HAMILTON, Bermuda--(BUSINESS WIRE)--Alterra Capital Holdings Limited (NASDAQ: ALTE) (BSX: ALTE.BH) (“Alterra”) today reported net income of $37.7 million, or $0.38 per diluted share, for the third quarter of 2012, compared to net income of $48.4 million, or $0.46 per diluted share, for the same quarter of 2011.
Net operating income for the third quarter of 2012 was $32.1 million, or $0.33 per diluted share, compared to net operating income of $50.1 million, or $0.47 per diluted share, for the same quarter of 2011. Annualized net operating return on average shareholders’ equity for the third quarter of 2012 was 4.5%.
For the nine months ended September 30, 2012, Alterra reported net income of $195.6 million, or $1.93 per diluted share, compared to net income of $34.3 million, or $0.32 per diluted share, for the same period of 2011. Net operating income for the nine months ended September 30, 2012 was $168.8 million, or $1.67 per diluted share, compared to net operating income of $64.9 million, or $0.61 per diluted share, for the same period of 2011. Annualized net operating return on average shareholders’ equity for the nine months ended September 30, 2012 was 7.9%.
W. Marston (Marty) Becker, President and Chief Executive Officer of Alterra, said: "Alterra's third quarter results reflect a fundamentally sound quarter, notwithstanding negative impacts from crop and storm losses. We've seen continued growth in book value per share contributing to an 11.5% growth in diluted book value per share including dividends, since December 31, 2011.
"Premium rates continue to firm at a measured pace, but with variation across product lines. We believe our diversified underwriting strategy, by both product line and geography, positions us well to capture favorable underwriting opportunities as they arise, even as we continue to limit our exposure in lines that we think are inadequately priced.
"The investment environment remains challenging, given the global market conditions all firms are confronting. We continue to search for higher yielding opportunities without compromising the overall quality of our portfolio, in addition to actively managing our capital positions," Mr. Becker concluded.
Third quarter 2012 results for Alterra include:
- Property and casualty gross premiums written of $385.5 million, which is unchanged compared to the same quarter of 2011;
- Net premiums written of $262.1 million, representing a decrease of $32.6 million, or 11.1%, compared to the same quarter of 2011. This decrease reflects increased property reinsurance premiums ceded in order to manage aggregate property exposures across all segments, partially offset by growth in gross premiums written in the global insurance and U.S. insurance segments;
- A combined ratio on property and casualty business of 99.9%, compared to 87.7% for the same quarter of 2011;
- Significant property catastrophe event net losses of $15.0 million, net of reinstatement premiums, principally within the U.S. insurance segment, compared to net losses of $42.1 million, net of reinstatement premiums, in the same quarter of 2011. A smaller proportion of 2012's property losses fell within the attritional loss ratio, contributing to a higher combined ratio in 2012;
- Net underwriting losses of $22.5 million on agriculture reinsurance, net of premiums and acquisition costs earned;
- Net favorable development on prior years’ loss reserves of $22.7 million, or 6.8 combined ratio points, compared to $31.7 million, or 9.2 combined ratio points, in the same quarter of 2011;
- Net investment income of $53.5 million, compared to $60.3 million in the same quarter of 2011, a decrease of 11.3%; and
- Income of $6.8 million from New Point Re IV Limited, a sidecar in which Alterra has an indirect 34.8% equity interest, consisting of fees and equity share earnings.
Gross premiums written and net premiums written from property and casualty underwriting for the third quarter of 2012 are shown in the following table, with the increase/decrease compared to the same quarter of 2011:
|
Segment ($ in millions) |
GPW |
% Inc/(Dec) |
NPW |
% Inc/(Dec) |
Combined Ratio |
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| Global Insurance | $ | 81.6 | 11.4 | % | $ | 37.5 | 5.0 | % | 86.3 | % | |||||||
| Reinsurance | 172.8 | (5.3 | )% | 142.5 | (14.5 | )% | 86.5 | % | |||||||||
| U.S. Insurance | 88.0 | 3.7 | % | 47.9 | (11.7 | )% | 129.7 | % | |||||||||
| Alterra at Lloyd’s | 43.1 | (3.9 | )% | 34.2 | (10.1 | )% | 131.4 | % | |||||||||
| Total | $ | 385.5 | — | % | $ | 262.1 | (11.1 | )% | 99.9 | % | |||||||
Results for the nine months ended September 30, 2012 include:
- Property and casualty gross premiums written of $1,612.2 million, representing an increase of $36.3 million, or 2.3%, compared to the same period of 2011;
- Net premiums written of $1,074.6 million, representing a decrease of $136.6 million, or 11.3%, compared to the same period of 2011. This decrease reflects increased property reinsurance premiums ceded in order to manage aggregate property exposures across all segments, and a decrease in net premiums written on the contract binding business in the U.S. insurance segment resulting from the sale of the renewal rights for this business in 2011;
- A combined ratio on property and casualty business of 92.9%, compared to 98.4% for the same period of 2011;
- Significant property catastrophe event net losses of $15.0 million, net of reinstatement premiums, compared to net losses of $197.9 million, net of reinstatement premiums, in the same period of 2011;
- Net underwriting losses of $22.5 million on agriculture reinsurance, net of premiums and acquisition costs earned;
- Net favorable development on prior years’ loss reserves of $53.8 million, or 5.3 combined ratio points, compared to $110.4 million, or 10.3 combined ratio points, in the same period of 2011;
- Net investment income of $166.9 million, compared to $177.8 million in the same period of 2011, a decrease of 6.1%; and
- Income of $23.4 million from New Point Re IV Limited consisting of fees and equity share earnings.
Gross premiums written and net premiums written from property and casualty underwriting for the nine months ended September 30, 2012 are shown in the following table, with the increase/decrease compared to the same period of 2011:
|
Segment ($ in millions) |
GPW |
% Inc/(Dec) |
NPW |
% Inc/(Dec) |
Combined Ratio |
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| Global Insurance | $ | 273.7 | 2.1 | % | $ | 133.0 | (2.8 | )% | 66.8 | % | |||||
| Reinsurance | 772.8 | (4.6 | )% | 612.5 | (16.0 | )% | 88.5 | % | |||||||
| U.S. Insurance | 304.5 | 11.8 | % | 142.4 | (18.8 | )% | 110.0 | % | |||||||
| Alterra at Lloyd’s | 261.2 | 16.0 | % | 186.7 | 9.6 | % | 115.2 | % | |||||||
| Total | $ | 1,612.2 | 2.3 | % | $ | 1,074.6 | (11.3 | )% | 92.9 | % | |||||
With the total impact and ramifications of Hurricane Sandy unclear, it is too early for Alterra to make a reliable estimate of losses for this event. However, the social and economic loss has already shown itself to be meaningful. In accordance with Alterra's normal practice, a loss estimate will be released once more information is available.
Balance Sheet
Total invested assets, including cash and cash equivalents, were $7,970.9 million as of September 30, 2012, an increase of $156.2 million from December 31, 2011. As of September 30, 2012, 96.3% of the fixed maturities portfolio (by carrying value) was investment-grade, an increase from 94.4% as of December 31, 2011. As of September 30, 2012, the weighted average book yield of Alterra’s cash and fixed maturities portfolio was 3.21%, and the weighted average duration was 4.4 years.
Under a Board-approved share repurchase authorization, Alterra repurchased 921,707 common shares during the third quarter of 2012 at an average price of $23.11 per share for a total of $21.3 million. Share repurchases under the Board-approved share repurchase authorization for the nine months ended September 30, 2012 were 6,626,684 common shares at an average price of $23.03 per share for a total of $152.6 million. As of September 30, 2012, $201.7 million remained under the Board-approved share repurchase authorization.
