Assured Guaranty Posts $46.9 Million Q1 Net

Assured Guaranty Ltd., the international surety insurer, formed from the spin off of ACE Limited’s surety operations, announced net income of $46.9 million for the first quarter ended March 31, 2004, an increase of 48 percent compared with $31.8 million earned in the first quarter of 2003.

The bulletin also noted that net income per diluted share “was $0.63 in the quarter, up 50 percent, compared to $0.42 earned in the first quarter of 2003, based on 75 million shares outstanding upon completion of the IPO on April 28, 2004.”

Operating income (defined as net income excluding after-tax net realized gains [losses] on investments and after-tax unrealized gains [losses] on derivative financial instruments), was $43.7 million or $0.58 per diluted share in the first quarter of 2004, up 42 percent compared with $30.7 million or $0.41 per diluted share in the first quarter of 2003.

“Management, investors and analysts use operating income to evaluate our results of operations, as this measure highlights the underlying profitability of our business,” said the bulletin. “A portion of operating income arose in connection with transactions associated with our IPO, which included our exiting certain lines of business, and expenses associated with a staff reduction in February 2004. The net impact of these actions on first quarter 2004 results was an increase in operating income of $11.1 million, or $0.15 per share in the quarter.”

CEO Dominic Frederico noted, “This quarter demonstrates the strength of our flexible operating structure. Our reinsurance business produced outstanding results despite a soft financial guaranty market. Our mortgage guaranty platform also produced solid new business that will contribute to our future earnings base.”

Topics Profit Loss