Aspen Insurance Holdings said late yesterday that it earned $30.3 million, or 31 cents a share in the fourth quarter of 2005 compared to a profit of $72.2 million, or $1.01 a share, a year earlier.

For the year, Aspen lost $177.8 million compared to a profit of 195 million in 2004.

Operating income, which excludes net realised investment gains and losses, for the three months to December 31 was 43 cents a share in the period, down from 94 cents a share a year ago, the Bermuda-based reinsurer added. Aspen was expected to lose 14 cents a share for the quarter, according to the average estimate of nine analysts in a Thomson First Call survey.

Before the release of the results, Aspen closed down 18 cents to $22.32 on the New York Stock Exchange.

Chris O?Kane, chief executive officer, said in a statement: ?Our results for 2005 are clearly very disappointing and do not meet our expectations. The insurance industry, including Aspen, has a great deal to learn from the hurricanes of 2004 and 2005 and I am confident that Aspen is in the vanguard of putting these new insights to work.

?We have benefited in the past from our diversified underwriting strategy and 2006 will see greater diversification of our portfolio as we redeploy our capital in favour of the best underwriting opportunities.?

Shareholders? equity increased from $1,481.5 million at December 31, 2004 to $2,039.8 million at December 31, 2005.

Gross written premiums for the quarter were $25 million compared to $216.2 million a year earlier and $2.09 billion for the year, up from $1.59 billion in 2004.

Net written premiums were $188 million in the quarter, down from $188.7 million as the reinsurer more than doubled the amount of premiums it ceded from $27.5 million to $56.9 million. Many reinsurers are ceding, or passing along more of their premiums to reduce their risk profiles in the wake of the disastrous 2005 hurricane season.

For the year, Aspen wrote net premiums of $1.65 billion, up from $1.35 a million in 2004.

Aspen saw claims jump from $156.9 million in the quarter to $272.2 million. For the year, it accepted losses of $1.3 billion, up from $723 million.

Aspen earlier said losses from Hurricanes Katrina and Rita, after recoveries from its outward reinsurance and re-instatement premiums, would be between $470 million and $535 million after taxes. Aspen said it expected to lose between $20 million and $35 million from Hurricane Wilma.

Aspen recorded an underwriting loss of $17 million in the fourth quarter compared to a $79.6 million profit in the same period a year ago, while it took a $259.2 million underwriting loss for the year compared to a $104.2 million profit in 2004.