COPY OF THE COMPANY'S FINANCIAL SUPPLEMENT
Published on April 30, 2009
Exhibit 99.2
| RenaissanceRe Holdings Ltd. | ||
| Financial Supplement | ||
| March 31, 2009 | ||
| Contact: | ||
| Investors: | ||
| RenaissanceRe Holdings Ltd. | ||
| Fred R. Donner, Chief Financial Officer and Executive Vice President 441-295-4513 |
||
| Media: | ||
| Kekst and Company | ||
| David Lilly or Dawn Dover | ||
| 212-521-4800
|
||
RenaissanceRe Holdings Ltd.
Contents
| Page(s) | ||||
| Basis of Presentation | i | |||
| Financial Highlights | 1 | |||
| Income Statements | ||||
| a. |
Summary Consolidated Statements of Operations | 2 | ||
| b. |
Consolidated Segment Underwriting Results | 3 | ||
| c. |
Reinsurance Segment - Catastrophe and Specialty Underwriting Results | 4 | ||
| d. |
Reinsurance Segment - Gross Premiums Written | 5 | ||
| e. |
Individual Risk Segment - Gross Premiums Written | 6 | ||
| f. |
DaVinciRe Holdings Ltd. and Subsidiary Consolidated Statements of Operations | 7 | ||
| Balance Sheets | ||||
| a. |
Summary Consolidated Balance Sheets | 8 | ||
| Investments | ||||
| a. |
Composition of Investment Portfolio | 9 | ||
| b. |
Summary of Other Investments | 10 | ||
| c. |
Investment Result | 11 | ||
| Loss Reserve Analysis | ||||
| a. |
Reserves for Claims and Claim Expenses | 12 | ||
| b. |
Paid to Incurred Analysis | 13 | ||
| Other Items | ||||
| a. |
Equity in Earnings of Other Ventures | 14 | ||
| b. |
Ratings | 15 | ||
| Comments on Regulation G |
16-17 | |||
|
RenaissanceRe Holdings Ltd.
Basis of Presentation
This financial supplement includes certain non-GAAP financial measures including operating income, operating income per common share - diluted, operating return on average common equity - annualized, managed catastrophe premium, tangible book value per common share and tangible book value per common share plus accumulated dividends. A reconciliation of such measures to the most comparable GAAP figures in accordance with Regulation G is presented in the attached supplemental financial data. See pages 16 and 17 for Comments on Regulation G.
RenaissanceRe Holdings Ltd. is a global provider of reinsurance and insurance. The Companys business consists of two segments: (1) Reinsurance, which includes catastrophe reinsurance, specialty reinsurance and certain joint ventures and other investments managed by the Companys subsidiary RenaissanceRe Ventures Ltd., and (2) Individual Risk, which includes primary insurance and quota share reinsurance.
Cautionary Statement under Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995: Statements made in this release contain information about the Companys future business prospects. These statements may be considered forward-looking. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements. For further information regarding cautionary statements and factors affecting future results, please refer to RenaissanceRe Holdings Ltd.s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2008 and its quarterly reports on Form 10-Q .
All information contained herein is unaudited, except for the financial data relating to the balance sheet for the year ended December 31, 2008. Unless otherwise noted, dollar amounts are in thousands, except for share and per share amounts and ratio information. Certain prior period comparatives have been reclassified to conform to the current presentation. This supplement is being provided for informational purposes only. It should be read in conjunction with documents filed by RenaissanceRe Holdings Ltd. with the Securities and Exchange Commission, including the Annual Report on Form 10-K for 2008 and its quarterly reports on Form 10-Q . Please refer to the Companys website at www.renre.com for further information about RenaissanceRe Holdings Ltd.
| i |
|
RenaissanceRe Holdings Ltd.
Financial Highlights
| Three months ended March 31, |
||||||||
| 2009 | 2008 | |||||||
| Highlights |
||||||||
| Gross premiums written |
$ | 598,301 | $ | 527,038 | ||||
| Net premiums written |
446,836 | 403,116 | ||||||
| Net premiums earned |
301,748 | 308,914 | ||||||
| Net claims and claim expenses incurred |
86,197 | 82,156 | ||||||
| Underwriting income |
131,190 | 150,217 | ||||||
| Net investment income |
42,126 | 52,503 | ||||||
| Net income available to RenaissanceRe common shareholders |
97,284 | 137,165 | ||||||
| Net realized gains (losses) on investments |
3,104 | (10,670 | ) | |||||
| Operating income available to RenaissanceRe common shareholders (1) |
94,180 | 147,835 | ||||||
| Total assets |
$ | 8,059,909 | $ | 8,169,942 | ||||
| Total shareholders equity |
$ | 3,121,403 | $ | 3,385,952 | ||||
| Per share data |
||||||||
| Net income available to RenaissanceRe common shareholders per common share - diluted |
$ | 1.57 | $ | 2.05 | ||||
| Operating income available to RenaissanceRe common shareholders per common share - diluted (1) |
$ | 1.52 | $ | 2.21 | ||||
| Dividends per common share |
$ | 0.24 | $ | 0.23 | ||||
| Book value per common share |
$ | 39.65 | $ | 42.14 | ||||
| Adjustment for goodwill and other intangibles (1) |
(1.93 | ) | (0.09 | ) | ||||
| Tangible book value per common share (1) |
37.72 | 42.05 | ||||||
| Accumulated dividends per common share |
8.16 | 7.23 | ||||||
| Tangible book value per common share plus accumulated dividends (1) |
$ | 45.88 | $ | 49.28 | ||||
| Financial ratios |
||||||||
| Net claims and claim expense ratio - current accident year |
26.2 | % | 41.2 | % | ||||
| Net claims and claim expense ratio - prior accident years |
2.4 | % | (14.6 | %) | ||||
| Net claims and claim expense ratio - calendar year |
28.6 | % | 26.6 | % | ||||
| Underwriting expense ratio |
27.9 | % | 24.8 | % | ||||
| Combined ratio |
56.5 | % | 51.4 | % | ||||
| Operating return on average common equity - annualized (1) |
15.5 | % | 21.3 | % | ||||
| (1) | See Comments on Regulation G for a reconciliation of non-GAAP financial measures. |
| 1 |
|
RenaissanceRe Holdings Ltd.
