Bermuda-based Montpelier Re Holdings Ltd. reported net income of $102.4 million, or $1.53 diluted earnings per share, for the three months ended December 31, 2004 and net income of $240.3 million, or $3.55 diluted earnings per share, for the year ended December 31, 2004. Comprehensive income for the quarter was $106.8 million, or $1.59 diluted comprehensive income per share, and $241.7 million, or $3.57 diluted comprehensive income per share, for the twelve months ended December 31, 2004.
The bulletin noted: “Book value per share at December 31, 2004, on a fully converted basis, was $26.75, which incorporates the accrual of a $0.34 dividend per share for the quarter. Total return to shareholders, incorporating both the change in fully converted book value per share and dividends accrued, was 5.9 percent for the fourth quarter of 2004 and 13.1 percent for the year. In the three months to December 31, 2004, Montpelier released $17.3 million of net reserves from prior accident years. The net impact expected from the third quarter storms rose $34.7 million, or 16.9 percent, to $239.7 million.
President and CEO Anthony Taylor commented: “Montpelier has produced another strong set of results in the fourth quarter and in 2004. For a property reinsurance company such as ours to achieve a 51.4% loss ratio in the worst year ever for natural catastrophes is no mean feat.”
He also noted that the “January renewal season has seen increasing price competition, more acute in the international market than the U.S. market, resulting in a reduced number of risks meeting our return criteria. While pricing remains adequate on the business we have renewed, we have declined a significant number of programs. As a consequence, our bound premium in respect of 1st January renewals has reduced by approximately 20 percent compared to 2004. However, in light of the opportunities we see for the balance of the year, we expect the annual reduction in our overall written premiums to be closer to 10 percent. We continue to believe that superior long-term returns for shareholders will be driven by disciplined underwriting through the cycle.”
CFO Kip Oberting stated: “Net of dividends our capital grew a further $88.4 million in the fourth quarter. Book value growth since our inception, coupled with a reduction in exposures in our insurance portfolio following the January renewals, means that we have a surfeit of capital. We already have in place a meaningful regular dividend and a share repurchase program, and we are actively considering additional capital management measures.”
For further information consult Montpelier Re’s Financial Supplement, posted on the Company’s investor information section of its website at: www.montpelierre.bm.
The company will hold a conference call, including a question and answer period, on Thursday, February 17, 2005 at 10:00 a.m. EST. The presentation will be available via a live audio webcast accessible on the Earnings Call page of the Investor Information section of the Company’s website at: www.montpelierre.bm. A telephone replay of the conference call will be available through February 25, 2005 by dialing 888-286-8010 (toll-free) or 617-801-6888 (international) and entering the pass code: 56182101.