HAMILTON, Bermuda, April 22 /PRNewswire-FirstCall/ -- Platinum Underwriters Holdings, Ltd. (NYSE: PTP) today reported net income of $84.9 million, or $1.58 per diluted common share, for the quarter ended March 31, 2009.
The results for the quarter include net premiums earned of $247.8 million, a decrease of 17.9% from the same quarter last year, net favorable development of $22.1 million, compared with net favorable development of $29.5 million in the same quarter last year, and net investment income and net realized gains on investments of $54.8 million, an increase of 5.3% from the same quarter last year.
Michael D. Price, Platinum's Chief Executive Officer, commented, "Platinum's results in the quarter reflect strong current period underwriting gains, favorable prior period development, solid investment performance and active capital management. Our book value per share was $35.76 as of March 31, 2009, an increase of 3.4% from December 31, 2008, and reflects share repurchases and the conversion of our preferred shares during the quarter."
Mr. Price added, "During the quarter, we experienced more attractive underwriting conditions for property and marine than for casualty. The U.S. property catastrophe market continues to improve and we expect increased demand and higher pricing for the balance of the year."
Results for the quarter ended March 31, 2009 are summarized as follows:
-- Net income was $84.9 million or $1.58 per diluted common share.
-- Net premiums written were $245.3 million and net premiums earned were
$247.8 million.
-- GAAP combined ratio was 80.1%.
-- Net investment income was $34.2 million.
-- Net realized gains on investments were $20.6 million.
Results for the quarter ended March 31, 2009 compared with the quarter ended March 31, 2008 are summarized as follows:
-- Net income decreased $20.2 million (or 19.3%).
-- Net premiums written decreased $51.0 million (or 17.2%) and net premiums
earned decreased $54.1 million (or 17.9%).
-- GAAP combined ratio increased 1.7 percentage points.
-- Net investment income decreased $14.8 million (or 30.2%).
-- Net realized gains on investments increased $17.6 million.
Net premiums written for Platinum's Property and Marine, Casualty and Finite Risk segments for the quarter ended March 31, 2009 were $141.8 million, $98.0 million and $5.5 million, respectively, representing 57.8%, 40.0% and 2.2%, respectively, of total net premiums written. Combined ratios for these segments were 77.0%, 82.8% and 107.8%, respectively. Compared with the quarter ended March 31, 2008, net premiums written decreased $27.1 million (or 16.0%) in the Property and Marine segment, $27.6 million (or 22.0%) in the Casualty segment and increased $3.6 million in Finite Risk segment.
Total assets were $4.99 billion as of March 31, 2009, an increase of $63.8 million (or 1.3%) from $4.93 billion as of December 31, 2008. The increase in total assets reflects positive cash flow from operations, partially offset by share repurchases in the quarter. Cash, cash equivalents and fixed maturity investments were $4.31 billion as of March 31, 2009, an increase of $54.7 million (or 1.3%) from $4.26 billion as of December 31, 2008.
Shareholders' equity was $1.83 billion as of March 31, 2009, an increase of $20.1 million (or 1.1%) from $1.81 billion as of December 31, 2008. Book value per common share was $35.76 as of March 31, 2009 based on 51.2 million common shares outstanding, an increase of $1.18 (or 3.4%) from $34.58 as of December 31, 2008 based on 47.5 million common shares outstanding. Book value reflects share repurchases of $60.0 million at an average price of $26.66 per share and the conversion of our preferred shares during the quarter.
Financial Supplement
Platinum has posted a financial supplement on the Financial Reports page of the Investor Relations section of its website (Financial Supplement). The Financial Supplement provides additional detail regarding the financial performance of Platinum and its business segments.
Teleconference
Platinum will host a teleconference to discuss its financial results on Thursday, April 23, 2009 at 8:00 a.m. Eastern time. The call may be accessed by dialing 800-811-8824 (US callers) or 913-312-9324 (international callers), or in a listen-only mode via the Investor Relations section of Platinum's website at www.platinumre.com. Those who intend to participate in the teleconference should register at least ten minutes in advance to ensure access to the call.