Summary Consolidated Statements of Operations - Quarter to Date
| Three months ended | ||||||||||||||||||||
| March 31, 2009 |
December 31, 2008 |
September 30, 2008 |
June 30, 2008 |
March 31, 2008 |
||||||||||||||||
| Revenues |
||||||||||||||||||||
| Gross premiums written |
$ | 598,301 | $ | 161,609 | $ | 239,806 | $ | 807,575 | $ | 527,038 | ||||||||||
| Net premiums written |
$ | 446,836 | $ | 142,074 | $ | 194,408 | $ | 614,022 | $ | 403,116 | ||||||||||
| (Increase) decrease in unearned premiums |
(145,088 | ) | 179,921 | 184,934 | (237,449 | ) | (94,202 | ) | ||||||||||||
| Net premiums earned |
301,748 | 321,995 | 379,342 | 376,573 | 308,914 | |||||||||||||||
| Net investment income (loss) |
42,126 | (82,724 | ) | 15,767 | 38,685 | 52,503 | ||||||||||||||
| Net foreign exchange (losses) gains |
(10,155 | ) | (5,553 | ) | 3,448 | (231 | ) | 4,936 | ||||||||||||
| Equity in earnings of other ventures |
1,736 | 148 | 2,333 | 4,872 | 6,250 | |||||||||||||||
| Other (loss) income |
(14,795 | ) | 6 | 2,258 | (24 | ) | 8,012 | |||||||||||||
| Net realized gains (losses) on investments |
3,104 | (83,873 | ) | (87,610 | ) | (24,161 | ) | (10,670 | ) | |||||||||||
| Total revenues |
323,764 | 149,999 | 315,538 | 395,714 | 369,945 | |||||||||||||||
| Expenses |
||||||||||||||||||||
| Net claims and claim expenses incurred |
86,197 | 28,769 | 535,347 | 114,217 | 82,156 | |||||||||||||||
| Acquisition expenses |
44,604 | 59,281 | 54,231 | 53,613 | 46,428 | |||||||||||||||
| Operational expenses |
39,757 | 28,262 | 30,296 | 33,494 | 30,113 | |||||||||||||||
| Corporate expenses |
6,588 | 6,705 | 3,116 | 7,111 | 8,703 | |||||||||||||||
| Interest expense |
4,136 | 6,513 | 5,379 | 5,937 | 6,804 | |||||||||||||||
| Total expenses |
181,282 | 129,530 | 628,369 | 214,372 | 174,204 | |||||||||||||||
| Income (loss) before taxes |
142,482 | 20,469 | (312,831 | ) | 181,342 | 195,741 | ||||||||||||||
| Income tax benefit (expense) |
852 | 368 | 455 | 6,295 | (7,686 | ) | ||||||||||||||
| Net income (loss) |
143,334 | 20,837 | (312,376 | ) | 187,637 | 188,055 | ||||||||||||||
| Net (income) loss attributable to redeemable noncontrolling interest - DaVinciRe |
(35,475 | ) | (65,454 | ) | 91,977 | (41,341 | ) | (40,315 | ) | |||||||||||
| Net income (loss) attributable to RenaissanceRe |
107,859 | (44,617 | ) | (220,399 | ) | 146,296 | 147,740 | |||||||||||||
| Dividends on preference shares |
(10,575 | ) | (10,575 | ) | (10,575 | ) | (10,575 | ) | (10,575 | ) | ||||||||||
| Net income (loss) available (attributable) to RenaissanceRe common shareholders |
$ | 97,284 | $ | (55,192 | ) | $ | (230,974 | ) | $ | 135,721 | $ | 137,165 | ||||||||
| Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted (1) |
$ | 1.52 | $ | 0.47 | $ | (2.35 | ) | $ | 2.50 | $ | 2.21 | |||||||||
| Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - basic |
$ | 1.57 | $ | (0.91 | ) | $ | (3.79 | ) | $ | 2.16 | $ | 2.09 | ||||||||
| Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted |
$ | 1.57 | $ | (0.91 | ) | $ | (3.79 | ) | $ | 2.13 | $ | 2.05 | ||||||||
| Net claims and claim expense ratio |
28.6 | % | 8.9 | % | 141.1 | % | 30.3 | % | 26.6 | % | ||||||||||
| Underwriting expense ratio |
27.9 | % | 27.2 | % | 22.3 | % | 23.2 | % | 24.8 | % | ||||||||||
| Combined ratio |
56.5 | % | 36.1 | % | 163.4 | % | 53.5 | % | 51.4 | % | ||||||||||
| Operating return on average common equity - annualized (1) |
15.5 | % | 4.8 | % | (22.4 | %) | 23.4 | % | 21.3 | % | ||||||||||
| (1) | See Comments on Regulation G for a reconciliation of non-GAAP financial measures. |
| 2 |
|
RenaissanceRe Holdings Ltd.
Consolidated Segment Underwriting Results - Quarter to Date
| Three months ended March 31, 2009 | |||||||||||||||
| Reinsurance | Individual Risk | Eliminations (1) | Total | ||||||||||||
| Gross premiums written |
$ | 532,916 | $ | 65,149 | $ | 236 | $ | 598,301 | |||||||
| Net premiums written |
$ | 414,787 | $ | 32,049 | $ | 446,836 | |||||||||
| Net premiums earned |
$ | 225,971 | $ | 75,777 | $ | 301,748 | |||||||||
| Net claims and claim expenses incurred |
16,571 | 69,626 | 86,197 | ||||||||||||
| Acquisition expenses |
19,021 | 25,583 | 44,604 | ||||||||||||
| Operational expenses |
29,115 | 10,642 | 39,757 | ||||||||||||
| Underwriting income (loss) |
$ | 161,264 | $ | (30,074 | ) | $ | 131,190 | ||||||||
| Net claims and claim expenses incurred - current accident year |
$ | 41,306 | $ | 37,629 | $ | 78,935 | |||||||||
| Net claims and claim expenses incurred - prior accident years |
(24,735 | ) | 31,997 | 7,262 | |||||||||||
| Net claims and claim expenses incurred - total |
$ | 16,571 | $ | 69,626 | $ | 86,197 | |||||||||
| Net claims and claim expense ratio - current accident year |
18.3 | % | 49.7 | % | 26.2 | % | |||||||||
| Net claims and claim expense ratio - prior accident years |
(11.0 | %) | 42.2 | % | 2.4 | % | |||||||||
| Net claims and claim expense ratio - calendar year |
7.3 | % | 91.9 | % | 28.6 | % | |||||||||
| Underwriting expense ratio |
21.3 | % | 47.8 | % | 27.9 | % | |||||||||
| Combined ratio |
28.6 | % | 139.7 | % | 56.5 | % | |||||||||
| Three months ended March 31, 2008 | |||||||||||||||
| Reinsurance | Individual Risk | Eliminations (1) | Total | ||||||||||||
| Gross premiums written |
$ | 443,728 | $ | 80,821 | $ | 2,489 | $ | 527,038 | |||||||
| Net premiums written |
$ | 342,920 | $ | 60,196 | $ | 403,116 | |||||||||
| Net premiums earned |
$ | 232,227 | $ | 76,687 | $ | 308,914 | |||||||||
| Net claims and claim expenses incurred |
47,069 | 35,087 | 82,156 | ||||||||||||
| Acquisition expenses |
18,515 | 27,913 | 46,428 | ||||||||||||
| Operational expenses |
21,139 | 8,974 | 30,113 | ||||||||||||
| Underwriting income |
$ | 145,504 | $ | 4,713 | $ | 150,217 | |||||||||
| Net claims and claim expenses incurred - current accident year |
$ | 70,576 | $ | 56,665 | $ | 127,241 | |||||||||
| Net claims and claim expenses incurred - prior accident years |
(23,507 | ) | (21,578 | ) | (45,085 | ) | |||||||||
| Net claims and claim expenses incurred - total |
$ | 47,069 | $ | 35,087 | $ | 82,156 | |||||||||
| Net claims and claim expense ratio - current accident year |
30.4 | % | 73.9 | % | 41.2 | % | |||||||||
| Net claims and claim expense ratio - prior accident years |
(10.1 | %) | (28.1 | %) | (14.6 | %) | |||||||||
| Net claims and claim expense ratio - calendar year |
20.3 | % | 45.8 | % | 26.6 | % | |||||||||
| Underwriting expense ratio |
17.0 | % | 48.1 | % | 24.8 | % | |||||||||
| Combined ratio |
37.3 | % | 93.9 | % | 51.4 | % | |||||||||
| (1) | Represents gross premiums ceded from the Individual Risk segment to the Reinsurance segment. |
| 3 |
|
RenaissanceRe Holdings Ltd.
