The Navigators Group Inc. reported net income of $9,037,000 for the 2004 second quarter compared to $6,157,000 for the 2003 second quarter, an increase of 47%. Net income per share was $0.71 for both the 2004 and 2003 second quarters based on diluted average shares outstanding of 12,647,000 and 8,650,000, respectively.
The 2004 second quarter net income includes a net realized capital loss of $0.01 per share compared to net realized capital gains of $0.06 per share in the 2003 second quarter.
Gross written premium and net written premium for the 2004 second quarter were $161,626,000 and $73,689,000 respectively, increases of 14% and 20% from the comparable 2003 periods. The 2003 second quarter net written premium reflects an increase in ceded reinsurance premium for specialty business due to a reinsurance treaty change effective from April 1, 2003 to Sept. 30, 2003 which had no impact on net income.
Net income for the six month period ended June 30, 2004 was $17,950,000 or $1.42 per share, compared to $10,867,000 or $1.26 per share for the six month period ended June 30, 2003. Included in these results were net realized capital gains of $0.02 per share and $0.08 per share for the six months ended June 30, 2004 and 2003, respectively.
Gross written premium and net written premium for the six month period ended June 30, 2004 were $357,577,000 and $169,624,000 respectively, increases of 13% and 11% from the comparable 2003 periods.
The combined loss and expense ratios for the 2004 second quarter and six month period were 88.8% for both periods compared to 95.7% and 96.2% for the comparable 2003 periods. The combined loss and expense ratios for the 2004 second quarter and six month periods were favorably impacted by 1.9 and 2.7 loss ratio points, respectively for a redundancy of prior year loss reserves in the Lloyd’s operations.
Navigators’ CEO, Stan Galanski, commented, “We are very pleased with the profitable underwriting results and premium growth levels achieved during the second quarter. Pricing remains at an acceptable level overall, despite softening that is most evident in the energy and directors and officers liability product lines. Incurred loss activity for the first half of 2004 has generally been favorable, particularly for our Lloyd’s operations and our cash flow continues to be strong.”
Consolidated cash flow from operations for the 2004 second quarter and six month period ended June 30, 2004 was $66,427,000 and $93,160,000, respectively, compared to $39,515,000 and $65,550,000 for the comparable 2003 periods.
Net investment income for the 2004 second quarter and six month period was $6,625,000 and $12,527,000 respectively, increases of 46% and 36% from the 2003 comparable periods. The pre-tax investment yields for the 2004 second quarter and six month period were 3.6% and 3.5%, respectively compared to 3.9% and 4.1% for the comparable 2003 periods.
The Navigators Group Inc. is an international insurance holding company with insurance company operations, underwriting management companies, and operations at Lloyd’s of London.
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