Bermuda-based Platinum Underwriters Holdings, Ltd. reported net income for the fourth quarter of $49.922 million, slightly more than the $49.815 million it earned in the same period last year. Full year earnings, however, fell to $84.8 million, compared to $144.823 million in 2003.
Other Q4 highlights included:
— Basic and diluted net income per common share was $1.16 and $1.03, respectively.
— Net premiums written were $394.9 million.
— GAAP combined ratio was 89.7 percent.
— Net investment income was $26.2 million.
The announcement noted that “during the quarter the Company revalued losses from hurricanes Charley, Frances, Ivan and Jeanne in light of actual claims received to date and higher industry loss estimates of approximately $30 billion. As a result, the Company recorded an additional after-tax charge of $31.6 million during the quarter, bringing the overall negative after-tax impact of the hurricanes, for the year ended December 31, 2004 to $176.4 million.”
CEO Gregory Morrison commented: “Our fourth quarter results were good with strong overall underwriting profitability offsetting increases in losses from the hurricanes. We experienced a strong January 1, 2005 renewal season and expect the reinsurance market will remain attractive throughout 2005.”
Full year highlights included:
Basic and diluted net income per common share was $1.96 and $1.81,
— Net premiums written were $1.65 billion.
— GAAP combined ratio was 96.7 percent.
— Net investment income was $84.5 million.
Platinum’s net income decreased by $60.0, while its combined ratio increased by 12 percentage points, “largely as a result of the significant catastrophe losses incurred in the year ended December 31, 2004,” said the bulletin. The company’s net premiums written, however, increased by 40.4 percent to $473.9 million, reflecting “increases in all three segments.” Net premiums earned rose 35.6 percent to $380.4 million. Net investment income increased $26.9 million or 46.6 percent.
Board Chairman Steven H. Newman, commented: “2004 was an important and successful year for Platinum. Income from underwriting was $47.2 million, of which $31.4 million was contributed by our Property and Marine segment, despite this being one of the worst catastrophe years on record for the reinsurance industry. This strong underwriting performance supports our reputation as a disciplined risk manager.”
The company said that, “based on the results of the January 1 renewal season, our experience to date and the mix of business underwritten, Platinum estimates that net premiums written and net premiums earned for 2005 will be approximately $1.6 billion, and its GAAP combined ratio for 2005 will be approximately 94 percent. Platinum expects its combined portfolio of cash and fixed maturity investments to be approximately $3.1 billion at year-end 2005, including the proceeds from the conversion of the Equity Security Units (ESU’s). On this basis Platinum estimates earnings for 2005 of $3.50 to $4.00 per diluted common share based on estimated weighted average diluted shares outstanding of 47 million for 2005. This estimate reflects the conversion of the ESU’s in the fourth quarter.”
Further financial details, reports and a financial supplement can be obtained on the company’s website at: http://www.platinumre.com/.
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