Endurance Reports Second Quarter 2015 Financial Results
(Thomson Reuters ONE) -
PEMBROKE, Bermuda - August 3, 2015 - Endurance Specialty Holdings Ltd.
(NYSE:ENH) today reported net income available to common shareholders of $76.0
million and $1.68 per diluted common share for the second quarter of 2015 versus
net income of $75.0 million and $1.68 per diluted common share for the second
quarter of 2014.
For the six months ended June 30, 2015, Endurance reported net income available
to common shareholders of $176.3 million and $3.91 per diluted common share
versus net income of $171.3 million and $3.84 per diluted common share for the
six months ended June 30, 2014. Book value per diluted share was $63.32 at
June 30, 2015, up 3.2% from December 31, 2014.
Operating highlights for the quarter ended June 30, 2015 were as follows:
* Gross premiums written of $861.2 million, an increase of 24.9% compared to
the same period in 2014;
* Net premiums written of $559.1 million, an increase of 9.3% compared to the
same period in 2014;
* Combined ratio of 85.5%, which included 12.8 percentage points of favorable
prior year loss reserve development and 2.2 percentage points of net
catastrophe losses from 2015 events, 3.9 percentage points of large property
and energy losses, and 0.8 percentage points of corporate expenses related
to the acquisition of Montpelier Re Holdings Ltd. ("Montpelier");
* Net investment income of $32.3 million, a decrease of $7.1 million from the
same period in 2014;
* Operating income, which excludes after-tax realized investment gains and
foreign exchange losses, of $79.5 million and $1.76 per diluted common
share; and
* Operating return on average common equity for the quarter of 2.8% or 11.1%
on an annualized basis.
Operating highlights for the six months ended June 30, 2015 were as follows:
* Gross premiums written of $2,162.6 million, an increase of 17.1% over the
same period in 2014;
* Net premiums written of $1,324.0 million, an increase of 1.1% over the same
period in 2014;
* Combined ratio of 84.1%, which included 13.7 percentage points of favorable
prior year loss reserve development, 2.1 percentage points of current year
catastrophe losses, 2.1 percentage points of large property and energy
losses, and 0.5 percentage points of corporate expenses related to the
acquisition of Montpelier;
* Net investment income of $74.1 million, a decrease of $6.2 million over the
same period in 2014;
* Operating income of $170.7 million and $3.78 per diluted common share; and
* Operating return on average common equity for the first six months of the
year of 6.1%, or 12.1% on an annualized basis.
John R. Charman, Chairman and Chief Executive Officer, commented, "During the
second quarter we continued to deliver improved profitability by generating an
operating ROE of 11.1% in spite of very challenging market conditions. We were
also able to meaningfully expand our global specialty book of business as
evidenced by our 25% growth in gross written premiums. These strong results
continue to reflect the significant strategic improvements we have implemented
over the past 30 months at Endurance. Our globally recognized, market leading
underwriters are now firmly established and are attracting high quality,
historically profitable business. Our underwriters' careful risk selection and
underwriting discipline remain critical in this very competitive rate
environment and I am confident of our ability to continue to deliver strong
financial results as well as creating exceptional value for our shareholders.
Last week we announced the completion of our acquisition of Montpelier after
both Endurance and Montpelier received overwhelming shareholder support for the
transaction. Having spent the last several months diligently planning, we have
already begun to immediately integrate Montpelier into Endurance. We are
confident in our ability to materially exceed our original synergy estimates and
to achieve our targeted strategic and financial objectives."
Insurance Segment
Operating highlights for Endurance's Insurance segment for the quarter ended
June 30, 2015 were as follows:
* Gross premiums written of $468.9 million, an increase of 45.8% from the
second quarter of 2014;
* Net premiums written of $190.3 million, an increase of 6.3% from the second
quarter of 2014; and
* Combined ratio of 95.2%, which included favorable prior year loss reserve
development of 9.2 percentage points, net catastrophe losses from 2015
events of $1.2 million or 0.6 percentage points and large property and
energy losses of $16.2 million or 8.8 percentage points.
Operating highlights for Endurance's Insurance segment for the six months ended
June 30, 2015 were as follows:
* Gross premiums written of $1,205.1 million, an increase of 23.8% from the
same period in 2014;
* Net premiums written of $494.3 million, a decrease of 5.3% from the same
period in 2014; and
* Combined ratio of 92.2%, which included favorable prior year loss reserve
development of 11.6 percentage points, net catastrophe losses from 2015
events of $5.7 million or 1.7 percentage points and large property and
energy losses of $16.2 million or 5.3 percentage points.
Gross premiums written in the Insurance segment increased $147.3 million and
$231.3 million for the quarter and six months ended June 30, 2015 compared to
the same periods in 2014 as we achieved growth across all lines of business.
