Bermuda-based Flagstone Reinsurance Holdings Limited announced that its net income attributable to common shareholders for the quarter ended September 30, 2009, was $67.1 million, or $0.80 per diluted share, compared to a net loss of $186.5 million, or $2.18 per diluted share, for the quarter ended September 30, 2008.
Net income available to common shareholders for the nine months ended September 30, 2009 was $170.7 million, or $2.01 per diluted share, compared to a net loss of $111.7 million, or $(1.31) per diluted share, for the nine months ended September 30, 2008.
The reinsurer’s basic 2009 book value per share of $13.69 and diluted book value per share of $13.20 were up 6.6 percent and 6.5 percent, respectively, for the quarter (percentages inclusive of dividends).
CEO David Brown commented: “Flagstone’s third quarter results continue our excellent performance in 2009. Our core underwriting results were again strong this quarter, and we continue to develop a geographically diversified business as well as further expand our specialty lines, and our Lloyds business.
In the quarter, our global platform generated a loss ratio of 41.0 percent, creating an underwriting profit of $48.5 million. This result is especially noteworthy considering the continued growth of our non-catastrophe business, which now accounts for 49 percent of our portfolio. A low loss ratio, when combined with our ability to achieve a high premium to surplus ratio means our shareholders will benefit from quality book value growth over time.”
He added that “Q3 2009 is of course a welcome contrast to the third quarter in 2008, which was our only very disappointing quarter since we started operations in 2006. The losses in 2008 were on the investment side; we had little credit risk, but we did have 30 percent of assets in global equities and commodities.
“We derisked the portfolio, and have amended our investment guidelines so that 85 percent or more of Flagstone’s assets will henceforth be in high grade bonds and cash. While we recognize that leaves some money on the table during a rally, it also means that Flagstone is now a purer play on underwriting skill and proprietary technology.”
The complete report, additional information and details on accessing the replay of Tuesday’s earnings conference call may be obtained on the Company’s web site at: www.flagstonere.bm.
Source: Flagstone Re
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