Car insurer Admiral declared itself happy with a 6% rise in profits today, despite seeing its UK business stall in the face of price-cutting rivals.
The Cardiff-based company, whose brands include Elephant and Bell, said its vehicle count remained the same as a year ago at just over three million, while rate cuts of 7% on new business also depressed turnover.
But with Admiral focusing on margins rather than market share, it grew profits to £181.4 million in the six months to June 30, helped by a better claims environment and a 20% rise in profits at comparison site Confusion.
Chief executive Henry Engelhardt said: " I'm really pleased with our results in the first half of 2013. Any time you can increase profits by 6% when competitors are cutting prices you've got to be happy.
"We didn't grow the UK insurance business, which was great news because of the competitive environment."
Admiral said that after two years of significant rate increases in 2010 and 2011, the UK car insurance market was now in its second year of being more price competitive.
This resulted in a 10% reduction in UK car insurance turnover to £924.5 million but profits still increased by 5% to £192.7 million.
The half-year performance means more than 6,600 staff will be eligible to receive £1,500 of shares each via the company's share scheme.
Revenues generated by Admiral from the sale of additional products fell 16% to £87.3 million, equivalent to a reduction of £9 per insured vehicle.
This partly reflected the loss of personal injury referral fees, which were banned from April. It also earned £7.3 million in credit hire referral fees, which are the subject of an investigation by the Competition Commission.
However, it said claims trends continue to be positive for the company, having surged in recent years due to sharp hikes in personal injury claims, fraud, uninsured drivers and regulatory changes.
This trend is now reversing following various legislative moves, including a crackdown on fraudulent whiplash injury claims.
Admiral said Confused had a positive half-year after it held market share broadly steady in its core car insurance comparison market and increased total revenues by 4% to £44.8 million. Profits of £10.2 million were up from £8.4 million a year earlier.
The company added: "The UK market remains highly competitive, with four players continuing to dominate market share and advertising spend."
Admiral also has car insurance businesses in four markets outside the UK - in Spain, Italy, the United States and France. The division, whose operations were launched between 2006 and 2010, made a loss of £10.8 million.