Form 8-K ASPEN INSURANCE HOLDINGS For: Oct 29
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E-mailUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
�
FORM 8-K
Current Report
Pursuant to Section�13 OR 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 29, 2014
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ASPEN INSURANCE HOLDINGS LIMITED
(Exact name of registrant as specified in its charter)
�
Bermuda | 001-31909 | Not Applicable |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
141 Front Street
Hamilton HM 19
Bermuda
(Address of principal executive offices)
(Zip Code)
Registrants telephone number, including area code: (441)�295-8201
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
� | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
� | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
� | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
� | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Section 2 - Financial Information
Item 2.02 - Results of Operations and Financial Condition
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On October 29, 2014, Aspen Insurance Holdings Limited ( Aspen or the Company ) issued a press release announcing results for the quarter and nine months ended September 30, 2014, which is attached hereto as Exhibit 99.1. In addition, a copy of the Aspen Insurance Holdings Limited Earnings Release Supplement for the quarter and nine months ended September 30, 2014 is attached hereto as Exhibit 99.2.
Section 7 - Regulation FD
Item 7.01 - Regulation FD Disclosure
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On October 29, 2014, Aspen issued a press release announcing results for the quarter and nine months ended September 30, 2014 which is attached hereto as Exhibit 99.1. In addition, a copy of the Aspen Insurance Holdings Limited Earnings Release Supplement for the quarter and nine months ended September 30, 2014 is attached hereto as Exhibit 99.2.
Section 9 - Financial Statements and Exhibits
�
Item 9.01- Financial Statements and Exhibits
(d) The following exhibits are furnished under Items 2.02 and 7.01 as part of this report:
99.1 | Press Release of the Registrant, dated October 29, 2014. | |
99.2 | Earnings Release Supplement for the quarter and nine months ended September 30, 2014. | |
The information furnished under Item 2.02 Results of Operations and Financial Condition and Item 7.01 Regulation FD Disclosure shall not be deemed filed for purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act ), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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� | � | ASPEN INSURANCE HOLDINGS LIMITED (Registrant) | ||||
Dated: October 29, 2014 | � | � | By: | � | /s/ John Worth | |
� | � | Name: | � | John Worth | ||
� | � | Title: | � | Chief Financial Officer | ||
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Exhibit 99.1
 | PRESS RELEASE |
ASPEN REPORTS RESULTS FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2014
Annualized Operating ROE of 10.0%
Diluted Operating Income Per Share of $1.08
Diluted Book Value Per Share of $44.60, up 9.0% (10.1% excluding bid defense costs) from December 31, 2013
Hamilton, Bermuda, October 29, 2014 - Aspen Insurance Holdings Limited ( Aspen ) (NYSE: AHL) today reported net income after tax of $37.4 million, or $0.42 diluted net income per share, for the quarter ended September 30, 2014.
Chris OKane, Chief Executive Officer, commented, During the third quarter we continued to execute our strategy to increase ROE and shareholder value with good operating results, opportunistic share repurchases and further rebalancing of our investment portfolio. Reinsurance had another very strong quarter and continues to successfully navigate a dynamic market. Insurance continued to evidence momentum, with our U.S. Insurance teams continuing to make strong progress in building out the platform through profitable growth. As we enter the final quarter of 2014 we are well positioned to comfortably exceed our 10% ROE target for the year. We will continue to focus on ROE improvement in 2015 and beyond.
Operating highlights for the quarter ended September 30, 2014
" | Gross written premiums increased by 12.2% to $652.5 million in the third quarter of 2014 from the third quarter of 2013, with growth from both Insurance and Reinsurance segments |
" | Combined ratio of 94.6% (91.3% excluding corporate expenses related to bid defense costs) for the third quarter of 2014 compared with 91.8% for the third quarter of 2013.� There were $17.1 million, or 2.8 combined ratio points, of pre-tax catastrophe losses in the third quarter of 2014 compared with $14.2 million, or 2.6 percentage points, of pre-tax catastrophe losses net of reinsurance recoveries and reinstatement premiums in the third quarter of 2013� |
�
" | Net favorable development on prior year loss reserves of $32.6 million, or 5.3 combined ratio points, for the third quarter of 2014 compared with $33.6 million, or 6.2 combined ratio points, for the third quarter of 2013 |
Financial highlights for the quarter and nine months ended September 30, 2014
" | Annualized net income return on average equity of 4.0% (6.4% excluding bid defense costs) and annualized operating return on average equity of 10.0% for the third quarter of 2014 compared with 14.8% and 10.8%, respectively, for the third quarter of 2013(1)� |
" | Annualized net income return on average equity of 12.0% (13.3% excluding bid defense costs) and annualized operating return on average equity of 12.4% for the first nine months of 2014 compared with 10.1% and 9.2%, respectively, for the first nine months of 2013(1)� |
" | Diluted net income per share of $0.42 ($0.72 excluding $20.2 million of bid defense costs) for the quarter ended September 30, 2014, compared with diluted net income per share of $1.43 for the third quarter of 2013. Diluted net income per share of $3.91 ($4.34 excluding $28.5 million of bid defense costs) for the nine months ended September 30, 2014 compared with diluted net income per share of $2.95 for the nine months ended September 30, 2013 |
" | Diluted operating income per share of $1.08 for the quarter ended September 30, 2014, compared with $1.05 for the third quarter of 2013. Diluted operating income per share of $4.04 for the nine months ended September 30, 2014 compared with diluted operating income per share of $2.78 for the nine months ended September 30, 2013(1)� |
" | On a pre-tax basis, net catastrophe losses were $17.1 million, or $0.26 per diluted share, for the third quarter of 2014 compared with $14.2 million, or $0.21 per diluted share, for the third quarter of 2013 |
" | Diluted book value per share of $44.60 at September 30, 2014 up 9.0% from December 31, 2013; |
Diluted book value per share increased 10.1% excluding bid defense costs from December 31, 2013 �
(1)� | See definition of non-GAAP financial measures at the end of this release. |
Segment highlights
Reinsurance
Operating highlights for Reinsurance for the quarter ended September 30, 2014 include:
" | Gross written premiums of $256.9 million, an increase of 17.0% from $219.5 million in the third quarter of 2013 |
" | Combined ratio of 79.5% compared with 80.5% for the third quarter of 2013 |
" | Prior year favorable reserve development of $26.0 million, or 9.3 combined ratio points, compared with $32.3 million prior year favorable loss reserve development, or 12.6 combined ratio points, for the third quarter of 2013 |
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The growth in gross written premiums was primarily due to increased production and new business in Other Property.
