Go Compare sees profits rise and predicts more to come

Looking forward to uplift
Looking forward to uplift
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Price comparison site Go Compare has bolstered profits by close to a third and said the firm could enjoy an uplift from Government changes to the insurance industry.

The firm said adjusted operating profits jumped 30% to £30 million in the year to the end of December, while revenues rose 20% to £142.1m.

However, a separate measure of operating profits, which included its listing costs on the London Stock Exchange (LSE), dropped 5% to £21.9m.

It comes after Go Compare put the finishing touches to its demerger from insurer esure and listed on LSE on November 3 last year.

Chief executive Matthew Crummack said the Government’s recent decision to adjust the discount rate calculation could bump up the price of car insurance premiums and inspire more customers to search for cheaper products.

Insurers have been pencilling in a financial hit after Lord Chancellor Liz Truss put forward the change, which is expected to increase payments given to victims of life-changing injuries through medical negligence, car crashes and other incidents.

Mr Crummack told Reuters: “What we hear from the sector about the (discount) rate is it is very likely to push up prices and our experience is that when you see price rises, you tend to see more people looking for better deals and therefore it’s an opportunity for us.”

Shares were down 4% in afternoon trading despite the firm saying it was on track to meet its full-year targets for 2017.

The Newport-based firm said the amount saved by customers had risen by 30% to more than £1bn over the period, while customer interactions climbed 26% to £32 m.