Posted on 04 Aug 2010
XL Group plc on Tuesday today its results for the second quarter of 2010.
Commenting on the Company's performance, Chief Executive Officer Mike McGavick said: "We are pleased to report another quarter of solid operating results. Our P&C operations delivered a healthy combined ratio of 92.2% which includes 6.8 points of favorable prior period development. The current accident year combined ratio for our P&C operations was 99.0% in the quarter and our top-line remains strong.
"Our operating income was $242.6 million in the second quarter, compared to $291.4 million in the same quarter last year. Included in operating income was a net charge of $23.5 million for the previously announced termination of the EIB guarantees. This termination continues our progress in eliminating distractions from our core P&C focus.
"We grew our book value per ordinary share for the fifth consecutive quarter, this time by 5%, driven by both investment portfolio gains and net income. Our tangible book value per ordinary share increased 6% during the quarter to $25.30. Total shareholders' equity was $10.5 billion at June 30, 2010, an increase of 5% in the quarter and 11% since the end of 2009.
"Our investment portfolio's favorable mark to market of $349 million this quarter was driven by interest rate declines even as corporate credit spreads widened. Our repositioned P&C portfolio weathered the turmoil in the credit markets, as we had limited exposure to the impacted Euro governments.
"Annualized operating return on ordinary shareholders' equity was 10.5%. Both our investment income and P&C operations contributed to these gains."
Mr. McGavick concluded: "We believe these results demonstrate our continued commitment to disciplined underwriting and vigorous risk management despite anemic pricing conditions."