Argo reports 2019 loss but CEO Rehnberg promises a brighter future
Re/insurer Argo has reported a loss for 2019, with a significantly worsened combine ratio. Kevin Rehnberg, who was recently appointed as permanent CEO of the business, said the results are not indicative of the company’s future direction.
Gross written premiums for 2019 were $3.1 billion, compared with $2.9 billion in 2018. Its combined ratio was 109.1 percent, compared to 97.9 percent in 2018. The company made a net loss of $8.4 million, compared to a net income of $63.6 million in 2018.
“We believe our organisation has great potential, but our results for 2019 are not indicative of our future direction,” said Rehnberg. “Immediately upon my appointment as Interim CEO in November, we started a review process of all of Argo’s operations. That review process is ongoing. The company has a strong foundation of specialty insurance and reinsurance businesses, focused largely on the most attractive specialty market – US domiciled risks. The core of this foundation is not going to change, but it can certainly be enhanced. Some of our businesses are performing very well today, while others are not meeting return expectations. We are acting swiftly to address areas where the available return prospects are not achievable in the near term and do not fit our focused strategic direction.
“Going forward, we are insisting upon a culture of results and accountability, as well as a set of operating principles that will help us to be a more focused and efficient organisation. We are eliminating unnecessary spending and will deploy capital more strategically going forward. We believe Argo has an excellent specialty platform and world-class talent. We intend to work together to aggressively pursue our financial targets and deliver an improving return on equity over the near and long term. We look forward to sharing more about this strategy on our earnings call tomorrow and throughout the rest of the year.”
Thomas Bradley, chairman-elect of the Argo board of directors, added: “The board is fully supportive of Kevin’s vision for the company and impressed by all that has been achieved over the past few months, and we welcome him as Argo’s permanent CEO. He and the team have a strong track record of operational excellence and noteworthy results in the US.
We are confident in Kevin’s ability to execute those strategies companywide. We believe the Argo management team has been strengthened by recent hires, and we are confident in their ability to deliver on the company’s commitments to customers, employees and shareholders.”
