Earnings Reports: Catlin Group, RSA

August 6, 2012

Selected earnings highlights in US dollars from the Bermuda-based Catlin Group for the first six months of 2012 are as follows:
1st Half 2012 1st Half 2011
Gross premiums written ———— $3.010 bn $2.683 bn
Net premiums written ————— $2.258 bn $2.269 bn
Net premiums earned ————- $1.711 bn $1.763 bn
Net income (loss) before tax ——– $231 mn ($201 mn)
Net underwriting contribution* —- $443 mn ($91 mn)
Total investment return ————– $87 mn $1192 mn
* Net underwriting contribution is defined as net premiums earned less losses and loss expenses and policy acquisition costs.

1st half combined ratio – 86.3 percent (116.5 percent in 1st half 2011)

Chief Executive Stephen Catlin commented: “Catlin produced excellent financial results for the first six months of 2012, including a record underwriting contribution and strong profits before tax.

“Our business continues to grow, with the London/UK underwriting hub producing meaningful growth for the first time in five years along with a good performance from the rest of the business.

“The rating environment continues to be favorable, as average weighted premium rates across the portfolio increased by 5 per cent during the first half of 2012. Rates for catastrophe-exposed business classes continue to increase, and we are seeing positive momentum for other classes, including US Casualty business. Catlin’s focus on underwriting discipline and flexible capital structure puts us in a solid position to take advantage of opportunities as they arise in the second half of the year and beyond.”

Source: Catlin Group

Selected earnings highlights – in US dollars converted from pounds – from the UK-based RSA Group for the first six months of 2012 are as follows:
1st Half 2012 1st Half 2011
Net premiums written ———— $6.66417 bn $6.52727 bn
Net income before tax ———— $363.148 mn $585.852 mn
Net income after tax ————– $255.472 mn $431.498 mn
Underwriting Result ————— $246.073 mn $320.748 mn
Operating result ——————- $491.853 mn $634.978 mn
Investment result —————— $350.221 mn $417.152 mn

1st half combined ratio – 95.2 percent (93.2 percent in 1st half 2011)

Group Chief Executive Simon Lee commented: “We are making good progress with our strategic priorities. Premium growth in the first half of the year was led by our focus areas of Emerging Markets, Canada and Specialty. In the UK, we’ve grown our core lines of Home, Pet and Commercial Property and continued to reduce volumes in Motor.

“In terms of profitability, our major overseas operations have again performed strongly with a COR of around 83 percent in Scandinavia and a record first half underwriting result in Canada. Set against this, are the adverse weather conditions experienced in the UK and the impact of the two Italian earthquakes in May.

“However, the overall COR of 95.2 percent represents a solid performance in challenging conditions. Economic conditions will undoubtedly remain tough in some of our markets. Despite this, we remain confident of delivering a good performance for the full year and, assuming more normal levels of weather losses for the remainder of 2012, now expect to deliver a COR for the Group of better than 96 percent. In line with our policy, we have increased the interim dividend by 2 percent to 3.41p (H1 2011: 3.34p).”

Source: RSA

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