Shareholders’ equity was $2,923.2 million as of September 30, 2012, an increase of 4.1% from December 31, 2011. Diluted book value per share as of September 30, 2012 was $29.57. Including dividends declared, diluted book value per share growth for the third quarter of 2012 was 3.6%, and was 11.5% for the nine months ended September 30, 2012. Not included in shareholders’ equity as of September 30, 2012 were $194.8 million of unrecognized gains on held-to-maturity securities, which represented $1.97 in unrecognized diluted book value per share.
A copy of Alterra’s third quarter financial supplement is available on Alterra’s website at www.alterracap.com.
Alterra will host a conference call on Wednesday, November 7, 2012 at 11:00 am (EDT) to discuss these results and related matters. The conference call can be accessed via telephone by dialing 1-866-700-7173 (toll-free U.S.) or 1-617-213-8838 (international) and using access code 15493660. A live broadcast of the conference call will also be available through Alterra’s website at www.alterracap.com.
Alterra Capital Holdings Limited is a global enterprise dedicated to providing diversified specialty insurance and reinsurance products to corporations, public entities and property and casualty insurers.
Non-GAAP Financial Measures
In presenting Alterra’s results, management has included and discussed net operating income, net operating income per diluted share, annualized net operating return on average shareholders’ equity and diluted tangible book value per share. These measures are “non-GAAP financial measures” as defined in Regulation G. Management believes that these non-GAAP financial measures, which may be defined differently by other companies, allow for a more complete understanding of Alterra’s business. These measures, however, should not be viewed as a substitute for measures determined in accordance with U.S. GAAP. The reconciliation of these measures to their respective most directly comparable U.S. GAAP financial measures is presented in the attached financial information in accordance with Regulation G.
Cautionary Note Regarding Forward-Looking Statements
This release includes forward-looking statements that reflect Alterra’s current views with respect to future events and financial performance. In particular, statements regarding future rate movements are forward looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those suggested by such statements. For further information regarding cautionary statements and factors affecting Alterra’s future results, please refer to the most recent reports on Form 10-K and Form 10-Q and other documents filed by Alterra with the SEC. Alterra undertakes no obligation to update or revise publicly any forward-looking statement whether as a result of new information, future developments or otherwise.
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ALTERRA CAPITAL HOLDINGS LIMITED
CONSOLIDATED BALANCE SHEETS (Expressed in thousands of United States Dollars, except per share and share amounts) |
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|
September 30, 2012 |
December 31, 2011 |
||||||
| (Unaudited) | |||||||
| ASSETS | |||||||
| Cash and cash equivalents | $ | 405,809 | $ | 469,477 | |||
| Fixed maturities, trading, at fair value | 376,498 | 229,206 | |||||
| Fixed maturities, available for sale, at fair value | 5,728,640 | 5,501,925 | |||||
| Fixed maturities, held to maturity, at amortized cost (fair value $1,032,100) | 837,348 | 874,259 | |||||
| Other investments | 376,870 | 286,515 | |||||
| Restricted cash and cash equivalents | 245,747 | 453,367 | |||||
| Accrued interest income | 65,236 | 71,322 | |||||
| Premiums receivable | 872,948 | 715,154 | |||||
| Losses and benefits recoverable from reinsurers | 1,149,684 | 1,068,119 | |||||
| Deferred acquisition costs | 166,128 | 145,850 | |||||
| Prepaid reinsurance premiums | 303,171 | 212,238 | |||||
| Trades pending settlement | 77,802 | 22,887 | |||||
| Goodwill and intangible assets | 55,371 | 56,111 | |||||
| Other assets | 72,758 | 79,417 | |||||
| Total assets | $ | 10,734,010 | $ | 10,185,847 | |||
| LIABILITIES | |||||||
| Property and casualty losses | $ | 4,460,045 | $ | 4,216,538 | |||
| Life and annuity benefits | 1,148,317 | 1,190,697 | |||||
| Deposit liabilities | 139,518 | 151,035 | |||||
| Funds withheld from reinsurers | 93,190 | 112,469 | |||||
| Unearned property and casualty premiums | 1,192,203 | 1,020,639 | |||||
| Reinsurance balances payable | 214,202 | 134,354 | |||||
| Accounts payable and accrued expenses | 93,810 | 110,380 | |||||
| Trades pending settlement | 29,022 | — | |||||
| Senior notes | 440,527 | 440,500 | |||||
| Total liabilities | 7,810,834 | 7,376,612 | |||||
| SHAREHOLDERS’ EQUITY | |||||||
|
Common shares (par value $1.00 per share); 95,985,461 (2011—102,101,950) shares issued and outstanding |
95,985 | 102,102 | |||||
| Additional paid-in capital | 1,715,748 | 1,847,034 | |||||
| Accumulated other comprehensive income | 265,232 | 166,957 | |||||
| Retained earnings | 846,211 | 693,142 | |||||
| Total shareholders’ equity | 2,923,176 | 2,809,235 | |||||
| Total liabilities and shareholders’ equity | $ | 10,734,010 | $ | 10,185,847 | |||
| Book value per share | $ | 30.45 | $ | 27.51 | |||
| Diluted book value per share | $ | 29.57 | $ | 26.91 | |||
| Diluted tangible book value per share [a] | $ | 29.01 | $ | 26.37 | |||
| Diluted shares outstanding | 98,850,961 | 104,406,779 | |||||
|
[a] Non-GAAP financial measure as defined by Regulation G. |
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ALTERRA CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) (Expressed in thousands of United States Dollars, except per share and share amounts) |
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|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
2012 |
2011 |
2012 |
2011 |
|||||||||||||
| REVENUES | ||||||||||||||||
| Gross premiums written | $ | 386,228 | $ | 386,328 | $ | 1,614,415 | $ | 1,578,083 | ||||||||
| Reinsurance premiums ceded | (123,477 | ) | (90,891 | ) | (537,818 | ) | (364,874 | ) | ||||||||
| Net premiums written | $ | 262,751 | $ | 295,437 | $ | 1,076,597 | $ | 1,213,209 | ||||||||
| Earned premiums | $ | 483,222 | $ | 452,931 | $ | 1,457,928 | $ | 1,385,201 | ||||||||