The underwriting investments we have made over the last 30 months within the
professional lines, casualty and other specialty and property, marine and energy
lines of business continue to attract new business to Endurance. Non-agriculture
net premiums written increased $34.4 million and $74.6 million for the quarter
and six months ended June 30, 2015, compared to the same periods in 2014. Net
premiums written were impacted by greater levels of reinsurance, including
additional quota share protection for individual lines of business as well as
across the entire portfolio. Within agriculture insurance, greater cessions to
the federal government and increased purchases of third party reinsurance led to
a decline in net premiums written of $23.1 million and $102.3 million for the
quarter and six months ended June 30, 2015 compared to the same periods in 2014.
The 3.4 percentage point increase in the Insurance segment combined ratio for
the quarter ended June 30, 2015 compared to the same period in 2014 was driven
by higher net loss and acquisition expense ratios partially offset by a lower
general and administrative expense ratio. The increase in the net loss ratio
reflects lower levels of favorable loss reserve development which improved the
current quarter's net loss ratio by 9.2 percentage points compared to 10.1
percentage points in 2014. The accident year net loss ratio increased modestly
in the current quarter as two large energy losses totaling $16.2 million, or
8.8 percentage points, were partially offset by improved profitability within
our expanding professional lines business. The current quarter's decline in the
general and administrative expense ratio reflects higher ceding commissions
received as a result of increased quota share reinsurance purchases. The
acquisition expense ratio increased in the current quarter as specialty lines
with higher related acquisition costs accounted for a greater percentage of
earned premiums than a year ago. For the six months ended June 30, 2015
compared to the same period in 2014, the combined ratio improved as lower net
loss and general and administrative expense ratios were partially offset by a
higher acquisition expense ratio.
Reinsurance Segment
Operating highlights for Endurance's Reinsurance segment for the quarter ended
June 30, 2015 were as follows:
* Gross premiums written of $392.3 million, an increase of 6.6% from the
second quarter of 2014;
* Net premiums written of $368.8 million, an increase of 10.9% from the second
quarter of 2014; and
* Combined ratio of 73.0%, which included favorable prior year loss reserve
development of 15.7 percentage points and net catastrophe losses from 2015
events of $8.6 million or 3.5 percentage points.
Operating highlights for Endurance's Reinsurance segment for the six months
ended June 30, 2015 were as follows:
* Gross premiums written of $957.5 million, an increase of 9.7% from the same
period in 2014;
* Net premiums written of $829.7 million, an increase of 5.3% from the same
period in 2014; and
* Combined ratio of 73.8%, which included favorable prior year loss reserve
development of 15.0 percentage points, and net catastrophe losses from 2015
events of $11.3 million or 2.3 percentage points.
Gross premiums written in the Reinsurance segment increased $24.4 million and
$84.4 million for the quarter and six months ended June 30, 2015 compared to the
same periods in 2014. For the second quarter of 2015, the increase was driven
by the professional lines and casualty lines of business, partially offset by
declines within the property, catastrophe and specialty lines of business.
Growth in professional lines and casualty predominantly resulted from expansion
of existing contracts at renewal, some renewal date changes, as well as the
entry into new quota share agreements. Declines in the property and catastrophe
lines of business were driven by the non-renewal of numerous contracts that no
longer met our profitability targets, while the decline in the specialty line of
business resulted primarily from reduced premium estimates on some existing
treaties. For the quarter and six months ended June 30, 2015, net premiums
written increased $36.4 million and $41.6 million from a year ago as the growth
in gross premiums written was largely offset by the purchase of greater levels
of proportional and aggregate excess of loss retrocessional coverage for the
Company's catastrophe portfolio and the initiation of a new whole account quota
share retrocession for the majority of the specialty line of business.
The combined ratio in the Reinsurance segment for the second quarter of 2015
improved by 1.3 percentage points compared to the same period in 2014, due to a
lower net loss ratio that was partially offset by higher acquisition and general
and administrative expense ratios. The net loss ratio improved by 5.2
percentage points in the current quarter compared to a year ago predominantly
due to higher levels of favorable reserve development and a lower level of
catastrophe losses. The 2.1 percentage point increase in the current quarter's
acquisition expense ratio was attributed to an increase in gross premiums
written in the specialty lines of business, which has higher acquisition
expenses. The general and administrative expense ratio increased 1.8 percentage
points in the second quarter of 2015 primarily from higher personnel expenses
related to strategic investments made within our global specialty reinsurance
operations.
Investments
Endurance's net investment income for the quarter and six months ended June 30,
2015 was $32.3 million and $74.1 million, a decrease of $7.1 million and $6.2
million, respectively, compared to the same periods in 2014. The total return
of Endurance's investment portfolio was (0.07)% and 0.81% for the quarter and
six months ended June 30, 2015, compared to 1.52% and 2.78% for the quarter and
six months ended June 30, 2014. Investment income generated from Endurance's
available for sale investments increased by $0.1 million and $2.0 million for
the three and six months ended June 30, 2015, compared to the same periods in
2014 as assets and returns have remained relatively flat. During the quarter
and six months ended June 30, 2015, Endurance's net investment income on its
alternative investment funds and high yield loan funds, which are included in
other investments, included gains of $3.6 million and $16.0 million, as compared
to $10.8 million and $24.3 million in the second quarter and the first six
months of 2014. The ending book yield on Endurance's fixed maturity investments
at June 30, 2015 was 2.27%, up from 2.15% at June 30, 2014.
