Property and casualty insurer
W.R. Berkley Corp.
) reported second-quarter core operating earnings of 70 cents per
share, 3 cents ahead of the Zacks Consensus Estimate. The
earnings beat came on the back of higher premium written, pricing
gains and a lower share count. Earnings inched up by 7.7% year
On a GAAP basis, net income increased 7.9% year over year to
82 cents per share.
Revenue in the quarter came in at $1.57 billion, up 11.0% year
over year. The year-over-year increase was attributable to higher
premiums earned, insurance fee service, higher income from wholly
owned investees and increased net investment income.
W.R. Berkley's net written premium for the quarter was
approximately $1.34 billion, an increase of 12.7% year over year.
The company saw broad-based growth with each of its operating
segments reporting higher premium.
Net investment income was $143.7 million in the quarter, down
10.9% year over year.
Total expenses also increased 11.4% year over year to $1.41
billion, due to an increase in loss and loss expenses, other
operating cost partly offset by lower interest expenses.
Net premiums written in the
segment increased 11% year over year to $967.7 million. Combined
ratio improved 240 basis points to 95.4% in the quarter.
Net premiums written in the
Regional segment climbed 11.0% year over year to $241.7 million.
Combined ratio deteriorated 110 basis points year-over-year to
segment reported a 17% increase in net premiums written to $190.0
million in the quarter. Combined ratio improved 120 basis points
year-over-year to 99.0%.
Another player in the same industry
) reported first-quarter ahead of the Zacks Consensus
The Travelers Companies Inc.
) are scheduled to report second quarter 2013 soon.
W.R. Berkley has been reporting ahead of expectations for the
past several quarters. The company has maintained its trend of
beating earnings estimates in the reported quarter as well. We
expect the trend to continue going forward. The company has
positioned itself well to take advantage of hardening in the
insurance market by forming several new units over the past few
years. Premiums written for its core business have increased and
the new units are accruing to earnings. Average renewal rates are
on the rise and so is the price trend.
W.R. Berkley's balance sheet, which is adequately capitalized,
is another major company strength. The company has maintained its
practice of increasing yearly dividends. In our view, the company
is well poised to return value to its shareholders over the long
W.R. Berkley currently retains a Zacks Rank #3 (Hold).
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