Validus Holdings, Ltd. (“Validus” or the “Company”) (NYSE: VR) today reported net income of $124.2 million, or $1.18 per diluted common share for the three months ended March 31, 2012, compared to a net loss of ($172.4) million, or ($1.78) per diluted common share, for the three months ended March 31, 2011.
Net operating income for the three months ended March 31, 2012 was $92.9 million, or $0.88 per diluted common share, compared with a net operating loss of ($165.4) million, or ($1.71) per diluted common share, for the three months ended March 31, 2011.
Net operating income (loss), a non-GAAP financial measure, is defined as net income (loss) excluding net realized and unrealized gains (losses) on investments, foreign exchange gains (losses) and non-recurring items. A reconciliation of this measure to net income (loss), the most directly comparable GAAP measure, is presented at the end of this release.
Commenting on financial results for the quarter ended March 31, 2012, Ed Noonan, Validus’ Chairman and Chief Executive Officer stated: “I am pleased to report nearly $125 million in net income and annualized growth in diluted book value per share of 15.1% despite meaningful catastrophe losses in connection with the Costa Concordia sinking and severe tornado activity in the U.S. heartland. The net effect of the Costa Concordia loss, after the impact of reinstatement premiums was $63.1 million, which was within our pre-announced range of $50 million to $65 million. The total effect of notable losses after reinstatement premiums was $84.5 million in the first quarter of 2012, as compared to $271.1 million for the first quarter of 2011. Validus continues to expand and leverage our core capabilities as evidenced by the announcement of the capitalization of PaCRe, Ltd. and continued development of AlphaCat. We have also received interest in, and are considering opportunities to, raise additional capital for one or more of our AlphaCat funds or managed accounts. These additional facilities allow Validus to better serve our customers, intermediaries and ultimately our shareholders through the growth of our business. With the January 1 and April 1 renewals behind us, we have plenty of capacity available for opportunities through the remainder of the year. Our balance sheet is strong and we continue to generate excess capital. We expect to become more active in capital management for the balance of 2012, while maintaining our capital in excess of our rating agency targets and stated risk appetites.”
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