PartnerRe Weathers the Storm: Cuts Q3 Losses, Premiums Up 45%

November 4, 2002

Despite loss estimates of around $120 million from this summer’s floods in Germany and Eastern Europe, Bermuda’s PartnerRe had a relatively good third quarter, narrowing its net loss for the three months to $27.9 million from $338.5 million last year, and recording $570 million in net premiums written.

PartnerRe President & CEO Patrick Thiele stressed that “The Company is experiencing strong growth in net written premiums, continuing the trend that started at the beginning of 2001. Total net written premiums were up 45% for the quarter over the same period last year and 40% for the nine-month period. This was driven by both price increases and growth in treaties and participations.”

PartnerRe, along with the rest of the industry, was severely impacted during the third quarter of 2001 by the Sept. 11 attacks, but it is making a strong recovery. Total revenues rose by nearly half a billion dollars for the first nine months of this year from $1.3865 billion to $1.8457 billion.

The bulletin said: “For the nine months ended September 30, 2002, operating earnings were $109.9 million or $2.13 per share on a fully diluted basis. Net premiums written were $2.0 billion, an increase of 40% from the prior year. Net income for the nine months was $101.9 million, or $1.68 per share. Net income for the period includes net (after-tax) realized losses of $23.0 million.”

“Operating losses for the nine months ended September 30, 2001 were $239.7 million or $4.78 per share. Net loss for the first nine months of 2001 was $189.4 million or $4.08 per share after net (after-tax) realized gains of $7.5 million and the cumulative effect of adopting FAS 133 of $27.8 million,” it continued.

Thiele indicated that PartnerRe’s growth was concentrated in activities such as aviation, energy and engineering, which he believes “will produce superior returns” He forecast that fourth quarter results would “reflect a return to more normalized earnings patterns.”

“Barring any major catastrophes, we expect to achieve full year operating earnings of between $3.55 and $3.65 per share, and a return on beginning shareholders’ equity of at least 12%. We now believe our net written premium increases for the year will exceed 35%, he concluded

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