AXIS Capital CEO Benchimol praises ‘strong’ Q2 2019 results as net income grows

Bermuda-based re/insurer AXIS Capital's CEO reports “strong” second quarter results were “made possible” by continuing improvement in core underwriting margins, operating return on equity of 12.3 percent, and a 6 percent growth in book value per share.

The firm's net income rose to $166 million in Q2 2019 up from $93 million in the same three months in the previous year. The net income for the first half of the year also rose to $265 million from $155 million in the first six months of 2018.

However, in Q2 2019 gross premiums written (GPW) fell by $3 million to $1.647 billion from $1.650 billion in Q2 2018, although AXIS reported that on a constant currency basis this would have been an increase of $21 million or 1 percent.

The re/insurer said the change in GPW was caused by a decrease of $58 million or 6 percent in the insurance segment and an increase of $55 million, or 9 percent in the reinsurance segment.

“The increase in gross premiums written on a constant currency basis was principally due to improved market penetration in Japan which increased the reinsurance segment's gross premiums written, partially offset by a decrease in gross premiums written in the insurance segment due to the repositioning of the segment’s property book,” the company said.

The combined ratio increased by 3 percentage points to 96.1 percent in Q2 2019 up from 93.1 percent in the same quarter a year before.

Albert Benchimol, president and CEO of AXIS Capital, said he was pleased with the “strong” second quarter results, which he said were "made possible by continuing improvement in core underwriting margins, operating return on equity of 12.3 percent ex PGAAP, and 6 percent growth in book value per share".

He added: "Our results speak to the progress made as we continue executing on our strategy to strengthen our market position and improve our underwriting profitability, which includes disciplined corrective actions on under-performing business, and reducing portfolio volatility. Furthermore, the actions we have taken to enhance our franchise in our chosen markets give us excellent opportunities for profitable growth. With our strong presence at Lloyd’s, US E&S markets, professional lines and global reinsurance, we believe AXIS is in a superior position to take advantage of the necessary firming in re/insurance markets.

"In addition, we are continuing to invest in technology and data and analytics - all to enhance our ability to deliver differentiated service and value to our clients and partners in distribution.

"While there is more work that needs to be done, we’re on the right path and are seeing tangible results as we continue to advance on our strategy and focus on driving long-term profitable growth and increased shareholder value."

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