Bermuda-based Montpelier Re joined a number of its compatriots in posting sharp declines in both fourth quarter 2010 net income and for the full year.
The Group’s Q4 net income was $42.2 million, compared to $$104.7 million in Q4 2009. For the full year Montpelier Re’s net income wa$212 million, compared to $463.5 million for 2009.
The Group reported that its operating income, which excludes capital gains/losses, for the fourth quarter was $53.9 million, or $0.81 per share, compared to $94.1 million in Q4, 2009. For the full year operating income was$164 million, compared to $270.8 million in 2009.
The combined ratio increased markedly in the fourth quarter, from 48.7 percent in Q4 2009 to 74.1 percent in Q4 2010, the combined ratio for the full year rose to 82 percent from 62.2 percent in 2009.
“The loss ratio for the quarter was 38.6 percent which includes 11 points ($18 million) of increase in net losses from the September New Zealand earthquake,” said the earnings report. “The quarter benefited from 15 points ($25 million) of favorable prior year loss reserve movements. The loss ratio for the full year was 48.3 percent including a 17 point ($109 million) benefit from prior year loss reserve releases.”
President and CEO Christopher Harris commented: “We grew fully converted book value per share by 18 percent in 2010. This result was satisfying considering the challenging market conditions we faced and the large number of earthquakes and other catastrophe losses experienced around the globe. A combination of solid underwriting results, steady investment performance and active capital management all contributed to our strong performance.
“Over the last five years, we have grown book value per share at an annualized rate of 17.2 percent, an excellent performance over a period in which we were also developing our U.S. and Lloyd’s operating platforms.”
“We expect difficult trading conditions for the remainder of 2011, but we remain very pleased with the quality of our in-force portfolio. We further reduced our net catastrophe risk profile in the January renewal season in response to softening rates, and share repurchases remain a compelling option as part of our ongoing cycle management strategy.”
Source: Montpelier Re
Topics Profit Loss
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