Validus Holdings almost doubled its profits for the fourth quarter 2007 in what proved to be a successful set of results for both the quarter and year.

The Bermuda-based reinsurance company reported its fourth-quarter net income rose to $139 million, or $1.77 per diluted common share, compared to $69.1 million, or $1.16 per share, for the same three months in 2006.

Meanwhile, full-year net income for 2007 was $403 million, or $5.95 per share, compared to $183.1 million, or $3.11 per share for the corresponding period in 2006.

Gross premiums written increased by 191.6 percent to $191 million, from $65.5 million in the fourth quarter of 2006, mainly due to the acquisition of Lloyd's of London company Talbot, which added $143.5 million of gross premiums written.

Validus' combined ratio was 63.1 percent, including $10 million of incurred losses relating to the October California wildland fires and $30.6 million of favourable prior year loss reserve development benefiting the loss ratio by 9.6 percentage points over the same period as well.

Investment income was also up by 112.6 percent to $37.5 million from $17.7 million, primarily down to higher investment balances resulting from funds from operations and the addition of Talbot over the same timescale.

Ed Noonan, chairman and chief executive officer of Validus, said: "2007 was a milestone year for Validus. We successfully completed the acquisition of Talbot and our initial public offering, while continuing to grow our franchise at Validus Re.

"The enhanced operating leverage resulting from the Talbot acquisition allowed us to generate an annualised return on average equity of 29.9 percent in the fourth quarter and 26.9 percent for the year.

"In 2007, we grew diluted book value per share by 21.6 percent and leave 2007 with a strong balance sheet comprising of $3.1 billion total investments and cash and total capitalisation of $2.3 billion."