Endurance Specialty Holdings Ltd. reported net income of $110 million or $1.67 a share for the second quarter of 2005, a 4 percent decline from net income of $114.8 million or $1.69 a share in the second quarter of 2004.

The Bermuda-based insurance and reinsurance company still beat estimates however as Wall Street analysts had, on average, expected Endurance to report earnings from continuing operations of $1.44 a share, according to Reuters Estimates.

Operating income was $111.8 million or $1.69 per share for the second quarter of 2005, a five percent decline from $117.9 million or $1.74 per share in the second quarter of 2004.

Kenneth J. LeStrange, Chairman and Chief Executive Officer, said: ?Endurance achieved one of its highest levels of net income this quarter and we grew diluted book value per share by 16 percent year over year after repurchasing approximately $79 million in stock and paying $56 million in dividends in the past 12 months.

?These results are a testament to our disciplined underwriting, our specialised niche focus and our strategy of portfolio diversification.?

For the six months ended June 30, 2005, net income was $206.3 million or $3.11 per diluted share versus net income of $215.6 million or $3.16 per share for the first half of 2004.

Operating income for the first half of 2005 was $214.5 million versus $216.6 million for the first half of 2004. Gross premiums written of $403.2 million for the 2005 quarter included $19.1 million of favourable adjustments to prior period written premium estimates as a result of actual premiums reported exceeding the company?s original estimates. The company benefited from a low level of catastrophe loss activity in the quarter as well as from $27.7 million in net favourable reserve development for the second quarter of 2005 from prior years, compared to $40.7 million in the second quarter of 2004.

This reduction in the company?s estimated losses for prior years was largely driven by lower than anticipated frequency in the Property Per Risk Treaty Reinsurance, Casualty Individual Risk, and Aerospace and Other Specialty Lines segments, the company said.

Investment income was $39.7 million in the 2005 quarter, a 37.l1 percent increase from the $28.9 million in the same period last year reflecting a significant build-up of invested assets, a general rise in interest rates and flattening of the yield curve over the past year.

In the current quarter, estimated potential gross claims from Hurricanes Dennis and Emily are expected to be less than $10 million for each event.

In the second quarter of 2005, Endurance repurchased 683,186 shares for $25 million.

In the past 12 months, the Company has repurchased 2.2 million of its ordinary shares for $78.5 million and paid $56.2 million in dividends.