Montpelier Re Holdings Ltd. (NYSE: MRH), (“Montpelier” or the “Company”), a leading global provider of property catastrophe reinsurance and other specialty lines, today reported its financial results for the fourth quarter and year ended December 31, 2012.
Fully converted book value per common share was $26.14, a decrease of 1.3% for the fourth quarter and an increase of 17.0% for the full year, each computed after taking into account common share dividends declared during each period.
The operating loss for the quarter was $0.31 per common share ($17 million) and the net loss was $0.48 per common share ($27 million), each expressed after preferred share dividends. The net loss for the quarter includes $3 million of realized and unrealized investment gains, $3 million of net foreign exchange losses and a $10 million loss on early extinguishment of debt.
Despite the loss for the quarter, operating income for the year was $2.58 per common share ($151 million) and net income was $3.67 per common share ($214 million), each expressed after preferred share dividends. Net income for the year includes $82 million of realized and unrealized investment gains, $9 million of net foreign exchange losses and a $10 million loss on early extinguishment of debt.
Net premiums written were up 2% in the quarter, or 19%, when adjusting for reinstatement premiums ($5 million) and the sale of MUSIC ($15 million).
The quarterly result included a $94 million loss (net of reinsurance recoveries and reinstatements) from windstorm Sandy, consistent with our December announcement, which was partially offset by $26 million in prior-year loss reserve development. The combined ratio was 116% for the quarter. The loss ratio and the combined ratio for the full year were 46% and 81%, respectively.
Net investment income for the quarter was $17 million and $67 million for the full year. The total return on the investment portfolio was 0.6% for the quarter and 5.2% for the full year.