The combined ratio of 79.5% for the third quarter of 2014 included $10.5 million, or 3.8 percentage points, of pre-tax catastrophe losses primarily related to North American and European storms. The combined ratio of 80.5% for the third quarter of 2013 included $11.3 million, or 4.5 percentage points, of pre-tax catastrophe losses, net of reinsurance recoveries and $1.4 million of reinstatement premiums. For the quarter ended September 30, 2014 the Reinsurance accident year ex catastrophe loss ratio improved 320 basis points to 52.7% from 55.9% a year ago.(1)�
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Insurance
Operating highlights for Insurance for the quarter ended September 30, 2014 include:
" | Gross written premiums of $395.6 million, an increase of 9.3% compared with $362.1 million in the third quarter of 2013 |
" | Combined ratio of 96.7% in line with the third quarter of 2013 |
" | Prior year favorable reserve development of $6.6 million, or 2.0 combined ratio points, compared with prior year favorable reserve development of $1.3 million, or 0.5 combined ratio point, for the third quarter of 2013 |
The increase in gross written premiums was attributable to Property and Casualty and Financial and Professional Lines, primarily resulting from the continued growth from the U.S. teams. The U.S. Insurance teams were again profitable in the quarter and through the first nine months of 2014 have achieved a loss ratio of 59.4%.
The combined ratio of 96.7% for the third quarter of 2014 included $6.6 million, or 2.0 percentage points, of pre-tax catastrophe losses related to U.S. storms. The combined ratio for the third quarter of 2013 included $2.9 million, or 1.0 percentage point, of pre-tax catastrophe losses related to U.S. storms. There was a higher frequency of non-correlated mid-sized losses of $14.3 million principally in the Marine, Energy and Aviation lines which accounted for 4.3 percentage points on the loss ratio.
Investment performance
Aspens investment portfolio continues to be comprised primarily of high quality fixed income securities with an average credit quality of AA- . The average duration of the fixed income portfolio was 3.51 years at September 30, 2014 excluding the impact of interest rate swaps, or 3.26 years including the impact of interest rate swaps. The total return on Aspens investment portfolio was relatively flat for the third quarter of 2014, and was 2.19% for the nine months ended September 30, 2014. The equity portfolio which comprises 7.6% of the total portfolio, had a total return of negative 2.25% for the quarter and a total return of positive 5.36% for the nine months ended September 30, 2014.
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Net investment income for the third quarter of 2014 was $48.0 million compared with $45.0 million for the third quarter of 2013. Book yield as at September 30, 2014 on the fixed income portfolio was 2.65% compared to 2.74% at December 31, 2013 and 2.82% at September 30, 2013.
Capital
Total shareholders equity was $3.4 billion at September 30, 2014.
During the third quarter of 2014, 2,120,625 ordinary shares were repurchased under a Rule 10b5-1 plan at an average price of $42.46 per share for a total cost of $90.0 million. For the nine months ended September 30, 2014, a total of 2,891,130 ordinary shares were repurchased at an average price of $41.82 per ordinary share for a total cost of $120.9 million. Between September 30, 2014 and October 28, 2014, a further 1,249,326 ordinary shares were repurchased under a Rule 10b5-1 plan at an average price of $42.78 per ordinary share for a total cost of $53.4 million.
Outlook
Aspen now expects to achieve an operating return on equity comfortably in excess of 10% in 2014, assuming normal loss experience.
Aspen expects to achieve an operating return on equity of 11% in 2015, and to achieve an operating return on equity of between 11% and 12% in 2016(3).
See Forward-looking Statements Safe Harbor below.
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Earnings conference call and webcast
Aspen will host a conference call to discuss the results at 9:00 am (EDT) on Thursday, October 30, 2014.
To participate in the October 30 conference call by phone
Please call to register at least 10 minutes before the conference call begins by dialing:
+1 (888) 868 3191 (US toll free) or
+1 (973) 321 1024 (international)
Conference ID 1931681
To listen live online
Aspen will provide a live webcast on Aspens website at www.aspen.co.
To download the materials
The earnings press release and a detailed financial supplement will also be published on Aspens website at www.aspen.co.
To listen later
A replay of the call will be available for 14 days via phone and internet, available two hours after the end of the live call. To listen to the replay by phone please dial:
+1 (855) 859 2056 (US toll free) or
+1 (404) 537 3406 (international)
Replay ID 1931681
The recording will be also available at www.aspen.co on the Event Calendar page within the Investor Relations section.
