2000 was $138.3 million, or $1.10 per share, compared with $150.7 million, or $1.17 per share, for the quarter ended September 30, 1999.
For the nine months ended September 30, 2000, net income was $505.7 million, or $4.02 per share, compared with $409.9 million, or $3.14 per share, during the same period in 1999. Economic operating income was $466.0 million, or $3.71 per share, during the first nine months of 2000 compared with $479.0 million, or $3.66 per share, for the first nine months of 1999. Operating income for the first nine months of 2000 was $424.6 million, or $3.38 per share, compared with $442.0 million, or $3.38 per share, for the nine months ended September 30, 1999.
Commenting on third quarter results, Brian M. O'Hara, President and Chief Executive Officer of XL, stated: "We are seeing positive signs of a market turn in nearly all of our property-casualty businesses and continued growth in our Financial Services segment. Our recently announced realignment positions the Company for future growth in those areas in which XL has chosen to specialize. We are finalizing the specific realignment charges expected to be in the previously announced range of $100 million to $125 million and which will be included in our fourth quarter results."
Mr. O'Hara noted, "The Company's operating results, which are in line with expectations, reflect the impact of deliberate actions taken in late 1999 and early 2000 to focus our most recently acquired operations on more profitable lines and an increase in our loss ratio assumptions for many lines of business."
Total revenues were $694.6 million and $646.8 million for the quarters ended September 30, 2000 and 1999, respectively. For the first nine months of 2000 and 1999, revenues were $2.1 billion and $1.8 billion, respectively.
Gross premiums written were $736.6 million for the third quarter of 2000,compared with $629.6 million for the third quarter of 1999. Net premiums earned were $540.0 million in the third quarter of 2000 versus $488.7 million in 1999.
For the nine months ended September 30, 2000, gross premiums written were $2.4 billion compared with $1.9 billion in 1999's first nine months. Net premiums earned were $1.5 billion in the first nine months of 2000 versus $1.3 billion in the first nine months of 1999.
Net investment income, excluding net realized investment gains, was $134.6 million in the third quarter of 2000, compared with $126.6 million in 1999's third quarter. Net realized gains on investments were $1.0 million in the third quarter of 2000 compared with net realized losses of $12.7 million in 1999's third quarter.
Net investment income, excluding net realized investment gains, was $399.6 million during the first nine months of 2000, compared with $394.8 million in 1999's first nine months. Net realized gains on investments were $74.8 million during the first nine months of 2000 compared with $72.4 million in 1999's first nine months.
The Company's equity in the net income of its affiliates for the third
quarter was $18.4 million in 2000 versus $15.4 million in 1999. The
Company's equity in the net income of its affiliates during the first nine months was $61.7 million in 2000 versus $24.7 million in 1999.
Total assets at September 30, 2000 were $16.4 billion compared with $15.1billion at December 31, 1999. Shareholders' equity was $5.6 billion at September 30, 2000 and December 31, 1999. Fully diluted book value per share at September 30, 2000 was $44.78 compared with $43.13 at December 31, 1999.
The combined ratio was 96.4% in the third quarter of 2000 compared with
96.6% in the third quarter of 1999. The loss ratios were 62.6% and 63.4% in the third quarters of 2000 and 1999, respectively, and the corresponding expense ratios were 33.8% and 33.2%.
The combined ratio for the Company was 96.4% during the first nine months of 2000 compared with 93.3% during the first nine months of 1999. The loss ratios were 63.1% and 60.5% in 2000 and 1999, respectively, and the corresponding expense ratios were 33.3% and 32.8%.
During the first nine months of 2000, the Company repurchased 4.9 million of its shares at an average price of $47.56 per share. XL has approximately $265.0
million remaining in its current share repurchase authorization. No shares were repurchased in the third quarter of 2000.
Insurance Operations
Gross premiums written by the Company's insurance segment in the third
quarter of 2000 were $352.7 million compared with $216.0 million in the
third quarter of 1999. Net premiums earned were $178.0 million and $155.5million in the respective 2000 and 1999 periods. The combined ratios for insurance operations were 100.3% and 91.4% in the third quarters of 2000 and 1999, respectively. The loss ratios for the third quarters of 2000 and 1999 were 70.8% and 63.6%, respectively, and the expense ratios for the respective 2000 and 1999 periods were 29.5% and 27.8%.
Gross premiums written by the Company's insurance segment during the first nine months of 2000 were $845.8 million compared with $483.9 million during the first nine months of 1999. Net premiums earned were $475.6 million and $352.0 million in the respective 2000 and 1999 periods. The combined ratios for insurance operations were 91.9% and 88.3% in the first nine months of 2000 and 1999, respectively. The loss ratios for the first nine months of 2000 and 1999 were 63.8% and 60.1%, respectively, and the expense ratios for the respective 2000 and 1999 periods were 28.1% and 28.2%.
