PartnerRe Ltd. (PRE)

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PartnerRe Ltd. (PRE)

Q4 2009 Earnings Call

February 11, 2010 09:00 pm ET


Robin Sidders - IR

Patrick Thiele - President and CEO

Albert Benchimol - EVP and CFO


Jay Gelb - Barclays Capital

Matthew Heimermann - JPMorgan

Jay Cohen - Bank of America, Merrill Lynch

Ian Gutterman - Adage Capital

Paul Tucker - Egerton Capital

Josh Shanker - Deutsche Bank



Before we begin the call I would like to remind all participants that they are in a listen-only mode. (Operator Instructions).

If you haven't received a copy of the press release, it is posted on our company's website, or you can call 212-687-8080 and one will be faxed to you right away. As a reminder this call is being recorded.

I'll now hand over to Robin Sidders, Director of Investor Relations at PartnerRe, who will begin the call today. Please go ahead.

Robin Sidders

Good morning. And welcome to PartnerRe's fourth quarter and full year 2009 earnings conference call and webcast. As a remainder our fourth quarter financial supplement can be found on our website at, in the Investor Relations section by clicking on supplementary financial data on the financial reports page.

On today's call are Patrick Thiele, President and CEO of PartnerRe; and Albert Benchimol, Executive Vice President and CFO of PartnerRe.

Patrick will start with an overview of the quarter and full year and then handover to Albert who'll provide more details on the results. Patrick will conclude with some additional commentary on the market and then we'll open the call up for a Question-and-Answer Session.

I'll begin with the Safe Harbor Statements. Forward-looking statements contained in this call are based on the Company's assumptions and expectations concerning future events and financial performance of the company, and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation and Reform Act of 1995.

Such statements are subject to significant business, economic, and competitive risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements.

PartnerRe's forward-looking statements could be affected by numerous foreseeable and unforeseeable events in developments such as exposure to catastrophe or other large property and casualty losses, equity and reserves, risks associated with implementing business strategy levels in pricing of new and renewal business achieved. Credit interest currency and other risks associated with the company's investment portfolio, changes in accounting policies and other factors identified in the company's filings with the Securities and Exchange Commission.

In light of the significant uncertainties inherent in the forward-looking information contained herein, listeners are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the dates on which they are made. The company disclaims any obligation to publicly update or revise any forward-looking information or statements.

In addition, during the call, management will refer to some non-GAAP measures when talking about the company's performance. You can find the reconciliation of these measures to GAAP measures in the company's financial supplement.

With that, I'll hand over call over to Patrick.

Patrick Thiele

Thank you Robin and welcome everyone to the 2009 results conference call for PartnerRe. 2009 was an exceptional year for PartnerRe on several levels. We had record results on a number of metrics including operating earnings per share on $14.59 which led to an operating return on beginning equity or 22% and GAAP book value per share of $84.51 representing 32% growth in the one year period.

We did this despite starting the year of in the worst economic and financial environment the company has ever faced and finally to position and prepare ourselves for the future we purchased PARIS RE substantially increasing our capital base our asset portfolio premium volume and diversification while reducing our overall risk profile.

Our performance in 2009 underscores the focus on risk and return management that is central to the strategy that we are consistently applied and executed over the last several years. Over virtually any time period during the last 10 years we have met or exceeded our financial goals of 13% operating ROE and 10% plus growth rate in book output value per share.

We have increased our common dividend every year since our inception, creating approximately 300 basis points of additional share holder return. We expect that with the new larger size stronger balance sheet and more diversified risk portfolio we are well positioned to continue this track record under whatever external market pressures economic financial or industry specific we are faced with.

Specifically our significant and larger premium base allows us to deploy the capital to lines and markets with the most attractive risk and return characteristics and take advantage as opportunities as they arrive. As we have in the past we expect to return capital which we cannot efficiently deploy to shareholders through dividends and share repurchase assuming the stock continues to sell at less than economic value.

As regards to PARIS RE we are moving ahead with the integration and expect that as of July 1, we will be operating as one company. We maintain our existing executive committee and our business unit structure while making some senior management changes which are outlines in the press release that is being issued today.

Next up is dealing with the combined operations expense structure. Obviously given the unique nature of French regulation this process will take time and money to accomplish but we expect to have it substantially complete by year end and consistent with the regional economics of the deal.

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