Third Point Re claims strong performance in Q2 2017 results
Third Point Re has reported that its net income for the second quarter of 2017 came to $74.6 million, a 39 percent increase on the $53.4 million it made in the same period of 2016.
The quarter takes the company to a first half 2017 result of $178.8 million in net income, a massive increase on the $2.2 million it made in the first six months of 2016.
"Our strong performance for 2017 continued through the second quarter with a return on beginning shareholders' equity of 5.0 percent, bringing our six month return to 12.8 percent," said Rob Bredahl, president and CEO. "Our investment manager, Third Point LLC continues to have a great year and has generated an investment return of 10.6 percent through six months and 11.7 percent through July 2017. Although difficult reinsurance market conditions persist, we have successfully generated stable, long-term float and our asset leverage is within our target range of 1.50 to 1.75. This allows us to remain selective in our underwriting without diminishing our earnings potential.“
Gross written premiums (GWP) for the second quarter of 2017 came to $156.6 million, a decrease on the $196.9 million it wrote over the same period of 2016. GWP for the first half of 2017 also saw a fall from the previous year, going from $394 million in the first six months of 2016 to $302.9 million for the same period of 2017.
Third Point Re said that this decrease in the three and six months results was primarily due to contracts that it did not renew as a result of underlying terms and conditions, lower premium adjustments in the current year periods and other timing differences partially offset by new premium.
However, the company also said that net premiums earned in the second quarter of 2017 came to $173.6 million, an increase on the $133.1 million it earned in the same period of 2016. Net premiums earned over the first half of 2017 came to $311.6, again an increase over the $269.9 million it made in the first six months of 2016.
This rise was primarily credited to the addition of $83.9 million of new retroactive exposures in reinsurance contracts included in net premiums earned in the three and six months ended June 30, 2017, partially offset by a lower in-force underwriting portfolio. The company said that it did not write any retroactive reinsurance contracts in the three and six months ended June 30, 2016.
Third Point Re’s half-year combined ratio also fell, going from 111.9 percent in the first half of 2016 to 106.6 percent in the first six months of 2017.