For further information please contact
Investors
Kerry Calaiaro, Senior Vice President, Investor Relations, Aspen
+1 (646) 502 1076
Kathleen de Guzman, Vice President, Investor Relations, Aspen
+1 (646) 289 4912
Media
Steve Colton, Head of Communications, Aspen
+44 20 7184 8337
International - Citigate Dewe Rogerson
Caroline Merrell or Jos Bieneman
+44 20 7638 9571
North America - Sard Verbinnen & Co
Paul Scarpetta or Jamie Tully
+1 (212) 687 8080
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Aspen Insurance Holdings Limited
Summary consolidated balance sheet (unaudited)
$ in millions, except per share data
As at September�30, 2014 | As at December�31, 2013 | |||||||
ASSETS | ||||||||
Total investments | $ | 7,274.0 | $ | 6,959.8 | ||||
Cash and cash equivalents | 1,289.1 | 1,293.6 | ||||||
Reinsurance recoverables | 614.5 | 484.6 | ||||||
Premiums receivable | 1,105.3 | 999.0 | ||||||
Other assets | 546.7 | 493.5 | ||||||
Total assets | $ | 10,829.6 | $ | 10,230.5 | ||||
LIABILITIES | ||||||||
Losses and loss adjustment expenses | $ | 4,787.3 | $ | 4,678.9 | ||||
Unearned premiums | 1,508.7 | 1,280.6 | ||||||
Other payables | 475.5 | 372.4 | ||||||
Silverton loan notes | 64.5 | 50.0 | ||||||
Long-term debt | 549.1 | 549.0 | ||||||
Total liabilities | $ | 7,385.1 | $ | 6,930.9 | ||||
SHAREHOLDERS EQUITY | ||||||||
Total shareholders equity | 3,444.5 | 3,299.6 | ||||||
Total liabilities and shareholders equity | $ | 10,829.6 | $ | 10,230.5 | ||||
Book value per share | $ | 45.60 | $ | 41.87 | ||||
Diluted book value per share (treasury stock method)� | $ | 44.60 | $ | 40.90 | ||||
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Aspen Insurance Holdings Limited
Summary consolidated statement of income (unaudited)
$ in millions, except ratios
Three Months Ended | ||||||||
September�30, 2014 | September�30, 2013 | |||||||
UNDERWRITING REVENUES | ||||||||
Gross written premiums | $ | 652.5 | $ | 581.6 | ||||
Premiums ceded | (75.2 | ) | (39.6 | ) | ||||
Net written premiums | 577.3 | 542.0 | ||||||
Change in unearned premiums | 33.1 | 2.3 | ||||||
Net earned premiums | 610.4 | 544.3 | ||||||
UNDERWRITING EXPENSES | ||||||||
Losses and loss adjustment expenses | 342.7 | 290.2 | ||||||
Amortization of deferred policy acquisition costs | 115.5 | 110.5 | ||||||
General, administrative and corporate expenses (excluding non-recurring corporate expenses) | 99.6 | 98.9 | ||||||
Total underwriting expenses | 557.8 | 499.6 | ||||||
Underwriting income including corporate expenses | 52.6 | 44.7 | ||||||
OTHER OPERATING REVENUE | ||||||||
Net investment income | 48.0 | 45.0 | ||||||
Interest expense | (7.4 | ) | (7.7 | ) | ||||
Other (expense) income | (7.8 | ) | 1.6 | |||||
Total other operating revenue | 32.8 | 38.9 | ||||||
OPERATING INCOME BEFORE TAX | 85.4 | 83.6 | ||||||
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Non-recurring corporate expenses (bid defense costs) | (20.2 | ) | ||||||
Net realized and unrealized exchange (losses) gains | (26.5 | ) | 13.3 | |||||
Net realized and unrealized investment gains | 13.4 | |||||||
INCOME BEFORE TAX | 38.7 | 110.3 | ||||||
Income tax expense | (1.3 | ) | (2.9 | ) | ||||
NET INCOME AFTER TAX | 37.4 | 107.4 | ||||||
Dividends paid on ordinary shares | (13.1 | ) | (12.2 | ) | ||||
Dividends paid on preference shares | (9.5 | ) | (9.5 | ) | ||||
Proportion due to non-controlling interest | 0.1 | 0.3 | ||||||
Retained income | $ | 14.9 | $ | 86.0 | ||||
Components of net income (after tax) | ||||||||
Operating income | $ | 81.7 | $ | 82.0 | ||||
Non-recurring corporate expenses | (20.2 | ) | ||||||
Net realized and unrealized exchange (losses) gains after tax | (24.1 | ) | 12.0 | |||||
Net realized investment gains after tax | 13.4 | |||||||
NET INCOME AFTER TAX | $ | 37.4 | $ | 107.4 | ||||
� | ||||||||
Loss ratio | 56.1 | % | 53.3 | % | ||||
Policy acquisition expense ratio | 18.9 | % | 20.3 | % | ||||
General, administrative and corporate expense ratio | 19.6 | % | 18.2 | % | ||||
General, administrative and corporate expense ratio (excluding non-recurring corporate expenses) | 16.3 | % | 18.2 | % | ||||
Expense ratio | 38.5 | % | 38.5 | % | ||||
Expense ratio (excluding non-recurring corporate expenses) | 35.2 | % | 38.5 | % | ||||
Combined ratio | 94.6 | % | 91.8 | % | ||||
Combined ratio (excluding non-recurring corporate expenses) | 91.3 | % | 91.8 | % | ||||
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Aspen Insurance Holdings Limited
Summary consolidated statement of income (unaudited)
$ in millions, except ratio
Nine Months Ended | ||||||||
September�30, 2014 | September�30, 2013 | |||||||
UNDERWRITING REVENUES | ||||||||
Gross written premiums | $ | 2,287.3 | $ | 2,042.3 | ||||
Premiums ceded | (326.1 | ) | (290.6 | ) | ||||
Net written premiums | 1,961.2 | 1,751.7 | ||||||
Change in unearned premiums | (168.1 | ) | (152.5 | ) | ||||
Net earned premiums | 1,793.1 | 1,599.2 | ||||||
UNDERWRITING EXPENSES | ||||||||
Losses and loss adjustment expenses | 967.9 | 892.3 | ||||||
Amortization of deferred policy acquisition costs | 336.4 | 322.3 | ||||||
General, administrative and corporate expenses (excluding non-recurring corporate expenses) | 295.7 | 273.2 | ||||||
Total underwriting expenses | 1,600.0 | 1,487.8 | ||||||
Underwriting income including corporate expenses | 193.1 | 111.4 | ||||||
OTHER OPERATING REVENUE | ||||||||
Net investment income | 143.6 | 139.2 | ||||||
Interest expense | (22.1 | ) | (23.2 | ) | ||||
Other (expense) income | (5.9 | ) | 3.0 | |||||
Total other operating revenue | 115.6 | 119.0 | ||||||
OPERATING INCOME BEFORE TAX | 308.7 | 230.4 | ||||||
