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ACE Reports Third Quarter Operating Income Of $688 Million, Combined Ratio Of 92.0% And Operating ROE Of 11.5%; Book Value Up 10.8% And Tangible Book Value Up 12.5% For The Year

Stocks in this article: ACE

ACE Limited (NYSE: ACE) today reported net income for the quarter ended September 30, 2012, of $1.86 per share, compared with a net loss of $0.11 per share for the same quarter last year. (1) Income excluding net realized gains (losses) was $2.01 per share, compared with $2.20 per share for the same quarter last year. (2) Book value and tangible book value increased 4.7% and 5.0%, respectively, from June 30, 2012. Book value and tangible book value per share now stand at $79.36 and $64.67, respectively. Operating return on equity for the quarter was 11.5%. (2) The property and casualty (P&C) combined ratio for the quarter was 92.0%.

Third Quarter Summary
(in millions, except per share amounts)
(Unaudited)
               
(Per Share - Diluted)
2012   2011   Change 2012   2011   Change
 
Net income (loss) $ 640 $ (39 ) NM $ 1.86 $ (0.11 ) NM
Net realized gains (losses), net of tax (48 ) (790 ) (94 )% (0.15 ) (2.31 ) (94 )%
Income excluding net realized gains
(losses), net of tax (2) $ 688   $ 751   (8 )% $ 2.01   $ 2.20   (9 )%

Crop insurance income (loss)

net of tax, included above

$

(97

)

$

54

NM

$

(0.28

)

$

0.16

NM

 

For the nine months ended September 30, 2012, net income was $5.67 per share, compared with $2.36 per share for 2011. Income excluding net realized gains (losses) was $6.23 per share, compared with $4.94 per share for 2011. Book value increased $2.6 billion, up 10.8% from December 31, 2011, and tangible book value increased $2.4 billion, up 12.5%. The P&C combined ratio for the nine months ended September 30, 2012, was 90.2%.

Nine Months Ended Summary
(in millions, except per share amounts)
(Unaudited)
               
(Per Share - Diluted)
2012   2011   Change 2012   2011   Change
 
Net income $ 1,941 $ 805 141 % $ 5.67 $ 2.36 140 %
Net realized gains (losses), net of tax (191 ) (878 ) (78 )% (0.56 ) (2.58 ) (78 )%
Income excluding net realized gains
(losses), net of tax (2) $ 2,132   $ 1,683   27 % $ 6.23   $ 4.94   26 %
 

Evan G. Greenberg, Chairman and Chief Executive Officer of ACE Limited, commented: “ACE had an excellent third quarter marked by strong earnings, outstanding growth in book value, broad-based premium revenue growth and two acquisition announcements that further our global strategy.

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