White Mountains income falls
White Mountains Insurance Group posted a net income of $102.6 million in the second quarter of 2007 — a decrease of $13 million from the previous quarter.
The decrease of $9.51 a share was primarily due to losses associated with Hurricane Katrina, according to a filing last week with the Securities and Exchange Commission.
The company did well by most other measures. Revenues relatively were flat at $1.2 billion, but expenses were down by nearly $95 million. And the company’s fully diluted tangible book value per share – its own measure of performance – was $422, an increase of 2.2 percent.
The company’s main subsidiaries all faced various challenges. OneBeacon personal auto lines had difficulty, though its specialty and commercial lines were strong. White Mountain Re had to swallow $60 million in pre-tax losses in the first half of the year due to European windstorms. It also suffered $137 million in pre-tax losses related to reimbursement of Olympus Re, a catastrophic insurance sidecar that was still reeling from hurricane-related losses in 2005. Even so, White Mountain Re’s pre-tax income was $85 million.
Another unit, Esurance, actually lost $13 million, primarily due to higher bodily injury claims and lower prices.
The company was able to pay its usual $2 dividend. The company’s per-share price closed at $540.25, up 4.75, at the close of trading on Monday. – BOB SANDERS