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Non-recurring corporate expenses (bid defense costs) | (28.5 | ) | ||||||
Net realized and unrealized exchange (losses) | (13.8 | ) | (10.7 | ) | ||||
Net realized and unrealized investment gains | 33.5 | 29.4 | ||||||
INCOME BEFORE TAX | 299.9 | 249.1 | ||||||
Income tax expense | (11.3 | ) | (9.8 | ) | ||||
NET INCOME AFTER TAX | 288.6 | 239.3 | ||||||
Dividends paid on ordinary shares | (37.9 | ) | (36.0 | ) | ||||
Dividends paid on preference shares | (28.4 | ) | (26.1 | ) | ||||
Change in redemption value | (7.1 | ) | ||||||
Proportion due to non-controlling interest | 0.3 | |||||||
Retained income | $ | 222.3 | $ | 170.4 | ||||
Components of net income (after tax) | ||||||||
Operating income | $ | 297.2 | $ | 219.9 | ||||
Non-recurring corporate expenses | (28.5 | ) | ||||||
Net realized and unrealized exchange (losses) after tax | (13.3 | ) | (9.5 | ) | ||||
Net realized investment gains after tax | 33.2 | 28.9 | ||||||
NET INCOME AFTER TAX | $ | 288.6 | $ | 239.3 | ||||
Loss ratio | 54.0 | % | 55.8 | % | ||||
Policy acquisition expense ratio | 18.8 | % | 20.2 | % | ||||
General, administrative and corporate expense ratio | 18.1 | % | 17.1 | % | ||||
General, administrative and corporate expense ratio (excluding non-recurring corporate expenses) | 16.5 | % | 17.1 | % | ||||
Expense ratio | 36.9 | % | 37.3 | % | ||||
Expense ratio (excluding non-recurring corporate expenses) | 35.3 | % | 37.3 | % | ||||
Combined ratio | 90.9 | % | 93.1 | % | ||||
Combined ratio (excluding non-recurring corporate expenses) | 89.3 | % | 93.1 | % | ||||
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Aspen Insurance Holdings Limited
Summary consolidated financial data (unaudited)
$ in millions, except number of shares
Three Months Ended | Nine Months Ended | ||||||||||||||
September�30, 2014 | September�30, 2013 | September�30, 2014 | September�30, 2013 | ||||||||||||
Basic earnings per ordinary share | |||||||||||||||
Net income adjusted for preference share dividend | $0.43 | $1.47 | $3.99 | $3.07 | |||||||||||
Operating income adjusted for preference share dividend | $1.11 | $1.09 | $4.12 | $2.89 | |||||||||||
Diluted earnings per ordinary share | |||||||||||||||
Net income adjusted for preference share dividend | $0.42 | $1.43 | $3.91 | $2.95 | |||||||||||
Operating income adjusted for preference share dividend | $1.08 | $1.05 | $4.04 | $2.78 | |||||||||||
� | � | � | |||||||||||||
Weighted average number of ordinary shares outstanding (in millions) | 65.116 | 66.716 | 65.284 | 67.303 | |||||||||||
Weighted average number of ordinary shares outstanding and dilutive potential ordinary shares (in millions) | 66.513 | 68.562 | 66.599 | 69.959 | |||||||||||
� | � | � | |||||||||||||
Book value per ordinary share | $45.60 | $41.33 | $45.60 | $41.33 | |||||||||||
Diluted book value per ordinary share (treasury stock method) | $44.60 | $40.43 | $44.60 | $40.43 | |||||||||||
� | � | � | |||||||||||||
Ordinary shares outstanding at end of the period (in millions) | 63.350 | 65.701 | 63.350 | 65.701 | |||||||||||
Ordinary shares outstanding and dilutive potential ordinary shares at end of the period (treasury stock method) (in millions) | 64.783 | 67.171 | 64.783 | 67.171 | |||||||||||
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Aspen Insurance Holdings Limited
Summary consolidated segment information (unaudited)
$ in millions, except ratios
Three Months Ended September 30, 2014 | Three Months Ended September 30, 2013 | |||||||||||||||||||
Reinsurance | Insurance | Total | Reinsurance | Insurance | Total | |||||||||||||||
Gross written premiums | $ | 256.9 | $ | 395.6 | $ | 652.5 | $ | 219.5 | $ | 362.1 | $ | 581.6 | ||||||||
Net written premiums | 250.9 | 326.4 | 577.3 | 218.4 | 323.6 | 542.0 | ||||||||||||||
Gross earned premiums | 291.0 | 403.9 | 694.9 | 268.6 | 356.5 | 625.1 | ||||||||||||||
Net earned premiums | 279.6 | 330.8 | 610.4 | 255.7 | 288.6 | 544.3 | ||||||||||||||
Losses and loss adjustment expenses | 132.0 | 210.7 | 342.7 | 122.2 | 168.0 | 290.2 | ||||||||||||||
Policy acquisition expenses | 52.1 | 63.4 | 115.5 | 49.1 | 61.4 | 110.5 | ||||||||||||||
General and administrative expenses | 38.4 | 45.6 | 84.0 | 34.6 | 49.5 | 84.1 | ||||||||||||||
Underwriting income� | $ | 57.1 | $ | 11.1 | $ | 68.2 | $ | 49.8 | $ | 9.7 | $ | 59.5 | ||||||||
Net investment income | 48.0 | 45.0 | ||||||||||||||||||
Net realized and unrealized investment gains (1) | 13.4 | |||||||||||||||||||
Corporate expenses | (15.6 | ) | (14.8 | ) | ||||||||||||||||
Non-recurring corporate expenses | (20.2 | ) | ||||||||||||||||||
Other (expense) income | (7.8 | ) | 1.6 | |||||||||||||||||
Interest expenses | (7.4 | ) | (7.7 | ) | ||||||||||||||||
Net realized and unrealized foreign exchange (losses) gains (2) | (26.5 | ) | 13.3 | |||||||||||||||||
Income before tax | $ | 38.7 | $ | 110.3 | ||||||||||||||||
Income tax expense | (1.3 | ) | (2.9 | ) | ||||||||||||||||
Net income� | $ | 37.4 | $ | 107.4 | ||||||||||||||||
Ratios | ||||||||||||||||||||
Loss ratio | 47.2 | % | 63.7 | % | 56.1 | % | 47.8 | % | 58.2 | % | 53.3 | % | ||||||||
Policy acquisition expense ratio | 18.6 | % | 19.2 | % | 18.9 | % | 19.2 | % | 21.3 | % | 20.3 | % | ||||||||
General and administrative expense ratio (3) | 13.7 | % | 13.8 | % | 19.6 | % | 13.5 | % | 17.2 | % | 18.2 | % | ||||||||
General and administrative expense ratio (excluding non-recurring corporate expenses) (3) | 13.7 | % | 13.8 | % | 16.3 | % | 13.5 | % | 17.2 | % | 18.2 | % | ||||||||
Expense ratio | 32.3 | % | 33.0 | % | 38.5 | % | 32.7 | % | 38.5 | % | 38.5 | % | ||||||||
