Montpelier Reports $37 Million Q2 Net Income; $36 Million Operating

July 29, 2014

Bermuda-based Montpelier Re Holdings Ltd. reported operating income for the second quarter of $36 million, or $0.76 per common share. Net income was $37 million, or $0.78 per common share, which “included $12 million of realized and unrealized investment gains and $11 million of net foreign exchange losses.”

Other earnings highlights were listed as follows:
— Fully converted book value per common share was $31.74, an increase of 2.8 percent from March 31, 2014 and an increase of 8.7 percent from December 31, 2013, each after taking into account common share dividends declared during the period.
— Net premiums written – $204.9 million – in the second quarter were flat year-over-year, when adjusting for reinstatements, with increased writings within the Company’s Montpelier at Lloyd’s and Collateralized Reinsurance segments, offsetting a decrease in writings at Montpelier Bermuda.
— The loss ratio for the quarter was 41 percent, which includes $24 million of net losses from known catastrophe events in the quarter, offset by $38 million of favorable prior year loss reserve movements.
— The combined ratio was 77 percent for the quarter.
— Net investment income was $12 million for the quarter, and the total return on the investment portfolio was 0.9 percent.

President and CEO Christopher Harris commented: “Despite a high frequency of smaller industry loss events, we produced solid underwriting profitability with a 77 percent combined ratio, reflecting strong contributions from our growing Montpelier at Lloyd’s and Collateralized Re segments, as well as the benefit of prior period development.

“We believe our nimble underwriting approach, flexible capital base, and excellent client relationships continue to position us well in the current environment.”

The bulletin also noted that during the second quarter of 2014, the Company repurchased a total of 863,911 common shares at an average price of $30.18 per share. During the third quarter of 2014, the Company has thus far repurchased an additional 343,800 shares at an average price per share of $31.85.

As of June 30, 2014, the Company’s shareholders’ equity was $1,668 million, and its total capital was $2,067 million.

Source: Montpelier Re Holdings

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