Reinsurance Segment - Catastrophe and Specialty Underwriting Results
| Three months ended March 31, 2009 | Three months ended March 31, 2008 | |||||||||||||||||||||||
| Catastrophe | Specialty | Total | Catastrophe | Specialty | Total | |||||||||||||||||||
| Gross premiums written |
$ | 461,416 | $ | 71,500 | $ | 532,916 | $ | 364,146 | $ | 79,582 | $ | 443,728 | ||||||||||||
| Net premiums written |
$ | 347,443 | $ | 67,344 | $ | 414,787 | $ | 263,338 | $ | 79,582 | $ | 342,920 | ||||||||||||
| Net premiums earned |
$ | 185,125 | $ | 40,846 | $ | 225,971 | $ | 173,349 | $ | 58,878 | $ | 232,227 | ||||||||||||
| Net claims and claim expenses incurred |
7,491 | 9,080 | 16,571 | 30,489 | 16,580 | 47,069 | ||||||||||||||||||
| Acquisition expenses |
10,423 | 8,598 | 19,021 | 3,639 | 14,876 | 18,515 | ||||||||||||||||||
| Operational expenses |
22,601 | 6,514 | 29,115 | 16,385 | 4,754 | 21,139 | ||||||||||||||||||
| Underwriting income |
$ | 144,610 | $ | 16,654 | $ | 161,264 | $ | 122,836 | $ | 22,668 | $ | 145,504 | ||||||||||||
| Net claims and claim expenses incurred - current accident year |
$ | 19,807 | $ | 21,499 | $ | 41,306 | $ | 30,189 | $ | 40,387 | $ | 70,576 | ||||||||||||
| Net claims and claim expenses incurred - prior accident years |
(12,316 | ) | (12,419 | ) | (24,735 | ) | 300 | (23,807 | ) | (23,507 | ) | |||||||||||||
| Net claims and claim expenses incurred - total |
$ | 7,491 | $ | 9,080 | $ | 16,571 | $ | 30,489 | $ | 16,580 | $ | 47,069 | ||||||||||||
| Net claims and claim expense ratio - current accident year |
10.7 | % | 52.6 | % | 18.3 | % | 17.4 | % | 68.6 | % | 30.4 | % | ||||||||||||
| Net claims and claim expense ratio - prior accident years |
(6.7 | %) | (30.4 | %) | (11.0 | %) | 0.2 | % | (40.4 | %) | (10.1 | %) | ||||||||||||
| Net claims and claim expense ratio - calendar year |
4.0 | % | 22.2 | % | 7.3 | % | 17.6 | % | 28.2 | % | 20.3 | % | ||||||||||||
| Underwriting expense ratio |
17.9 | % | 37.0 | % | 21.3 | % | 11.5 | % | 33.3 | % | 17.0 | % | ||||||||||||
| Combined ratio |
21.9 | % | 59.2 | % | 28.6 | % | 29.1 | % | 61.5 | % | 37.3 | % | ||||||||||||
| 4 |
|
RenaissanceRe Holdings Ltd.
Reinsurance Segment - Gross Premiums Written
| Three months ended | ||||||||||||||||
| Mar. 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
Mar. 31, 2008 |
||||||||||||
| Renaissance catastrophe premiums |
$ | 289,630 | $ | 19,487 | $ | 97,839 | $ | 291,317 | $ | 224,968 | ||||||
| Renaissance specialty premiums |
68,973 | 26,875 | 28,408 | 22,955 | 75,463 | |||||||||||
| Total Renaissance premiums |
358,603 | 46,362 | 126,247 | 314,272 | 300,431 | |||||||||||
| DaVinci catastrophe premiums |
171,786 | 5,070 | 43,413 | 173,349 | 139,178 | |||||||||||
| DaVinci specialty premiums |
2,527 | 1,975 | (197 | ) | 172 | 4,119 | ||||||||||
| Total DaVinci premiums |
174,313 | 7,045 | 43,216 | 173,521 | 143,297 | |||||||||||
| Total Reinsurance premiums |
$ | 532,916 | $ | 53,407 | $ | 169,463 | $ | 487,793 | $ | 443,728 | ||||||
| Total specialty premiums (1) |
$ | 71,500 | $ | 28,850 | $ | 28,211 | $ | 23,127 | $ | 79,582 | ||||||
| Total catastrophe premiums |
$ | 461,416 | $ | 24,557 | $ | 141,252 | $ | 464,666 | $ | 364,146 | ||||||
| Catastrophe premiums written on behalf of our joint venture, Top Layer Re (2) |
23,792 | | (293 | ) | 24,042 | 31,621 | ||||||||||
| Catastrophe premiums assumed from the Individual Risk segment |
236 | 244 | (13,342 | ) | 4,937 | 2,489 | ||||||||||
| Total managed catastrophe premiums (3) |
$ | 485,444 | $ | 24,801 | $ | 127,617 | $ | 493,645 | $ | 398,256 | ||||||
| (1) | Total specialty premiums written includes $nil, $nil, $nil, $nil and $nil of premiums assumed from the Individual Risk segment for the three months ended March 31, 2009, December 31, 2008, September 30, 2008, June 30, 2008 and March 31, 2008, respectively. |
| (2) | Top Layer Re is accounted for under the equity method of accounting. |
| (3) | See Comments on Regulation G for a reconciliation of non-GAAP financial measures. |
| 5 |
|
RenaissanceRe Holdings Ltd.