At June 30, 2015, Endurance's fixed maturity portfolio, which comprises 82.6% of
Endurance's investments, had an average credit quality of AA- and a duration of
3.08 years. Endurance's fixed maturity portfolio was in a net unrealized gain
position of $43.6 million at June 30, 2015, a decrease of $42.5 million from
December 31, 2014. Endurance recorded net realized investment gains, net of
impairments, of $9.3 million and $26.8 million during the second quarter and
first six months of 2015, compared to $3.2 million and $8.0 million during the
second quarter and first six months of 2014.
Endurance ended the second quarter of 2015 with cash and invested assets of $6.6
billion, which represents a 0.8% decrease from December 31, 2014. Net operating
cash inflow was $23.5 million for the six months ended June 30, 2015 versus
$19.7 million for the same period in 2014.
Capitalization and Shareholders' Equity
At June 30, 2015, Endurance's shareholders' equity was $3.30 billion or $63.32
per diluted common share versus $3.19 billion or $61.33 per diluted common share
at December 31, 2014. For the quarter and six months ended June 30, 2015,
Endurance declared and paid common dividends of $0.35 and $0.70 per share,
respectively.
Earnings Call
Endurance will host a conference call on August 4, 2015 at 9:00 a.m. Eastern
time to discuss its financial results. The conference call can be accessed via
telephone by dialing (888) 240-9314 or (913) 312-1477 (international) and
entering pass code: 1577277. Those who intend to participate in the conference
call should register at least ten minutes in advance to ensure access to the
call. A telephone replay of the conference call will be available through
August 18, 2015 by dialing (888) 203-1112 or (719) 457-0820 (international) and
entering the pass code: 1577277.
The public may access a live broadcast of the conference call at the "Investors"
section of Endurance's website, www.endurance.bm. Following the live broadcast,
an archived version will continue to be available on Endurance's website.
A copy of Endurance's financial supplement for the second quarter of 2015 will
be available on Endurance's website at www.endurance.bm shortly after the
release of earnings.
Operating income, operating return on average common equity, operating income
per diluted common share, operating income allocated to common shareholders and
the combined ratio excluding prior year net loss reserve development are non-
GAAP measures. Reconciliations of these measures to the appropriate GAAP
measures are included in the attached tables.
About Endurance Specialty Holdings
Endurance Specialty Holdings Ltd. is a global specialty provider of property and
casualty insurance and reinsurance. Through its operating subsidiaries,
Endurance writes agriculture, casualty and other specialty, professional lines
and property, marine and energy lines of insurance and catastrophe, property,
casualty, professional lines and specialty lines of reinsurance. We maintain
excellent financial strength as evidenced by the ratings of A (Excellent) from
A.M. Best (XV size category) and A (Strong) from Standard and Poor's on our
principal operating subsidiaries. Endurance's headquarters are located at
Waterloo House, 100 Pitts Bay Road, Pembroke HM 08, Bermuda and its mailing
address is Endurance Specialty Holdings Ltd., Suite No. 784, No. 48 Par-la-Ville
Road, Hamilton HM 11, Bermuda. For more information about Endurance, please
visit www.endurance.bm.
Safe Harbor for Forward-Looking Statements
Some of the statements in this press release may include, and Endurance may make
related oral forward-looking statements which reflect our current views with
respect to future events and financial performance. Such statements may include
forward-looking statements both with respect to us in general and the insurance
and reinsurance sectors specifically, both as to underwriting and investment
matters. Statements which include the words "should," "would," "expect,"
"intend," "plan," "believe," "project," "target," "anticipate," "seek," "will,"
"deliver," and similar statements of a future or forward-looking nature identify
forward-looking statements in this press release for purposes of the U.S.
federal securities laws or otherwise. We intend these forward-looking
statements to be covered by the safe harbor provisions for forward-looking
statements in the Private Securities Litigation Reform Act of 1995.
All forward-looking statements address matters that involve risks and
uncertainties. Accordingly, there are or may be important factors that could
cause actual results to differ materially from those indicated in the forward-
looking statements. These factors include, but are not limited to, the effects
of competitors' pricing policies, greater frequency or severity of claims and
loss activity, changes in market conditions in the agriculture insurance
industry, termination of or changes in the terms of the U.S. multiple peril crop
insurance program, a decreased demand for property and casualty insurance or
reinsurance, changes in the availability, cost or quality of reinsurance or
retrocessional coverage, our inability to renew business previously underwritten
or acquired, our inability to maintain our applicable financial strength
ratings, our inability to effectively integrate acquired operations,
uncertainties in our reserving process, changes to our tax status, changes in
insurance regulations, reduced acceptance of our existing or new products and
services, a loss of business from and credit risk related to our broker
counterparties, assessments for high risk or otherwise uninsured individuals,
possible terrorism or the outbreak of war, a loss of key personnel, political
conditions, changes in insurance regulation, changes in accounting policies, our
investment performance, the valuation of our invested assets, a breach of our
investment guidelines, the unavailability of capital in the future, developments
in the world's financial and capital markets and our access to such markets,
government intervention in the insurance and reinsurance industry, illiquidity
in the credit markets, changes in general economic conditions and other factors
described in our Annual Report on Form 10-K for the year ended December 31,
2014.
