Resources In Insurance Group is benefiting from insurers outsourcing part of their claims handling operations.
The insurers have claims backlogs, unexpected surges in claims and lack of staff with the correct skills. RIIG has access to the skilled staff and can supply them to the insurer to take on these claims backlogs.
There appears to be enormous demand for these services. RIIG is even considering setting up training operations.
RIIG increased its revenues from £688,000 to £925,000 in the six months to June 2010. The interim loss was reduced from £293,000 to £152,000. The loss adjusting business was sold in April 2009.
RIIG would like to grow through acquisition but it does not want to issue shares at their current level. Other businesses that supply outsourced services to insurers would be the type of organisation that RIIG would like to buy.
A £300,000 convertible issue does provide some fire power for acquisitions. There was also a £190,000 share placing at 0.45p a share in June. That left £134,000 in the bank at the end of June 2010 and no bank borrowings.
At 0.5p a share, RIIG is valued at £900,000.
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