Individual Risk Segment - Gross Premiums Written
| Three months ended | |||||||||||||||
| Mar. 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
|||||||||||
| By Line of Business |
|||||||||||||||
| Commercial multi-line |
$ | 24,642 | $ | 27,131 | $ | 29,773 | $ | 31,699 | $ | 31,384 | |||||
| Personal lines property |
16,234 | 10,543 | 17,168 | 19,239 | 13,212 | ||||||||||
| Commercial property |
16,121 | 18,055 | 24,863 | 60,830 | 30,853 | ||||||||||
| Multi-peril crop |
8,152 | 52,229 | 11,881 | 203,077 | 5,372 | ||||||||||
| Total Individual Risk premiums |
$ | 65,149 | $ | 107,958 | $ | 83,685 | $ | 314,845 | $ | 80,821 | |||||
| 6 |
|
DaVinciRe Holdings Ltd. and Subsidiary
Consolidated Statements of Operations
| Three months ended | ||||||||||||||||||||
| Mar. 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
Mar. 31, 2008 |
||||||||||||||||
| Revenues |
||||||||||||||||||||
| Gross premiums written |
$ | 174,313 | $ | 7,045 | $ | 43,216 | $ | 173,521 | $ | 143,297 | ||||||||||
| Net premiums written |
$ | 149,125 | $ | 5,071 | $ | 38,485 | $ | 163,390 | $ | 134,251 | ||||||||||
| (Increase) decrease in unearned premiums |
(69,479 | ) | 71,459 | 61,787 | (85,705 | ) | (56,378 | ) | ||||||||||||
| Net premiums earned |
79,646 | 76,530 | 100,272 | 77,685 | 77,873 | |||||||||||||||
| Net investment income (loss) |
8,862 | (211 | ) | 12,149 | 15,183 | 15,964 | ||||||||||||||
| Net foreign exchange (losses) gains |
(3,332 | ) | (717 | ) | 124 | (559 | ) | 1,763 | ||||||||||||
| Other income (loss) |
90 | (1,370 | ) | (114 | ) | (1,258 | ) | (217 | ) | |||||||||||
| Net realized gains (losses) on investments |
1,236 | (9,195 | ) | (20,330 | ) | (3,765 | ) | (3,221 | ) | |||||||||||
| Total revenues |
86,502 | 65,037 | 92,101 | 87,286 | 92,162 | |||||||||||||||
| Expenses |
||||||||||||||||||||
| Net claims and claim expenses incurred (recovered) |
1,792 | (35,507 | ) | 202,378 | 3,001 | 12,421 | ||||||||||||||
| Acquisition expenses |
15,760 | 9,377 | 2,706 | 20,929 | 17,094 | |||||||||||||||
| Operational and corporate expenses |
10,427 | 3,943 | 4,325 | 8,060 | 7,811 | |||||||||||||||
| Interest expense |
1,145 | 2,495 | 1,754 | 1,782 | 2,647 | |||||||||||||||
| Total expenses |
29,124 | (19,692 | ) | 211,163 | 33,772 | 39,973 | ||||||||||||||
| Net income (loss) |
57,378 | 84,729 | (119,062 | ) | 53,514 | 52,189 | ||||||||||||||
| Net (income) loss attributable to redeemable noncontrolling interest |
(117 | ) | (175 | ) | 235 | (111 | ) | (111 | ) | |||||||||||
| Net income (loss) available (attributable) to DaVinciRe common shareholders |
$ | 57,261 | $ | 84,554 | $ | (118,827 | ) | $ | 53,403 | $ | 52,078 | |||||||||
| Net claims and claim expenses incurred - current accident year |
$ | 7,675 | $ | 1,764 | $ | 213,116 | $ | 10,171 | $ | 12,314 | ||||||||||
| Net claims and claim expenses incurred - prior accident years |
(5,883 | ) | (37,271 | ) | (10,738 | ) | (7,170 | ) | 107 | |||||||||||
| Net claims and claim expenses incurred - total |
$ | 1,792 | $ | (35,507 | ) | $ | 202,378 | $ | 3,001 | $ | 12,421 | |||||||||
| Net claims and claim expense ratio - current accident year |
9.6 | % | 2.3 | % | 212.5 | % | 13.1 | % | 15.8 | % | ||||||||||
| Net claims and claim expense ratio - prior accident years |
(7.4 | %) | (48.7 | %) | (10.7 | %) | (9.2 | %) | 0.2 | % | ||||||||||
| Net claims and claim expense ratio - calendar year |
2.2 | % | (46.4 | %) | 201.8 | % | 3.9 | % | 16.0 | % | ||||||||||
| Underwriting expense ratio |
32.9 | % | 17.4 | % | 7.0 | % | 37.3 | % | 31.9 | % | ||||||||||
| Combined ratio |
35.1 | % | (29.0 | %) | 208.8 | % | 41.2 | % | 47.9 | % | ||||||||||
| 7 |
|
RenaissanceRe Holdings Ltd.
Summary Consolidated Balance Sheets
| March 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
|||||||||||
| Assets |
|||||||||||||||
| Fixed maturity investments available for sale, at fair value |
$ | 3,164,848 | $ | 2,996,885 | $ | 3,645,294 | $ | 3,775,345 | $ | 3,816,518 | |||||
| Short term investments, at fair value |
2,136,336 | 2,172,343 | 1,438,201 | 1,400,884 | 1,565,589 | ||||||||||
| Other investments, at fair value |
733,023 | 773,475 | 902,328 | 927,247 | 858,621 | ||||||||||
| Investments in other ventures, under equity method |
88,159 | 99,879 | 117,789 | 104,438 | 99,466 | ||||||||||
| Total investments |
6,122,366 | 6,042,582 | 6,103,612 | 6,207,914 | 6,340,194 | ||||||||||
| Cash and cash equivalents |
249,340 | 274,692 | 427,176 | 262,951 | 335,409 | ||||||||||
| Premiums receivable |
593,199 | 565,630 | 728,046 | 965,955 | 499,384 | ||||||||||
| Ceded reinsurance balances |
149,309 | 88,019 | 155,487 | 206,888 | 122,631 | ||||||||||
| Losses recoverable |
201,215 | 299,534 | 300,076 | 191,789 | 151,555 | ||||||||||
| Accrued investment income |
