Montpelier Reports 4th Quarter, Full Year Results

February 10, 2015

Bermuda-based Montpelier Re Holdings Ltd. reported its financial results for the fourth quarter and year ended December 31, 2014.

Fully converted book value per common share was $33.19, an increase of 3.5% for the fourth quarter and an increase of 15.0% for the full year, each computed after taking into account common share dividends declared.

Operating income for the quarter was $60 million, or $1.34 per common share, representing a quarterly return on common equity of 4.0%. Net income was $49 million, or $1.09 per common share. The $11 million difference between the Company’s operating income and net income for the quarter represented net realized and unrealized investment and foreign exchange losses.

Net premiums written in the fourth quarter were up 20% year-over-year as increased writings within the Company’s Montpelier at Lloyd’s and Collateralized Reinsurance segments offset a decrease in writings at Montpelier Bermuda. Net premiums earned in the fourth quarter were up 9%.

The loss ratio for the quarter of 21% benefitted from $42 million of favorable prior year loss reserve movements and included no individually significant losses from catastrophe events. The combined ratio was 61% for the quarter.

Net investment income was $10 million and the total return on the investment portfolio was -0.5% for the quarter.

Christopher Harris, President and Chief Executive Officer, said, “The fourth quarter marked a strong end to a successful year for Montpelier. All operating segments delivered strong profitability, driving an increase in book value per share of 15% for the year.

“Our underwriting teams executed well, and we continued to see steady growth in capital under management at Blue Capital, which now stands at $790 million.”

Mr. Harris continued, “Based on the January renewals, we expect our net written premiums for the first quarter of 2015 to be flat versus the prior year, with planned growth in Individual Risk and Other Specialty lines offsetting the impact of targeted reductions in Property Catastrophe.”

During the fourth quarter of 2014, the Company repurchased a total of 1,005,093 common shares at an average price of $31.75 per share.

As of December 31, 2014, the Company’s total shareholders’ equity was $1.65 billion, and its total capital was $2.05 billion.

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