The foregoing review of important factors should not be construed as exhaustive
and should be read in conjunction with the other cautionary statements that are
included herein and elsewhere, including the risk factors included in
Endurance's most recent report on Form 10-K and other documents of Endurance on
file with the Securities and Exchange Commission. Any forward-looking
statements made in this material are qualified by these cautionary statements,
and there can be no assurance that the actual results or developments
anticipated by Endurance will be realized or, even if substantially realized,
that they will have the expected consequences to, or effects on, Endurance or
its business or operations. Except as required by law, Endurance undertakes no
obligation to update publicly or revise any forward-looking statement, whether
as a result of new information, future developments or otherwise.
The contents of any website referenced in this press release are not
incorporated by reference herein.
ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED BALANCE SHEETS
(In thousands of United States dollars, except share and per share amounts)
June 30, December 31,
2015 2014
---------------- --------------
Assets
Cash and cash equivalents $ 622,642 $ 745,472
Fixed maturity investments, available for sale,
at fair value 4,933,776 5,092,581
Short-term investments, available for sale, at
fair value 16,366 9,014
Equity securities, available for sale, at fair
value 420,411 331,368
Other investments 623,868 541,454
Premiums receivable, net 1,665,990 883,450
Insurance and reinsurance balances receivable 108,162 122,214
Deferred acquisition costs 296,568 207,368
Prepaid reinsurance premiums 668,964 354,940
Reinsurance recoverable on unpaid losses 785,472 670,795
Reinsurance recoverable on paid losses 157,287 218,291
Accrued investment income 25,118 27,183
Goodwill and intangible assets 150,296 153,405
Deferred tax asset 46,779 48,995
Net receivable on sales of investments 21,420 38,877
Other assets 172,162 199,375
---------------- --------------
Total Assets $ 10,715,281 $ 9,644,782
---------------- --------------
Liabilities
Reserve for losses and loss expenses $ 3,833,525 $ 3,846,859
Reserve for unearned premiums 2,046,933 1,254,519
Deposit liabilities 13,376 15,136
Reinsurance balances payable 632,457 375,711
Debt 528,123 527,715
Net payable on purchases of investments 82,375 151,682
Other liabilities 275,586 287,978
---------------- --------------
Total Liabilities 7,412,375 6,459,600
---------------- --------------
Shareholders' Equity
Preferred shares
Series A, non-cumulative - 8,000,000 issued
and outstanding (2014 - 8,000,000) 8,000 8,000
Series B, non-cumulative - 9,200,000 issued
and outstanding (2014 - 9,200,000) 9,200 9,200
Common shares
45,156,845 issued and outstanding (2014 -
44,765,153) 45,157 44,765
Additional paid-in capital 610,585 598,226
Accumulated other comprehensive income 36,965 76,706
Retained earnings 2,592,999 2,448,285
---------------- --------------
Total Shareholders' Equity 3,302,906 3,185,182
---------------- --------------
Total Liabilities and Shareholders' Equity $ 10,715,281 $ 9,644,782
---------------- --------------
Book Value per Common Share
Dilutive common shares outstanding 45,367,976 44,920,768
Diluted book value per common share [a] $ 63.32 $ 61.33
Note: All financial information contained herein is unaudited, except the
balance sheet data for the year ended December 31, 2014, which was derived from
Endurance's audited financial statements.
[a] Excludes the $430 million liquidation value of the preferred shares.
ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands of United States dollars, except share and per share amounts)
Three Months Ended Six Months Ended
--------------------------- ------------------------------
June 30, June 30, June 30, June 30,
2015 2014 2015 2014
------------- ------------- ------------------------------
Revenues
Gross premiums
written $ 861,184 $ 689,425 $ 2,162,616 $ 1,846,940
------------- ------------- --------------- --------------
Net premiums written $ 559,083 $ 511,427 $ 1,324,037 $ 1,310,132
Change in unearned
premiums (100,948 ) (29,889 ) (476,043 ) (432,328 )
------------- ------------- --------------- --------------
Net premiums earned 458,135 481,538 847,994 877,804
Other underwriting
income (loss) 1,389 (4,824 ) 3,795 (6,062 )
Net investment
income 32,252 39,302 74,113 80,292
Net realized and
unrealized gains 9,680 3,411 27,869 8,283
Total other-than-
temporary
impairment losses (424 ) (198 ) (1,073 ) (309 )
Portion of loss
recognized in
other
comprehensive
(loss) income - - - -
------------- ------------- --------------- --------------
Net impairment (1,073 ) (309 )
losses recognized in
earnings (424 ) (198 )
------------- ------------- --------------- --------------
Total revenues 501,032 519,229 952,698 960,008
------------- ------------- --------------- --------------
Expenses
Net losses and loss
expenses 239,122 259,196 411,058 436,092
Acquisition expenses 84,971 78,601 167,064 150,758
General and
administrative
expenses 54,965 58,312 109,855 117,813
Corporate expenses
[a] 12,634 28,143 24,902 41,848
Amortization of
intangibles 1,579 1,623 3,178 3,240
Net foreign exchange
losses 12,981 319 20,533 3,283
Interest expense 9,062 9,732 18,121 18,783
------------- ------------- --------------- --------------
Total expenses 415,314 435,926 754,711 771,817
------------- ------------- --------------- --------------
Income before income
taxes 85,718 83,303 197,987 188,191
Income tax expense (1,512 ) (140 ) (5,302 ) (548 )
------------- ------------- --------------- --------------
Net income 84,206 83,163 192,685 187,643
Preferred dividends (8,188 ) (8,188 ) (16,376 ) (16,376 )
------------- ------------- --------------- --------------
Net income available
to common and
participating common
shareholders $ 76,018 $ 74,975 $ 176,309 $ 171,267
------------- ------------- --------------- --------------
Per share data
Basic earnings per
common share $ 1.69 $ 1.68 $ 3.92 $ 3.84
------------- ------------- --------------- --------------
Diluted earnings per
common share $ 1.68 $ 1.68 $ 3.91 $ 3.84
------------- ------------- --------------- --------------
[a] The Company incurred $3.5 million and $4.5 million of corporate expenses in
relation to the Company's acquisition of Montpelier for the quarter and six
months ended June 30, 2015. For the quarter and six months ended June 30,
2014, the Company incurred $12.1 million and $13.0 million of corporate expenses
in relation to the Company's proposed acquisition of Aspen Insurance Holdings
Limited.
ENDURANCE SPECIALTY HOLDINGS LTD.
RESULTS BY SEGMENT
(in thousands of United States dollars, except ratios)
Three Months Ended June 30, 2015
-----------------------------------------
Reported
Insurance Reinsurance Totals
------------- ------------- -------------
Revenues
Gross premiums written $ 468,866 $ 392,318 $ 861,184
Ceded premiums written (278,567 ) (23,534 ) (302,101 )
------------- ------------- -------------
Net premiums written 190,299 368,784 559,083
------------- ------------- -------------
Net premiums earned 201,460 256,675 458,135
Other underwriting income - 1,389 1,389
------------- ------------- -------------
Total underwriting revenues 201,460 258,064 459,524
------------- ------------- -------------
Expenses
Net losses and loss expenses 145,483 93,639 239,122
Acquisition expenses 17,702 67,269 84,971
General and administrative
expenses 28,567 26,398 54,965
------------- ------------- -------------
191,752 187,306 379,058
------------- ------------- -------------
Underwriting income $ 9,708 $ 70,758 80,466
------------- ------------- -------------
Net investment income 32,252
Corporate expenses (12,634 )
Interest expense (9,062 )
Amortization of intangibles (1,579 )
Net foreign exchange losses (12,981 )
Net realized and unrealized
gains 9,680
Net impairment losses
recognized in earnings (424 )
-------------
Income before income taxes $ 85,718
-------------
Net loss ratio 72.2 % 36.5 % 52.2 %
Acquisition expense ratio 8.8 % 26.2 % 18.5 %
General and administrative
expense ratio 14.2 % 10.3 % 14.8 % [a]
------------- ------------- -------------
Combined ratio 95.2 % 73.0 % 85.5 %
------------- ------------- -------------
[a] General and administrative expense ratio includes general and administrative
expenses and corporate expenses.
ENDURANCE SPECIALTY HOLDINGS LTD.
RESULTS BY SEGMENT
(in thousands of United States dollars, except ratios)
Three Months Ended June 30, 2014
-----------------------------------------
Reported
Insurance Reinsurance Totals
------------- ------------- -------------
Revenues
Gross premiums written $ 321,526 $ 367,899 $ 689,425
Ceded premiums written (142,488 ) (35,510 ) (177,998 )
------------- ------------- -------------
Net premiums written 179,038 332,389 511,427
------------- ------------- -------------
Net premiums earned 218,563 262,975 481,538
Other underwriting loss - (4,824 ) (4,824 )
------------- ------------- -------------
Total underwriting revenues 218,563 258,151 476,714
------------- ------------- -------------
Expenses
Net losses and loss expenses 149,567 109,629 259,196
Acquisition expenses 15,128 63,473 78,601
General and administrative
expenses 35,969 22,343 58,312
------------- ------------- -------------
200,664 195,445 396,109
------------- ------------- -------------
Underwriting income $ 17,899 $ 62,706 80,605
------------- ------------- -------------
Net investment income 39,302
Corporate expenses (28,143 )
Interest expense (9,732 )
Amortization of intangibles (1,623 )
Net foreign exchange losses (319 )
Net realized and unrealized
gains 3,411
Net impairment losses
recognized in earnings (198 )
-------------
Income before income taxes $ 83,303
-------------
Net loss ratio 68.5 % 41.7 % 53.8 %
Acquisition expense ratio 6.9 % 24.1 % 16.3 %
General and administrative
expense ratio 16.4 % 8.5 % 18.0 % [a]
------------- ------------- -------------
Combined ratio 91.8 % 74.3 % 88.1 %
------------- ------------- -------------
[a] General and administrative expense ratio includes general and administrative
expenses and corporate expenses.