Expense ratio (excluding non-recurring corporate expenses) | 32.3 | % | 33.0 | % | 35.2 | % | 32.7 | % | 38.5 | % | 38.5 | % | ||||||||
Combined ratio | 79.5 | % | 96.7 | % | 94.6 | % | 80.5 | % | 96.7 | % | 91.8 | % | ||||||||
Combined ratio (excluding non-recurring corporate expenses) | 79.5 | % | 96.7 | % | 91.3 | % | 80.5 | % | 96.7 | % | 91.8 | % | ||||||||
(1) Includes realized and unrealized capital gains and losses and realized and unrealized gains and losses on interest rate swaps
(2) Includes realized and unrealized foreign exchange gains and losses and realized and unrealized gains and losses on foreign exchange contracts
(3) The total group general and administrative expense ratio includes the impact from corporate expenses
9
Aspen Insurance Holdings Limited
Summary consolidated segment information (unaudited)
$ in millions, except ratios
Nine Months Ended September 30, 2014 | Nine Months Ended September 30, 2013 | |||||||||||||||||||
Reinsurance | Insurance | Total | Reinsurance | Insurance | Total | |||||||||||||||
Gross written premiums | $ | 1,027.5 | $ | 1,259.8 | $ | 2,287.3 | $ | 957.7 | $ | 1,084.6 | $ | 2,042.3 | ||||||||
Net written premiums | 980.4 | 980.8 | 1,961.2 | 907.5 | 844.2 | 1,751.7 | ||||||||||||||
Gross earned premiums | 859.2 | 1,182.0 | 2,041.2 | 828.9 | 1,000.7 | 1,829.6 | ||||||||||||||
Net earned premiums | 825.1 | 968.0 | 1,793.1 | 788.2 | 811.0 | 1,599.2 | ||||||||||||||
Losses and loss adjustment expenses | 367.4 | 600.5 | 967.9 | 394.9 | 497.4 | 892.3 | ||||||||||||||
Policy acquisition expenses | 152.3 | 184.1 | 336.4 | 161.0 | 161.3 | 322.3 | ||||||||||||||
General and administrative expenses | 107.0 | 142.6 | 249.6 | 97.2 | 134.0 | 231.2 | ||||||||||||||
Underwriting income� | $ | 198.4 | $ | 40.8 | $ | 239.2 | $ | 135.1 | $ | 18.3 | $ | 153.4 | ||||||||
Net investment income | 143.6 | 139.2 | ||||||||||||||||||
Net realized and unrealized investment gains (1) | 33.5 | 29.4 | ||||||||||||||||||
Corporate expenses | (46.1 | ) | (42.0 | ) | ||||||||||||||||
Non-recurring corporate expenses | (28.5 | ) | ||||||||||||||||||
Other (expense) income | (5.9 | ) | 3.0 | |||||||||||||||||
Interest expenses | (22.1 | ) | (23.2 | ) | ||||||||||||||||
Net realized and unrealized foreign exchange gains (losses) (2) | (13.8 | ) | (10.7 | ) | ||||||||||||||||
Income before tax | $ | 299.9 | $ | 249.1 | ||||||||||||||||
Income tax expense | (11.3 | ) | (9.8 | ) | ||||||||||||||||
Net income� | $ | 288.6 | $ | 239.3 | ||||||||||||||||
Ratios | ||||||||||||||||||||
Loss ratio | 44.5 | % | 62.0 | % | 54.0 | % | 50.1 | % | 61.3 | % | 55.8 | % | ||||||||
Policy acquisition expense ratio | 18.5 | % | 19.0 | % | 18.8 | % | 20.4 | % | 19.9 | % | 20.2 | % | ||||||||
General and administrative expense ratio (3) | 13.0 | % | 14.7 | % | 18.1 | % | 12.3 | % | 16.5 | % | 17.1 | % | ||||||||
General and administrative expense ratio (excluding non-recurring corporate expenses) (3) | 13.0 | % | 14.7 | % | 16.5 | % | 12.3 | % | 16.5 | % | 17.1 | % | ||||||||
Expense ratio | 31.5 | % | 33.7 | % | 36.9 | % | 32.7 | % | 36.4 | % | 37.3 | % | ||||||||
Expense ratio (excluding non-recurring corporate expenses) | 31.5 | % | 33.7 | % | 35.3 | % | 32.7 | % | 36.4 | % | 37.3 | % | ||||||||
Combined ratio | 76.0 | % | 95.7 | % | 90.9 | % | 82.8 | % | 97.7 | % | 93.1 | % | ||||||||
Combined ratio (excluding non-recurring corporate expenses) | 76.0 | % | 95.7 | % | 89.3 | % | 82.8 | % | 97.7 | % | 93.1 | % | ||||||||
(1) Includes realized and unrealized capital gains and losses and realized and unrealized gains and losses on interest rate swaps
(2) Includes realized and unrealized foreign exchange gains and losses and realized and unrealized gains and losses on foreign exchange contracts
(3) The total group general and administrative expense ratio includes the impact from corporate expenses
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About Aspen Insurance Holdings Limited
Aspen provides reinsurance and insurance coverage to clients in various domestic and global markets through wholly-owned subsidiaries and offices in Bermuda, France, Germany, Ireland, Singapore, Switzerland, the United Kingdom and the United States. For the year ended December 31, 2013, Aspen reported $10.2 billion in total assets, $4.7 billion in gross reserves, $3.3 billion in total shareholders equity and $2.6 billion in gross written premiums. Its operating subsidiaries have been assigned a rating of A ( Strong ) by Standard & Poors Financial Services LLC ( S&P ), an A ( Excellent ) by A.M. Best Company Inc. ( A.M. Best ) and an A2 ( Good ) by Moodys Investor Service, Inc. ( Moodys ).
For more information about Aspen, please visit www.aspen.co.
Forward-looking Statements Safe Harbor
This press release contains, and Aspens earnings conference call will contain, written or oral forward-looking statements within the meaning of the US federal securities laws. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, and can be identified by the use of words such as expect, intend, plan, believe, do not believe, aim, project, anticipate, seek, will, likely, assume, estimate, may, continue, guidance, objective, outlook, trends, future, could, would, should, target and similar expressions of a future or forward-looking nature.
All forward-looking statements rely on a number of assumptions, estimates and data concerning future results and events and are subject to a number of uncertainties and other factors, many of which are outside Aspens control that could cause actual results to differ materially from such statements.