| Earned premiums ceded | (150,584 | ) | (105,889 | ) | (436,337 | ) | (309,331 | ) | ||||||||
| Net premiums earned | 332,638 | 347,042 | 1,021,591 | 1,075,870 | ||||||||||||
| Net investment income | 53,518 | 60,335 | 166,925 | 177,766 | ||||||||||||
| Net realized and unrealized gains (losses) on investments | 20,436 | (7,972 | ) | 59,410 | (32,564 | ) | ||||||||||
| Total other-than-temporary impairment losses | (522 | ) | (692 | ) | (6,409 | ) | (2,003 | ) | ||||||||
| Portion of loss recognized in other comprehensive income (loss), before taxes | (70 | ) | (169 | ) | (122 | ) | (240 | ) | ||||||||
| Net impairment losses recognized in earnings | (592 | ) | (861 | ) | (6,531 | ) | (2,243 | ) | ||||||||
| Other income | 1,586 | 1,473 | 8,876 | 3,379 | ||||||||||||
| Total revenues | 407,586 | 400,017 | 1,250,271 | 1,222,208 | ||||||||||||
| LOSSES AND EXPENSES | ||||||||||||||||
| Net losses and loss expenses | 228,529 | 198,521 | 631,322 | 714,060 | ||||||||||||
| Claims and policy benefits | 11,838 | 14,538 | 38,576 | 44,818 | ||||||||||||
| Acquisition costs | 61,923 | 61,434 | 183,818 | 196,722 | ||||||||||||
| Interest expense | 9,026 | 11,303 | 27,289 | 30,392 | ||||||||||||
| Net foreign exchange (gains) losses | (82 | ) | (147 | ) | (89 | ) | 2,065 | |||||||||
| General and administrative expenses | 57,515 | 61,555 | 176,374 | 202,417 | ||||||||||||
| Total losses and expenses | 368,749 | 347,204 | 1,057,290 | 1,190,474 | ||||||||||||
| INCOME BEFORE TAXES | 38,837 | 52,813 | 192,981 | 31,734 | ||||||||||||
| Income tax expense (benefit) | 1,185 | 4,427 | (2,635 | ) | (2,600 | ) | ||||||||||
| NET INCOME | 37,652 | 48,386 | 195,616 | 34,334 | ||||||||||||
| Holding gains on available for sale securities arising in period [a] | 57,314 | 66,329 | 117,251 | 97,610 | ||||||||||||
| Net realized gains on available for sale securities included in net income [a] | (3,083 | ) | (4,958 | ) | (22,809 | ) | (8,076 | ) | ||||||||
| Portion of other-than-temporary impairment losses recognized in other comprehensive income [a] | 70 | 169 | 122 | 240 | ||||||||||||
| Foreign currency translation adjustment | 8,702 | (20,733 | ) | 3,711 | (15,695 | ) | ||||||||||
| Other comprehensive income | 63,003 | 40,807 | 98,275 | 74,079 | ||||||||||||
| COMPREHENSIVE INCOME | $ | 100,655 | $ | 89,193 | $ | 293,891 | $ | 108,413 | ||||||||
| Net income per share | $ | 0.39 | $ | 0.46 | $ | 1.98 | $ | 0.32 | ||||||||
| Net income per diluted share | $ | 0.38 | $ | 0.46 | $ | 1.93 | $ | 0.32 | ||||||||
| Net operating income per diluted share [b] | $ | 0.33 | $ | 0.47 | $ | 1.67 | $ | 0.61 | ||||||||
| Weighted average common shares outstanding—basic | 95,791,466 | 104,830,300 | 98,785,999 | 105,866,771 | ||||||||||||
| Weighted average common shares outstanding—diluted | 98,610,267 | 105,665,282 | 101,252,927 | 107,092,882 | ||||||||||||
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[a] Net of tax. [b] Non-GAAP financial measure as defined by Regulation G. |
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ALTERRA CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) (Expressed in thousands of United States Dollars) |
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| Nine Months Ended September 30, | ||||||||
|
2012 |
2011 |
|||||||
| Common shares | ||||||||
| Balance, beginning of period | $ | 102,102 | $ | 110,963 | ||||
| Issuance of common shares, net | 765 | 1,384 | ||||||
| Repurchase of shares | (6,882 | ) | (8,023 | ) | ||||
| Balance, end of period | 95,985 | 104,324 | ||||||
| Additional paid-in capital | ||||||||
| Balance, beginning of period | 1,847,034 | 2,026,045 | ||||||
| Issuance of common shares, net | 2,483 | 632 | ||||||
| Stock based compensation expense | 18,005 | 28,014 | ||||||
| Repurchase of shares | (151,774 | ) | (163,928 | ) | ||||
| Balance, end of period | 1,715,748 | 1,890,763 | ||||||
| Accumulated other comprehensive income | ||||||||
| Unrealized holdings gains on investments: | ||||||||
| Balance, beginning of period | 204,301 | 118,197 | ||||||
| Holding gains on available for sale fixed maturities arising in period, net of tax | 117,251 | 97,610 | ||||||
| Net realized gains on available for sale securities included in net income, net of tax | (22,809 | ) | (8,076 | ) | ||||
| Portion of other-than-temporary impairment losses recognized in other comprehensive income, net of tax | 122 | 240 | ||||||
| Balance, end of period | 298,865 | 207,971 | ||||||
| Cumulative foreign currency translation adjustment: | ||||||||
| Balance, beginning of period | (37,344 | ) | (19,251 | ) | ||||
| Foreign currency translation adjustment | 3,711 | (15,695 | ) | |||||
| Balance, end of period | (33,633 | ) | (34,946 | ) | ||||
| Total accumulated other comprehensive income, end of period | 265,232 | 173,025 | ||||||
| Retained earnings | ||||||||
| Balance, beginning of period | 693,142 | 682,316 | ||||||
| Net income | 195,616 | 34,334 | ||||||
| Dividends | (42,547 | ) | (40,024 | ) | ||||
| Balance, end of period | 846,211 | 676,626 | ||||||
| Total shareholders’ equity | $ | 2,923,176 | $ | 2,844,738 | ||||
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ALTERRA CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF CASHFLOWS (Unaudited) (Expressed in thousands of United States Dollars) |
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| Nine Months Ended September 30, | ||||||||
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|
2012 |
2011 |
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| OPERATING ACTIVITIES | ||||||||
| Net income | $ | 195,616 | $ | 34,334 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Stock based compensation | 18,005 | 28,014 | ||||||
| Amortization of premium on fixed maturities | 23,282 | 15,383 | ||||||
| Accretion of deposit liabilities | 2,430 | 4,245 | ||||||
| Net realized and unrealized (gains) losses on investments | (59,410 | ) | 32,564 | |||||
| Net impairment losses recognized in earnings | 6,531 | 2,243 | ||||||
| Changes in: | ||||||||
| Accrued interest income | 6,127 | 4,370 | ||||||
| Premiums receivable | (154,967 | ) | (188,751 | ) | ||||
| Losses and benefits recoverable from reinsurers | (77,861 | ) | (123,268 | ) | ||||
| Deferred acquisition costs | (19,764 | ) | (54,495 | ) | ||||