The teleconference will be recorded and a replay will be available from 11:00 a.m. Eastern time on Thursday, April 23, 2009 until midnight Eastern time on Thursday, April 30, 2009. To access the replay by telephone, dial 888-203-1112 (US callers) or 719-457-0820 (international callers) and specify passcode 4736162. The teleconference will also be archived on the Investor Relations section of Platinum's website at www.platinumre.com for the same period of time.
Non-GAAP Financial Measures
In presenting the Company's results, management has included and discussed certain schedules containing financial measures that are not calculated under standards or rules that comprise accounting principles generally accepted in the United States (GAAP). Such measures, including segment underwriting income (or loss) related underwriting ratios and fully converted book value per common share, are referred to as non-GAAP. These non-GAAP measures may be defined or calculated differently by other companies. Management believes these measures, which are used to monitor the results of operations, assist in understanding the Company. These measures should not be viewed as a substitute for those determined in accordance with GAAP. A reconciliation of such measures to the most comparable GAAP figures such as income or loss before income tax expense or benefit and total shareholders' equity is presented in the attached financial information in accordance with Regulation G.
About Platinum
Platinum Underwriters Holdings, Ltd. (NYSE: PTP) 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. The Company has a financial strength rating of A (Excellent) from A.M. Best Company, Inc. For further information, please visit Platinum's website at www.platinumre.com.
Safe Harbor Statement Regarding Forward-Looking Statements:
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). Forward-looking statements are based on our current plans or expectations that are inherently subject to significant business, economic and competitive uncertainties and contingencies. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, us. In particular, statements using words such as "may," "should," "estimate," "expect," "anticipate," "intend," "believe," "predict," "potential," or words of similar import generally involve forward-looking statements. The inclusion of forward-looking statements in this press release should not be considered as a representation by us or any other person that our current plans or expectations will be achieved. Numerous factors could cause our actual results to differ materially from those in forward-looking statements, including, but not limited to, severe catastrophic events over which we have no control, the effectiveness of our loss limitation methods and pricing models, the adequacy of our liability for unpaid losses and loss adjustment expenses, our ability to maintain our A.M. Best Company, Inc. rating, the cyclicality of the property and casualty reinsurance business, conducting operations in a competitive environment, our ability to maintain our business relationships with reinsurance brokers, the availability of retrocessional reinsurance on acceptable terms, market volatility and interest rate and currency exchange rate fluctuation, tax, regulatory or legal restrictions or limitations applicable to us or the property and casualty reinsurance business generally, general political and economic conditions, including the effects of civil unrest, acts of terrorism, war or a prolonged United States or global economic downturn or recession; and changes in our plans, strategies, objectives, expectations or intentions, which may happen at any time at our discretion. As a consequence, our future financial condition and results may differ from those expressed in any forward-looking statements made by or on behalf of us. The foregoing factors should not be construed as exhaustive. Additionally, forward-looking statements speak only as of the date they are made, and we undertake no obligation to revise or update forward-looking statements to reflect new information or circumstances after the date hereof or to reflect the occurrence of future events.
Platinum Underwriters Holdings, Ltd.
Condensed Consolidated Balance Sheets
As of March 31, 2009 and December 31, 2008
(amounts in thousands, except per share amounts)
March 31, December 31,
2009 2008
(Unaudited)
Assets
Investments $3,968,831 $3,371,886
Cash, cash equivalents and short-term
investments 345,810 888,053
Reinsurance premiums receivable 356,736 307,539
Accrued investment income 32,817 29,041
Reinsurance balances (prepaid and
recoverable) 18,220 23,310
Deferred acquisition costs 47,828 50,719
Funds held by ceding companies 136,944 136,278
Other assets 83,810 120,337
Total assets $4,990,996 $4,927,163
Liabilities
Unpaid losses and loss adjustment
expenses $2,494,997 $2,463,506
Unearned premiums 213,638 218,890
Debt obligations 250,000 250,000
Commissions payable 127,195 125,551
Other liabilities 75,707 59,819
Total liabilities 3,161,537 3,117,766
Total shareholders' equity 1,829,459 1,809,397
Total liabilities and
shareholders' equity $4,990,996 $4,927,163
Book value per common share (a) $35.76 $34.58
(a) Book value per common share is determined by dividing shareholders'
equity, excluding capital attributable to preferred shares, by actual
common shares outstanding.
