Bermuda-based PartnerRe Ltd. reported record operating results for the 2002 first quarter of $66.8 million, or $1.29 per share on a fully diluted basis compared to $55.6 million, or $1.08 per share, for the first quarter of 2001, but increased costs and investment losses caused the company’s net income to fall to $63.3 million, or $1.13 per common share on a fully diluted basis, from $95.9 million, or $1.76 per common share, in the same period last year.
While Q1 2001 results reflected realized capital gains of $7.5 million and a non-recurring gain of $27.8 million,.Q1 2002 recorded after-tax realized investment losses of $8.5 million. Most analysts had forecast Q1 net earnings per share at around $1.30.
On an overall basis PartnerRe’s net premiums written were $824.5 million for the three months ended March 31, a 38% increase over the $597.8 million it recorded for the 2001 first quarter. “Sustained growth was achieved in every line and market, with the exception of the credit and surety line, as the Company allocated capital to those lines of business and markets that present the most attractive return opportunities,” said the earnings announcement.
Commenting on the results Patrick Thiele, PartnerRe’s President and CEO? stated that, “We are very pleased with our first quarter results, which position PartnerRe for what we believe will be a banner year. On an annualized basis, our first quarter operating earnings represent a return on beginning common equity in excess of 17%, a level that amply rewards our shareholders.”
“The Company’s significant premium growth reflects a very strong January renewal season, with pricing increases across the board and attractive terms and conditions. Our excellent non-life underwriting performance, with a combined ratio of 92.6%, is the product of a low incidence of losses in the catastrophe line, and continued improvement in all other lines. This was partially offset by losses in credit and surety,” Thiele continued.
He went on to note that, “In light of our first quarter and April 1 renewal performance, we now believe that our growth in net written premiums will exceed the 30% objective we previously advised, and we remain confident in our prior guidance for 2002 of operating earnings per share of at least $5.50 and a return on equity in excess of 17%, absent unusual loss events.”
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