Burst pipes benefit HomeServe

The company said it benefitted from the cold December, with more call-outs for domestic emergencies such as burst pipes. 

In an Interim Management Statement for the period from 1 October 2010, the company said: “Our core utility acquisition marketing campaigns have been successful resulting in the number of UK plumbing & drains and water supply pipe policies at the end of December 2010 being higher than at the same time 2009, and our customer growth initiatives, including one contact, financial services and landlords are also delivering good results.

“The UK retention rate has remained high and we are on track to achieve our full year target of a retention rate of at least 82%.

“The coldest December on record meant customers needed HomeServe's home emergency repair engineers more than ever, with the number of jobs completed over 30% higher than in December 2009.  This cold weather resulted in slightly higher gross new policy sales, as consumers sought to protect themselves from the inconvenience and cost of future home emergencies.  The additional revenue from these jobs and policy sales is not material and is broadly offset by higher direct costs in the claim and repair networks.

“We continue to expect the underlying UK operating margin for the current financial year to be broadly similar to the same period last year.”

The company also operates in the USA and mainland Europe. Worldwide it has 4.8m customers, 14% up on a year ago.

“The business continues to be highly cash generative with low levels of net debt and we remain on track for another year of strong earnings growth,” the company said.

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