ENDURANCE SPECIALTY HOLDINGS LTD.
RESULTS BY SEGMENT
(in thousands of United States dollars, except ratios)
Six Months Ended June 30, 2015
---------------------------------------------
Reported
Insurance Reinsurance Totals
--------------- ------------- ---------------
Revenues
Gross premiums written $ 1,205,084 $ 957,532 $ 2,162,616
Ceded premiums written (710,746 ) (127,833 ) (838,579 )
--------------- ------------- ---------------
Net premiums written 494,338 829,699 1,324,037
--------------- ------------- ---------------
Net premiums earned 337,324 510,670 847,994
Other underwriting income - 3,795 3,795
--------------- ------------- ---------------
Total underwriting
revenues 337,324 514,465 851,789
--------------- ------------- ---------------
Expenses
Net losses and loss
expenses 219,995 191,063 411,058
Acquisition expenses 33,585 133,479 167,064
General and administrative
expenses 57,409 52,446 109,855
--------------- ------------- ---------------
310,989 376,988 687,977
--------------- ------------- ---------------
Underwriting income $ 26,335 $ 137,477 163,812
--------------- ------------- ---------------
Net investment income 74,113
Corporate expenses (24,902 )
Interest expense (18,121 )
Amortization of
intangibles (3,178 )
Net foreign exchange
losses (20,533 )
Net realized and
unrealized gains 27,869
Net impairment losses
recognized in earnings (1,073 )
---------------
Income before income taxes $ 197,987
---------------
Net loss ratio 65.2 % 37.4 % 48.5 %
Acquisition expense ratio 10.0 % 26.1 % 19.7 %
General and administrative
expense ratio 17.0 % 10.3 % 15.9 % [a]
--------------- ------------- ---------------
Combined ratio 92.2 % 73.8 % 84.1 %
--------------- ------------- ---------------
[a] General and administrative expense ratio includes general and administrative
expenses and corporate expenses.
ENDURANCE SPECIALTY HOLDINGS LTD.
RESULTS BY SEGMENT
(in thousands of United States dollars, except ratios)
Six Months Ended June 30, 2014
-------------------------------------------
Reported
Insurance Reinsurance Totals
------------- ------------- ---------------
Revenues
Gross premiums written $ 973,802 $ 873,138 $ 1,846,940
Ceded premiums written (451,737 ) (85,071 ) (536,808 )
------------- ------------- ---------------
Net premiums written 522,065 788,067 1,310,132
------------- ------------- ---------------
Net premiums earned 362,584 515,220 877,804
Other underwriting loss - (6,062 ) (6,062 )
------------- ------------- ---------------
Total underwriting revenues 362,584 509,158 871,742
------------- ------------- ---------------
Expenses
Net losses and loss expenses 238,100 197,992 436,092
Acquisition expenses 27,389 123,369 150,758
General and administrative
expenses 72,668 45,145 117,813
------------- ------------- ---------------
338,157 366,506 704,663
------------- ------------- ---------------
Underwriting income $ 24,427 $ 142,652 167,079
------------- ------------- ---------------
Net investment income 80,292
Corporate expenses (41,848 )
Interest expense (18,783 )
Amortization of intangibles (3,240 )
Net foreign exchange losses (3,283 )
Net realized and unrealized
gains 8,283
Net impairment losses
recognized in earnings (309 )
---------------
Income before income taxes $ 188,191
---------------
Net loss ratio 65.7 % 38.5 % 49.6 %
Acquisition expense ratio 7.6 % 23.9 % 17.2 %
General and administrative
expense ratio 20.0 % 8.7 % 18.2 % [a]
------------- ------------- ---------------
Combined ratio 93.3 % 71.1 % 85.0 %
------------- ------------- ---------------
[a] General and administrative expense ratio includes general and administrative
expenses and corporate expenses.
ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED FINANCIAL RATIOS
As Reported
---------------------------------------------------------
Three Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 72.2 % 68.5 % 36.5 % 41.7 % 52.2 % 53.8 %
Acquisition
expense ratio 8.8 % 6.9 % 26.2 % 24.1 % 18.5 % 16.3 %
General and
administrative
expense ratio 14.2 % 16.4 % 10.3 % 8.5 % 14.8 % 18.0 %
--------- --------- -------- -------- -------- ----------
Combined ratio 95.2 % 91.8 % 73.0 % 74.3 % 85.5 % 88.1 %
--------- --------- -------- -------- -------- ----------
Effect of Prior Year Net Loss
Reserve Development
Favorable /
(Unfavorable)
---------------------------------------------------------
Three Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 9.2 % 10.1 % 15.7 % 12.2 % 12.8 % 11.3 %
--------- --------- -------- -------- -------- ----------
Net of Prior Year Net Loss
Reserve Development
---------------------------------------------------------
Three Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 81.4 % 78.6 % 52.2 % 53.9 % 65.0 % 65.1 %
Acquisition
expense ratio 8.8 % 6.9 % 26.2 % 24.1 % 18.5 % 16.3 %
General and
administrative
expense ratio 14.2 % 16.4 % 10.3 % 8.5 % 14.8 % 18.0 %
--------- --------- -------- -------- -------- ----------
Combined ratio 104.4 % 101.9 % 88.7 % 86.5 % 98.3 % 99.4 %
--------- --------- -------- -------- -------- ----------
The combined ratio is the sum of the loss, acquisition expense and general
and administrative expense ratios. Endurance presents the combined ratio as
a measure that is commonly recognized as a standard of performance by
investors, analysts, rating agencies and other users of its financial
information. The combined ratio, excluding prior year net loss reserve
development, enables investors, analysts, rating agencies and other users of
its financial information to more easily analyze Endurance's results of
underwriting activities in a manner similar to how management analyzes
Endurance's underlying business performance. The combined ratio, net of
prior year net loss reserve development, should not be viewed as a
substitute for the combined ratio.
ENDURANCE SPECIALTY HOLDINGS LTD.
CONSOLIDATED FINANCIAL RATIOS
As Reported
---------------------------------------------------------
Six Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 65.2 % 65.7 % 37.4 % 38.5 % 48.5 % 49.6 %
Acquisition
expense ratio 10.0 % 7.6 % 26.1 % 23.9 % 19.7 % 17.2 %
General and
administrative
expense ratio 17.0 % 20.0 % 10.3 % 8.7 % 15.9 % 18.2 %
--------- --------- -------- -------- -------- ----------
Combined ratio 92.2 % 93.3 % 73.8 % 71.1 % 84.1 % 85.0 %
--------- --------- -------- -------- -------- ----------
Effect of Prior Year Net Loss
Reserve Development
Favorable /
(Unfavorable)
---------------------------------------------------------
Six Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 11.6 % 9.3 % 15.0 % 13.7 % 13.7 % 11.9 %
--------- --------- -------- -------- -------- ----------
Net of Prior Year Net Loss
Reserve Development
---------------------------------------------------------
Six Months Ended June 30,
---------------------------------------------------------
Insurance Reinsurance Total
------------------- ----------------- -------------------
2015 2014 2015 2014 2015 2014
Net loss ratio 76.8 % 75.0 % 52.4 % 52.2 % 62.2 % 61.5 %
Acquisition
expense ratio 10.0 % 7.6 % 26.1 % 23.9 % 19.7 % 17.2 %
General and
administrative
expense ratio 17.0 % 20.0 % 10.3 % 8.7 % 15.9 % 18.2 %
--------- --------- -------- -------- -------- ----------
Combined ratio 103.8 % 102.6 % 88.8 % 84.8 % 97.8 % 96.9 %
--------- --------- -------- -------- -------- ----------
The combined ratio is the sum of the loss, acquisition expense and general
and administrative expense ratios. Endurance presents the combined ratio as
a measure that is commonly recognized as a standard of performance by
investors, analysts, rating agencies and other users of its financial
information. The combined ratio, excluding prior year net loss reserve
development, enables investors, analysts, rating agencies and other users of
its financial information to more easily analyze Endurance's results of
underwriting activities in a manner similar to how management analyzes
Endurance's underlying business performance. The combined ratio, net of
prior year net loss reserve development, should not be viewed as a
substitute for the combined ratio.
ENDURANCE SPECIALTY HOLDINGS LTD.
GROSS AND NET PREMIUMS WRITTEN BY SEGMENT
(in thousands of United States dollars)
The following tables show Endurance's gross and net premiums written for the
three months ended June 30, 2015 and 2014:
Three Months Ended Three Months Ended
June 30, 2015 June 30, 2014
------------------------------- ------------------------------
Gross Net Premiums Gross Net Premiums
Premiums Written Premiums Written
Written Written
--------------- --------------- --------------- --------------
Insurance
Agriculture $ 112,012 $ 22,677 $ 80,540 $ 45,826
Casualty and
other
specialty 146,056 65,302 108,030 56,475
Professional
lines 96,736 43,443 74,650 29,846
Property,
marine and
energy 114,062 58,877 58,306 46,891
--------------- --------------- --------------- --------------
Subtotal
Insurance 468,866 190,299 321,526 179,038
--------------- --------------- --------------- --------------
Reinsurance
Catastrophe 139,833 122,305 158,372 123,411
Property 30,560 30,118 42,887 42,886
Casualty 48,132 48,132 30,875 30,868
Professional
lines 134,241 134,241 84,117 84,117
Specialty 39,552 33,988 51,648 51,107
--------------- --------------- --------------- --------------
Subtotal
Reinsurance 392,318 368,784 367,899 332,389
--------------- --------------- --------------- --------------
Total $ 861,184 $ 559,083 $ 689,425 $ 511,427
--------------- --------------- --------------- --------------
ENDURANCE SPECIALTY HOLDINGS LTD.
