Validus Posts Q2 Net of $70.8 Million

Bermuda’s Validus Holdings Limited reported net income for the quarter ended June 30, 2007 of $70.8 million, or $1.17 per diluted common share, compared with $29.7 million, or $0.51 per diluted common share, for the quarter ended June 30, 2006. Net income for the six months ended June 30, 2007 was $127.5 million, or $2.11 per diluted share, compared with $44.4 million, or $0.76 per diluted share, for the corresponding period in 2006.

The earnings report explained that the “Validus data for 2006 and 2007 refer only to the company prior to its acquisition of Talbot Holdings Ltd. (Talbot). As part of this release, the second quarter and six months ended June 30, 2007 results of Talbot will be reported separately. Further, the Validus data do not give effect to the initial public offering of 15,244,888 common shares, which was consummated on July 30, 2007” (See IJ web site May 16, Aug.1).

Operating income, which excludes capital gains/losses, for the second quarter of 2007 was $75.2 million, or $1.24 per diluted share, compared with $29.3 million, or $0.50 per diluted common share, for the quarter ended June 30, 2006. Operating income for the six months ended June 30, 2007 was $128.8 million, or $2.13 per diluted share, compared with $44.5 million, or $0.76 per diluted common share, for the six months ended June 30, 2006.

Validus also listed the following additional Q2 results:
— Gross premiums written increased by 57.6 percent to $174.3 million;
— Net premiums written increased by 57.5 percent to $147.5 million;
— Net premiums earned increased by 100.2 percent to $133.0 million;
— Combined ratio of 55.3 percent;
— Investment income increased by 49.7 percent to $19.7 million primarily due to a combination of higher investment balances and higher investment yields;
— Annualized return on average equity of 22.0 percent;
— Annualized operating return on average equity of 23.4 percent.

Operating highlights for the first half of the year included the following:
— Gross premiums written increased by 54.0 percent to $552.4 million;
— Net premiums written increased by 48.3 percent to $494.6 million;
— Net premiums earned increased by 124.6 percent to $244.5 million;
— Combined ratio of 59.5 percent;
— Investment income increased by 58.7 percent to $38.2 million;
— Annualized return on average equity of 20.3 percent; and
— Annualized operating return on average equity of 20.5 percent.

Chairman and CEO Ed Noonan commented: “We are pleased to report an annualized operating return on average equity in the quarter of 23.4 percent. Our results in the quarter reflect strong and stable underwriting results, increasing investment income and the broad diversification in our Validus Re portfolio despite industry loss activity in the quarter.”

The full report, additional information as well as the report from Talbot is available on the Company’s web site at: http://www.validusre.bm. A replay of the earnings conference call, held Friday Aug. 10 is also available on the web site, or by dialing (877) 660-6853 (toll-free) or (201) 612-7415 (international) and entering account number 286 and pass code 250641.

Source: Validus