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Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements.More details about these risks and uncertainties can be found in the Company’s most recent annual report on Form 10-K and quarterly report on Form 10-Q, both are filed with the U.S. Securities and Exchange Commission. Management will also refer to certain non-GAAP financial measures when describing the company’s performance. These items are reconciled and explained in our earnings release and financial supplement. With that, I’ll turn the call over to Ed Noonan. Ed Noonan Thanks, Jon. Good morning and thank you all for taking the time to join us today. This was a good quarter for Validus as we generated net income of $124 million, operating income of $93 million and annualized growth in diluted book value per share of 15.1%. We recorded losses of $63 million related to the sinking of the Costa Concordia and $21 million related to U.S. tornadoes. Both Talbot and Validus generated strong underwriting income in the quarter and we continue to operate in a favorable rate environment for all of our major classes. We also continued our growth in managed catastrophe risk during the quarter with formation of PaCRe, a new $500 million reinsurer that will be managed by our AlphaCat subsidiary. With that, I’ll turn the call over to Jeff and we’ll be back to give you more color on our operations following his description of our financial results. Jeff Consolino Thank you, Ed. Thank you all for joining the call this morning. Good to see so many familiar names up on our screen. Before we get started on the results of operations and financial position for the quarter, I want to make some reference to changes we’ve made in our disclosure package effective with this first quarter of 2012. Effective with this quarter we’ve refined our segment reporting. You’ll see in our earnings release and in our investor supplement that we sub-divided the previous Validus Re segment into Validus Re and AlphaCat. This has no effect on the Talbot segment.
If you look at our consolidated segment income statement on Page 12 and 35 in our investor supplement, you’ll see that we present, still, a Validus Re consolidated income statement, which is the summation of Validus Re sub-segment and the AlphaCat sub-segment. This is because when we prepare consolidated Validus Re financial statements, these segments are consolidated within the Validus Re legal entity.For those of you who wish to measure financial models, you can break what you used to have as Validus Re into these two constituent parts. For those of you who prefer to analyze their business just on Validus Re and Talbot segments, we still provide you with the means to do so. You can call this Validus Re classic. However, effective with the second quarter, we’ll be consolidated PaCRe into the AlphaCat sub-segment, which will add substantially to the (inaudible) AlphaCat. So any work done on your models in advance for second quarter earnings will presumably be well worth it. For this quarter the main earnings drivers for the AlphaCat segment are fees generated from this activities managing third party capital and the 22.3% equity method income in AlphaCat Re 2011’s earnings. To analyze this component, you’d need to use the 100% AlphaCat Re 2011 income statement. We’ve provided you with this on Page 35 of the supplement, along with the balance sheet on Page 34. Next quarter we’ll do the same for PaCRe. You’ll need to add the unrealized investment gains or losses for PaCRe as another potentially significant source of earnings for AlphaCat. This would net of a 90% non-controlling interest in the $500 million PaCRe capital base. For those of you who want to move from modeling our company on a Validus classic basis to our new segmentation, we’ve also furnished an 8-K last evening showing the re-segmentation by quarter for all of 2011. Read the rest of this transcript for free on seekingalpha.com