Everest Re Reports Full Year & Q4 2019 Results
Bermuda-based Everest Re Group, Ltd. reported that for the full year ended December 31, 2019, net income was $1,009.5 million, or $24.70 per diluted common share, compared to net income of $89.0 million, or $2.17 per diluted common share, for the year ended December 31, 2018.
The company said, “After-tax operating income for the year was $872.4 million, or $21.34 per diluted common share, compared to after-tax operating income of $190.7 million, or $4.65 per diluted common share, for the same period in 2018.
“For the fourth quarter 2019, the Company reported net income of $217.6 million, or $5.32 per diluted common share, compared to a net loss of $385.3 million, or [$9.58] per common share for the fourth quarter of 2018. After-tax operating income was $130.8 million, or $3.20 per diluted common share, for the fourth quarter of 2019, compared to an after-tax operating loss of $236.9 million, or [$5.89] per common share, for the same period last year.”
Commenting on the Company’s results, President and Chief Executive Officer Juan C. Andrade said, “For the full year 2019, Everest produced net income of over $1 billion, the best result since 2014. On an ROE basis, this equates to a 12% return on average equity. These numbers speak to the strength and diversification of our business, and the strength of our underwriting and investment operations. Everest has a great franchise, a well-diversified platform and top talent. We are well positioned for the future.”
Operating highlights for the full year 2019 included the following:
- “Gross written premiums for the year were $9.1 billion, an increase of 8% compared to 2018. Reinsurance premiums were up 2% to $6.4 billion with growth in treaty casualty more than offsetting reductions to treaty property premium and reinstatement premiums. Insurance premiums were up 23% to $2.8 billion, with balanced growth being generated across all major business lines.
- “The combined ratio was 95.5% for the year, compared to 108.8% for 2018. Excluding catastrophe losses, reinstatement premiums and the favorable prior period loss development, the attritional combined ratio was 88.4% for the year, compared to 87.0% for 2018.
- “Catastrophe losses, net of reinsurance and reinstatement premiums, amounted to $550.0 million in the year, primarily related to losses from Hurricane Dorian of $166.4 million and losses from Japanese Typhoons Faxai and Hagibis in the amount of $113.3 million and $190.0 million, respectively.
- “Prior year reserve development for 2019 was reported in the amount of $93.6 million favorable, equal to 1.3 loss ratio points.
- “Net investment income amounted to $647.1 million for the year, an increase of 11%, including limited partnership income in the amount of $105.8 million.
- “Net after-tax realized gains amounted to $150.8 million for the year, while net after-tax unrealized capital gains were $483.8 million.
- “Cash flow from operations was $1.9 billion for the full year 2019, compared to $610.1 million for 2018.
- “During 2019, the Company repurchased 114,633 shares at a total cost of $24.6 million. The repurchases were made pursuant to a share repurchase authorization, provided by the Company’s Board of Directors, under which there remains 1.3 million shares available.
Operating highlights for the fourth quarter of 2019 included the following:
- “Gross written premiums for the quarter were $2.4 billion, an increase of 7% compared to the fourth quarter of 2018. Reinsurance premiums, excluding the impact of reinstatement premiums, increased 4%, mainly due to growth in treaty casualty. Insurance premiums were up 30% to $758.7 million, with balanced growth being generated across all major business lines.
- “The combined ratio was 101.5% for the quarter, compared to 134.1% for the same period during 2018. Excluding catastrophe losses, reinstatement premiums and the favorable prior period loss development, the attritional combined ratio was 90.3% for the quarter, compared to 90.4% for the fourth quarter of 2018.
- “Catastrophe losses, net of reinsurance and reinstatement premiums, amounted to $215.0 million in the quarter, primarily related to losses from Japanese Typhoon Hagibis in the amount of $190.0 million and Tornadoes in Dallas, Texas in the amount of $25.0 million.
- “Prior year development for the quarter was reported in the amount of $19.2 million favorable, equal to 1.0 loss ratio point.
- “Net investment income amounted to $146.1 million for the quarter including limited partnership income in the amount of $5.5 million.
- “Net after-tax realized gains amounted to $61.1 million for the quarter, while net after-tax unrealized capital losses were $36.6 million.”