| Prepaid reinsurance premiums | (90,053 | ) | (65,156 | ) | ||||
| Other assets | (513 | ) | 5,652 | |||||
| Property and casualty losses | 231,665 | 293,119 | ||||||
| Life and annuity benefits | (35,517 | ) | (47,023 | ) | ||||
| Funds withheld from reinsurers | (19,279 | ) | 3,524 | |||||
| Unearned property and casualty premiums | 168,203 | 244,206 | ||||||
| Reinsurance balances payable | 79,739 | 75,643 | ||||||
| Accounts payable and accrued expenses | (16,996 | ) | 10,871 | |||||
| Cash provided by operating activities | 257,238 | 275,475 | ||||||
| INVESTING ACTIVITIES | ||||||||
| Purchases of available for sale securities | (1,701,243 | ) | (1,929,474 | ) | ||||
| Sales of available for sale securities | 754,150 | 1,126,984 | ||||||
| Redemptions/maturities of available for sale securities | 852,480 | 660,245 | ||||||
| Purchases of trading securities | (358,770 | ) | (50,971 | ) | ||||
| Sales of trading securities | 194,355 | 24,563 | ||||||
| Redemptions/maturities of trading securities | 27,219 | 44,231 | ||||||
| Purchases of held to maturity securities | — | (2,580 | ) | |||||
| Redemptions/maturities of held to maturity securities | 28,667 | 18,251 | ||||||
| Net (purchases) sales of other investments | (121,706 | ) | 27,353 | |||||
| Dividends from equity method investments | 8,694 | — | ||||||
| Change in restricted cash and cash equivalents | 207,620 | (98,165 | ) | |||||
| Cash used in investing activities | (108,534 | ) | (179,563 | ) | ||||
| FINANCING ACTIVITIES | ||||||||
| Net proceeds from issuance of common shares | 3,248 | 2,016 | ||||||
| Repurchase of common shares | (158,656 | ) | (171,951 | ) | ||||
| Dividends paid | (42,317 | ) | (39,894 | ) | ||||
| Additions to deposit liabilities | 8,725 | 334 | ||||||
| Payments of deposit liabilities | (22,672 | ) | (5,056 | ) | ||||
| Cash used in financing activities | (211,672 | ) | (214,551 | ) | ||||
| Effect of exchange rate changes on foreign currency cash and cash equivalents | (700 | ) | (15,157 | ) | ||||
| Net decrease in cash and cash equivalents | (63,668 | ) | (133,796 | ) | ||||
| Cash and cash equivalents, beginning of period | 469,477 | 561,694 | ||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 405,809 | $ | 427,898 | ||||
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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Interest paid totaled $25,138 and $25,320 for the nine months ended September 30, 2012 and 2011, respectively. Income taxes paid totaled $7,013 and $172 for the nine months ended September 30, 2012 and 2011, respectively. |
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ALTERRA CAPITAL HOLDINGS LIMITED |
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| SCHEDULE OF SUPPLEMENTAL SEGMENT DATA - THREE MONTHS ENDED SEPTEMBER 30, 2012 (Unaudited) | ||||||||||||||||||||||||||||||||
| (Expressed in thousands of United States Dollars) | ||||||||||||||||||||||||||||||||
| Property & Casualty |
Life & Annuity Reinsurance |
Corporate | Consolidated | |||||||||||||||||||||||||||||
|
Global Insurance |
U.S. Insurance |
Reinsurance |
Alterra at Lloyd’s |
Total | ||||||||||||||||||||||||||||
| Gross premiums written | $ | 81,627 | $ | 88,006 | $ | 172,796 | $ | 43,074 | $ | 385,503 | $ | 725 | $ | — | $ | 386,228 | ||||||||||||||||
| Reinsurance premiums ceded | (44,157 | ) | (40,083 | ) | (30,318 | ) | (8,835 | ) | (123,393 | ) | (84 | ) | — | (123,477 | ) | |||||||||||||||||
| Net premiums written | $ | 37,470 | $ | 47,923 | $ | 142,478 | $ | 34,239 | $ | 262,110 | $ | 641 | $ | — | $ | 262,751 | ||||||||||||||||
| Earned premiums | $ | 92,526 | $ | 100,187 | $ | 223,231 | $ | 66,553 | $ | 482,497 | $ | 725 | $ | — | $ | 483,222 | ||||||||||||||||
| Earned premiums ceded | (48,392 | ) | (52,222 | ) | (36,446 | ) | (13,440 | ) | (150,500 | ) | (84 | ) | — | (150,584 | ) | |||||||||||||||||
| Net premiums earned | 44,134 | 47,965 | 186,785 | 53,113 | 331,997 | 641 | — | 332,638 | ||||||||||||||||||||||||
| Net losses and loss expenses | (31,631 | ) | (46,489 | ) | (98,067 | ) | (52,342 | ) | (228,529 | ) | — | — | (228,529 | ) | ||||||||||||||||||
| Claims and policy benefits | — | — | — | — | — | (11,838 | ) | — | (11,838 | ) | ||||||||||||||||||||||
| Acquisition costs | (124 | ) | (4,404 | ) | (47,159 | ) | (10,104 | ) | (61,791 | ) | (132 | ) | — | (61,923 | ) | |||||||||||||||||
| General and administrative expenses | (6,328 | ) | (11,337 | ) | (16,259 | ) | (7,342 | ) | (41,266 | ) | (74 | ) | — | (41,340 | ) | |||||||||||||||||
| Other income | — | — | 1,560 | 1 | 1,561 | — | — | 1,561 | ||||||||||||||||||||||||
| Underwriting income (loss) | $ | 6,051 | $ | (14,265 | ) | $ | 26,860 | $ | (16,674 | ) | $ | 1,972 | n/a | — | n/a | |||||||||||||||||
| Net investment income | 13,224 | 40,294 | 53,518 | |||||||||||||||||||||||||||||
| Net realized and unrealized gains on investments | 20,436 | 20,436 | ||||||||||||||||||||||||||||||
| Net impairment losses recognized in earnings | (592 | ) | (592 | ) | ||||||||||||||||||||||||||||
| Corporate other income | 25 | 25 | ||||||||||||||||||||||||||||||
| Interest expense | (9,026 | ) | (9,026 | ) | ||||||||||||||||||||||||||||
| Net foreign exchange gains | 82 | 82 | ||||||||||||||||||||||||||||||
| Corporate general and administrative expenses | (16,175 | ) | (16,175 | ) | ||||||||||||||||||||||||||||
| Income before taxes | $ | 1,821 | $ | 35,044 | $ | 38,837 | ||||||||||||||||||||||||||
| Loss ratio (a) | 71.7 | % | 96.9 | % | 52.5 | % | 98.5 | % | 68.8 | % | ||||||||||||||||||||||
| Acquisition cost ratio (b) | 0.3 | % | 9.2 | % | 25.2 | % | 19.0 | % | 18.6 | % | ||||||||||||||||||||||
| General and administrative expense ratio (c) | 14.3 | % | 23.6 | % | 8.7 | % | 13.8 | % | 12.4 | % | ||||||||||||||||||||||
| Combined ratio (d) | 86.3 | % | 129.7 | % | 86.5 | % | 131.4 | % | 99.9 | % | ||||||||||||||||||||||
| SCHEDULE OF SUPPLEMENTAL SEGMENT DATA - NINE MONTHS ENDED SEPTEMBER 30, 2012 (Unaudited) | ||||||||||||||||||||||||||||||||
| (Expressed in thousands of United States Dollars) | ||||||||||||||||||||||||||||||||
| Property & Casualty |
Life & Annuity Reinsurance |
Corporate | Consolidated | |||||||||||||||||||||||||||||
|
Global Insurance |
U.S. Insurance |
Reinsurance |
Alterra at Lloyd’s |
