Everest Re Group’s 2016 First Quarter Results

April 26, 2016

Everest Re Group, Ltd. reported first quarter 2016 after-tax operating income available to common shareholders of $222.7 million, or $5.19 per diluted common share, compared to after-tax operating income of $329.9 million, or $7.34 per diluted common share, for the first quarter of 2015.

Net income available to common shareholders was $171.7 million, or $4.00 per diluted common share, for the first quarter of 2016, compared to net income of $323.0 million, or $7.19 per diluted common share, for the same period last year.

Commenting on the Company’s results, President and Chief Executive Officer, Dominic J. Addesso said, “Against the backdrop of what continues to be significant challenges affecting both investment and underwriting activities, Everest produced strong results with an annualized operating return on equity of 12% for the quarter.

“While foreign currency headwinds and declining rates are hampering growth in our reinsurance book, we are seeing strong and profitable growth in our insurance book as new initiatives take hold.”

Operating highlights for the first quarter of 2016 included the following:

  • Gross written premiums decreased 5% to $1.4 billion compared to the first quarter of 2015, but eliminating the unfavorable effects of foreign currency fluctuations, premiums were actually down 3%. Worldwide, reinsurance premiums were down 8%, on a constant dollar basis, while insurance premiums were up 11%, quarter over quarter.
  • The combined ratio was 86.0% for the quarter compared to 83.1% in the first quarter of 2015. Excluding catastrophe losses arising from the Taiwan earthquake that occurred in the quarter, and prior year development, the attritional combined ratio was 85.3% compared to 83.1% in the same period last year.
  • Net investment income for the quarter was $102.5 million, including a loss of $6.2 million on limited partnership investments.
  • Net after-tax realized capital losses were $51.0 million, while net after-tax unrealized capital gains totaled $175.3 million, for the quarter.
  • Cash flow from operations was $367.1 million compared to $350.6 million for the same period in 2015
  • For the quarter, the annualized after-tax operating income¹ return on average adjusted shareholders’ equity² was 11.7%.
  • During the quarter, the Company repurchased 464,360 of its common shares at an average price of $185.00 and a total cost of $85.9 million. The repurchases were made pursuant to a share repurchase authorization, provided by the Company’s Board of Directors, under which there remains 3.6 million shares available.
  • Shareholders’ equity ended the quarter at $7.8 billion, up 3% compared to year end 2015. Book value per share increased 4% from $178.21 at December 31, 2015 to $184.91 at March 31, 2016.
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