Platinum Reports $53.5 Million Loss
Bermuda-based Platinum Underwriters Holdings, Ltd. today [Oct. 20] reported a net loss of $53.5 million and a loss per common share of $1.43 for the quarter ended September 30, 2011.
The results for the quarter include net premiums earned of $166.8 million, net favorable development of $27.8 million, net investment income of $29.8 million and net realized gains on investments of $7.5 million. The results also reflect the net negative impact of $112.4 million from major catastrophe losses, net of retrocessional coverage, reinstatement premiums and taxes.
Michael D. Price, Platinum’s Chief Executive Officer, commented, “Our net income was adversely affected by natural catastrophe losses, particularly those arising from greater than expected claims activity from earthquakes in Japan and New Zealand earlier this year. However, our book value per common share grew by 1.8% in the quarter to $46.26 as of September 30, 2011, reflecting strong investment results on a total return basis and favorable non-catastrophe reserve development.”
Mr. Price added, “2011 has been a difficult year at Platinum with international catastrophe losses well in excess of our expectations. Nevertheless, we remain strongly capitalized and stand ready to seize on good reinsurance and investment opportunities.”
Results for the quarter ended September 30, 2011 are summarized as follows:
- Net loss was $53.5 million and the loss per common share was $1.43.
- Net premiums written were $177.1 million and net premiums earned were $166.8 million.
- GAAP combined ratio was 145.6%.
- Net investment income was $29.8 million.
- Net realized gains on investments were $7.5 million.
Results for the quarter ended September 30, 2011 as compared with the quarter ended September 30, 2010 are summarized as follows:
- Net loss was $53.5 million compared to net income of $93.7 million.
- Net premiums written decreased $22.3 million (or 11.2%) and net premiums earned decreased $16.6 million (or 9.0%).
- GAAP combined ratio increased 77.5 percentage points.
- Net investment income decreased $1.3 million (or 4.2%).
- Net realized gains on investments decreased $36.9 million.
- Net premiums written for Platinum’s Property and Marine, Casualty and Finite Risk segments for the quarter ended September 30, 2011 were $101.6 million, $72.7 million and $2.8 million, respectively, representing 57.4% , 41.0% and 1.6%, respectively, of total net premiums written. Combined ratios for these segments were 206.2%, 81.7% and 93.8%, respectively. Compared with the quarter ended September 30, 2010, net premiums written decreased $13.3 million (or 11.5%), $7.7 million (or 9.5%) and $1.4 million (or 33.0%) in the Property and Marine, Casualty and Finite Risk segments, respectively.
Results for the nine months ended September 30, 2011 are summarized as follows:
- Net loss was $231.1 million and the loss per common share was $6.18.
- Net premiums written were $497.8 million and net premiums earned were $522.1 million.
- GAAP combined ratio was 156.1%.
- Net investment income was $96.1 million.
- Net realized gains on investments were $3.2 million.
Results for the nine months ended September 30, 2011 as compared with the nine months ended September 30, 2010 are summarized as follows:
- Net loss was $231.1 million compared to net income of $233.2 million.
- Net premiums written decreased $100.8 million (or 16.8%) and net premiums earned decreased $72.9 million (or 12.2%).
- GAAP combined ratio increased 76.8 percentage points.
- Net investment income decreased $7.9 million (or 7.6%).
- Net realized gains on investments decreased $96.1 million.
Net premiums written for Platinum’s Property and Marine, Casualty and Finite Risk segments for the nine months ended September 30, 2011 were $267.8 million, $222.4 million and $7.5 million, respectively, representing 53.8%, 44.7% and 1.5%, respectively, of total net premiums written.
Combined ratios for these segments were 222.1%, 82.3% and 90.7%, respectively. Compared with the nine months ended September 30, 2010, net premiums written decreased $67.9 million (or 20.2%), $24.3 million (or 9.8%) and $8.5 million (or 53.2%) in the Property and Marine, Casualty and Finite Risk segments, respectively.
Total assets were $4.7 billion as of September 30, 2011, an increase of $133.7 million (or 2.9%) from $4.6 billion as of December 31, 2010. Fixed maturity investments and cash and cash equivalents were $4.3 billion as of September 30, 2011, an increase of $111.0 million (or 2.6%) from $4.2 billion as of December 31, 2010.
Shareholders’ equity was $1.7 billion as of September 30, 2011, a decrease of $168.5 million (or 8.9%) from $1.9 billion as of December 31, 2010. Book value per common share was $46.26 as of September 30, 2011 based on 37.3 million common shares outstanding, a decrease of $3.94 (or 7.8%) from $50.20 as of December 31, 2010 based on 37.8 million common shares outstanding.
The company did not repurchase any common shares during the quarter ended September 30, 2011. During the nine months ended September 30, 2011, the company repurchased 762,000 common shares for approximately $33.9 million at a weighted average cost, including commissions, of $44.50 per share.
The company also purchased 2,500,000 options held by Bermuda’s RenaissanceRe Holdings Ltd. for $47.9 million on January 20, 2011.
Platinum Underwriters Holdings, Ltd. is a leading provider of property, casualty and finite risk reinsurance coverages, through reinsurance intermediaries, to a diverse clientele on a worldwide basis. Platinum operates through its principal subsidiaries in Bermuda and the United States.