Total | ||||||||||||||||||||||||||||
| Gross premiums written | $ | 273,674 | $ | 304,474 | $ | 772,823 | $ | 261,225 | $ | 1,612,196 | $ | 2,219 | $ | — | $ | 1,614,415 | ||||||||||||||||
| Reinsurance premiums ceded | (140,632 | ) | (162,101 | ) | (160,335 | ) | (74,493 | ) | (537,561 | ) | (257 | ) | — | (537,818 | ) | |||||||||||||||||
| Net premiums written | $ | 133,042 | $ | 142,373 | $ | 612,488 | $ | 186,732 | $ | 1,074,635 | $ | 1,962 | $ | — | $ | 1,076,597 | ||||||||||||||||
| Earned premiums | $ | 279,432 | $ | 296,728 | $ | 670,767 | $ | 208,782 | $ | 1,455,709 | $ | 2,219 | $ | — | $ | 1,457,928 | ||||||||||||||||
| Earned premiums ceded | (140,892 | ) | (137,168 | ) | (101,423 | ) | (56,597 | ) | (436,080 | ) | (257 | ) | — | (436,337 | ) | |||||||||||||||||
| Net premiums earned | 138,540 | 159,560 | 569,344 | 152,185 | 1,019,629 | 1,962 | — | 1,021,591 | ||||||||||||||||||||||||
| Net losses and loss expenses | (72,437 | ) | (121,386 | ) | (313,452 | ) | (124,047 | ) | (631,322 | ) | — | — | (631,322 | ) | ||||||||||||||||||
| Claims and policy benefits | — | — | — | — | — | (38,576 | ) | — | (38,576 | ) | ||||||||||||||||||||||
| Acquisition costs | (422 | ) | (18,269 | ) | (137,739 | ) | (26,981 | ) | (183,411 | ) | (407 | ) | — | (183,818 | ) | |||||||||||||||||
| General and administrative expenses | (19,722 | ) | (35,809 | ) | (52,631 | ) | (24,293 | ) | (132,455 | ) | (227 | ) | — | (132,682 | ) | |||||||||||||||||
| Other income | 816 | 81 | 7,896 | 8 | 8,801 | — | — | 8,801 | ||||||||||||||||||||||||
| Underwriting income (loss) | $ | 46,775 | $ | (15,823 | ) | $ | 73,418 | $ | (23,128 | ) | $ | 81,242 | n/a | — | n/a | |||||||||||||||||
| Net investment income | 41,466 | 125,459 | 166,925 | |||||||||||||||||||||||||||||
| Net realized and unrealized gains on investments | 59,410 | 59,410 | ||||||||||||||||||||||||||||||
| Net impairment losses recognized in earnings | (6,531 | ) | (6,531 | ) | ||||||||||||||||||||||||||||
| Corporate other income | 75 | 75 | ||||||||||||||||||||||||||||||
| Interest expense | (27,289 | ) | (27,289 | ) | ||||||||||||||||||||||||||||
| Net foreign exchange gains | 89 | 89 | ||||||||||||||||||||||||||||||
| Corporate general and administrative expenses | (43,692 | ) | (43,692 | ) | ||||||||||||||||||||||||||||
| Income before taxes | $ | 4,218 | $ | 107,521 | $ | 192,981 | ||||||||||||||||||||||||||
| Loss ratio (a) | 52.3 | % | 76.1 | % | 55.1 | % | 81.5 | % | 61.9 | % | ||||||||||||||||||||||
| Acquisition cost ratio (b) | 0.3 | % | 11.4 | % | 24.2 | % | 17.7 | % | 18.0 | % | ||||||||||||||||||||||
| General and administrative expense ratio (c) | 14.2 | % | 22.4 | % | 9.2 | % | 16.0 | % | 13.0 | % | ||||||||||||||||||||||
| Combined ratio (d) | 66.8 | % | 110.0 | % | 88.5 | % | 115.2 | % | 92.9 | % | ||||||||||||||||||||||
|
(a) The loss ratio is calculated by dividing net losses and loss expenses by net premiums earned. (b) The acquisition cost ratio is calculated by dividing acquisition costs by net premiums earned. (c) The general and administrative expense ratio is calculated by dividing general and administrative expenses by net premiums earned. (d) The combined ratio is calculated by dividing the sum of net losses and loss expenses, acquisition costs and general and administrative expenses by net premiums earned. n/a Not applicable Percentage totals may not add due to rounding. |
||||||||||||||||||||||||||||||||
Segment Re-presentation
Effective July 1, 2012, the Company redefined its reporting segments by combining the reinsurance and Latin America segments into a single reinsurance segment. The Latin America segment comprised reinsurance business written for clients in Latin America through the Company's Rio de Janeiro, Bogota and Buenos Aires offices. This business will now be combined with and reported as part of the reinsurance segment. Segment disclosures for comparative periods have been re-presented to reflect this change.
|
ALTERRA CAPITAL HOLDINGS LIMITED |
||||||||||||||||||||||||||||||||
| SCHEDULE OF SUPPLEMENTAL SEGMENT DATA - THREE MONTHS ENDED SEPTEMBER 30, 2011 (Unaudited) | ||||||||||||||||||||||||||||||||
| (Expressed in thousands of United States Dollars) | ||||||||||||||||||||||||||||||||
| Property & Casualty |
Life & Annuity Reinsurance |
Corporate | Consolidated | |||||||||||||||||||||||||||||
|
Global Insurance |
U.S. Insurance |
Reinsurance |
Alterra at Lloyd’s |
Total | ||||||||||||||||||||||||||||
| Gross premiums written | $ | 73,297 | $ | 84,858 | $ | 182,535 | $ | 44,816 | $ | 385,506 | $ | 822 | $ | — | $ | 386,328 | ||||||||||||||||
| Reinsurance premiums ceded | (37,625 | ) | (30,579 | ) | (15,874 | ) | (6,723 | ) | (90,801 | ) | (90 | ) | — | (90,891 | ) | |||||||||||||||||
| Net premiums written | $ | 35,672 | $ | 54,279 | $ | 166,661 | $ | 38,093 | $ | 294,705 | $ | 732 | $ | — | $ | 295,437 | ||||||||||||||||
| Earned premiums | $ | 93,467 | $ | 83,279 | $ | 224,829 | $ | 50,534 | $ | 452,109 | $ | 822 | $ | — | $ | 452,931 | ||||||||||||||||
| Earned premiums ceded | (48,456 | ) | (28,004 | ) | (18,489 | ) | (10,850 | ) | (105,799 | ) | (90 | ) | — | (105,889 | ) | |||||||||||||||||
| Net premiums earned | 45,011 | 55,275 | 206,340 | 39,684 | 346,310 | 732 | — | 347,042 | ||||||||||||||||||||||||
| Net losses and loss expenses | (21,288 | ) | (36,002 | ) | (116,769 | ) | (24,462 | ) | (198,521 | ) | — | — | (198,521 | ) | ||||||||||||||||||
| Claims and policy benefits | — | — | — | — | — | (14,538 | ) | — | (14,538 | ) | ||||||||||||||||||||||
| Acquisition costs | 748 | (9,669 | ) | (46,138 | ) | (6,230 | ) | (61,289 | ) | (145 | ) | — | (61,434 | ) | ||||||||||||||||||
| General and administrative expenses | (6,699 | ) | (10,228 | ) | (18,901 | ) | (8,007 | ) | (43,835 | ) | (145 | ) | — | (43,980 | ) | |||||||||||||||||
| Other income | — | 58 | 777 | (27 | ) | 808 | (8 | ) | — | 800 | ||||||||||||||||||||||
| Underwriting income (loss) | $ | 17,772 | $ | (566 | ) | $ | 25,309 | $ | 958 | $ | 43,473 | n/a | — | n/a | ||||||||||||||||||
| Net investment income | 12,131 | 48,204 | 60,335 | |||||||||||||||||||||||||||||
| Net realized and unrealized losses on investments | (6,407 | ) | (1,565 | ) | (7,972 | ) | ||||||||||||||||||||||||||
