior to 31 December 1999 (but excluding certain
specified risks such as asbestos) in excess of Alea London Limited's
agreed retention of $101.9 million.
Max Re contract
The Max Re contract is an Excess of Loss Agreement effective 1
January 2001 among Max Re Ltd and Alea Europe Ltd, Alea London
Limited, Alea North America Insurance Company, Alea (Bermuda) Ltd and
Alea Group Holdings (Bermuda) Ltd that provides cover in respect of
the period from 1 January 2001 through 31 December,
2003 for worldwide business written (with certain exceptions) on
$1.578 billion of net earned premium during the period with a limit
equal to the lesser of 16.5% of total net earned premium over the
period or $285 million plus a catastrophe cover equal to 1.67% of
total net earned premium over the period, with the cover subject to
agreed loss ratio attachment points.
Reinsurance recoverable - aggregate excess contracts:
$ million               Amount   Discount  Net Amount   Collateral
                    Recoverable
Inter-Ocean
 contract                 196.2 -    11.9       184.3         139.0
 OPL contract              84.3         -        84.3          60.9
 Max Re contract         228.4   -   23.4       205.0         228.4
Both the Inter-Ocean contract and the OPL contract are collateralised
through deposits received from reinsurers. The deposits increase each
year through the allocation of other technical charges which were
$19.0 and $16.7 million respectively in 2003 and 2002. The overall
value of the reinsurance recovery under these contracts is reassessed
each year and any adjustments made are processed through the profit
and loss account as increases or reductions to the change in
reinsurers' share of provision for claims. These contracts were also
the subject of a prior year adjustment in 2003 which is detailed in
the accounting policies section of this report.
The Max Re contract is collateralised through trust funds and letters
of credit which do not appear on Alea's balance sheet but which
provide security for the amounts due to Alea by that company. The
trust funds are held in AA rated securities. In addition all unearned
premiums paid by Alea to Max Re are also
collateralised through trust funds.
Excluding the above contracts the reinsurers' share of claims
outstanding in respect of the other reinsurance contracts at 31
December 2003 was $252.9 million (2002: $238.6 million). The Group
analyses potential doubtful debts carefully and holds a provision of
$7.7 million (2002: $7.2 million) the majority of which is in Alea
London, relating to the business written prior to the Group's
acquisition of Alea London in 2000. In addition the Group holds
offsetting balances of $96.4 million (2002: $70.3 million) made up of
collateral provided by the reinsurer or amounts payable to the same
reinsurer leaving total net balances due of $156.5 million at 31
December 2003 (2002 $168.3 million) which represents 22% of
shareholders funds, a significant improvement compared to 34 % in
2002.
As of 31 December 2003, 89% (2002 95%) of the net balances due are in
respect of entities rated A and above, of which 5% (2002 6%) is with
AAA rated entities, 23% (2002 47%) is in respect of AA rated entities
and 61% (2002 42%) is in respect of A rated entities. The ten largest
ten reinsurers had net amounts due ranging from $5.7 million to $21.4
million and were all rated A or above.
Recent years have seen a substantial reduction in credit quality for
the entire industry. In the twelve month period to 31 December 2003,
there were more than 450 downgrades of industry participants (during
2002: 870) by Standard & Poor's' alone. The Group's reinsurance
security profile has been affected by these industry changes. For
2002, following the settlement of a number of large claims, the net
balance due from reinsurers rated BBB or lower reduced from 20% to 5%
of the total reinsurance recoverable. Reinsurers rated BBB or lower
have increased from 5% to 11% for the twelve month period to 31
December 2003 as a result of rating downgrades. The three largest net
balances due from BBB or lower reinsurers are $3.8 million (2.2%)
from Sorema (BBB), $ 2.9 million (1.9%) from Baloise (BBB), and $1.6
million (1.1%) from Trenwick (NR) against which the Group provides
$0.3 million doubtful debt reserve. No other reinsurer rated BBB or
below accounted for more than $0.7 million of net balances due at 31
December 2003.
