Argo Group suffered a drop off in profits for the fourth quarter 2007, despite being up for the year as a whole.

The insurance and reinsurance company, which is based in Bermuda, saw its net income decline from $31.4 million in the fourth quarter 2006 to $23.5 million for the same period last year.

But its full-year net income for 2007 totalled $143.8 million, compared to $106 million the previous year.

Gross written premiums also declined from $320.1 million for the fourth quarter of 2006 to $284.4 million in 2007, but for the year was up at $1.18 billion in 2007, compared to $1.15 billion the previous year. Argo Group restructured its US and Bermuda subsidiaries at the end of last year, with Bermuda-based insurance companies Peleus Reinsurance Ltd. and PXRE Reinsurance Ltd. merging into one Class 4 general business insurer.

Argo Group president and CEO Mark Watson said: "In 2007, Argo Group successfully established a unique international specialty insurance platform that will help drive our company's future growth and geographic expansion in new markets.

"With the period of transformation behind us, our focus full in 2008 is dedicated to capitalising on new opportunities for which we are well positioned to pursue. I'm very pleased that while we worked diligently to complete the PXRE merger, operational integration and subsequent reorganisation, our core business operations in the US continued to deliver solid results, setting new company benchmarks in 2007 for premium volume and total revenue and continued to produce profitable operations in a highly competitive marketplace.

"I believe these results demonstrate the internal strength of our people and business and bodes well for Argo Group's future potential."

ARGO GROUP 4Q

REPORT CARD

Net income: $31.4 million compared to $23.5 million in 2006

Gross premiums written: $284.4 million compared to $320.1 million in 2006