| Net impairment losses recognized in earnings | (861 | ) | (861 | ) | ||||||||||||||||||||||||||||
| Corporate other income | 673 | 673 | ||||||||||||||||||||||||||||||
| Interest expense | (11,303 | ) | (11,303 | ) | ||||||||||||||||||||||||||||
| Net foreign exchange gains | 147 | 147 | ||||||||||||||||||||||||||||||
| Corporate general and administrative expenses | (17,575 | ) | (17,575 | ) | ||||||||||||||||||||||||||||
| (Loss) income before taxes | $ | (8,380 | ) | $ | 17,720 | $ | 52,813 | |||||||||||||||||||||||||
| Loss ratio (a) | 47.3 | % | 65.1 | % | 56.6 | % | 61.6 | % | 57.3 | % | ||||||||||||||||||||||
| Acquisition cost ratio (b) | (1.7 | )% | 17.5 | % | 22.4 | % | 15.7 | % | 17.7 | % | ||||||||||||||||||||||
| General and administrative expense ratio (c) | 14.9 | % | 18.5 | % | 9.2 | % | 20.2 | % | 12.7 | % | ||||||||||||||||||||||
| Combined ratio (d) | 60.5 | % | 101.1 | % | 88.1 | % | 97.5 | % | 87.7 | % | ||||||||||||||||||||||
| SCHEDULE OF SUPPLEMENTAL SEGMENT DATA - NINE MONTHS ENDED SEPTEMBER 30, 2011 (Unaudited) | ||||||||||||||||||||||||||||||||
| (Expressed in thousands of United States Dollars) | ||||||||||||||||||||||||||||||||
| Property & Casualty |
Life & Annuity Reinsurance |
Corporate | Consolidated | |||||||||||||||||||||||||||||
|
Global Insurance |
U.S. Insurance |
Reinsurance |
Alterra at Lloyd’s |
Total | ||||||||||||||||||||||||||||
| Gross premiums written | $ | 268,101 | $ | 272,417 | $ | 810,244 | $ | 225,134 | $ | 1,575,896 | $ | 2,187 | $ | — | $ | 1,578,083 | ||||||||||||||||
| Reinsurance premiums ceded | (131,282 | ) | (97,123 | ) | (81,438 | ) | (54,820 | ) | (364,663 | ) | (211 | ) | — | (364,874 | ) | |||||||||||||||||
| Net premiums written | $ | 136,819 | $ | 175,294 | $ | 728,806 | $ | 170,314 | $ | 1,211,233 | $ | 1,976 | $ | — | $ | 1,213,209 | ||||||||||||||||
| Earned premiums | $ | 273,010 | $ | 246,993 | $ | 691,196 | $ | 171,815 | $ | 1,383,014 | $ | 2,187 | $ | — | $ | 1,385,201 | ||||||||||||||||
| Earned premiums ceded | (132,521 | ) | (79,640 | ) | (50,989 | ) | (45,970 | ) | (309,120 | ) | (211 | ) | — | (309,331 | ) | |||||||||||||||||
| Net premiums earned | 140,489 | 167,353 | 640,207 | 125,845 | 1,073,894 | 1,976 | — | 1,075,870 | ||||||||||||||||||||||||
| Net losses and loss expenses | (76,601 | ) | (108,429 | ) | (435,053 | ) | (93,977 | ) | (714,060 | ) | — | — | (714,060 | ) | ||||||||||||||||||
| Claims and policy benefits | — | — | — | — | — | (44,818 | ) | — | (44,818 | ) | ||||||||||||||||||||||
| Acquisition costs | 1,601 | (28,055 | ) | (141,014 | ) | (28,828 | ) | (196,296 | ) | (426 | ) | — | (196,722 | ) | ||||||||||||||||||
| General and administrative expenses | (21,425 | ) | (32,872 | ) | (68,329 | ) | (24,033 | ) | (146,659 | ) | (581 | ) | — | (147,240 | ) | |||||||||||||||||
| Other income | 814 | 195 | 1,325 | 353 | 2,687 | (31 | ) | — | 2,656 | |||||||||||||||||||||||
| Underwriting income (loss) | $ | 44,878 | $ | (1,808 | ) | $ | (2,864 | ) | $ | (20,640 | ) | $ | 19,566 | n/a | — | n/a | ||||||||||||||||
| Net investment income | 37,019 | 140,747 | 177,766 | |||||||||||||||||||||||||||||
| Net realized and unrealized losses on investments | (4,899 | ) | (27,665 | ) | (32,564 | ) | ||||||||||||||||||||||||||
| Net impairment losses recognized in earnings | (2,243 | ) | (2,243 | ) | ||||||||||||||||||||||||||||
| Corporate other income | 723 | 723 | ||||||||||||||||||||||||||||||
| Interest expense | (30,392 | ) | (30,392 | ) | ||||||||||||||||||||||||||||
| Net foreign exchange losses | (2,065 | ) | (2,065 | ) | ||||||||||||||||||||||||||||
| Corporate general and administrative expenses | (55,177 | ) | (55,177 | ) | ||||||||||||||||||||||||||||
| (Loss) income before taxes | $ | (11,760 | ) | $ | 23,928 | $ | 31,734 | |||||||||||||||||||||||||
| Loss ratio (a) | 54.5 | % | 64.8 | % | 68.0 | % | 74.7 | % | 66.5 | % | ||||||||||||||||||||||
| Acquisition cost ratio (b) | (1.1 | )% | 16.8 | % | 22.0 | % | 22.9 | % | 18.3 | % | ||||||||||||||||||||||
| General and administrative expense ratio (c) | 15.3 | % | 19.6 | % | 10.7 | % | 19.1 | % | 13.7 | % | ||||||||||||||||||||||
| Combined ratio (d) | 68.6 | % | 101.2 | % | 100.7 | % | 116.7 | % | 98.4 | % | ||||||||||||||||||||||
|
(a) The loss ratio is calculated by dividing net losses and loss expenses by net premiums earned. (b) The acquisition cost ratio is calculated by dividing acquisition costs by net premiums earned. (c) The general and administrative expense ratio is calculated by dividing general and administrative expenses by net premiums earned. (d) The combined ratio is calculated by dividing the sum of net losses and loss expenses, acquisition costs and general and administrative expenses by net premiums earned. n/a Not applicable Percentage totals may not add due to rounding. |
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|
ALTERRA CAPITAL HOLDINGS LIMITED
SCHEDULE OF SUPPLEMENTAL PREMIUM DATA - NINE MONTHS ENDED SEPTEMBER 30, 2012 (Unaudited) (Expressed in thousands of United States Dollars) |
|||||||||||||||||||||||||||
| Nine Months Ended September 30, 2012 | Nine Months Ended September 30, 2011 | ||||||||||||||||||||||||||
| Gross Premiums Written | Percentage of Total Gross Premiums Written | Movement on Prior Year Period | Gross Premiums Written [a] | Percentage of Total Gross Premiums Written [a] | |||||||||||||||||||||||
| Property & Casualty: | |||||||||||||||||||||||||||
| Global Insurance: | |||||||||||||||||||||||||||
| Aviation | S | $ | 11,252 | 0.7 | % | (6.0 | )% | $ | 11,966 | 0.8 | % | ||||||||||||||||
| Excess Liability | L | 80,367 | 5.0 | % | 4.0 | % | 77,301 | 4.9 | % | ||||||||||||||||||
| Professional Liability | L | 120,431 | 7.5 | % | 2.5 | % | 117,521 | 7.4 | % | ||||||||||||||||||
| Property | S | 61,624 | 3.8 | % | 0.5 | % | 61,313 | 3.9 | % | ||||||||||||||||||
| 273,674 | 17.0 | % | 2.1 | % | 268,101 | 17.0 | % | ||||||||||||||||||||
| U.S. Insurance: | |||||||||||||||||||||||||||
| General/Excess Liability | L | 76,590 | 4.7 | % | 4.9 | % | 73,036 | 4.6 | % | ||||||||||||||||||
| Marine | S | 79,168 | 4.9 | % | 22.4 | % | 64,687 | 4.1 | % | ||||||||||||||||||
| Professional Liability | L | 41,526 | 2.6 | % | 46.0 | % | 28,449 | 1.8 | % | ||||||||||||||||||
| Property | S | 107,190 | 6.6 | % | 0.9 | % | 106,245 | 6.7 | % | ||||||||||||||||||
