Strong quarter for Third Point Re despite underwriting loss
Third Point Re, the reinsurance firm backed by Dan Loeb’s hedge fund, Third Point, experienced healthy growth for the second quarter of 2014, despite an underwriting loss.
The firm made a net profit of $31.3 million for the quarter, compared with $26.2 million for the second quarter of 2013. Its gross written premiums (GWP) also increased to $145.5 million, compared with $98.2 million in the prior year quarter.
However, the reinsurer experienced a net underwriting loss of $2.1 million, a slight improvement from a $3.4 million loss in the second quarter of 2013.
Third Point Re’s combined ratio improved to 102.7 percent in the quarter, compared with 105.5 percent in the second quarter of 2013.
Furthermore, the reinsurer’s property/casualty reinsurance unit’s GWP grew 48.4 percent to $140.4 million, compared to $94.6 million in the second quarter of 2013.
“Our Total Return approach continued to generate growth in diluted book value per share in the second quarter," says John Berger, chairman, chief executive officer and chief underwriting officer.
"Our combined ratio dropped to 102.7 percent from 105.5 percent in the prior year's second quarter as we continue to gain scale and Third Point LLC, our investment manager, successfully navigated market volatility through selective investments in securities and market hedges. We have managed to maintain our underwriting margins so far in 2014, despite challenging market conditions."