Allied World profit dives in second quarter
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Second-quarter 2015 net income at Allied World Assurance Co. Holdings A.G. plunged to $9.5 million from $151.9 million a year ago as the company's bottom line was hard hit by catastrophe and noncatastrophe losses, as well as investment losses, the Zug, Switzerland-based insurer said.
Results were weighed down by catastrophe losses of $25.0 million from New South Wales storms in April, noncatastrophe weather- and fire-related losses of approximately $20.0 million, and mark-to-market losses on investments of $60.1 million, Allied World said Wednesday in its earnings statement.
Net premiums, however, rose 9.0% to $603.7 million while total revenue grew a modest 1.6% to $670.0 million over the prior-year period.
The company's combined ratio deteriorated to 99.2% from 90.3% in the second quarter of 2014.
President and CEO Scott Carmilani acknowledged the challenges but remained optimistic.
“While our quarter was mixed, I am pleased with the position of our franchise and our ability to grow,” Mr. Carmilani said on a Thursday morning call with analysts.
Net income for the six months ended June 30 dropped 59.3% to $133.8 million as the firm cited “elevated catastrophe and noncatastrophe weather and fire-related losses, a decrease in net favorable reserve development, and increased mark-to-market losses on investments” as reasons for the decline.
Net premiums written for the six months, however, rose 3.8% to $1.4 billion as revenue grew 2.9% to $1.3 billion.
The company's six-month combined ratio deteriorated to 94.0% from 85.1% during the year-ago period.
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