AXIS Capital Holdings Limited reported yesterday that first-quarter net income rose 30 percent on what one analyst termed strong underwriting margins.

The Bermuda-based company reported first-quarter net earnings of $195.2 million, compared with $151.8 million for the comparable 2005 period.

“Strong underwriting margins, investment income and corporate items all contributed to the upside,” wrote Morgan Stanley analyst William Wilt.

The company listed other first-quarter highlights as:

o Gross premiums written of $1.7 billion were in line with gross premiums written of $1.2 billion in the first quarter of 2005.

o Net premiums earned of $633.6 million were in line with net premiums earned of $625.6 million in the first quarter of 2005.

o Combined ratio of 79.5 included favorable prior period reserve development of 9.6 percentage points.

o Total pretax investment income, including net realized losses, increased by 60.9 percent to $82.6 million.

o Annualized return on average common shareholders' equity of 25.4 percent was achieved during the quarter.

Mr. Wilt called the results “broadly positive.”

“Reserve releases of $61 million were $21 million less than we had anticipated, suggesting that underlying margins are running stronger than expected,” he wrote. “The company is well positioned to capitalize on favorable marketplace dynamics,” he added.

Special Reports /

AXIS Net Up 30 Percent In Quarter

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