| 304,474 | 18.9 | % | 11.8 | % | 272,417 | 17.3 | % | ||||||||||||||||||||
| Reinsurance: | |||||||||||||||||||||||||||
| Agriculture | S | 23,379 | 1.4 | % | (23.3 | )% | 30,496 | 1.9 | % | ||||||||||||||||||
| Auto | S | 42,593 | 2.6 | % | (45.3 | )% | 77,812 | 4.9 | % | ||||||||||||||||||
| Aviation | S | 27,801 | 1.7 | % | 77.6 | % | 15,654 | 1.0 | % | ||||||||||||||||||
| Credit/Surety | S | 58,134 | 3.6 | % | 68.8 | % | 34,446 | 2.2 | % | ||||||||||||||||||
| General Casualty | L | 49,763 | 3.1 | % | (19.1 | )% | 61,522 | 3.9 | % | ||||||||||||||||||
| Marine & Energy | S | 23,264 | 1.4 | % | 12.9 | % | 20,605 | 1.3 | % | ||||||||||||||||||
| Medical Malpractice | L | 24,946 | 1.5 | % | (30.1 | )% | 35,672 | 2.3 | % | ||||||||||||||||||
| Other | S | 4,104 | 0.3 | % | 26.2 | % | 3,252 | 0.2 | % | ||||||||||||||||||
| Professional Liability | L | 131,289 | 8.1 | % | (5.6 | )% | 139,023 | 8.8 | % | ||||||||||||||||||
| Property | S | 347,019 | 21.5 | % | 5.1 | % | 330,146 | 20.9 | % | ||||||||||||||||||
| Whole Account | S/L | 4,478 | 0.3 | % | (86.6 | )% | 33,392 | 2.1 | % | ||||||||||||||||||
| Workers' Compensation | L | 36,053 | 2.2 | % | 27.7 | % | 28,224 | 1.8 | % | ||||||||||||||||||
| 772,823 | 47.9 | % | (4.6 | )% | 810,244 | 51.3 | % | ||||||||||||||||||||
| Alterra at Lloyd's: | |||||||||||||||||||||||||||
| Accident & Health | S | 35,256 | 2.2 | % | 12.1 | % | 31,447 | 2.0 | % | ||||||||||||||||||
| Agriculture | S | 18,355 | 1.1 | % | n/m | — | — | ||||||||||||||||||||
| Aviation | S | 8,620 | 0.5 | % | 11.8 | % | 7,707 | 0.5 | % | ||||||||||||||||||
| Financial Institutions | L | 18,870 | 1.2 | % | (1.0 | )% | 19,068 | 1.2 | % | ||||||||||||||||||
| International Casualty | L | 63,784 | 4.0 | % | 27.7 | % | 49,955 | 3.2 | % | ||||||||||||||||||
| Marine | S | 7,022 | 0.4 | % | n/m | — | — | ||||||||||||||||||||
| Professional Liability | L | 17,539 | 1.1 | % | (6.8 | )% | 18,828 | 1.2 | % | ||||||||||||||||||
| Property | S | 91,779 | 5.7 | % | (6.5 | )% | 98,129 | 6.2 | % | ||||||||||||||||||
| 261,225 | 16.2 | % | 16.0 | % | 225,134 | 14.3 | % | ||||||||||||||||||||
| Aggregate Property & Casualty | $ | 1,612,196 | 99.9 | % | 2.3 | % | $ | 1,575,896 | 99.9 | % | |||||||||||||||||
| Life & Annuity: | |||||||||||||||||||||||||||
| Annuity | $ | — | — | n/m | $ | 1,131 | 0.1 | % | |||||||||||||||||||
| Life | 2,219 | 0.1 | % | 110.1 | % | 1,056 | 0.1 | % | |||||||||||||||||||
| Aggregate Life & Annuity | $ | 2,219 | 0.1 | % | 1.5 | % | $ | 2,187 | 0.1 | % | |||||||||||||||||
| Aggregate Property & Casualty and Life & Annuity | $ | 1,614,415 | 100.0 | % | 2.3 | % | $ | 1,578,083 | 100.0 | % | |||||||||||||||||
| S = Short tail lines | $ | 948,799 | 58.9 | % | $ | 910,601 | 57.8 | % | |||||||||||||||||||
| L = Long tail lines | 663,397 | 41.1 | % | 665,295 | 42.2 | % | |||||||||||||||||||||
| Aggregate Property & Casualty | $ | 1,612,196 | $ | 1,575,896 | |||||||||||||||||||||||
| Property [b] | $ | 607,612 | 37.7 | % | $ | 595,833 | 37.8 | % | |||||||||||||||||||
| Casualty [c] | 661,158 | 41.0 | % | 648,599 | 41.2 | % | |||||||||||||||||||||
| Specialty [d] | 343,426 | 21.3 | % | 331,464 | 21.0 | % | |||||||||||||||||||||
| Aggregate Property & Casualty | $ | 1,612,196 | $ | 1,575,896 | |||||||||||||||||||||||
|
[a] Comparative period has been re-presented to conform with the current period's presentation. |
|||||||||||||||||||||||||||
| [b] Property includes property lines of business. | |||||||||||||||||||||||||||
|
[c] Casualty includes excess liability, financial institutions, general liability, international casualty, medical malpractice, professional liability and workers' compensation lines of business. |
|||||||||||||||||||||||||||
|
[d] Specialty includes accident & health, agriculture, auto, aviation, credit, energy, marine, other, surety and whole account lines of business. |
|||||||||||||||||||||||||||
| Percentage totals may not add due to rounding. | |||||||||||||||||||||||||||
| n/m Not meaningful. | |||||||||||||||||||||||||||
|
ALTERRA CAPITAL HOLDINGS LIMITED
NON-GAAP FINANCIAL MEASURE RECONCILIATIONS (UNAUDITED) Net Operating Income and Net Operating Income per Diluted Share (Expressed in thousands of United States Dollars, except per share and share amounts) |
|||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
|
2012 |
2011 |
2012 |
2011 |
||||||||||||
| Net income before tax | $ | 38,837 | $ | 52,813 | $ | 192,981 | $ | 31,734 | |||||||
| Net realized and unrealized (gains) losses on investments not included in operating income, before tax [a] | (6,348 | ) | 1,164 | (28,076 | ) | 28,427 | |||||||||
| Foreign exchange (gains) losses, before tax | (82 | ) | (147 | ) | (89 | ) | 2,065 | ||||||||
| Net operating income before tax | $ | 32,407 | $ | 53,830 | $ | 164,816 | $ | 62,226 | |||||||
| Net income | $ | 37,652 | $ | 48,386 | $ | 195,616 | $ | 34,334 | |||||||
| Net realized and unrealized (gains) losses on investments not included in operating income, net of tax [a] | (5,465 | ) | 1,807 | (26,732 | ) | 29,120 | |||||||||
| Foreign exchange (gains) losses, net of tax | (54 | ) | (111 | ) | (68 | ) | 1,461 | ||||||||
| Net operating income | $ | 32,133 | $ | 50,082 | $ | 168,816 | $ | 64,915 | |||||||
| Net income per diluted share | $ | 0.38 | $ | 0.46 | $ | 1.93 | $ | 0.32 | |||||||
| Net realized and unrealized (gains) losses on investments not included in operating income, net of tax [a] | (0.06 | ) | 0.02 | (0.26 | ) | 0.27 | |||||||||
| Foreign exchange losses, net of tax | — | — | — | 0.01 | |||||||||||
| Net operating income per diluted share | $ | 0.33 | $ | 0.47 | $ | 1.67 | $ | 0.61 | |||||||
| Weighted average shares outstanding - basic | 95,791,466 | 104,830,300 | 98,785,999 | 105,866,771 | |||||||||||
| Weighted average shares outstanding - diluted | 98,610,267 | 105,665,282 | 101,252,927 | 107,092,882 | |||||||||||
[a] Net realized and unrealized (gains) losses on investments not included in operating income includes realized and unrealized (gains) losses on trading securities, realized (gains) losses on available for sale securities, net impairment losses recognized in earnings, earnings from equity method investments in run-off and changes in fair value of derivatives, catastrophe bonds and structured deposits.
