Montpelier Re Holdings Ltd
) reported operating earnings of 76 cents per share in the second
quarter, missing the Zacks Consensus Estimate by 22%. Operating
earnings also declined 18% year over year.
The quarter experienced lower underwriting income largely due to
However, the quarter witnessed solid contribution from Lloyd's and
Collateralized Re segments, as well as benefit of prior-period
Including net realized investment losses of $5.5 million, net
unrealized investment gains of $14.3 million, net losses from
investment-related derivative instruments of $8.2 million, net
foreign currency losses of $8.8 million, net losses from foreign
exchange-related derivative instruments of $1.9 million, Montpelier
Re reported net income of 78 cents per share, rebounding from the
year-ago loss of 52 cents.
Quarterly Operational Update
Montpelier Re's net premiums written was flat year over year as
higher premiums at Lloyd's and Collateralized Reinsurance segments
were offset by lower premiums at Montpelier Bermuda.
Net investment income came in at $12 million, down 25.7% year over
Underwriting income of $37.8 million was down 12.3% over the
Loss ratio was 40.8% in the second quarter, up 710 basis points
(bps) from 33.7% in the year-ago quarter. Combined ratio
deteriorated 770 basis points year over year to 76.7%.
Montpelier Re exited the quarter with cash and investments of $3.4
billion, up 6.2% from the end of 2013.
At the end of the quarter, debt was $399.2 million, flat with the
Book value per share as of Jun 30, 2014 came in at $31.74, up 2.8%
year over year.
Share Repurchase Update
Montpelier Re spent $70.3 million to buy back 0.9 million common
shares in the second quarter. Following the quarter end, the
company has already repurchase 0.3 million shares to date.
On Jul 15, Montpelier Re paid 12.50 cents per share in quarterly
dividend to shareholders of record as of Jun 30.
Montpelier Re currently carries a Zacks Rank #3 (Hold).
Performance of Other Property and Casualty
While ACE Limited (
) outperformed the Zacks Consensus Estimate on solid underwriting
performances coupled with improved investment results, RLI
) earnings were in line. However, The Travelers Companies Inc. (
) missed the Zacks Consensus Estimate on higher-than-expected
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