Axis Capital bucks underperformance trend

Bermuda-based Axis Capital surpassed analysts’ forecasts with its Q2 results as it continues to rebalance its portfolio.

The company’s operating income grew to $173 million, compared with $50 million for the prior year quarter. Net income rose to $191 million for the second quarter, compared with $72 million for the second quarter of 2013.

Axis saw gross premiums written increase by 1 percent to $1.2 billion, with growth of 9 percent in its reinsurance segment. This was partially offset by a decrease of 3 percent in its insurance business.

The company’s combined ratio for the quarter was 90.8 percent, an improvement on the 101.7 percent in the prior year quarter.

Albert Benchimol, president and chief executive officer of Axis Capital, said: "AXIS reported strong results for the second quarter, with operating income of $1.63 per diluted share, annualised operating ROE of 13.1 percent and diluted book value per share of $49.69 at the end of the quarter. Adjusted for dividends, diluted book value grew 6 percent during the quarter and 19 percent over last year. Underlying these results is the continued rebalancing of our portfolio toward lower volatility and non-correlating lines creating greater efficiency of capital overall.

“During this year, we have already repurchased 7 million shares, representing 6 percent of our opening equity, for $318 million, in addition to distributing $59 million in dividends to shareholders.

“Despite more challenging market conditions, I am highly confident in the power of our market presence and our delivery of service and technical know-how. We remain well positioned to access and win high quality business in all key markets. These attributes, combined with gains we expect to reap heading into 2015 from our various initiatives, independent of the property and casualty pricing cycle, will support our achievement of superior results with less volatility.”