Everest Re reports $904m pre-tax loss
Catastrophe losses from hurricanes Harvey, Irma and Maria, and the Mexico City earthquake, weighed on Everest Re Group’s third-quarter earnings.
The company reported a pretax loss of $904 million. While the net loss after tax was $639.4 million, or $15.73 per common share for the third quarter, a consensus of Wall Street analysts had expected losses of $15.99 per share.
For the same period in 2016, Everest Re made a profit of $295.4 million, or $7.06 per share.
After-tax operating loss in the third quarter, excluding realised capital gains and losses, was $667.6 million compared to after-tax operating income of $273.2 million, a year ago.
Everest Re had previously announced that its third-quarter results included net catastrophe losses of $1.2 billion for Harvey, Irma, Maria and the Mexico City earthquake. The net after-tax impact on earnings from these events was $897.7 million or $22.09 per common share for the quarter.
Dominic Addesso, president and CEO, said: “This series of natural catastrophes highlights the nature of our business model. We have consistently generated strong margins which gives us the financial ability to respond to these events, without impairment. We are proud to be part of an industry that provides financial security to its customers in times of need.
“Looking forward, market conditions are expected to be more favourable allowing the industry to continue on a sound footing. We should benefit to a greater degree given the strong underwriting fundamentals of our portfolio.”
Everest’s gross written premiums for the quarter were $2 billion, up 15 per cent year-on-year. Net investment income was $137 million, up 12 per cent for the quarter.
The company’s combined ratio — the portion of premium dollars spent on claims and expenses — was 163.6 per cent compared to 85.6 per cent a year ago.
For the nine months ended September 30, the net loss was $102.1 million, or $2.51 per share. The after-tax operating loss, excluding realised capital gains and losses was $180.6 million, or $4.45 per common share.
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