Insurer ACE Ltd. (ACE) said on Tuesday that its fourth quarter profit surged from last year helped by net realized gains. Net premiums written increased 8%, while net premiums earned rose 5% for the fourth quarter.
The Zurich, Switzerland-based company posted fourth quarter net income available to holders of common shares of $953 million or $2.81 per share, compared to $20 million or $0.06 per share in the same period last year.
Net realized gains for the quarter was $373 million, compared to losses of $644 million in the previous year quarter.
Income excluding net realized gains for the quarter were $683 million or $2.01 per share, compared to $624 million or $1.86 per share in the comparable period last year.
On average, twenty analysts surveyed by Thomson Reuters expected the company to report earnings of $1.93 per share for the quarter. Analysts' estimates typically exclude special items.
Gross premiums written for the quarter was $4.51 billion, up from $4.32 billion in the corresponding quarter last year.
Quarterly net premiums written increased 8% to $3.31 billion from $3.05 billion in the preceding year period. Net premiums earned was $3.39 billion, up 5% from $3.23 billion in the previous year quarter. Analysts expected the company to report revenue of $3.19 billion for the quarter.
Excluding the impact of foreign exchange, net premiums written and earned increased 4% and 1%, respectively.
Underwriting income rose to $373 million from $349 million in the fourth quarter of 2008. Net investment income decreased 2% to $512 million.
Book value increased $934 million during the quarter, up 5% sequentially. Book value per share now stands at $58.44. Annualized return on average equity for the quarter was 14.2%. The property and casualty (P&C) combined ratio was 89.6%, compared with 86.9% in the previous year quarter.
Insurance-North American net premiums written increased 9%, with combined ratio of 89.5%, up from 83.0% last year. Excluding large single transactions written in the quarter, net premiums written rose 2%.
Insurance-Overseas General net premiums written rose 8%, with combined ratio of 90.3%, down from 90.7% a year ago. Adjusted for the impact of foreign exchange, net premiums written were flat.
Global Reinsurance net premiums written increased 14%. The combined ratio was 67.1%, compared with 72.3% in the previous year quarter.
Life net premiums written increased 5%. Life underwriting income increased to $104 million from $21 million in the prior year quarter.
For the fiscal year 2009, net income available to holders of common shares were $2.55 billion or $7.55 per share, compared to $1.17 billion or $3.50 per share in last year.
Income excluding net realized gains increased to $2.76 billion or $8.17 per share from $2.59 billion or $7.67 per share in the previous year.
Gross premiums written for the year was $19.16 billion, down from $19.24 billion last year. Net premiums written increased to $13.30 billion from $13.08 billion in the preceding year. Net premiums earned was $13.24 billion, up from $13.20 billion a year ago.
Analysts estimated the company to report earnings of $8.10 per share for the year on revenues of $13.09 billion.
ACE closed Tuesday's regular trading at $49.56, up 54 cents or 1.10%, on a volume of 2.71 million shares. In after-hours, the share further gained 62 cents or 1.25% to trade at $50.18. The stock has been moving in a range of $30.92 - $55.64 for the past 52 weeks, with an average daily volume of about 2.33 million shares for the past three months.
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