Helphire profitability below its view

(Reuters) - Accident claim-handling firm Helphire Group (HHR.L) said on Thursday its first-quarter profitability was below its expectations due to a fall in hire days, sending its shares down more than 10 percent.

The company also said it has appointed Finance Director Mark Adams as its chief executive with effect from Thursday. Adams will succeed CEO Mark Jackson.

Helphire, with a fleet of more than 17,000 vehicles, works with the insurance and motor industries to provide vehicles to motorists involved in accidents until their own vehicles are repaired or replaced.

The company said the number of hire days in the first quarter ended September 30 was down 1.1 percent from last year at 1.08 million days.

Higher fuel prices earlier in the year reduced vehicle usage, leading to fewer accidents and quicker repairs, thereby reducing the number of days customers' vehicles were off the road, it said.

In view of the drop in oil prices and an expected seasonal increase in activity levels during autumn and winter, it was too early to say whether the fall in hire days in the first quarter would be indicative of the year as a whole.

Helphire said cash flow in the quarter improved from last year, in line with its expectations, and it was working on cutting costs.

"It remains the board's intention to pay dividends at or above the 12.3 pence declared in 2007/08 and to improve cash generation such that a progressive dividend policy can be maintained," the company said.

At 8:44 a.m., Helphire shares were down 10.7 percent at 88 pence. (Reporting by Kumar Alagappan in Bangalore; Editing by Mike Miller)