) reported first-quarter operating earnings per share of 97
cents, striding ahead of the Zacks Consensus Estimate of 76 cents
as well as the year-ago quarter's earnings of 78 cents per share.
Operating earnings stood at $60 million, compared with $48
million in the prior-year quarter.
Operating income excludes the effects of net realized
investment gains or losses, guaranty fund assessment or
recoupment, gain on acquisition of Medmarc Mutual Insurance
Company and confidential settlements. These items led to a
positive adjustment of 85 cents per share to net income in the
reported quarter against 12 cents in the year-ago quarter.
Including non-recurring items, ProAssurance's net income was
reported at $112.9 million or $1.82 per share, increasing from
$55.6 million or 90 cents per share in the year-ago quarter.
During the quarter under review, total revenue of ProAssurance
increased 8% to $195 million from $180.6 million in the year-ago
quarter. Revenues also surpassed the Zacks Consensus Estimate of
Gross premiums written of ProAssurance declined 4.3% year over
year to $163.2 million. Moreover, owing to the
lower-than-expected loss severity, arising from accident years
2005 to 2010, the company garnered $53.1 million of net favorable
loss reserve development in the reported quarter versus $47.5
million a year ago. Total expenses amounted to $95.3 million,
down from $105.4 million in the year-ago quarter.
Net investment income of ProAssurance in the quarter was $32.1
million, inching down from $33.5 million in the prior-year
quarter. Net investment result (sum of net investment income and
equity in earnings of unconsolidated subsidiaries) amounted to
$31.9 million, inching up from $31.4 million in the year-ago
quarter. However, net realized investment gains stood at $26.7
million in the reported quarter, surging from $10.7 million in
the first quarter of 2012.
In the reported quarter, ProAssurance witnessed net cash
outflow from operating activities of $13.1 million, which
plummeted from an inflow of $28.1 million in the prior-year
quarter. Total assets of the company at the end of the quarter
were $5.2 billion, increasing from $4.9 billion as of Dec 31,
Meanwhile, ProAssurance's shareholder equity was $2.4 billion,
reflecting an increase from $2.3 billion as of Dec 31, 2012. Book
value per share also grew 3.6% to $38.19 from $36.85 as on Dec
ProAssurance's net loss ratio for the reported quarter came in
at 42.8%, compared with 51.4% in the prior-year quarter.
Additionally, expense ratio deteriorated slightly to 27.7% from
25.2% in the prior-year quarter.
The combined ratio of ProAssurance improved to 70.5% from
76.6% in the comparable quarter last year, while operating ratio
reduced to 46.6% from 52.0% in the prior-year quarter. Return on
equity (ROE) for the reported quarter was 13.4%, improving from
10.2% in the first quarter of 2012.
On Apr 11, 2013, ProAssurance paid a quarterly cash dividend
of 25 cents per share to shareholders of record as of Apr 1.
ProAssurance currently carries a Zacks Rank #1 (Strong Buy).
Other property and casualty insurers carrying the same Zacks Rank
Montpelier Re Holdings Ltd.
Hilltop Holdings Inc.
HCC Insurance Holdings Inc.
HCC INS HLDGS (HCC): Free Stock Analysis
HILLTOP HLDGS (HTH): Free Stock Analysis
MONTPELIER RE (MRH): Free Stock Analysis
PROASSURANCE CP (PRA): Free Stock Analysis
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