PXRe Group Ltd., a Bermuda reinsurer, on Thursday said it was posting a third-quarter net loss of $317.34 million after the company sustained heavy catastrophe losses, particularly from hurricanes Katrina and Rita.

The loss was equal to $11.17 a share compared to a loss of $73.2 million, or $5.48 a share, during the same period a year ago.

The company?s operating loss was $317.42 million, or $9.46 a share, compared to a loss of $73.37 million in the year ago period, equal to a loss of $2.67 a share.

Operating figures exclude net realised gains or losses. This measure is followed by many who track the reinsurance industry.

Overall, the company?s loss expenses in the third quarter added up to $409 million, or 46.7 percent of $763 million in shareholders? equity at the end of June. Hurricanes Katrina and Rita left PXRe with a loss of $356.7 million.

The company has since raised net proceeds of $474 million from offerings of common and preferred shares, bringing shareholder? equity at the end of the quarter to $914 million.

?Our increased size positions us well to take advantage of both the expected substantial increases in rates and improved terms and conditions for each line of business we write,? said chief executive Jeffrey L. Radke in a statement.

Most reinsurers expect rates to be higher when policies are renewed on January 1.

PXRe has not yet issued any estimate of the losses it sustained from Hurricane Wilma, a storm that devastated parts of the Caribbean, Mexico and Florida a week ago.

And because of the uncertainty surrounding the cost of damage from Hurricane Wilma, PXRe withdrew its earnings guidance for 2005.

Rating firms AM Best and Standard&Poor?s downgraded PXRe?s ratings after its earlier storm losses. The company?s financial strength ratings were downgraded from A to A-, and the ratings from both firms remain on credit watch negative, meaning another downgrade has not been ruled out. PXRe said it expected the ?A? ratings to be affirmed, or removed from threat of downgrade, once they converted preferred shares sold in a private placement into common shares.

PXRe?s losses in the third quarter were partly offset by a 162 percent jump in net investment income, which was $8.3 million higher for a total of $13.5 million. A $5.1 million jump in hedge fund investment returns and a $3.1 million increase in income from the company?s investments in fixed maturity and short-term investments drove the higher returns.

The company?s net policy sales fell 12 percent in the quarter, of $13.3 million, to $99.3 million. This was largely due to the company ceding, or passing on to other reinsurers, $25.9 million in reinstatement premiums following Katrina and Rita.

In total, the company lost six times more than what it sold and earned on reinsurance policies in the quarter, with the company posting a combined ratio of 623.1 percent, compared to 192.4 percent in the year-ago period.

A combined ratio measures an insurance or reinsurance company?s profitability in selling policies. A 100 percent ratio is the break-even point, meaning a combined ratio of less than 100 percent represents an underwriting profit and a combined ratio of more than 100 percent represents an underwriting loss.