AXIS Posts Q4, Full Year Net Income Gains; Conference Call Details

February 9, 2010

Bermuda-based AXIS Capital Holdings Limited reported net income for the fourth quarter of 2009 of $282 million, or $1.87 per diluted common share, compared with net income of $131 million, or $0.88 per diluted common share in Q4 2008.

Net income for the full year of 2009 was $461 million, or $3.07 per diluted share, compared with $351 million, or $2.26 per diluted share, for the prior year.

Operating income, which excludes capital gains/losses, for the fourth quarter of 2009 was $276 million, or $1.83 per diluted share, compared with $163 million, or $1.09 per diluted common share in Q4 2008. Operating income for the full year of 2009 was $766 million, or $5.10 per diluted share, compared with $436 million, or $2.81 per diluted common share for 2008.

AXIS listed the following fourth quarter and full year earnings highlights:
— Gross premiums written increased 9 percent in the quarter to $574 million and increased 6 percent to $3.6 billion for the year;
— Net premiums earned increased 8 percent in the quarter to $714 million and increased 4 percent to $2.8 billion for the year;
— Total underwriting income for the quarter of $216 million, unchanged from the prior year quarter. For the full year, total underwriting income increased 71 percent to $525 million;
— Combined ratio of 77.5 percent for the quarter and 79.3 percent for the full year;
— Net favorable prior year reserve development in the quarter of $120 million, benefiting the combined ratio by 16.8 points;
— Net investment income in the quarter of $118 million compared to net investment losses of $26 million in the prior year quarter. Net investment income for the year increased 88 percent to $464 million;
— The total return on our cash and investments portfolio was 1.1 percent for the quarter and 8.5 percent for the full year;
— Operating income for the quarter of $276 million represented an annualized operating return on average common equity2 of 22.3 percent and operating income for the full year of $766 million represented an annualized operating return on average common equity of 17.1 percent;
— Shareholders’ equity of $5.5 billion, an increase of 2 percent from September 30, 2009 and 23 percent from December 31, 2008;
— Diluted book value per common share of $33.65, an increase of 7 percent from September 30, 2009 and 31 percent from December 31, 2008;
— Share repurchases of $170 million in the quarter and for the year;
— Quarterly common dividend increased 5 percent to $0.21 per common share.

President and CEO John Charman commented: “I am delighted to report excellent fourth quarter results. Against the backdrop of extremely challenging competitive conditions as well as increased loss activity from lines impacted by the global financial crisis, we have delivered record quarterly operating earnings per share strongly supported by our highest level of underwriting profit.

“For the year, we delivered an operating return on average common equity of 17.1 percent and a 31 percent increase in diluted book value per share from very good property and casualty underwriting results and strong performance from our investment portfolio.”

The full earnings report and additional information may be obtained on the Company’s web site at: www.axiscapital.com.

AXIS will host a conference call today, Tuesday February 9, 2010 at 8:00 AM (Eastern) to discuss the fourth quarter financial results and related matters. The teleconference can be accessed by dialing (866) 843-0890 (U.S. callers) or (412) 317-9250 (international callers) and entering the pass-code 4-5-3-1-8-9-3 approximately ten minutes in advance of the call. A live, listen-only webcast of the call will also be available via the Investor Information section of the Company’s web site.

Source: AXIS Capital

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