American Safety Insurance Holdings, Ltd. (NYSE:ASI) today reported net earnings of $5.8 million for the three months ended September 30, 2011, or $.54 per diluted share, as compared to $7.2 million, or $0.68 per diluted share, for the same period of 2010.
Financial highlights for the quarter included
- Gross written premiums increased 2.4% to $73.2 million
- Net earned premiums increased 10.8% to $59.0 million
- The combined ratio was 101.3% compared to 98.3%
- Operating cash flow was $17.2 million compared to $17.0 million
- Book value was $31.31 per diluted share versus $29.00 at December 31, 2010
- Annualized return on average equity (exclusive of realized and unrealized gains from investments) was 8.0%
All comparisons are with the same period last year unless stated otherwise.
Third Quarter Results
Total revenues in the quarter increased to $68.1 million from $63.3 million in 2010 due to increased earned premiums across all divisions, driven primarily by growth in newer products within the E&S division.
The combined ratio of 101.3% consists of a loss ratio of 60.8% and an expense ratio of 40.5%, compared to 59.0% and 39.3%, respectively, for the same quarter of 2010. The increase in the loss ratio was due primarily to current market conditions, but was not impacted by Hurricane Irene losses. The increase in the expense ratio was due primarily to the impact of technology investments placed in service during the quarter and lower fee income.
For the three months ended September 30, 2011, net operating earnings of $5.8 million compares to $6.7 million for the same quarter 2010. We have presented net operating earnings, which is a non-GAAP financial measure because we believe that investors’ understanding of operating performance is enhanced by this disclosure. Net operating earnings (loss) represent after tax operational results without consideration of after-tax net investment gains (losses).