VALIDUS HOLDINGS LTD (NYSE:VR) filed Quarterly Report for the period ended 2011-09-30.
Validus Holdings Ltd. has a market cap of $2.71 billion; its shares were traded at around $27.37 with a P/E ratio of 20.3 and P/S ratio of 1.4. The dividend yield of Validus Holdings Ltd. stocks is 3.7%.
Highlight of Business Operations:Underwriting income (loss) measures the performance of the Companys core underwriting function, excluding revenues and expenses such as net investment income (loss), other income, finance expenses, net realized and unrealized gains (losses) on investments and foreign exchange gains (losses). The Company believes the reporting of underwriting income enhances the understanding of our results by highlighting the underlying profitability of the Companys core insurance and reinsurance operations. Underwriting income for the three months ended September 30, 2011 and 2010 was $111.8 million and $150.2 million, respectively. Underwriting income (loss) is a Non-GAAP financial measure as described in detail and reconciled in the section below entitled Underwriting Income (Loss).
Talbot net change in unearned premiums has increased for the three months ended September 30, 2011 compared to the three months ended September 30, 2010 due to the earnings pattern of gross premiums written and reinsurance premiums ceded during 2011.
Validus Re net change in unearned premiums has increased for the nine months ended September 30, 2011 due primarily to the earnings pattern of gross premiums written and ceded premiums during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010.
Policy acquisition costs include brokerage, commission and excise tax, are generally driven by contract terms and are normally a set percentage of premiums and are also net of ceding commission income on retrocessions. Items such as ceded premium, earned premium adjustments and reinstatement premiums that are recognized in the period have an effect on policy acquisition costs. Validus Re policy acquisition costs as a percent of net premiums earned for the nine months ended September 30, 2011 and 2010 were 15.8% and 15.1%, respectively. The policy acquisition cost ratio in the marine lines increased by 3.6 percentage points due primarily to the largest single reinsurance contract, by gross written premium, having an acquisition cost ratio of 36% and the impact of premium adjustments. The policy acquisition cost ratio in the specialty lines increased by 4.2 percentage points due primarily to an increase in profit commissions.
Tax expense for the nine months ended September 30, 2011 was ($1.1) million compared to ($2.1) million for the nine months ended September 30, 2010, a decrease of $1.0 million or 49.2%. For the nine months ended September 30, 2011, the decrease in tax expense arose primarily due to a reduction in the U.K. taxable profits.
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