OneBeacon Reports Drop In Net Income
Bermuda-based insurer OneBeacon reported net income attributable to common shareholders of $8.6 million, or 9 cents per share, down from a profit of $128.2 million, or $1.35 per share, in last year’s second quarter.
Second quarter comprehensive net income and net income were both $9 million and operating income was $18 million or $0.19 per share. For the six months ended June 30, 2010, comprehensive net income and net income were both $9 million and operating loss was $10 million, or $0.10 per share. Operating income (loss) is a non-GAAP financial measure which is explained later in this release.
During the quarter, OneBeacon repurchased $175 million aggregate principal amount of senior notes, including $156 million as a result of a cash tender offer, and recognized a loss of $10 million on these repurchases. OneBeacon also completed share repurchases of approximately $6 million on 0.4 million shares during the second quarter, which leaves $92 million remaining under its share repurchase authorization.
On July 1, 2010, OneBeacon announced that it completed the sale of its traditional personal lines business to Tower Group, Inc. The transaction will be included in OneBeacon’s third quarter financial statements, reflecting the sale’s July 1 closing date. As consideration, OneBeacon received approximately $167 million.
Mike Miller, CEO of OneBeacon, said, “Our results for the quarter were okay. We experienced a higher than usual level of large property claims and catastrophe losses. Importantly, we completed the sale of our Personal Lines business on July 1, a significant step in our transformation to a specialty company. The market is competitive but we are excited about the prospects for our specialty businesses.”