�
All forward-looking statements address matters that involve risks and uncertainties.� Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in these statements. Aspen believes these factors include, but are not limited to: our ability to successfully implement steps to further optimize the business portfolio, ensure capital efficiency and enhance investment returns; the possibility of greater frequency or severity of claims and loss activity, including as a result of natural or man-made (including economic and political risks) catastrophic or material loss events, than our underwriting, reserving, reinsurance purchasing or investment practices have anticipated; the assumptions and uncertainties underlying reserve levels that may be impacted by future payments for settlements of claims and expenses or by other factors causing adverse or favorable development; the reliability of, and changes in assumptions to, natural and man-made catastrophe pricing, accumulation and estimated loss models; decreased demand for our insurance or reinsurance products and cyclical changes in the insurance and reinsurance industry; increased competition from existing insurers and reinsurers and from alternative capital providers and insurance-linked funds and collateralized special purpose insurers on the basis of pricing, capacity, coverage terms, new capital, binding authorities to brokers or other factors and the related demand and supply dynamics as contracts come up for renewal; changes in the availability, cost or quality of reinsurance or retrocessional coverage; changes in general economic conditions, including inflation, deflation, foreign currency exchange rates, interest rates and other factors that could affect our financial results; the risk of a material decline in the value or liquidity of all or parts of our investment portfolio; evolving issues with respect to interpretation of coverage after major loss events; our ability to adequately model and price the effects of climate cycles and climate change; any intervening legislative or governmental action and changing judicial interpretation and judgments on insurers liability to various risks; the effectiveness of our risk management loss limitation methods, including our reinsurance purchasing; changes in the total industry losses, or our share of total industry losses, resulting from past events and, with respect to such events, our reliance on loss reports received from cedants and loss adjustors, our reliance on industry loss estimates and those generated by modeling techniques, changes in rulings on flood damage or other exclusions as a result of prevailing lawsuits and case law; the impact of one or more large losses from events other than natural catastrophes or by an unexpected accumulation of attritional losses and deterioration with loss estimates; the impact of acts of terrorism, acts of war and related legislation; any changes in our reinsurers credit quality and the amount and timing of reinsurance recoverables; the continuing and uncertain impact of the current depressed lower growth economic environment in many of the countries in which we operate; the level of inflation in repair costs due to limited availability of labor and materials after catastrophes; a decline in our operating subsidiaries ratings with S&P, A.M. Best or Moodys; the failure of our reinsurers, policyholders, brokers or other intermediaries to honor their payment obligations; our ability to execute our business plan to enter new markets, introduce new products and develop new distribution channels, including their integration into our existing operations; our reliance on the assessment and pricing of individual risks by third parties; our dependence on a few brokers for a large portion of our revenues; the persistence of heightened financial risks, including excess sovereign debt, the banking system and the Eurozone
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debt crisis; changes in our ability to exercise capital management initiatives (including our share repurchase program) or to arrange banking facilities as a result of prevailing market conditions or changes in our financial position; changes in government regulations or tax laws in jurisdictions where we conduct business; changes in accounting principles or policies or in the application of such accounting principles or policies; Aspen or Aspen Bermuda Limited becoming subject to income taxes in the United States or the United Kingdom; loss of one or more of our senior underwriters or key personnel; our reliance on information technology and third party service providers for our operations and systems; and increased counterparty risk due to the credit impairment of financial institutions. For a more detailed description of these uncertainties and other factors, please see the Risk Factors section in Aspens Annual Report on Form 10-K as filed with the U.S. Securities and Exchange Commission on February 20, 2014.� Aspen undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.
In addition, any estimates relating to loss events involve the exercise of considerable judgment and reflect a combination of ground-up evaluations, information available to date from brokers and cedants, market intelligence, initial tentative loss reports and other sources. The actuarial range of reserves and managements best estimate represents a distribution from our internal capital model for reserving risk based on our then current state of knowledge and explicit and implicit assumptions relating to the incurred pattern of claims, the expected ultimate settlement amount, inflation and dependencies between lines of business. Due to the complexity of factors contributing to the losses and the preliminary nature of the information used to prepare these estimates, there can be no assurance that Aspens ultimate losses will remain within the stated amount.
(1)Non-GAAP Financial Measures
In presenting Aspens results, management has included and discussed certain non-GAAP financial measures as such term is defined in Regulation G. Management believes that these non-GAAP financial measures, which may be defined differently by other companies, better explain Aspens results of operations in a manner that allows for a more complete understanding of the underlying trends in Aspens business. However, these measures should not be viewed as a substitute for those determined in accordance with GAAP. The reconciliation of such non-GAAP financial measures to their respective most directly comparable GAAP financial measures in accordance with Regulation G is included in the financial supplement, which can be obtained from the Investor Relations section of Aspens website at www.aspen.co.
Annualized Operating Return on Average Equity ( Operating ROE ) is a non-GAAP financial measure. Operating ROE is calculated using operating income, as defined below, and average equity is calculated as the arithmetic average on a monthly basis for the stated periods of shareholders equity excluding the aggregate value of the liquidation preferences of our preference shares net of issuance costs and the total amount of non-controlling interest. Aspen presents Operating ROE as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information.
See page 23 of Aspens financial supplement for a reconciliation of operating income to net income and page 7 for a reconciliation of average ordinary shareholders equity to average shareholders equity. Aspens financial supplement can be obtained from the Investor Relations section of Aspens website at www.aspen.co.
Operating Income is a non-GAAP financial measure. Operating income is an internal performance measure used by Aspen in the management of its operations and represents after-tax operational results excluding, as applicable, after-tax net realized and unrealized capital gains or losses, including net realized and unrealized gains or losses on interest rate swaps, after-tax net foreign exchange gains or losses, including�net realized and unrealized gains and losses from foreign exchange contracts and certain non-recurring items. In 2014, non-recurring items included costs associated with defending the unsolicited approach from Endurance Specialty Holdings Ltd. in the amounts of $20.2 million and $28.5 million for the three and nine months ended September 30, 2014, respectively.
Aspen excludes these above items from its calculation of operating income because they are either not expected to recur and therefore are not reflective of underlying performance or the amount of these gains or losses is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. Aspen believes these amounts are largely independent of its business and underwriting process and including them would distort the analysis of trends in its operations. In addition to presenting net income determined in accordance with GAAP, Aspen believes that showing operating income enables investors, analysts, rating agencies and other users of its
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financial information to more easily analyze Aspens results of operations in a manner similar to how management analyzes Aspens underlying business performance. Operating income should not be viewed as a substitute for GAAP net income. Please see page 23 of Aspens financial supplement for a reconciliation of operating income to net income. Aspens financial supplement can be obtained from the Investor Relations section of Aspens website at www.aspen.co.
Diluted Book Value per Ordinary Share is not a non-GAAP financial measure. Aspen has included diluted book value per ordinary share as it illustrates the effect on basic book value per share of dilutive securities thereby providing a better benchmark for comparison with other companies. Diluted book value per share is calculated using the treasury stock method, defined on page 22 of Aspens financial supplement, which can be obtained from the Investor Relations section of Aspens website at www.aspen.co.