Capital Management
Investment management
I am pleased to report that Alea had no write-offs on its investment
portfolio. During a year which has seen a number of insurance
companies write-off significant amounts of their investment portfolio
due to some significant corporate failures and reductions in credit
quality this is a significant achievement and vindicates our
conservative investment strategy.
The Group's investment strategy emphasises a high quality diversified
portfolio of liquid investment grade fixed income securities as a
method of preserving equity capital and prompt claim payment
capability. The investment portfolio does not currently consist of
equity or real estate investments. The Group utilises recognised
external expert investment managers to invest its assets. The
Investment Committee establishes the Group's investment policies and
creates guidelines for its external investment managers. These
guidelines specify criteria on the overall credit quality and
liquidity characteristics of the portfolio and include limitations on
the size of certain holdings as well as restrictions on purchasing
certain types of securities
At 31 December 2003, fixed income securities and deposits at credit
institutions comprised $1,582.2 million an increase of 42.9% since 31
December 2002. The Group's fixed income portfolio consisted of US and
non-US sovereign government obligations, corporate bonds and other
securities all of which were rated A or better and 98.4% were rated
AA or better by either Standard & Poor's or Moody's. The portfolio
had a weighted average rating of AAA based on ratings assigned by
Standard & Poor's or Moody's. Other than with respect to US, Canadian
and European Union government and agency securities, the Group's
investment guidelines limit its aggregate exposure to any single
issuer to 5% of its portfolio. All securities must be rated A or
better at the time of purchase and the weighted average rating
requirement of the Group's portfolio is AAA. At 31 December 2003, the
Group did not have an aggregate exposure to any single issuer of more
than 4.7% (GE Capital) of its shareholders' equity, other than with
respect to US, Canadian and European Union government and agency
securities.
Depending upon the duration of the liabilities supported by a
particular portfolio, the Group's portfolio investment duration
targets may range from three to five years. The duration of an
investment is based on the maturity of the security and also reflects
the payment of interest and the possibility of
early principal payment of such security. The Group seeks to utilise
investment benchmarks that reflect this duration target. The
Investment Committee periodically revises the Group's investment
benchmarks based on business and economic factors including the
average duration of the Group's potential liabilities. At 31 December
2003, the Group's investment assets had an effective duration of
approximately three and a quarter years, which approximates the
duration of its liabilities.
The Group's investment assets are subject to interest rate risk. The
Group's interest rate risk is concentrated in the United States and
Europe and is highly sensitive to many factors, including
governmental monetary polices and domestic and international economic
and political conditions. The estimated potential exposure to one
percentage point increase of the yield curve would be a reduction in
fixed income assets of $47.7 million.
The Group continued its conservative investment strategy following
the sale of its equity portfolio in May 2000. This strategy reflected
our perception of the increased risk in equity and bond markets over
the period coupled with our desire to utilise our capital primarily
to take underwriting risk. In 2003 we achieved a total return on the
investment portfolio of 3.0% (2002: 7.4%). The investment return
comprised 4.4% (2002: 4.4%) investment income, 0.9% (2002: 0.8%)
realised gains and -2.3% (2002: 2.2%) unrealised gains on average
invested assets of $1,294 m (2002: $1,119m). The total return for an
investment portfolio is a combination of price and income return.
Price return is affected by movements in interest rates whereas
income return is affected by the level of interest rates. The lower
total return period over period was a result of negative price return
due to increases in US interest rates from 31 December 2002 on a
portfolio weighted basis and a lower income return due to lower level
of interest rates during 2003 for the portfolio.
In 2003 in conformity with other LSE listed insurance companies we
have allocated an assumed investment return rate to the underwriting
result in respect of both 2003 and 2002. The return rate we have
chosen is 4.5% and reflects our heavy weighting in fixed income
investments. The Group continues to explore investment strategies
which have the potential to deliver incremental returns to fixed
income investments, however our overall investment risk appetite will
remain low.
