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Montpelier Re Holdings Ltd. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: February 24, 2012 10:40PM
Montpelier Re Holdings Ltd. (MRH) filed Annual Report for the period ended 2011-12-31. Montpelier Re has a market cap of $1.14 billion; its shares were traded at around $18.12 with and P/S ratio of 1.6. The dividend yield of Montpelier Re stocks is 2.3%.
Highlight of Business Operations:Montpelier Bermudas acquisition cost ratio for 2011 increased as compared to 2010 primarily as a result of an increase in ceded premium earned. Although ceding commissions on ceded reinsurance represent revenue to Montpelier Bermuda, the ceding commission ratio on reinsurance ceded during 2011 was lower than the acquisition cost ratio of gross premium written. As a result, the increase in ceded premium earned led to an increase in the net acquisition cost ratio. Montpelier Bermudas acquisition cost ratio for 2010, exclusive of profit commission adjustments, was consistent with that of 2009.
Favorable development of prior period net losses experienced as a percentage of our opening net loss reserves across all underwriting years was 12.4%, 17.9% and 11.0% for the years ended December 31, 2011, 2010 and 2009, respectively. As of December 31, 2011, we estimate that a 15% change in our net unpaid loss and LAE reserves would result in an increase or decrease in our net income or loss and shareholders equity of approximately $150.0 million. The net income or loss and shareholders equity impact of the change in net reserves might be partially offset by adjustments to items such as reinstatement premiums, profit commission expense, incentive compensation and income taxes.
Stocks Discussed: MRH,