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Alterra profits slide to $48.4m

Alterra Capital Holdings Ltd’s profits eased to $48.4 million for the third quarter due to higher catastrophe losses and lower investment yields.

That compared to a net income of $82.8 million or 70 cents per share for the same quarter in 2010.

The company’s net operating income for the quarter was $50.1 million or 47 cents per share compared to $76 million or 64 cents per share for the same quarter of 2010. Annualised net operating return on average shareholders’ equity for the third quarter was 7.1 percent.

For first nine months of 2011, Alterra reported net income of $34.3 million or 32 cents per share versus $222.7 million or $2.50 per share for the same period last year.

Net operating income for the nine months ended September 30, 2011 was $64.9 million or 61 cents per share compared to $175.5 million or $1.97 per share over the same time period. Annualised net operating return on average shareholders’ equity for the nine months ended September 30, 2011 was 3.1 percent.

Alterra’s 2010 results include the results of operations for the former Harbor Point Ltd companies from May 12, 2010.

Marston (Marty) Becker, president and CEO of Alterra, said: “Alterra’s reported results reflect a balanced quarter, with solid operating earnings across our segments and nearly five percent growth in diluted book value per share.

“Earnings are down compared to the prior year, pressured by higher catastrophe losses and lower investment yields.

“However, we remain pleased with the consistency of our underwriting results in the face of a very challenging year for property catastrophe business.

“The relatively limited impact of this year’s property catastrophe events on our results and the absence of negative development of our aggregated loss estimates beyond initially stated ranges continue to reflect favourably on the quality of Alterra’s diversified underwriting, risk management and reserving capabilities.

“As we near the end of the Atlantic hurricane season and approach the January renewal season, we believe that we have the capital and operational breadth and flexibility to take advantage of what appear to be more favourable market opportunities.”

Property and casualty gross premiums written were $385.5 million for the quarter, representing an increase of $61.6 million or 19 percent, while the combined ratio on property and casualty business of 87.7 percent compared to 86 percent for the same quarter of 2010.

Property catastrophe event and significant per-risk net losses of $42.8 million ($42.1 million net of reinstatement premiums) compared to $14.1 million last year, while losses net of reinsurance and reinstatements included $21.8 million for natural disasters during the third quarter of 2011, including Hurricane Irene. The remainder of the net losses related to increased loss estimates on property catastrophe loss events from the first half of the year, which remain within previously announced ranges;

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Published November 02, 2011 at 2:00 am (Updated November 02, 2011 at 9:40 am)

Alterra profits slide to $48.4m

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