German hailstorms cost Platinum Underwriters Holdings Ltd approximately $16 million in losses, the company reported in their unaudited financial supplement, dated September 30.Michael Price, president and chief executive officer of Platinum stated in a conference call that the company produced net income of more than $38 million, or $1.32 per diluted common share for the three month reporting period. That beats analysts’ estimates of $0.95, according to some reports.He said the Bermudian provider of property, casualty and finite risk’s tangible book value per share grew by two percent in the quarter and now stands at $60.87, as net income “more than offset a negative mark-to-market effect.”He said: “Figures include approximately $16 million of losses from the German hailstorms,” and added: “Net premiums earned are approximately the same as last year’s third quarter.”Mr Price said: “Based on our current reserve position, our net-in-force portfolio, our asset portfolio and our underwriting prospects for the near term, we believe that we’re well capitalised with a comfortable margin above the rating agency targets for a company with our ratings. If the business performs as expected, we anticipate our capital cushion will grow over time. Under those conditions, we would have the financial flexibility to expand our underwriting, hold riskier assets or buy back shares. Our decision making will be guided by the pricing that we observe in the various markets.“Our talented professionals, strong balance sheet and financial flexibility allow us to operate effectively in the current challenging market conditions.”He said:” “As regards 2013 major catastrophes, German hailstorms resulted in a net loss to us of $15.7 million. During the quarter, we also received updated reporting from our clients related to the floods in Central and Eastern Europe and the Moore, Oklahoma, tornadoes, both of which occurred last quarter. Accordingly, we reduced our estimates for those losses for those events by $2.8 million and $1.7 million, respectively,” he said.“Regarding prior year’s favourable development, our Property and Marine segment had net favourable development of $2 million for the quarter. We had favourable development in the Marine and Aviation, property pro-rata and property non-major catastrophe classes of $5.8 million. However, this was partially offset by unfavourable development from major catastrophes of $3.8 million, resulting primarily from a marine loss related to Hurricane Ike.“Our Casualty segment had net favourable development of $39.1 million for the quarter. This favourable development related primarily to the North American claims made in umbrella classes for most prior underwriting years.”He also reported that net investment income was $17.8 million for the quarter compared with $23.2 million for the same quarter last year. “The average book yield decreased from 2.4 percent in the third quarter of 2012 to two percent in the third quarter of 2013.” He said the decrease in average book yield reflected sales maturities and paydowns and the prevailing low interest rate environment. “We continue to retain a high proportion of cash in our portfolio in order to manage the overall duration and provide ample liquidity,” he said.“Contributing to the decrease in net investment income was a reduction in the average book value of investments in cash and cash equivalents from $3.9 billion for the quarter ended September 30, 2012, to $3.5 billion for the quarter ended September 30, 2013. This decrease of $393 million was primarily due to share repurchases, as well as negative operating cash flows over the last 12 months.“Net realised losses on investments for the quarter were $306,000, as compared with net realised gains on investments of $23 million in the same quarter last year. Our net realised losses related to fair value adjustments on our foreign currency denominated trading securities.“Net impairment losses on investments for the quarter were less than $100,000 and relate exclusively to investments in securitised mortgages not guaranteed by US government agencies.“During the quarter, our net unrealised gains on available-for-sale investments, net of deferred taxes, decreased by $7 million to $57.4 million at September 30, 2013, and was attributable to our longer-dated municipal bonds. At September 30, 2013, the duration of our portfolio of investable assets, including cash and cash equivalents, increased to 2.5 years from 2.4 years at June 30, 2013. At September 30 last year, our portfolio duration was 2.8 years.“Our operating expenses were $20.7 million for the third quarter of 2013, as compared with $20 million from the same quarter in 2012.“Finally, on income taxes, we recorded a tax expense of $15.1 million for the quarter. Our income tax expense or benefit will vary depending on the contribution to taxable earnings by our US-based subsidiaries.Mr Price said that the recent underwriting period constitutes a small portion of our annual activity. “Overall, we had approximately $62 million of premium expiring since late July. We wrote $55 million, an 11 percent decrease. Year-to-date, we have $516 million of premium expiring, and we’ve written $497 million, plus, we’ve written approximately four percent less business this year as compared with last year. For reference, there’s $13 million of business expiring between now and year end.“In Property and Marine, we had $4 million of business expiring since late July, and we wrote a similar amount. Year-to-date, we had $240 million of premium expiring and we’ve written $248 million, a three percent increase. Currently, our one-in-250 year net probable maximum catastrophe loss estimate is within our stated risk tolerance of approximately 10 percent of total capital and 12 percent of shareholders’ equity.“Global insured catastrophe activity in 2013 has been below the long-term average level, and absent a major insured catastrophe event during the balance of the year, we anticipate continued downward pressure on pricing for catastrophe exposed business. We expect for 2014 to write a portfolio similar to that currently enforced.“In the Casualty segment, we had $59 million of business expiring since late July and we wrote $52 million, a 12 percent decrease. For the year-to-date, we’ve written $232 million of premium versus an expiring base of $253 million. Both clients and competitors appear to be strongly capitalised and well-reserved for prior year liabilities.“Recent rate increases may be moderating. Competition for ceded reinsurance business remains strong. While volatile at times, Treasury yields remain at historical lows. Credit spreads are at approximately average levels despite a slow-growing economy. Unless these conditions change, we expect the total return available from the casualty business will not improve materially. Accordingly, we expect to write a similar sized portfolio in 2014 as compared with what we have currently in force. We’ve written no finite business since January 1, continue to expect little or no activity in this segment.“During the quarter, we added to our municipal bond portfolio. The mark-to-market effect from rising rates was modest this quarter. If yields increase further or spreads expand, we anticipate deploying cash into investment-grade securities.“During the quarter, we repurchased 1,353,682 shares for a total consideration of $79 million, an average cost per share of $58.01. Today, we have approximately $171 million remaining in our buy-back authorisation.”