Validus delivers ‘solid’ results in face of tough conditions
Validus’ first quarter results provide some indication of the tough market conditions facing the reinsurance sector in 2014.
Validus reported net income for the three months ending March 31st 2014 of $162.4 million, or $1.66 per diluted common share. The figure is $60.9 million down from the $232 million achieved in the first quarter of 2013.
Combined ratio for Q1 was 68.3 percent which included $39.4 million of favourable loss reserve development on prior accident years, benefiting the loss ratio by 8.2 percentage points. This compared to a combined ratio of 60.5 including $65.8 million of favourable loss reserve development for Q1 of 2013.
Gross written premiums for the first quarter of 2014 were $1,012 million compared to $1,104.8 million for Q1 of 2013, a decrease of $92.8 million, as the company has trimmed its sails in the face of tough conditions.
Validus’ chairman and CEO Ed Noonan says, “Validus delivered very solid results for the first quarter of 2014. The company had $162.4 million in net income, 4.6 percent growth in book value per diluted share inclusive of dividends and a 17.7 percent annualized return on average equity.”
Nevertheless, Noonan is pleased with the financial results, “While there is clearly competition in the (re)insurance industry, Validus' size, scale and our willingness to share analytical insights with our customers allows us to maintain a preferred position in the marketplace."