PartnerRe reports 2017 profit, despite nat cat losses

PartnerRe has reported that its net income for the fourth quarter of 2017 came to $72 million, a substantial rise from the net loss of $191 million for the same period of 2016.

The quarterly profit helped the company to a net income profit of $218 million for the full year 2017, down on the $387 million it made over 2016.

Operating losses for the fourth quarter of 2017 came to $28 million, a fall from the operating profit of $125 million that PartnerRe reported for the same period of 2016. Operating losses for the full year 2017 were $1 million compared to gains of $289 million for the full year 2016. Operating losses for the fourth quarter of 2017 and the full year were driven primarily by large catastrophic losses, with the losses from Hurricanes Harvey, Irma and Maria and the California wildfires totalling $569 million in aggregate.

The company pointed out that on October 5, 2017, it forecast at the Exor Investor Day an adjusted net income for 2017 in the $220-300 million range, assuming an absence of material catastrophe and other large losses in the fourth quarter of 2017 and nil mark-to-market in the standard fixed income portfolio. The reported adjusted net income of $250 million is within the forecasted range, notwithstanding $120 million losses related to the California wildfires in the fourth quarter of 2017.

“In 2017, in the face of industry insured losses in excess of $100 billion, we delivered solid financial results with adjusted net income of $250 million and an adjusted ROE of 4.2 percent,” said PartnerRe president and chief executive officer Emmanuel Clarke. “This remarkable performance demonstrates the value of our underwriting discipline, our portfolio construction with highly diversified and profitable business segments and our gross-to-net strategy. Together these have enabled us to deliver positive returns to our shareholders in a year marked by high frequency of severe catastrophes.

“We have started 2018 on a very positive note, with strong execution at the January renewals where we benefited from pricing improvements across a broad span of our portfolio with a double-digit rate increase in North America Property Cat rates along with improving profit margins in most of our Specialty lines and other P&C segments globally. We have leveraged opportunities to expand our business relationships with our clients and brokers and further improve our portfolio, with double digit year-on-year growth in Non-Life renewable treaty premium. I am very confident that we will continue to build on these achievements to deliver great results in 2018.”