Reinsurance Operations
The reinsurance segment had gross premiums written of $249.5 million in the third quarter of 2000 compared with $260.9 million in the same quarter of 1999. Net premiums earned in the third quarter of 2000 were $263.0 million versus $235.2 million in 1999's third quarter. The combined ratios for this segment were 89.7% in the third quarter of 2000 and 95.5% for the third quarter of 1999. The loss ratios for reinsurance in the third quarter were 56.9% and 58.5% in 2000 and 1999, and the corresponding expense ratios were 32.8% and 37.0%.
The reinsurance segment had gross premiums written of $1.1 billion during the first nine months of 2000 compared with $876.0 million in the first nine months of 1999. Net premiums earned in the first nine months of 2000 were $752.2 million versus $653.3 million during 1999's first nine months. The combined ratios for this segment were 94.7% during the first nine months of 2000 and 88.6% for the first nine months of 1999. The loss ratios for reinsurance were 60.7% and 54.3% in the first nine months of 2000 and 1999, respectively, and the expense ratios for the respective 2000 and 1999 periods were 34.0% and 34.3%.
Lloyd's Operations
Gross premiums written by the Company's Lloyd's segment were $104.3 million in the third quarter of 2000 versus $146.9 million in the third quarter of 1999. Net premiums earned were $93.4 million in the third quarter of 2000 versus $95.1 million in the same period of 1999. The combined ratio was 105.6% in the third
quarter of 2000 compared with 107.3% in the third quarter of 1999. The Lloyd's segment had loss ratios of 65.3% and 76.3% and expense ratios of 40.3% and 31.0% in the third quarters of 2000 and 1999, respectively.
Gross premiums written by the Company's Lloyd's segment were $399.9 million during the first nine months of 2000 versus $480.2 million during the first nine months of 1999. Net premiums earned were $291.6 million during the first nine months of 2000 versus $269.3 million in the same period of 1999. The combined ratio was 106.1% for the first nine months of 2000 compared with 111.9% for the same period in 1999. The Lloyd's segment had loss ratios of 70.2% and 78.2% and expense ratios of 35.9% and 33.7% during the first nine months of 2000 and 1999, respectively.
Financial Services
The financial services segment had gross premiums written of $30.0 million in the third quarter of 2000 compared with $5.8 million in 1999's third quarter. For the first nine months of 2000, gross premiums written were $50.8 million compared with $22.8 million in 1999's first nine months.
Net premiums earned were $5.5 million in the third quarter of 2000 compared with $2.9 million in the third quarter of 1999. Net premiums earned were $18.5 million in the first nine months of 2000 compared with $15.3 million in the first nine months of 1999.
The combined ratios were 141.3% and 122.7% in the third quarters of 2000 and 1999, respectively. The loss ratios for the same periods were 26.4% and 28.2%, respectively, and the related expense ratios were 114.9% and 94.5%, respectively. The combined ratio for the Financial Services segment would have been 113.5% if the fee income from financial guarantees written in swap form were included in net premiums earned for purposes of calculating the underwriting expense ratio. For the first nine months of 2000 and 1999, respectively, the combined ratios were 126.9% and 82.8%. The loss ratios for the first nine months of 2000 and 1999 were 25.5% and 24.6%, respectively, and related expense ratios were 101.4% and 58.2%, respectively. If fee income relating to financial guarantees written in swap form were included in the expense ratio calculation for the nine months of 2000, the combined ratio for the Financial Services segment would have been 99.8%.
XL Capital Ltd, through its operating subsidiaries, is a leading provider of insurance and reinsurance coverages and financial products to industrial, commercial and professional service firms, insurance companies and other enterprises on a worldwide basis. Additional unaudited supplemental financial information relating to the Company's 1999 and 2000 results is available on its web site: www.xl-capital.com
This press release contains forward-looking statements. Statements that are not historical facts, including statements about the Company's beliefs or expectations, are forward-looking statements. These statements are based on current plans, estimates and expectations. Accordingly forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. Forward-looking statements concerning the estimated amount of the one-time charge to be incurred in connection with the realignment, prospects for rate or price increases, premium growth,
future earnings and reserves are particularly sensitive to factors such as actual charges or costs associated with the realignment being larger than currently anticipated, the levels of competition in the industry, the frequency and severity of claims and losses, conditions in the world's financial and capital markets affecting the Company's investment performance, changes in the economic, regulatory or tax environment in which the Company operates, and other factors identified in the Company's most recent annual report on Form 10-K and other documents on file with theSecurities and Exchange Commission that could cause actual results to differ materially from those contained in forward-looking statements. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
XL Capital Ltd, through its operating subsidiaries, is a leading provider of insurance and reinsurance coverages and financial products to industrial, commercial and professional service firms, insurance companies and other enterprises on a worldwide basis. Additional information on XL is available at: www.xl-capital.com http://www.xl-capital.com.