Diluted Operating Earnings per Share and Basic Operating Earnings per Share are non-GAAP financial measures. Aspen believes that the presentation of diluted operating earnings per share and basic operating earnings per share supports meaningful comparison from period to period and the analysis of normal business operations. Diluted operating earnings per share and basic operating earnings per share are calculated by dividing operating income by the diluted or basic weighted average number of shares outstanding for the period. See page 23 of Aspens financial supplement for a reconciliation of diluted and basic operating earnings per share to basic earnings per share. Aspens financial supplement can be obtained from the Investor Relations section of Aspens website at www.aspen.co.
Combined Ratio Excluding Catastrophes is a non-GAAP financial measure. Aspen believes that the presentation of combined ratio excluding catastrophes supports meaningful comparison from period to period of the underlying performance of the business. Combined ratio excluding catastrophes is calculated by dividing net losses excluding catastrophe losses and net expenses by net earned premiums excluding catastrophe related reinstatement premiums. Aspen has defined catastrophe losses in the third quarter of 2014 as losses predominantly associated with North American and European storms. Aspen has defined losses in the comparative period in 2013 as losses associated with hailstorms in Germany, floods in Toronto and Mexico and changes in loss estimates for natural catastrophe losses which occurred in the first half of 2013.
Accident Year Loss Ratio Excluding Catastrophes is a non-GAAP financial measure.� Aspen believes that the presentation of loss ratio excluding catastrophes and prior year reserve movements supports meaningful comparison from period to period of the underlying performance of the business.� Accident year loss ratio excluding catastrophes is calculated by dividing net losses excluding catastrophe losses, net expenses and prior year reserve movements by net earned premiums excluding catastrophe related reinstatement premiums.� Aspen has defined catastrophe losses in the third quarter of 2014 as losses predominantly associated with North American and European storms. Aspen has defined losses in the comparative period in 2013 as losses primarily associated with hailstorms in Germany, floods in Toronto and Mexico and changes in loss estimates for natural catastrophe losses which occurred in the first half of 2013. The third quarter of 2014 accident year loss ratio excluding catastrophes for the Reinsurance Segment of 52.7% is calculated as follows: the loss ratio 47.2% plus 9.3 percentage points of prior year loss reserve development less 3.8 percentage points of pre-tax catastrophe losses.
(2) Catastrophe Load included in our outlook is an estimate of the average annual aggregate loss before tax and after reinsurance from natural catastrophe events based on 50,000 simulations of our internal capital model which, in relation to its catastrophe modeling components, is based on a combination of catastrophe models selected by Aspen to best fit its current understanding of the worldwide natural catastrophe perils to which Aspen has known exposures. It does not include losses from non-natural catastrophe events such as terrorism or industrial accidents.
The $185 million catastrophe load included in the 10% Return on Operating Equity outlook for 2014 provided on February 6, 2014, was calculated based on the expected catastrophe load for the year. There is a higher proportion of the catastrophe load allocated to the third quarter due to the historical frequency of U.S. Wind events in this period. As an organization, Aspen monitors its current catastrophe losses to date against expected losses. Actual catastrophe loss experience may materially differ from the catastrophe load in any one year or attributable to any one quarter for reasons which include natural variability in the frequency and severity of catastrophe events, and limitations in one or more of the models or uncertainties in the application of policy terms and limits.
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(3) The outlook for 2015 and 2016 assumes normal loss experience and the current insurance rate environment. Our outlook in 2015 and 2016 in particular is necessarily subject to heightened sensitivity in relation to assumptions which are likely to be the subject of future change, amendment, update and review, as necessary. For example, our assumptions for rising interest rates in 2015 and 2016 are subject to and dependent upon the anticipated and actual monetary policy decisions taken by the central banks in the jurisdictions in which we operate. Our assumptions are also based on the retention of our senior underwriters and client relationships. In addition, the models underlying our normal loss experience assumptions will produce different illustrative loss patterns if the modeling assumptions are changed. While recent decreases in pricing in certain business lines, if sustained, are expected to have an adverse effect on operating return on equity, Aspen continues to identify actions in each of its three operating return on equity levers - optimization of the business portfolio, capital efficiency and enhancing investment returns - to help mitigate the impact of pricing declines on operating return on equity.
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Exhibit 99.2
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| � | �FINANCIAL SUPPLEMENT | |||||||||||
| � | �As of September 30, 2014 | |||||||||||
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| � | Aspen Insurance Holdings Limited | |||||||||||
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| � | This financial supplement is for information purposes only. It should be read in conjunction with other documents filed or to be filed by Aspen Insurance Holdings Limited with the United States Securities and Exchange Commission. | |||||||||||
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| � | www.aspen.co | |||||||||||
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| � | Investor Contact: | |||||||||||
| � | Aspen Insurance Holdings Limited | |||||||||||
| � | Kerry Calaiaro, Senior Vice President, Investor Relations | |||||||||||
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| � | email: [email protected] | |||||||||||
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 | ASPEN INSURANCE HOLDINGS LIMITED | |||
Table Of Contents | ||||
Page | ||||
Condensed Consolidated Statements of Cash Flows | ||||
Prior Year Reserve Releases | ||||
Changes to Segmental Reporting | ||||
Written and Earned Premiums by Segment and Prior Lines of Business | ||||
 | ASPEN INSURANCE HOLDINGS LIMITED | |||
Basis of Presentation | ||||
Definitions and presentations: All financial information contained herein is unaudited except for information for the fiscal year ended December 31, 2013 and December 31, 2012. Unless otherwise noted, all data is in U.S. dollar millions, except for per share amounts, percentages and ratio information. | ||||
In presenting Aspen's results, management has included and discussed certain "non-GAAP financial measures", as such term is defined in Regulation G. Management believes that these non-GAAP measures, which may be defined differently by other companies, better explain Aspen's results of operations in a manner that allows for a more complete understanding of the underlying trends in Aspen's business. However, these measures should not be viewed as a substitute for those determined in accordance with GAAP. The reconciliation of such non-GAAP financial measures to their respective most directly comparable GAAP financial measures in accordance with Regulation G is included in this financial supplement. | ||||
