Everest Re Ltd. Reports Record Earnings
Bermuda’s Everest Re Group, Ltd. yesterday [Apr. 23] reported net income of $384.3 million, or $7.50 per diluted common share, for the first quarter of 2013, compared to net income of $304.7 million, or $5.68 per diluted common share, for the first quarter of 2012.
Excluding realised capital gains and losses, after-tax operating income1 was $301.1 million, or $5.88 per diluted common share, for the first quarter 2013, compared to after-tax operating income1 of $239.9 million, or $4.48 per diluted common share, for the same period last year.
Commenting on the company’s results, chairman and CEO Joseph V. Taranto said, “This was a record quarter for Everest with 13 percent growth in premium, 25 percent growth in operating earnings, and an annualised net income return on equity of 25 percent.
“Clearly the industry benefitted from a quarter without catastrophe losses but Everest’s performance is also the result of a targeted growth strategy aimed at broadening its book and improving the risk-adjusted returns. We continue to see opportunities and are very excited about the future prospects for Everest.”
Operating highlights for the first quarter of 2013 included the following:
- Gross written premiums increased 13% to $1.18 billion compared to the first quarter of 2012. Worldwide, reinsurance premiums were up 11%, quarter over quarter, driven by strong January renewals, primarily for property catastrophe exposed business. Insurance premiums were up 19% for the period with growth coming from its California workers’ compensation, crop, and non-standard automobile books of business.
- The combined ratio was 80.7 percent for the quarter compared to 89.0% in the first quarter of 2012. Excluding catastrophe losses, reinstatement premiums, and prior year development, for each quarter, the attritional combined ratio improved 5.7 points.
- Net investment income for the current quarter was $145.8 million, including limited partnership income of $17.5 million.
- Net after-tax realized capital gains totaled $83.3 million for the quarter.
- Cash flow from operations was $225.7 million compared to $165.7 million for the same period in 2012.
- For the quarter, the annualized after-tax operating income¹ return on average adjusted shareholders’ equity² was 19.4%.
- During the quarter, the Company repurchased 2.0 million of its common shares at an average price of $122.34 and a total cost of $238.6 million. Subsequent to the quarter, the Company repurchased an additional 88,100 shares for a total cost of $11.4 million. The repurchases were made pursuant to a share repurchase authorization, provided by the Company’s Board of Directors, under which there remains 2.3 million shares available.
- Shareholders’ equity ended the quarter at $6.8 billion, up from $6.7 billion at year end 2012. Book value per share increased 4% from $130.96 at December 31, 2012 to $136.43 at March 31, 2013.
Everest Re is a Bermuda domiciled reinsurer licensed as a long term and Class 4 insurer under the Bermuda Insurance Act of 1978.
