2007 was a "milestone year" with Talbot buyout and the start-up's IPO, says Noonan
Validus has reported net income for the fourth quarter of 2007 of $139m, compared with $69.1m for the fourth quarter of 2006.
Net income for the year was $403m, compared with $183.1m for the corresponding period in 2006.
Net operating income for the fourth quarter of 2007 was $131.5m, compared with $68.2m for the fourth quarter of 2006.
Net operating income for the year was $388.2m, compared with $182.1m for 2006.
Operating results of Talbot have been included in the consolidated financial statements from the acquisition date of 2 July 2007. The Validus data for the full year 2006 and first six months of 2007 refer only to the company prior to its acquisition of Talbot.
Gross premiums written increased by 191.6% in the fourth quarter to $191m from $65.5m, due to the addition of Talbot which added $143.5m of gross premiums written.
The combined ratio was 63.1%, which included $10m of incurred losses relating to the October California wildfires (representing 3.1 percentage points of the consolidated 33.8% loss ratio), and $30.6 million of favourable prior year loss reserve development benefiting the loss ratio by 9.6 percentage points;
Gross premiums written for the year increased by 82.8% to $988.6m from $540.8m, due to the addition of Talbot which added $286.5m of gross premiums written and growth in the Validus Re segment.
The combined ratio of 62% included $62.3m of favourable prior year loss reserve development (representing a benefit of 7.3 percentage points of the 33.1% loss ratio).
Commenting on the fourth quarter of 2007 results, Ed Noonan, chairman and chief executive officer of Validus, stated: “2007 was a milestone year for Validus. We successfully completed the acquisition of Talbot and our initial public offering, while continuing to grow our franchise at Validus Re.
“The enhanced operating leverage resulting from the Talbot acquisition allowed us to generate an annualised return on average equity of 29.9% in the fourth quarter and 26.9% for the year.
“In 2007 we grew diluted book value per share by 21.6% and leave 2007 with a strong balance sheet comprising of $3.1 billion total investments and cash and total capitalization of $2.3 billion.”