UPDATE 3-Admiral's confused.com margins squeezed, shares down
* Margins at Confused.com unit under pressure
* At least to meet forecasts as customer numbers grow
* Nine-month turnover up 13 percent
(Adds further analyst reaction, updates shares)
LONDON, Oct 10 (Reuters) - British motor insurer Admiral Group Plc (ADML.L) said on Friday that competitive pressures continue to weigh on its price comparison website confused.com, helping send its stock to a three-month low.
The group said it expects at least to meet forecasts of a 9.9 percent rise in profit this year, but said margins at confused.com remained under pressure, with turnover from the website over the first nine months of 2008 in line with the same period last year.
Confused.com, which accounted for 20 percent of group profit in 2007, has been hit by growing competition from new entrants to the price comparison market.
By 1040 GMT, Admiral shares were down 11.7 percent at 797.5 pence, having fallen as low as 772p, their lowest since July. The FTSE 100 share index was 8.2 percent lower, weighed down by weakness in financial stocks amid mounting fears that the credit crunch will trigger a global recession.
Admiral shares have fallen 19 percent since the beginning of the year.
Numis Securities analyst Richard Gradidge said the company's outlook for in-line nine-month turnover at confused.com implied that the unit's revenues had fallen in the third quarter, offsetting an increase reported at the half-year stage.
"There are a couple of things in the statement that may have disappointed. Confused is starting to see revenue reductions," Gradidge said.
Admiral is expected to report a 2008 pretax profit of 200.1 million pounds ($345.8 million), up 9.9 percent from 182.1 million pounds the previous year, according to the average of seven analysts' estimates collected by the company.
"We are on track to hit or exceed analysts' consensus profit estimates for 2008. Despite all the turmoil in the financial markets, Admiral had another good quarter," Admiral Chief Executive Henry Engelhardt said in a statement.
Admiral, which sells car insurance through the Admiral, Bell, Diamond and Elephant.co.uk brands, said it had 1.71 million car insurance customers as of Sept. 30, a 17 percent increase from a year earlier.
That helped push group turnover for the first nine months of the year up 13 percent to 718 million pounds.
Admiral's Engelhardt said the company had also benefited from price increases and lower insurance claims. "Prices are moving up while claim trends are leading to improved profitability," Engelhardt said, without providing further detail. (Editing by Paul Bolding)
