The Bermuda-based, London headquartered, Catlin Group announced very good financial results for the year ended December 31, 2013, with a 27 percent increase in profit before tax to $432 million, compared to $339 million in 2012, and a 29 percent increase in net income to common stockholders to $392 million (2012: $305 million).
Other highlights included in the report were as follows:
• 17.0 percent return on net tangible assets (2012: 14.6 per cent); 13.4 per cent return on equity (2012: 11.3 per cent)
• Record net underwriting contribution of $1.0 billion (2012: $788 million)
• 48 percent of net underwriting contribution produced by non-London underwriting hubs (2012: 33 per cent)
• 50.1 percent attritional loss ratio (2012: 50.6 per cent)
• 85.6 percent combined ratio (2012: 90.0 per cent)
• 7 percent increase in gross premiums written to $5.31 billion (2012: $4.97 billion)
• 16 percent increase in gross premiums written for non-London hubs
• 53 percent of total GPW produced by non-London hubs (2012: 49 per cent)
• Total investment return of 1.5 percent (2012: 2.0 per cent)
• 5 percent increase in annual dividend to 31.0 UK pence per share (49.8 US cents) (2012: 29.5 UK pence; 46.0 US cents)
Catlin Group Chairman John Barton commented: “Catlin has produced strong financial results for 2013 as profit before tax increased by 27 percent to $432 million. The Group’s underwriting operations performed well, with net underwriting contribution amounting to slightly more than $1.00 billion, an all-time record. Net tangible assets per share increased during 2013 by 9 percent to $7.17, whilst book value per share rose by 7 per cent to $8.92.
He also pointed out that, although it’s “now clear that market conditions are becoming increasingly competitive for many classes of business underwritten by Catlin, margins are still strong. I believe that Catlin has the strategy, the infrastructure and most importantly the people in place to continue to produce good results for shareholders.”
Chief Executive Stephen Catlin said: “Catlin’s net underwriting contribution exceeded US$1 billion for the first time in 2013 because of our steadfast focus on underwriting discipline and our investment in building underwriting hubs outside of the London market.
“Our attritional loss ratio – which measures the quality of our underwriting before exceptional losses and reserve movements are considered – remained at a low level of 50.1 percent. At the same time, our non-London underwriting hubs produced net underwriting contribution of $480 million, an 83 percent increase. These hubs accounted for 48 percent of the Group’s net underwriting contribution, compared with 33 percent in 2012.
“I believe there are still good opportunities for Catlin, even in a softening market. Our diversified portfolio – by region and by product – allows us to see business that many of our competitors do not have the opportunity to write. Using our tested technical skills, we can select the business that we believe is most profitable. It also must be remembered that margins for most classes of business are still strong and that rates for some classes of business are still rising. Catlin continues to build a business for the future, and we look ahead with confidence.”
Source: Catlin Group