Per share totals may not add due to rounding.
|
Annualized Net Operating Return on Average Shareholders' Equity (Expressed in thousands of United States Dollars) |
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| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
|
2012 |
2011 |
2012 |
2011 |
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| Net income | $ | 37,652 | $ | 48,386 | $ | 195,616 | $ | 34,334 | ||||||||
| Annualized net income | 150,608 | 193,544 | 260,821 | 45,779 | ||||||||||||
| Net operating income | $ | 32,133 | $ | 50,082 | $ | 168,816 | $ | 64,915 | ||||||||
| Annualized net operating income | 128,532 | 200,328 | 225,088 | 86,553 | ||||||||||||
| Average shareholders' equity [b] | $ | 2,887,456 | $ | 2,818,210 | $ | 2,856,401 | $ | 2,799,260 | ||||||||
| Annualized return on average shareholders' equity | 5.2 | % | 6.9 | % | 9.1 | % | 1.6 | % | ||||||||
| Annualized net operating return on average shareholders' equity | 4.5 | % | 7.1 | % | 7.9 | % | 3.1 | % | ||||||||
[b] Average shareholders equity is computed as the average of the quarterly average shareholders' equity balances.
|
Diluted Tangible Book Value Per Share (Expressed in thousands of United States Dollars, except per share and share amounts) |
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|
September 30, 2012 |
December 31, 2011 |
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| Shareholders' equity | $ | 2,923,176 | $ | 2,809,235 | |||
| Goodwill and intangible assets | 55,371 | 56,111 | |||||
| Tangible book value | $ | 2,867,805 | $ | 2,753,124 | |||
| Diluted shares outstanding | 98,850,961 | 104,406,779 | |||||
| Diluted tangible book value per share | $ | 29.01 | $ | 26.37 | |||
|
ALTERRA CAPITAL HOLDINGS LIMITED
SCHEDULE OF SUPPLEMENTAL INVESTMENT DATA - SEPTEMBER 30, 2012 (UNAUDITED) (Expressed in thousands of United States Dollars) |
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| Type of Investment | As of September 30, 2012 | Investment Distribution | As of December 31, 2011 | Investment Distribution | ||||||||||
| Cash and cash equivalents (restricted and unrestricted) | $ | 651,556 | 8.2 | % | $ | 922,844 | 11.8 | % | ||||||
| U.S. government and agencies | $ | 811,788 | 10.2 | % | $ | 751,806 | 9.6 | % | ||||||
| Non-U.S. governments | 240,463 | 3.0 | % | 164,621 | 2.1 | % | ||||||||
| Corporate securities | 2,673,789 | 33.5 | % | 2,646,358 | 33.9 | % | ||||||||
| Municipal securities | 270,501 | 3.4 | % | 263,007 | 3.4 | % | ||||||||
| Asset-backed securities | 354,739 | 4.5 | % | 247,965 | 3.2 | % | ||||||||
| Residential mortgage-backed securities | 1,310,149 | 16.4 | % | 1,296,277 | 16.6 | % | ||||||||
| Commercial mortgage-backed securities | 443,709 | 5.6 | % | 361,097 | 4.6 | % | ||||||||
| Fixed maturities at fair value | $ | 6,105,138 | 76.6 | % | $ | 5,731,131 | 73.3 | % | ||||||
| U.S. government and agencies | $ | 27,627 | 0.3 | % | $ | 29,201 | 0.4 | % | ||||||
| Non-U.S. governments | 516,673 | 6.5 | % | 524,449 | 6.7 | % | ||||||||
| Corporate securities | 292,392 | 3.7 | % | 319,609 | 4.1 | % | ||||||||
| Asset-backed securities | 656 | — | 1,000 | — | ||||||||||
| Fixed maturities at amortized cost | $ | 837,348 | 10.5 | % | $ | 874,259 | 11.2 | % | ||||||
| Other investments | $ | 376,870 | 4.7 | % | $ | 286,515 | 3.7 | % | ||||||
| Total invested assets | $ | 7,970,912 | 100.0 | % | $ | 7,814,749 | 100.0 | % | ||||||
| Credit Rating | As of September 30, 2012 | Ratings Distribution | As of December 31, 2011 | Ratings Distribution | ||||||||||
| U.S. government and agencies [a] | $ | 2,084,315 | 30.0 | % | $ | 1,869,405 | 28.3 | % | ||||||
| AAA | 1,203,508 | 17.3 | % | 948,861 | 14.4 | % | ||||||||
| AA | 757,361 | 10.9 | % | 883,783 | 13.4 | % | ||||||||
| A | 1,480,920 | 21.3 | % | 1,378,361 | 20.9 | % | ||||||||
| BBB | 321,374 | 4.6 | % | 281,983 | 4.3 | % | ||||||||
| BB | 67,285 | 1.0 | % | 84,803 | 1.3 | % | ||||||||
| B | 140,223 | 2.0 | % | 131,159 | 2.0 | % | ||||||||
| CCC or lower | 33,576 | 0.5 | % | 53,157 | 0.8 | % | ||||||||
| Not rated | 16,576 | 0.2 | % | 99,619 | 1.5 | % | ||||||||
| Fixed maturities at fair value | $ | 6,105,138 | 87.9 | % | $ | 5,731,131 | 86.8 | % | ||||||
| U.S. government and agencies | $ | 27,627 | 0.4 | % | $ | 29,201 | 0.4 | % | ||||||
| AAA | 583,187 | 8.4 | % | 619,832 | 9.4 | % | ||||||||
| AA | 92,473 | 1.3 | % | 82,511 | 1.2 | % | ||||||||
| A | 101,119 | 1.5 | % | 117,600 | 1.8 | % | ||||||||
| BBB | 30,567 | 0.4 | % | 24,117 | 0.4 | % | ||||||||
| BB | 2,375 | — | 998 | — | ||||||||||
| Fixed maturities at amortized cost | $ | 837,348 | 12.1 | % | $ | 874,259 | 13.2 | % | ||||||
| Total fixed maturities | $ | 6,942,486 | 100.0 | % | $ | 6,605,390 | 100.0 | % | ||||||
[a] Included within U.S. government and agencies are agency-issued residential mortgage-backed securities with a fair value of $1,272,527 (December 31, 2011: $1,117,599)
Percentage totals may not add due to rounding.
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
|
2012 |
2011 |
2012 |
2011 |
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| Net investment income | $ | 53,518 | $ | 60,335 | $ | 166,925 | $ | 177,766 | ||||||||
| Realized and unrealized gains on trading fixed maturities | 3,621 | 1,663 | 5,274 | 1,268 | ||||||||||||
| Net realized gains on available for sale fixed maturities | 3,087 | 6,097 | 22,836 | 9,520 | ||||||||||||
| Increase (decrease) in fair value of hedge funds | 8,245 | (7,668 | ) | 9,030 | (6,380 | ) | ||||||||||
| Decrease in fair value of catastrophe bonds | — | — | — | (25,641 | ) | |||||||||||
| Increase (decrease) in fair value of structured deposit | 1,003 | (2,007 | ) | 713 | (1,957 | ) | ||||||||||
| Income from equity method investments | 5,167 | 579 | 15,677 | 422 | ||||||||||||
| (Decrease) increase in fair value of derivatives | (687 | ) | (6,636 | ) | 5,880 | (9,796 | ) | |||||||||
| Net realized and unrealized gains (losses) on investments | $ | 20,436 | $ | (7,972 | ) | $ | 59,410 | $ | (32,564 | ) | ||||||
| Net impairment losses recognized in earnings | $ | (592 | ) | $ | (861 | ) | $ | (6,531 | ) | $ | (2,243 | ) | ||||