Argo Group International Holdings Ltd. boosted its profits by almost 50 percent for the first quarter 2008.

The Bermuda-based international specialty insurer and reinsurer for the casualty and property market saw its net income climb 47 percent to $36.9 million, or $1.20 per diluted share, in this year's first quarter from $25.1 million, or $1.13 per share, for the same time last year.

Gross premiums written were also up from $286.7 million in the first quarter of 2007 to $346.6 million for the respective period in 2008.

Other highlights for the 2008 first quarter included pre-tax operating income at a record $40 million, while the commercial specialty segment increased gross written premiums to $137.3 million via targeted adjacency products and acquisition, and the international specialty segment produced $50.3 million in gross written premiums.

Total revenue was up 10.1 percent over the first quarter of 2007, and book value per share at March 31, 2008 was $46.36.

Argo Group president and CEO Mark Watson III said: "Our results in the first quarter reflect disciplined execution of our business plan, particularly in our commercial specialty and international specialty segments.

"I am pleased E&S (excess and surplus lines) continues to perform well in a marketplace that is highly competitive, a condition we believe will continue in 2008. Our diversified international business platform is well designed to provide balance throughout the cycle and we are encouraged by the opportunities we see across business lines."

The financial results for the three months ended March 31, 2008 and 2007 include results of the predecessor to Argo Group, Argonaut Group Inc. The merger of PXRE Corporation and Argonaut Group closed on August 7, 2007 and the financial results from then represent the combined company.

As announced last month, Argo made an offer to acquire Lloyd's insurer Heritage Underwriting Agency plc. The acquisition is subject to Heritage shareholder and regulatory approval and is expected to close in the second quarter of 2008.

During the quarter, the company also took over Massamont Insurance Agency Inc., a specialist in the public entity insurance sector.

Argo completed the sale of PXRE Reinsurance Co. on March 31, 2008. At December 31, 2007, Argo Group had classified the assets and liabilities of PXRE Re as assets held for sale and liabilities held for sale, respectively, in the consolidated balance sheet.

After the close of the quarter, Argo Group purchased approximately $5.1 million of its common stock pursuant to its stock repurchase programme authorised last year.