GROSS AND NET PREMIUMS WRITTEN BY SEGMENT
(in thousands of United States dollars)
The following tables show Endurance's gross and net premiums written for the six
months ended June 30, 2015 and 2014:
Six Months Ended Six Months Ended
June 30, 2015 June 30, 2014
-------------------------------- ------------------------------
Gross Premiums Net Premiums Gross Net Premiums
Written Written Premiums Written
Written
---------------- --------------- --------------- --------------
Insurance
Agriculture $ 628,928 $ 225,137 $ 608,434 $ 327,471
Casualty and
other
specialty 246,738 110,360 175,683 93,288
Professional
lines 151,496 67,674 113,430 44,416
Property,
marine and
energy 177,922 91,167 76,255 56,890
---------------- --------------- --------------- --------------
Subtotal
Insurance $ 1,205,084 $ 494,338 $ 973,802 $ 522,065
---------------- --------------- --------------- --------------
Reinsurance
Catastrophe $ 264,240 $ 175,765 $ 285,020 $ 202,374
Property 156,260 153,567 209,300 209,208
Casualty 106,230 106,230 115,857 114,260
Professional
lines 178,098 178,098 109,736 109,736
Specialty 252,704 216,039 153,225 152,489
---------------- --------------- --------------- --------------
Subtotal
Reinsurance $ 957,532 $ 829,699 $ 873,138 $ 788,067
---------------- --------------- --------------- --------------
Total $ 2,162,616 $ 1,324,037 $ 1,846,940 $ 1,310,132
---------------- --------------- --------------- --------------
ENDURANCE SPECIALTY HOLDINGS LTD.
RECONCILIATIONS
(in thousands of United States dollars, except share, per share amounts and
ratios)
The following is a reconciliation of Endurance's net income, net income per
basic or diluted common share, net income allocated to common shareholders under
the two-class method and annualized return on average common equity to operating
income, operating income per basic or diluted common share, operating income
allocated to common shareholders under the two-class method and annualized
operating return on average common equity (all non-GAAP measures) for the three
and six months ended June 30, 2015 and 2014:
Three Months Ended Six Months Ended
------------------------------- ------------------------------
June 30, June 30,
------------------------------- ------------------------------
2015 2014 2015 2014
--------------- --------------- --------------- --------------
Net income $ 84,206 $ 83,163 $ 192,685 $ 187,643
Add (less)
after-tax items:
Net foreign
exchange
losses 12,910 305 20,484 3,277
Net realized
and unrealized
gains (9,707 ) (3,559 ) (27,021 ) (8,563 )
Net impairment
losses
recognized in
earnings 309 198 957 309
--------------- --------------- --------------- --------------
Operating income
before preferred
dividends 87,718 80,107 $ 187,105 $ 182,666
Preferred
dividends (8,188 ) (8,188 ) (16,376 ) (16,376 )
--------------- --------------- --------------- --------------
Operating income
allocated to
common and
participating
common
shareholders $ 79,530 $ 71,919 $ 170,729 $ 166,290
--------------- --------------- --------------- --------------
Operating income
allocated to
common
shareholders
under the two-
class method $ 77,152 $ 69,797 $ 165,657 $ 161,447
--------------- --------------- --------------- --------------
Weighted average
diluted common
shares 43,896,721 43,350,911 43,792,626 43,265,626
--------------- --------------- --------------- --------------
Operating income
per diluted
common share [b] $ 1.76 $ 1.61 $ 3.78 $ 3.73
--------------- --------------- --------------- --------------
Average common
equity [a] $ 2,858,876 $ 2,628,392 $ 2,814,044 $ 2,571,112
Operating return
on average
common equity 2.8 % 2.7 % 6.1 % 6.5 %
--------------- --------------- --------------- --------------
Annualized
operating return
on average
common equity 11.1 % 10.9 % 12.1 % 12.9 %
--------------- --------------- --------------- --------------
Net income $ 84,206 $ 83,163 $ 192,685 $ 187,643
Preferred
dividends (8,188 ) (8,188 ) (16,376 ) (16,376 )
--------------- --------------- --------------- --------------
Net income
available to
common and
participating
common
shareholders $ 76,018 $ 74,975 $ 176,309 $ 171,267
--------------- --------------- --------------- --------------
Net income
allocated to
common
Datum: 03.08.2015 - 22:16 Uhr
Sprache: Deutsch
News-ID 411151
Anzahl Zeichen: 65606
contact information:
Town:
Pembroke
Kategorie:
Business News
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"Endurance Reports Second Quarter 2015 Financial Results"
steht unter der journalistisch-redaktionellen Verantwortung von
Endurance Specialty Holdings Ltd (Nachricht senden)
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