There is a floating pledge over certain investments for the issuance,
in the normal course of business, of letters of credit. As at 31
December 2003 the pledge covered total investment assets of $227.6
million compared to $175.7 million as at 31 December 2002. In
addition $ 19.8 million (31 December 2002 $11.1 million) is held as
statutory deposits for local regulators and a further $540.5 million
(31 December 2002 $402.0 million) is held in trust for the benefit of
holders of North American policy holders which includes $185.4
million (31 December 2002 $ 46.3 million) that Alea (Bermuda) Ltd has
placed in trust on behalf of Alea North American Insurance Company
under the quota share arrangements between these two companies.
Included within ''Debt securities unit trusts listed'' as at 31
December 2003 the Group held Societe d'Investissement a Capital
Variable (SICAV) of $34.1million (31 December 2002: $21.7 million)
pledged for the benefit of French and Belgian Cedants. These SICAVs
are mutual funds invested in European fixed income securities which
average credit quality of AA and duration of approximately 5 years.
Equity finance
The Group successfully listed on the LSE on 19 November 2003. The
initial public offering raised total net proceeds of $263.7 million.
None of the equity shareholders sold any stock in the offering.
As at 31 December 2003, 38.7% of the Group's stock was publicly held
as set out in the table below:
No. of Shares  Ownership % Fully Diluted Fully Diluted
                      Held                              Ownership %
KKR & related
 parties        70,740,080        40.5%     70,740,080        38.0%
 Management      4,199,835         2.4%     15,429,235         8.3%
 Other 
 Investors      32,193,500        18.4%     32,193,500        17.3%
 Publicly Held  67,574,000        38.7%     67,574,000        36.3%
                --------    ---------       --------      ---------
               174,707,415       100.0%    185,936,815       100.0%
                --------    ---------       --------      ---------
Other investors invested in Alea during the capital enhancement
program in 2001. KKR and related parties and other investors entered
into Lock up agreements for a period of six months from 19 November
2003. Management have a twelve month lock up subject to prorate
sell-down rights in the event of an offering of KKR shares prior to
19 November 2004.
A portion of the net proceeds of $263.7 million were used to purchase
$50 million subordinated preferred shares from a third party
shareholder for $42.5 million. The majority of the remainder was used
to inject capital to support business growth in the Group's insurance
subsidiaries as set out in the following table below, the balance
being retained for general corporate purposes.
Use of proceeds                                  $ million
Alea North America                                  157.0
 Alea Europe                                          30.0
 Alea London                                          10.2
 Alea Bermuda                                         12.4
                                                     209.6
 Purchase of subordinated preferred shares            42.5
 General corporate purposes                           11.6
 Total                                               263.7
Debt finance
Alea Group Holdings AG (AGHAG), a Swiss wholly owned subsidiary of
the Group entered into term loan facilities which comprise three
elements; Term "A" facility of CHF 100 million repayable in annual
tranches in 2002 to 2004 with the balance due in 2005; Revolving
credit facility of up to CHF 100 million which it can draw down until
the expiry of the Term "A" Loan; and Term "B" facility providing
incremental debt of $75 million on a non amortising basis
repayable in 2007.
The Group had total debt finance as at 31 December 2003 of $178.3
million (2002: $168.5 million). The increase year-on-year is solely
due to the change in exchange rates between the Swiss Franc and the
United States Dollar. Funds under the revolver have been utilised to
repay the Term A amounts due in 2003. The total amount remaining
available under the revolver facility was $30.7 million
at 31 December 2003.
The loan facilities include certain restrictive covenants which were
comfortably met in 2003.
Total loan repayments under the above facilities fall due as follows:
Year ended 31
                                                December
                                               $ million
 2004                                               12.9
 2005                                               92.9
 2006                                                  -
 2007                                               75.0
 Total before capital raising expenses             180.8
 Capitalised debt raising expenses                  (2.4)
 Total                                             178.4
Part 4 follows

Plus de actualités: Alea Group Holdings (Bermuda) Ltd.
Plus de actualités: Alea Group Holdings (Bermuda) Ltd.
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