XL Capital Q1 profits down 57%

by David Masters

Story link: XL Capital Q1 profits down 57%

XL Capital, a Bermuda-based reinsurer, has reported its first quarter results, with income down 57% compared to the same period in 2007.

The company reported a first quarter income of $244.4 million, down from $562.5 million in 2007.

Excluding net realised gains and losses, profit stood at $276.9 million, compared to $540 million the previous year.

That equates to $1.57 per share, down from $3.01 per share in 2007, and also significantly lower than analysts’ predictions of $2.23 per share. After the results were announced, XL’s share price fell 6.5%

The company has attributed the fall in profits to a $107.1 million decrease in net income from investment affiliates, net realised losses on investments of $102.3 million, a $52.4 million decrease in underwriting profit from casualty and property operations, a $44.2 million increase in foreign exchange losses, and a $39.6 million decrease in net income from financial operating affiliates.

CEO and acting chairman Brian O’Hara has said that the company is “steadily navigating” an “extremely difficult global credit market.” Despite the fall in profits, he called the results a “solid performance.”