Thursday, IPC Holdings, Ltd. (IPCR), a provider of insurance and reinsurance products, reported an increase in second quarter earnings aided by continuing improvements in pricing, and a substantial turnaround in the equity and debt markets.
Net income for the quarter rose to $173.9 million or $3.11 per common share from $47.5 million or $0.78 per share in the corresponding period last year.
Net operating income for the quarter declined to $96.49 million or $1.72 per share from $98.34 million or $1.62 per share in the corresponding period last year. Share count for the quarter declined to about 56 million shares from about 60.6 million in the prior year period.
On average, five analysts polled by Thomson Reuters expected the company to earn $1.36 per share for the quarter. Analysts' estimates typically exclude special items.
Gross premiums written rose to $127.5 million from $105.2 million in the year-ago quarter. Premiums written in respect of new business totaled $7.1 million. Net premiums earned rose to $96.2 million from $84.9 million in the second quarter of 2008 mainly due to the increase in premiums written in the last twelve months, which were 27.9% higher than in the previous corresponding period.
Net investment income was $21.3 million compared to $23.4 million in the same period last year. IPC attributed the decline to a fall in average invested assets, as well as to a decrease in the overall yield from the fixed income portfolio.
Net gain on investments was $77.4 million compared to a net loss of $50.9 million in the second quarter of 2008. The company attributed the increase mainly to the second quarter 2009 recovery in investment markets.
Net losses incurred during the quarter included $9.1 million from the Air France Airbus crash in June and $2.0 million from an earthquake in Italy in April, offset by reductions to the company's estimates of ultimate losses for several prior period events, totaling about $19.5 million.
For the six month period, net income rose to $182.1 million or $3.25 per share from $134.3 million or $2.12 per share in the corresponding period last year.
Gross premiums written increased to $362.2 million from $303.0 million in the year-ago period. Premiums earned rose to $194.9 million from $174.6 million in the same period last year. Net investment income declined to $43.1 million from $47.3 million in the corresponding period of 2008. Net gains on investment was $41.8 million compared with a loss of $57 million in the corresponding period last year.
The company said on July 23, the Board declared a quarterly dividend of $0.22 per common share, payable on September 2 to shareholders of record on August 20.
IPCR rose $0.73 or 2.59% and closed Thursday's regular trading at $28.95. After hours, IPCR advanced further $1.40 or 4.84% and traded at $30.35.
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