Allied World Assurance Company Holdings last night reported net income of $96.4 million for the second quarter and comfortably beat analysts’ expectations.The Switzerland-based re/insurer with substantial operations in Bermuda posted operating earnings of $87.3 million, or $2.35 per share, beating Wall Street’s predictions of $1.76 per share by a full 59 cents.Profit was slightly up from the same period in 2001, when Allied reported net income of $93.8 million.Underwriting operations were profitable with a combined ratio of 85.1 percent in the quarter, compared to 97.4 percent in the April through June period of last year.Some of this was down to net favourable reserve development on prior loss years of $41.9 million, which resulted in a benefit of 9.8 percentage points to the company’s loss and loss expense ratio for the quarter.President and chief executive officer Scott Carmilani said: “Allied World continues to build across our operating platforms, and the momentum in our premium growth is a direct result of our expansion efforts and new business initiatives over the last few years.“Gross premiums written were up by almost 25 percent for the quarter, surpassing the $1.3 billion mark for the first half of 2012.“The company had strong underwriting performance and solid investment returns resulting in $96.4 million of net income for the quarter.“These results, combined with the accretive benefits from our share repurchase programme, resulted in our diluted book value per share growing by 3.2 percent for the quarter, to $88.24.“For the first half of 2012, our diluted book value per share grew by a robust ten percent.”Gross premiums written were $646.9 million in the second quarter of 2012, a 24.5 percent increase compared to $519.6 million in the second quarter of 2011.As of June 30, 2012, Allied’s total shareholders’ equity was $3.28 billion, compared to $3.15 billion as of the end of last year, while diluted book value per share was $88.24, an increase of 10.1 percent compared to $80.11 as of December 31, 2011.During the second quarter, the company repurchased 905,383 of its common shares through its share repurchase programme in the open market at an average price of $73.38 per share for an aggregate cost of $66.4 million.