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RLI Reports 2012 Fourth Quarter And Year-End Results

RLI Corp. (NYSE: RLI) – RLI Corp. reported fourth quarter 2012 operating earnings of $19.2 million ($0.89 per share), compared to $28.2 million ($1.31 per share) for the fourth quarter of 2011. For the year ended December 31, 2012, operating earnings were $86.9 million ($4.02 per share) compared to $115.5 million ($5.39 per share) for the 2011 fiscal year.

         
  Fourth Quarter   Full Year
Earnings Per Diluted Share   2012   2011*   2012   2011*
Operating earnings (1) $0.89   $1.31 $4.02   $5.39
Net earnings   $1.16   $1.39   $4.79   $5.91
 
*2011 results were revised to reflect the retrospective adoption of a new accounting
standard for policy acquisition costs.
(1) See discussion of non-GAAP financial measures on page 3.
 

Highlights for the quarter included:

  • 11% growth in gross premiums written.
  • Underwriting income of $8.5 million, resulting in a combined ratio of 94.3.
  • $7.5 million net increase in underwriting income resulting from favorable development on prior years’ loss reserves.
  • $13.2 million net decrease in underwriting income resulting from Hurricane Sandy.
  • Special dividend of $5.00 per share, representing $106.3 million returned to shareholders and resulting in a tax benefit of $2.9 million as dividends to the ESOP are fully deductible.
  • $6.6 million dividend from Maui Jim, Inc. resulting in a tax benefit on dividends received from affiliates of $1.8 million.

Highlights for the year included:

  • 12% growth in gross premiums written.
  • Underwriting income of $63.6 million, resulting in a combined ratio of 89.0.
  • 17 th consecutive year of underwriting income.
  • Book value per share of $37.45 at year end, representing an increase of 17%, inclusive of dividends.
  • $59.8 million net increase in underwriting income resulting from favorable development on prior years’ loss reserves.
  • $30.8 million net decrease in underwriting income resulting from catastrophe events including Hurricane Sandy.
  • Comprehensive earnings of $129.2 million ($5.99 per share).

“We delivered solid financial results during the fourth quarter,” said RLI Corp. Chairman & CEO Jonathan E. Michael. “We achieved good top line growth and reported a 94.3 combined ratio, despite the impact of Hurricane Sandy.”

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