Lancashire Holdings Limited (“Lancashire” or “the Company”) today announces its results for the second quarter of 2009 and the six month period ended 30 June 2009. Lancashire grows book value per share 6.9% in Q2 2009, 9.9% year to date combined ratio of 35.4% in Q2 2009, 57.9% year to date.
Financial highlights for the second quarter of 2009:
- Fully converted book value per share of $7.57 at 30 June 2009, compared to $7.08 at 31 March 2009, an increase of 6.9%;
- Gross written premiums of $241.9 million. Net written premiums of $238.7 million;
- Reported loss ratio of 5.8% and a combined ratio of 35.4%. Accident year loss ratio of 30.7%;
- Annualised total investment return of 2.4%;
- Net operating profit of $103.3 million, or $0.55 diluted operating earnings per share; and
- Net profit after tax of $106.4 million, or $0.57 diluted earnings per share.
Financial highlights for the first half of 2009 :
- Fully converted book value per share of $7.57 at 30 June 2009, compared to $6.89 at 31 December 2008, an increase of 9.9%;
- Compound annual Return on Equity since inception of 18.2%;
- Gross written premiums of $384.7 million. Net written premiums of $337.9 million;
- Reported loss ratio of 29.3% and a combined ratio of 57.9%; Accident year loss ratio of 29.8%;
- Annualised total investment return of 3.5%;
- Net operating profit of $139.2 million, or $0.75 diluted operating earnings per share;
- Net profit after tax of $147.1 million, or $0.79 diluted earnings per share ; and
- Interim dividend of 5.0 cents per common share.
Richard Brindle, Group Chief Executive Officer, commented:
“I am pleased to report another good performance by Lancashire. We grew book value per share by 6.9% in the second quarter, delivering a return on equity of 9.9% for the first half of the year.
Our underwriting result was excellent with a combined ratio for the second quarter of 35.4%. Our investments returned 2.4% on an annualised basis; a reasonable result given our conservative philosophy. Since our inception, Lancashire has grown book value per share, including dividends, in thirteen quarters out of fourteen, generating a compound annual return of 18.2%.
We have, however, been somewhat surprised by the reduced demand this year for Gulf of Mexico energy hurricane cover. This significantly reduced the level of business written by Lancashire in that particular class, as compared to our expectations. At the same time, we have made steady progress in building our property catastrophe book in many United States’ critical catastrophe zones and expect to become a significant market participant. Despite reduced premium income in the Gulf of Mexico market, Lancashire has seen strong overall premium growth in the quarter. We are also pleased with the business written in July at rating levels supporting our decision to hold back capacity earlier in the year.
We are proud of the fact that during the quarter Lancashire entered the London Stock Exchange FTSE 250 Index. We are also pleased to declare an interim dividend of 5.0 cents per share.
We look forward with enthusiasm to the opportunities ahead of us for the rest of the year.”
Full report available here
