Bermuda-based ESG Re Limited reported an overall loss of $1.8 million for the first quarter of 2003 compared to a budgeted loss of $1.7 million. It also said that “underwriting profit for the quarter amounted to $2.5 million which was $1.9 million less than expected.”
The company explained that “$3.9 million was due to a write down of estimated premium income for the North American business which was partially offset by improved claims experience and selected commutations,” while “investment income was $1.0 million, which was in excess of budget target. Operating expenses were on budget at $6.4 million, despite adverse movement in the Euro for the quarter.
The quarter resulted in an overall net loss of $0.16 per share.”
In assessing the first quarter, CEO Alasdair Davis stated: “The completion of the reaudit of 2001 and the audit of 2002 took considerable time and attention during the quarter. Until we were able to publish our audited financials, we were significantly handicapped in our ability to produce new business. In the second quarter we have been able to direct our full attention to building new business and effectively managing the business already on the books. We intend to remain in this business. Clean audited accounts allowed us to restart the new business process and focus on our clients”.
Davis sounded a hopeful note, indicating that, “Our clients and prospects see that ESG is sufficiently capitalized with solid bond assets writing business in which we are experienced and that we understand. We have already acquired a new North American client who will be coming on board mid-year and will bring in an estimated $20 million in premium income.”
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