23,927 | 26,614 | 35,134 | 32,976 | 36,337 | ||||||||||
| Deferred acquisition costs |
97,710 | 81,904 | 114,038 | 134,319 | 106,310 | ||||||||||
| Receivable for investments sold |
308,483 | 236,485 | 368,313 | 209,320 | 349,835 | ||||||||||
| Other secured assets |
76,331 | 76,424 | 107,252 | 107,025 | 107,784 | ||||||||||
| Other assets |
165,492 | 217,986 | 178,163 | 156,970 | 114,957 | ||||||||||
| Goodwill and other intangibles |
72,537 | 74,181 | 71,942 | 74,169 | 5,546 | ||||||||||
| Total assets |
$ | 8,059,909 | $ | 7,984,051 | $ | 8,589,239 | $ | 8,550,276 | $ | 8,169,942 | |||||
| Liabilities, Redeemable Noncontrolling Interest and Shareholders Equity | |||||||||||||||
| Liabilities |
|||||||||||||||
| Reserve for claims and claim expenses |
$ | 1,992,049 | $ | 2,160,612 | $ | 2,433,420 | $ | 2,009,803 | $ | 1,986,006 | |||||
| Reserve for unearned premiums |
716,613 | 510,235 | 757,624 | 993,959 | 673,991 | ||||||||||
| Debt |
450,000 | 450,000 | 450,000 | 450,000 | 450,999 | ||||||||||
| Reinsurance balances payable |
289,522 | 315,401 | 360,829 | 408,775 | 263,700 | ||||||||||
| Payable for investments purchased |
590,401 | 378,111 | 545,100 | 247,482 | 387,838 | ||||||||||
| Other secured liabilities |
77,420 | 77,420 | 106,420 | 106,420 | 106,420 | ||||||||||
| Other liabilities |
171,738 | 290,998 | 195,071 | 165,905 | 156,185 | ||||||||||
| Total liabilities |
4,287,743 | 4,182,777 | 4,848,464 | 4,382,344 | 4,025,139 | ||||||||||
| Redeemable noncontrolling interest - DaVinciRe |
650,763 | 768,531 | 699,534 | 794,499 | 758,851 | ||||||||||
| Shareholders Equity |
|||||||||||||||
| Preference shares |
650,000 | 650,000 | 650,000 | 650,000 | 650,000 | ||||||||||
| Common shares |
62,324 | 61,503 | 61,401 | 62,862 | 64,927 | ||||||||||
| Additional paid-in capital |
11,373 | | | | | ||||||||||
| Accumulated other comprehensive income |
69,530 | 75,387 | 16,544 | 35,562 | 65,363 | ||||||||||
| Retained earnings |
2,328,176 | 2,245,853 | 2,313,296 | 2,625,009 | 2,605,662 | ||||||||||
| Total shareholders equity |
3,121,403 | 3,032,743 | 3,041,241 | 3,373,433 | 3,385,952 | ||||||||||
| Total liabilities, redeemable noncontrolling interest and shareholders equity |
$ | 8,059,909 | $ | 7,984,051 | $ | 8,589,239 | $ | 8,550,276 | $ | 8,169,942 | |||||
| Book value per common share |
$ | 39.65 | $ | 38.74 | $ | 38.94 | $ | 43.32 | $ | 42.14 | |||||
| Common shares outstanding |
62,324 | 61,503 | 61,401 | 62,862 | 64,927 | ||||||||||
| 8 |
|
RenaissanceRe Holdings Ltd.
Composition of Investment Portfolio
| March 31, 2009 | Dec. 31, 2008 | Sept. 30, 2008 | June 30, 2008 | Mar. 31, 2008 | |||||||||||||||||||||||||||||||
| TYPE OF INVESTMENT |
|||||||||||||||||||||||||||||||||||
| U.S. treasuries |
$ | 227,594 | 3.7 | % | $ | 467,480 | 7.8 | % | $ | 690,264 | 11.3 | % | $ | 648,806 | 10.5 | % | $ | 881,880 | 13.9 | % | |||||||||||||||
| Agencies |
404,124 | 6.6 | % | 448,521 | 7.4 | % | 419,053 | 6.9 | % | 332,298 | 5.3 | % | 199,993 | 3.2 | % | ||||||||||||||||||||
| Non-U.S. government |
80,921 | 1.3 | % | 57,058 | 0.9 | % | 83,556 | 1.4 | % | 59,168 | 1.0 | % | 80,708 | 1.3 | % | ||||||||||||||||||||
| FDIC guaranteed corporate |
516,115 | 8.4 | % | 207,393 | 3.4 | % | | | | | | | |||||||||||||||||||||||
| Corporate |
518,400 | 8.5 | % | 539,817 | 9.0 | % | 740,013 | 12.1 | % | 886,561 | 14.3 | % | 887,499 | 14.0 | % | ||||||||||||||||||||
| Agency mortgage-backed securities |
990,126 | 16.2 | % | 756,902 | 12.5 | % | 708,269 | 11.6 | % | 630,107 | 10.2 | % | 539,041 | 8.5 | % | ||||||||||||||||||||
| Non-agency mortgage-backed securities |
62,059 | 1.0 | % | 98,672 | 1.6 | % | 220,478 | 3.6 | % | 257,614 | 4.1 | % | 232,310 | 3.7 | % | ||||||||||||||||||||
| Commercial mortgage-backed securities |
213,943 | 3.5 | % | 255,020 | 4.3 | % | 435,000 | 7.1 | % | 461,948 | 7.4 | % | 434,858 | 6.8 | % | ||||||||||||||||||||
| Asset-backed |
151,566 | 2.5 | % | 166,022 | 2.7 | % | 348,661 | 5.7 | % | 498,843 | 8.0 | % | 560,229 | 8.8 | % | ||||||||||||||||||||
| Total fixed maturities available for sale, at fair value |
3,164,848 | 51.7 | % | 2,996,885 | 49.6 | % | 3,645,294 | 59.7 | % | 3,775,345 | 60.8 | % | 3,816,518 | 60.2 | % | ||||||||||||||||||||
| Short term investments, at fair value |
2,136,336 | 34.9 | % | 2,172,343 | 36.0 | % | 1,438,201 | 23.6 | % | 1,400,884 | 22.6 | % | 1,565,589 | 24.7 | % | ||||||||||||||||||||
| Other investments, at fair value |
733,023 | 12.0 | % | 773,475 | 12.8 | % | 902,328 | 14.8 | % | 927,247 | 14.9 | % | 858,621 | 13.5 | % | ||||||||||||||||||||
| Total managed investment portfolio |
6,034,207 | 98.6 | % | 5,942,703 | 98.4 | % | 5,985,823 | 98.1 | % | 6,103,476 | 98.3 | % | 6,240,728 | 98.4 | % | ||||||||||||||||||||
