Argo reports small net loss for Q2, insists business is improving

Argo Group made a small loss in the second quarter of 2020 but insisted its results show its underlying financial strength is improving, despite the challenging circumstances presented by COVID-19.

Argo made a net loss of $6.4 million for Q2 2020. In the same period of 2019 it had made a net profit of $28.8 million.

For the first half of the year, Argo generated a net loss of $25.2 million, compared to a $120 million profit in the same period of 2019.

Gross written premiums were up to $799.6 million for Q2 2020, from $772.9 million in the same period of 2019. For the first half of the year, gross written premiums were $1.62 billion, a little up on the $1.53 billion written in the first half of 2019.

Argo’s combined ratio improved on a quarterly basis, to 100.3 percent in Q2 2020, from 103.4 percent in the same period of 2019. But for the first half of the year it edged up to 101.7 percent, from 99.0 percent in the first half of 2019.

Kevin Rehnberg, chief executive officer at Argo, said the results demonstrate Argo’s shift to more positive underlying performance, particularly in its core US specialty business.

The results were negatively impacted by market volatility in the investment portfolio, he admitted, as well as COVID-19’s impact on premium growth and catastrophe losses. However, he added: “We remain optimistic that current market conditions will provide opportunity for continued growth and margin improvement.”

Argo’s recent preferred stock offering provides the re/insurer with additional capital, enhancing its financial strength and enabling it to more aggressively pursue its strategic growth objectives, he added.