LONDON (Bloomberg) ? Jardine Lloyd Thompson Plc, the UK?s second-biggest publicly traded insurance broker, said first-half profit dropped 2.5 percent because of increased competition and pressure on fees.

Net income declined to ?32.9 million ($61.3 million), or 14.8 pence a share, from ?33.7 million, or 16 pence, a year earlier, the company said. Revenue rose 3.9 percent to ?260.4 million.

Competition between brokers and pressure on insurance premiums ?is likely to remain the same for some time,? chief executive officer Dominic Burke said on a conference call yesterday.

Jardine Lloyd is cutting costs and seeking acquisitions to boost profit as it vies with the UK?s Benfield Plc and larger US brokers Aon Corp. and Marsh & McLennan Cos for clients. The closing of a defined benefit pension plan to new employees and an ?11 million savings from outsourcing information technology services will improve earnings from 2007, Burke said.

?The external pressures will not be viewed as an excuse,? he said. Shares of Jardine Lloyd dropped 12.5 pence, or 3.4 percent, to 357 pence. The stock has fallen 28 percent this year.

Jardine Lloyd?s trading margins, a measure of profitability, narrowed to 18 percent from 22 percent in the risk and insurance division.