| Investments in other ventures, under equity method |
88,159 | 1.4 | % | 99,879 | 1.6 | % | 117,789 | 1.9 | % | 104,438 | 1.7 | % | 99,466 | 1.6 | % | ||||||||||||||||||||
| Total investments |
$ | 6,122,366 | 100.0 | % | $ | 6,042,582 | 100.0 | % | $ | 6,103,612 | 100.0 | % | $ | 6,207,914 | 100.0 | % | $ | 6,340,194 | 100.0 | % | |||||||||||||||
| CREDIT QUALITY OF FIXED MATURITIES |
|||||||||||||||||||||||||||||||||||
| AAA |
$ | 2,625,260 | 83.0 | % | $ | 2,524,500 | 84.2 | % | $ | 2,928,677 | 80.3 | % | $ | 2,963,317 | 78.5 | % | $ | 3,046,146 | 79.8 | % | |||||||||||||||
| AA |
210,173 | 6.6 | % | 147,405 | 4.9 | % | 377,421 | 10.4 | % | 438,615 | 11.6 | % | 397,282 | 10.4 | % | ||||||||||||||||||||
| A |
200,312 | 6.3 | % | 200,318 | 6.7 | % | 172,897 | 4.7 | % | 192,189 | 5.1 | % | 175,885 | 4.6 | % | ||||||||||||||||||||
| BBB |
65,726 | 2.1 | % | 66,123 | 2.2 | % | 93,506 | 2.6 | % | 96,869 | 2.6 | % | 118,854 | 3.1 | % | ||||||||||||||||||||
| Non-investment grade |
63,377 | 2.0 | % | 58,539 | 2.0 | % | 72,793 | 2.0 | % | 84,355 | 2.2 | % | 78,351 | 2.1 | % | ||||||||||||||||||||
| Total fixed maturities available for sale, at fair value |
$ | 3,164,848 | 100.0 | % | $ | 2,996,885 | 100.0 | % | $ | 3,645,294 | 100.0 | % | $ | 3,775,345 | 100.0 | % | $ | 3,816,518 | 100.0 | % | |||||||||||||||
| MATURITY PROFILE OF FIXED MATURITIES |
|||||||||||||||||||||||||||||||||||
| Due in less than one year |
$ | 110,388 | 3.5 | % | $ | 115,316 | 3.8 | % | $ | 223,439 | 6.1 | % | $ | 260,972 | 6.9 | % | $ | 306,567 | 8.0 | % | |||||||||||||||
| Due after one through five years |
1,363,800 | 43.1 | % | 1,327,837 | 44.4 | % | 1,256,700 | 34.5 | % | 1,271,122 | 33.7 | % | 1,344,276 | 35.2 | % | ||||||||||||||||||||
| Due after five through ten years |
191,201 | 6.0 | % | 183,396 | 6.1 | % | 370,532 | 10.1 | % | 306,472 | 8.1 | % | 315,651 | 8.3 | % | ||||||||||||||||||||
| Due after 10 years |
81,765 | 2.6 | % | 93,720 | 3.1 | % | 82,215 | 2.3 | % | 88,267 | 2.3 | % | 83,586 | 2.2 | % | ||||||||||||||||||||
| Mortgage-backed securities |
1,266,128 | 40.0 | % | 1,110,594 | 37.1 | % | 1,363,747 | 37.4 | % | 1,349,669 | 35.8 | % | 1,206,209 | 31.6 | % | ||||||||||||||||||||
| Asset-backed securities |
151,566 | 4.8 | % | 166,022 | 5.5 | % | 348,661 | 9.6 | % | 498,843 | 13.2 | % | 560,229 | 14.7 | % | ||||||||||||||||||||
| Total fixed maturities available for sale, at fair value |
$ | 3,164,848 | 100.0 | % | $ | 2,996,885 | 100.0 | % | $ | 3,645,294 | 100.0 | % | $ | 3,775,345 | 100.0 | % | $ | 3,816,518 | 100.0 | % | |||||||||||||||
| As of or for the three months ended | |||||||||||||||||||||||||||||||||||
| March 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
|||||||||||||||||||||||||||||||
| Average yield to maturity of fixed maturities and short term investments |
2.5 | % | 2.8 | % | 5.0 | % | 4.1 | % | 4.0 | % | |||||||||||||||||||||||||
| Average duration of fixed maturities and short term investments |
1.3 | 1.5 | 2.2 | 2.1 | 1.9 | ||||||||||||||||||||||||||||||
| Average credit quality of fixed maturities and short term investments |
AA | AA | AA | AA | AA | ||||||||||||||||||||||||||||||
| 9 |
|
RenaissanceRe Holdings Ltd.
Summary of Other Investments
| Mar. 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
||||||||||||||||
| TYPE OF INVESTMENT |
||||||||||||||||||||
| Private equity partnerships |
$ | 247,559 | $ | 258,901 | $ | 297,167 | $ | 297,877 | $ | 308,188 | ||||||||||
| Senior secured bank loan funds |
220,202 | 215,870 | 272,752 | 290,801 | 226,341 | |||||||||||||||
| Catastrophe bonds |
93,798 | 93,085 | 83,434 | 56,774 | 47,003 | |||||||||||||||
| Non-U.S. fixed income funds |
81,757 | 81,719 | 104,196 | 122,970 | 121,153 | |||||||||||||||
| Hedge funds |
72,428 | 105,838 | 115,345 | 125,204 | 125,048 | |||||||||||||||
| Miscellaneous other investments |
17,279 | 18,062 | 29,434 | 33,621 | 30,888 | |||||||||||||||
| Total other investments, at fair value |
$ | 733,023 | $ | 773,475 | $ | 902,328 | $ | 927,247 | $ | 858,621 | ||||||||||
| TYPE OF INVESTMENT |
||||||||||||||||||||
| Private equity partnerships |
33.7 | % | 33.5 | % | 33.0 | % | 32.1 | % | 35.8 | % | ||||||||||
| Senior secured bank loan funds |
30.0 | % | 27.9 | % | 30.2 | % | 31.4 | % | 26.4 | % | ||||||||||
| Catastrophe bonds |
12.8 | % | 12.0 | % | 9.2 | % | 6.1 | % | 5.5 | % | ||||||||||
| Non-U.S. fixed income funds |
11.2 | % | 10.6 | % | 11.5 | % | 13.3 | % | 14.1 | % | ||||||||||
| Hedge funds |
9.9 | % | 13.7 | % | 12.8 | % | 13.5 | % | 14.6 | % | ||||||||||
| Miscellaneous other investments |
2.4 | % | 2.3 | % | 3.3 | % | 3.6 | % | 3.6 | % | ||||||||||
| Total other investments, at fair value |
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||
| 10 |
|
RenaissanceRe Holdings Ltd.