Platinum Underwriters Holdings, Ltd.
Condensed Consolidated Statements of Operations and Comprehensive Income
(Unaudited)
For the Three Months Ended March 31, 2009 and 2008
(amounts in thousands, except per share amounts)
Three Months Ended
March 31, March 31,
2009 2008
Revenue
Net premiums earned $247,752 $301,851
Net investment income 34,246 49,062
Net realized gains on investments 20,570 2,972
Other income (expense) 232 (96)
Total revenue 302,800 353,789
Expenses
Net losses and LAE 144,164 160,203
Net acquisition expenses 40,156 60,542
Net change in fair value of derivatives 2,417 810
Net impairment losses 3,408 -
Operating expenses 20,868 21,690
Net foreign currency exchange (gains)
losses 996 (4,869)
Interest expense 4,755 4,750
Total expenses 216,764 243,126
Income before income tax expense 86,036 110,663
Income tax expense 1,114 5,492
Net income 84,922 105,171
Preferred dividends 1,301 2,602
Net income attributable to common
shareholders $83,621 $102,569
Basic
Weighted average common shares
outstanding 49,521 52,104
Basic earnings per common share $1.69 $1.97
Diluted
Adjusted weighted average common shares
outstanding 53,702 59,874
Diluted earnings per common share $1.58 $1.76
Comprehensive income
Net income $84,922 $105,171
Other comprehensive loss, net of
deferred taxes (1,576) (4,121)
Comprehensive income $83,346 $101,050
Platinum Underwriters Holdings, Ltd.
Segment Reporting
For the Three Months Ended March 31, 2009 and 2008
($ in thousands)
Three Months Ended March 31, 2009 (Unaudited)
Property
and Finite
Segment underwriting results Marine Casualty Risk Total
Net premiums written $141,735 98,014 5,523 $245,272
Net premiums earned 133,671 109,960 4,121 247,752
Net losses and LAE 77,451 59,141 7,572 144,164
Net acquisition expenses 17,364 26,221 (3,429) 40,156
Other underwriting expenses 8,159 5,669 300 14,128
Total underwriting expenses 102,974 91,031 4,443 198,448
Segment underwriting income
(loss) $30,697 18,929 (322) 49,304
Net investment income 34,246
Net realized gains on investments 20,570
Net impairment losses (3,408)
Net change in fair value of
derivatives (2,417)
Net foreign currency exchange
losses (996)
Other income 232
Corporate expenses not
allocated to segments (6,740)
Interest expense (4,755)
Income before income tax expense $86,036
GAAP underwriting ratios:
Loss and LAE 57.9% 53.8% 183.7% 58.2%
Acquisition expense 13.0% 23.8% (83.2%) 16.2%
Other underwriting expense 6.1% 5.2% 7.3% 5.7%
Combined 77.0% 82.8% 107.8% 80.1%
Three Months Ended March 31, 2008
Segment underwriting results
Net premiums written $168,817 125,576 1,878 $296,271
Net premiums earned 153,390 147,495 966 301,851
Net losses and LAE 62,039 99,393 (1,229) 160,203
Net acquisition expenses 20,654 37,488 2,400 60,542
Other underwriting expenses 8,596 6,795 310 15,701
Total underwriting expenses 91,289 143,676 1,481 236,446
Segment underwriting income
(loss) $62,101 3,819 (515) 65,405
Net investment income 49,062
Net realized gains on investments 2,972
Net impairment losses -
Net change in fair value of
derivatives (810)
Net foreign currency exchange
gains 4,869
Other expense (96)
Corporate expenses not
allocated to segments (5,989)
Interest expense (4,750)
Income before income tax expense $110,663
GAAP underwriting ratios:
Loss and LAE 40.4% 67.4% (127.2%) 53.1%
Acquisition expense 13.5% 25.4% 248.4% 20.1%
Other underwriting expense 5.6% 4.6% 32.1% 5.2%
Combined 59.5% 97.4% 153.3% 78.4%
The GAAP underwriting ratios are calculated by dividing each item above
by net premiums earned.
SOURCE Platinum Underwriters Holdings, Ltd.
For further information: Lily Outerbridge, Investor Relations, +1-441-298-0760
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