Max Capital Group’s Q1 Net up 82% to $44.5 Million

The Bermuda-based Max Capital Group reported net income for the three months ended March 31, 2009 of $44.5 million, or $0.78 per diluted share, compared to net income of $7.7 million, or $0.13 per diluted share, for the three months ended March 31, 2008.

Net operating income, which represents net income excluding after-tax net realized gains and losses on fixed maturities and foreign exchange, for the three months ended March 31, 2009, was $41.7 million, or $0.73 per diluted share, compared to net operating income of $6.3 million, or $0.11 per diluted share, for the three months ended March 31, 2008.

Chairman and CEO W. Marston (Marty) Becker commented: “We are very pleased to report a strong first quarter profit, with each of Max Capital’s underwriting platforms in Bermuda, Dublin, the U.S. and Lloyd’s producing very favorable results across virtually every product area.

“Strong growth in gross premiums written was primarily driven by the expansion of Max’s global reach in the U.S. and at Lloyd’s. Loss ratios continue in line with plan, highlighting the benefits of Max’s diversified underwriting philosophy.

“We expect this trend to continue throughout 2009 as we see modest rate/exposure improvements in many classes of business relative to 2008. Likewise, the continued reduction of our alternative investments as a percentage of our total invested assets is progressing on plan and will continue throughout 2009.”

He also indicated that Max’s “pending merger with IPC is progressing well. Many regulatory approvals have already been received and we are on track for shareholder meetings and an expected closing in June 2009. The new combined organization will be strongly positioned as a global underwriter of specialty insurance and reinsurance, which in turn, will drive enhanced returns and value for our shareholders. With rates across many lines beginning to move positively, the marketplace timing for this transaction is very good.”

Max reported that gross premiums written from property and casualty underwriting for the three months ended March 31, 2009 were $433.7 million compared to $306.0 million for the three months ended March 31, 2008, an increase of 41.7 percent, with corresponding increase of 33.7 percent in net premiums written between the same periods.

The bulletin said the “increase in gross premiums written reflects the addition of the Company’s Max at Lloyd’s segment, the continued build-out of the U.S. specialty platform, and modest organic growth in each of the Company’s other property and casualty segments. Net premiums earned from property and casualty underwriting for the three months ended March 31, 2009 were $189.8 million compared to $135.3 million for the same period of 2008, an increase of 40.3 percent.”

In addition Max said its P/C “net losses and loss expenses were $124.7 million with a loss ratio of 65.7 percent and a combined ratio of 89.7 percent for the three months ended March 31, 2009, compared to $93.6 million with a loss ratio of 69.2 percent and a combined ratio of 88.8 percent for the same period in 2008. Net losses recognized in the three months ended March 31, 2009 related to property catastrophe losses were $3.4 million, with no corresponding losses in the first-quarter of 2008.”

The full report, additional information and details on accessing the Group’s earnings conference call held May 5, may be obtained on its web site at: www.maxcapgroup.com

Source: Max Capital