Investment Result
| Three months ended | ||||||||||||||||||||
| March 31, 2009 |
December 31, 2008 |
September 30, 2008 |
June 30, 2008 |
March 31, 2008 |
||||||||||||||||
| Fixed maturity investments available for sale |
$ | 39,127 | $ | 53,290 | $ | 52,087 | $ | 46,308 | $ | 49,535 | ||||||||||
| Short term investments |
3,071 | 7,313 | 9,990 | 12,054 | 19,080 | |||||||||||||||
| Other investments |
||||||||||||||||||||
| Hedge funds and private equity investments |
(19,741 | ) | (55,364 | ) | (15,080 | ) | (29,395 | ) | (1,940 | ) | ||||||||||
| Other |
21,821 | (84,983 | ) | (30,306 | ) | 11,863 | (14,441 | ) | ||||||||||||
| Cash and cash equivalents |
373 | 1,552 | 1,956 | 1,042 | 2,902 | |||||||||||||||
| 44,651 | (78,192 | ) | 18,647 | 41,872 | 55,136 | |||||||||||||||
| Investment expenses |
(2,525 | ) | (4,532 | ) | (2,880 | ) | (3,187 | ) | (2,633 | ) | ||||||||||
| Net investment income (loss) |
42,126 | (82,724 | ) | 15,767 | 38,685 | 52,503 | ||||||||||||||
| Gross realized gains |
31,423 | 40,749 | 20,007 | 18,606 | 20,272 | |||||||||||||||
| Gross realized losses |
(9,297 | ) | (58,371 | ) | (8,809 | ) | (16,194 | ) | (5,560 | ) | ||||||||||
| Other than temporary impairments |
(19,022 | ) | (66,251 | ) | (98,808 | ) | (26,573 | ) | (25,382 | ) | ||||||||||
| Net realized gains (losses) on investments |
3,104 | (83,873 | ) | (87,610 | ) | (24,161 | ) | (10,670 | ) | |||||||||||
| Net change in unrealized holding gains on fixed maturity investments available for sale |
(5,407 | ) | 62,363 | (21,411 | ) | (35,248 | ) | 23,729 | ||||||||||||
| Total investment result |
$ | 39,823 | $ | (104,234 | ) | $ | (93,254 | ) | $ | (20,724 | ) | $ | 65,562 | |||||||
| 11 |
|
RenaissanceRe Holdings Ltd.
Reserves for Claims and Claim Expenses
| March 31, 2009 |
Case Reserves | Additional Case Reserves |
IBNR | Total | ||||||||
| Property catastrophe reinsurance |
$ | 273,811 | $ | 281,956 | $ | 231,970 | $ | 787,737 | ||||
| Specialty reinsurance |
106,700 | 145,266 | 379,921 | 631,887 | ||||||||
| Total Reinsurance |
380,511 | 427,222 | 611,891 | 1,419,624 | ||||||||
| Individual Risk |
236,905 | 13,519 | 322,001 | 572,425 | ||||||||
| Total |
$ | 617,416 | $ | 440,741 | $ | 933,892 | $ | 1,992,049 | ||||
| December 31, 2008 |
||||||||||||
| Property catastrophe reinsurance |
$ | 312,944 | $ | 297,279 | $ | 250,946 | $ | 861,169 | ||||
| Specialty reinsurance |
113,953 | 135,345 | 387,352 | 636,650 | ||||||||
| Total Reinsurance |
426,897 | 432,624 | 638,298 | 1,497,819 | ||||||||
| Individual Risk |
253,327 | 14,591 | 394,875 | 662,793 | ||||||||
| Total |
$ | 680,224 | $ | 447,215 | $ | 1,033,173 | $ | 2,160,612 | ||||
| September 30, 2008 |
||||||||||||
| Property catastrophe reinsurance |
$ | 272,682 | $ | 529,537 | $ | 293,315 | $ | 1,095,534 | ||||
| Specialty reinsurance |
113,337 | 152,012 | 387,899 | 653,248 | ||||||||
| Total Reinsurance |
386,019 | 681,549 | 681,214 | 1,748,782 | ||||||||
| Individual Risk |
224,912 | 16,125 | 443,601 | 684,638 | ||||||||
| Total |
$ | 610,931 | $ | 697,674 | $ | 1,124,815 | $ | 2,433,420 | ||||
| June 30, 2008 |
||||||||||||
| Property catastrophe reinsurance |
$ | 207,054 | $ | 253,801 | $ | 245,737 | $ | 706,592 | ||||
| Specialty reinsurance |
111,652 | 141,268 | 400,024 | 652,944 | ||||||||
| Total Reinsurance |
318,706 | 395,069 | 645,761 | 1,359,536 | ||||||||
| Individual Risk |
226,020 | 9,780 | 414,467 | 650,267 | ||||||||
| Total |
$ | 544,726 | $ | 404,849 | $ | 1,060,228 | $ | 2,009,803 | ||||
| March 31, 2008 |
||||||||||||
| Property catastrophe reinsurance |
$ | 248,291 | $ | 272,396 | $ | 239,705 | $ | 760,392 | ||||
| Specialty reinsurance |
114,812 | 81,355 | 458,964 | 655,131 | ||||||||
| Total Reinsurance |
363,103 | 353,751 | 698,669 | 1,415,523 | ||||||||
| Individual Risk |
230,699 | 18,708 | 321,076 | 570,483 | ||||||||
| Total |
$ | 593,802 | $ | 372,459 | $ | 1,019,745 | $ | 1,986,006 | ||||
| 12 |
|
RenaissanceRe Holdings Ltd.
Paid to Incurred Analysis
| Three months ended March 31, 2009 | Three months ended March 31, 2008 | ||||||||||||||||||||
| Gross | Recoveries | Net | Gross | Recoveries | Net | ||||||||||||||||
| Reserve for losses and loss expenses, beginning of period |
$ | 2,160,612 | $ | 299,534 | $ | 1,861,078 | $ | 2,028,496 | $ | 183,275 | $ | 1,845,221 | |||||||||
| Incurred losses and loss expenses |
|||||||||||||||||||||
| Current year |
89,879 | 10,944 | 78,935 | 135,352 | 8,111 | 127,241 | |||||||||||||||
| Prior years |
8,154 | 892 | 7,262 | (53,324 | ) | (8,239 | ) | (45,085 | ) | ||||||||||||
| Total incurred losses and loss expenses |
98,033 | 11,836 | 86,197 | 82,028 | (128 | ) | 82,156 | ||||||||||||||
| Paid losses and loss expenses |
|||||||||||||||||||||
| Current year |
5,056 | 1,377 | 3,679 | 6,477 | 640 | 5,837 | |||||||||||||||
| Prior years |
261,540 | 108,778 | 152,762 | 118,041 | 30,952 | 87,089 | |||||||||||||||
| Total paid losses and loss expenses |
266,596 | 110,155 | 156,441 | 124,518 | 31,592 | 92,926 | |||||||||||||||
| Reserve for losses and loss expenses, end of period |
$ | 1,992,049 | $ | 201,215 | $ | 1,790,834 | $ | 1,986,006 | $ | 151,555 | $ | 1,834,451 | |||||||||
| 13 |
|
RenaissanceRe Holdings Ltd.
Equity in Earnings of Other Ventures
| Three months ended | ||||||||||||||||||||
| March 31, 2009 |
December 31, 2008 |
September 30, 2008 |
June 30, 2008 |
March 31, 2008 |
||||||||||||||||
| Top Layer Re |
$ | 2,146 | $ | 2,310 | $ | 2,431 | $ | 3,023 | $ | 3,613 | ||||||||||
| Starbound II |
| | 777 | 1,063 | 1,362 | |||||||||||||||
| Tower Hill and the Tower Hill Companies |
(491 | ) | (840 | ) | (832 | ) | 879 | 1,338 | ||||||||||||
| Other |
81 | (1,322 | ) | (43 | ) | (93 | ) | (63 | ) | |||||||||||
| Total equity in earnings of other ventures |
$ | 1,736 | $ | 148 | $ | 2,333 | $ | 4,872 | $ | 6,250 | ||||||||||
| 14 |
|
RenaissanceRe Holdings Ltd.
Ratings
| At March 31, 2009 |
A.M. Best | S&P | Moodys | Fitch | ||||
| REINSURANCE SEGMENT (1) |
||||||||
| Renaissance Reinsurance |
A+ | AA- | A2 | A | ||||
| DaVinci |
A | A+ | | | ||||
| Top Layer Re |
A+ | AA | | | ||||
| Renaissance Europe |
A+ | AA- | | | ||||
| INDIVIDUAL RISK SEGMENT (1) |
||||||||
| Glencoe |
A | | | | ||||
| Stonington |
A | | | | ||||
| Stonington Lloyds |
A | | | | ||||
| Lantana |
A | | | | ||||
| RENAISSANCERE (2) |
a- | A | Baa1 | BBB+ | ||||
| (1) | The A.M. Best, S&P, Moodys and Fitch ratings for the companies in the Reinsurance and Individual Risk segments reflect the insurers financial strength rating. |
| (2) | The A.M. Best, S&P, Moodys and Fitch ratings for RenaissanceRe represent the credit ratings on its senior unsecured debt. |
| 15 |
|
RenaissanceRe Holdings Ltd.
Comments on Regulation G
In addition to the GAAP financial measures set forth in this Financial Supplement, the Company has included certain non-GAAP financial measures in this Financial Supplement within the meaning of Regulation G. The Company has consistently provided these financial measurements in previous investor communications and the Companys management believes that these measurements are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for the comparison with other companies within the industry. These measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors are cautioned not to place undue reliance on these non-GAAP measures in assessing the Companys overall financial performance.
The Company uses operating income (loss) as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. Operating income (loss) as used herein differs from net income (loss) available (attributable) to RenaissanceRe common shareholders, which the Company believes is the most directly comparable GAAP measures, by the exclusion of net realized gains and losses on investments. The Companys management believes that operating income (loss) is useful to investors because it more accurately measures and predicts the Companys results of operations by removing the variability arising from fluctuations in the Companys investment portfolio, which is not considered by management to be relevant indicators of business operations. The Company also uses operating income (loss) to calculate operating income (loss) per common share - diluted and operating return on average common equity - annualized. The following is a reconciliation of 1) net income (loss) available (attributable) to RenaissanceRe common shareholders to operating income (loss) available (attributable) to RenaissanceRe common shareholders; 2) net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted to operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted; and 3) return on average common equity - -annualized to operating return on average common equity, annualized:
| Three months ended | ||||||||||||||||||||
| March 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
||||||||||||||||
| Net income (loss) available (attributable) to RenaissanceRe common shareholders |
$ | 97,284 | $ | (55,192 | ) | $ | (230,974 | ) | $ | 135,721 | $ | 137,165 | ||||||||
| Adjustment for net realized (gains) losses on investments |
(3,104 | ) | 83,873 | 87,610 | 24,161 | 10,670 | ||||||||||||||
| Operating income (loss) available (attributable) to RenaissanceRe common shareholders |
$ | 94,180 | $ | 28,681 | $ | (143,364 | ) | $ | 159,882 | $ | 147,835 | |||||||||
| Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted (1) |
$ | 1.57 | $ | (0.91 | ) | $ | (3.79 | ) | $ | 2.13 | $ | 2.05 | ||||||||
| Adjustment for net realized (gains) losses on investments |
(0.05 | ) | 1.38 | 1.44 | 0.37 | 0.16 | ||||||||||||||
| Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted (1) |
$ | 1.52 | $ | 0.47 | $ | (2.35 | ) | $ | 2.50 | $ | 2.21 | |||||||||
| Return on average common equity - annualized |
16.0 | % | (9.2 | %) | (36.1 | %) | 19.9 | % | 19.7 | % | ||||||||||
| Adjustment for net realized (gains) losses on investments |
(0.5 | %) | 14.0 | % | 13.7 | % | 3.5 | % | 1.6 | % | ||||||||||
| Operating return on average common equity - annualized |
15.5 | % | 4.8 | % | (22.4 | %) | 23.4 | % | 21.3 | % | ||||||||||
| (1) | In accordance with FAS 128, earnings per share calculations use average common shares outstandingbasic, when in a net loss position. |
The Company has also included in this Financial Supplement managed catastrophe premiums. Managed catastrophe premiums is defined as gross catastrophe premiums written by Renaissance Reinsurance and its related joint ventures, excluding catastrophe premiums assumed from the Companys Individual Risk segment. Managed catastrophe premiums differ from total catastrophe premiums, which the Company believes is the most directly comparable GAAP measure, due to the inclusion of catastrophe premiums written on behalf of the Companys joint venture Top Layer Re, which is accounted for under the equity method of accounting, and the exclusion of catastrophe premiums assumed from the Companys Individual Risk segment. The Companys management believes managed catastrophe premiums is useful to investors and other interested parties because it provides a measure of total catastrophe reinsurance premiums assumed by the Company through its consolidated subsidiaries and related joint ventures.
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RenaissanceRe Holdings Ltd.
Comments on Regulation G
The Company has also included in this Financial Supplement tangible book value per common share plus accumulated dividends. This is defined as book value per common share excluding goodwill and intangible assets, plus accumulated dividends. Tangible book value per common share plus accumulated dividends differs from book value per common share, which the Company believes is the most directly comparable GAAP measure, due to the exclusion of goodwill and intangible assets and the inclusion of accumulated dividends. The following is a reconciliation of book value per common share to tangible book value per common share plus accumulated dividends:
| Three months ended | ||||||||||||||||||||
| March 31, 2009 |
Dec. 31, 2008 |
Sept. 30, 2008 |
June 30, 2008 |
March 31, 2008 |
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| Book value per common share |
$ | 39.65 | $ | 38.74 | $ | 38.94 | $ | 43.32 | $ | 42.14 | ||||||||||
| Adjustment for goodwill and intangible assets (1) |
(1.93 | ) | (2.01 | ) | (1.92 | ) | (1.18 | ) | (0.09 | ) | ||||||||||
| Tangible book value per common share |
37.72 | 36.73 | 37.02 | 42.14 | 42.05 | |||||||||||||||
| Adjustment for accumulated dividends |
8.16 | 7.92 | 7.69 | 7.46 | 7.23 | |||||||||||||||
| Tangible book value per common share plus accumulated dividends |
$ | 45.88 | $ | 44.65 | $ | 44.71 | $ | 49.60 | $ | 49.28 | ||||||||||
| (1) | At March 31, 2009, December 31, 2008, September 30, 2008, June 30, 3008 and March 31, 2008, goodwill and other intangibles included $48.3 million, $49.8 million, $46.4 million, $nil and $nil, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method. |
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