Operating income�(a non-U.S. GAAP financial measure): Operating income is an internal performance measure used by Aspen in the management of its operations and represents after-tax operational results excluding, as applicable, after-tax net realized and unrealized capital gains or losses, including net realized and unrealized gains and losses on interest rate swaps, after-tax net foreign exchange gains or losses, including net realized and unrealized gains and losses from foreign exchange contracts and certain non-recurring items. In 2014, non-recurring items included costs associated with defending the unsolicited approach from Endurance Specialty Holdings Ltd. in the amounts of $20.2 million and $28.5 million for the three and nine months ended September 30, 2014, respectively.�In 2013, these non-recurring items included issue costs associated with the redemption of the 5.625% Preferred Income Equity Redemption Securities ("PIERS") and a $9.3 million make-whole payment associated with the redemption of the $250.0 million 6.0% coupon Senior Notes due to mature on August 15, 2014. | ||||
Aspen excludes these above items from its calculation of operating income because they are either not expected to recur and therefore are not reflective of underlying performance or the amount of these gains or losses is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. Aspen believes these amounts are largely independent of its business and underwriting process and including them would distort the analysis of trends in its operations. In addition to presenting net income determined in accordance with GAAP, Aspen believes that showing operating income enables investors, analysts, rating agencies and other users of its financial information to more easily analyze Aspen's results of operations in a manner similar to how management analyzes Aspen's underlying business performance. Operating income should not be viewed as a substitute for GAAP net income. Please see page 23 for a reconciliation of operating income to net income. | ||||
Annualized operating return on average equity ( Operating ROE )�(a non-GAAP financial measure): Operating ROE is calculated using operating income, as defined above, and average equity is calculated as the arithmetic average on a monthly basis for the stated periods of shareholders' equity excluding the aggregate value of the liquidation preferences of our preference shares net of issuance costs and the total amount of non-controlling interest. | ||||
Aspen presents Operating ROE as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information. See page 23 for a reconciliation of operating income to net income and page 7 for a reconciliation of average ordinary shareholders' equity to average shareholders' equity. | ||||
Diluted operating earnings per share and basic operating earnings per share�(non-GAAP financial measures): Aspen believes that the presentation of diluted operating earnings per share and basic operating earnings per share supports meaningful comparison from period to period and the analysis of normal business operations. Diluted operating earnings per share and basic operating earnings per share are calculated by dividing operating income by the diluted or basic weighted average number of shares outstanding for the period. See page 23 for a reconciliation of diluted and basic operating earnings per share to basic earnings per share. | ||||
Diluted book value per ordinary share�(not a non-GAAP financial measure): Aspen has included diluted book value per ordinary share as it illustrates the effect on basic book value per share of dilutive securities thereby providing a better benchmark for comparison with other companies. Diluted book value per share is calculated using the treasury stock method as defined on page 22. | ||||
Underwriting ratios�(GAAP financial measures): Aspen, along with others in the industry, uses underwriting ratios as measures of performance. The loss ratio is the ratio of net claims and claims adjustment expenses to net premiums earned. The acquisition expense ratio is the ratio of underwriting expenses (commissions, premium taxes, licenses and fees, as well as other underwriting expenses) to net premiums earned. The general and administrative expense ratio is the ratio of general and administrative expenses to net premiums earned. The combined ratio is the sum of the loss ratio, the acquisition expense ratio and the general and administrative expense ratio. These ratios are relative measurements that describe for every $100 of net premiums earned, the cost of losses and expenses, respectively. The combined ratio presents the total cost per $100 of earned premium. A combined ratio below 100% demonstrates underwriting profit; a combined ratio above 100% demonstrates underwriting loss. | ||||
GAAP combined ratios differ from U.S. statutory combined ratios primarily due to the deferral of certain third-party acquisition expenses for GAAP reporting purposes and the use of net premiums earned rather than net premiums written in the denominator when calculating the acquisition expense and the general and administrative expense ratios. | ||||
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 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||
Financial Highlights | ||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
(in US$ millions except for percentages, share and per share amounts) | 2014 | 2013 | Change | 2014 | 2013 | Change | ||||||||||||||||||
Gross written premium | $ | 652.5 | $ | 581.6 | 12.2 | �% | $ | 2,287.3 | $ | 2,042.3 | 12.0 | �% | ||||||||||||
Net written premium | $ | 577.3 | $ | 542.0 | 6.5 | �% | $ | 1,961.2 | $ | 1,751.7 | 12.0 | �% | ||||||||||||
Net earned premium | $ | 610.4 | $ | 544.3 | 12.1 | �% | $ | 1,793.1 | $ | 1,599.2 | 12.1 | �% | ||||||||||||
Net income after tax | $ | 37.4 | $ | 107.4 | (65.2 | )% | $ | 288.6 | $ | 239.3 | 20.6 | �% | ||||||||||||
Operating income after tax | $ | 81.7 | $ | 82.0 | (0.4 | )% | $ | 297.2 | $ | 219.9 | 35.2 | �% | ||||||||||||
Net investment income | $ | 48.0 | $ | 45.0 | 6.7 | �% | $ | 143.6 | $ | 139.2 | 3.2 | �% | ||||||||||||
Underwriting income | $ | 52.6 | $ | 44.7 | 17.7 | �% | $ | 193.1 | $ | 111.4 | 73.3 | �% | ||||||||||||
Earnings Per Share and Book Value Per Share | ||||||||||||||||||||||||
Basic earnings per ordinary share | ||||||||||||||||||||||||
����Net income adjusted for preference share dividend | $ | 0.43 | $ | 1.47 | (70.7%) | $ | 3.99 | $ | 3.07 | 29.0 | �% | |||||||||||||
����Operating income adjusted for preference share dividend | $ | 1.11 | $ | 1.09 | 1.8 | �% | $ | 4.12 | $ | 2.89 | 41.4 | �% | ||||||||||||
Diluted earnings per ordinary share | ||||||||||||||||||||||||
����Net income adjusted for preference share dividend | $ | 0.42 | $ | 1.43 | (70.6 | )% | $ | 3.91 | $ | 2.95 | 30.0 | �% | ||||||||||||
����Operating income adjusted for preference share dividend | $ | 1.08 | $ | 1.05 | 2.9 | �% | $ | 4.04 | $ | 2.78 | 42.9 | �% | ||||||||||||
Weighted average number of ordinary shares outstanding (in millions of shares) | 65.116 | 66.716 | (2.4 | )% | 65.284 | 67.303 | (3.0 | )% | ||||||||||||||||
Diluted weighted average number of ordinary shares outstanding (in millions of shares) | 66.513 | 68.562 | (3.0 | )% | 66.599 | 69.959 | (4.8 | )% | ||||||||||||||||
Book value per ordinary share | $ | 45.60 | $ | 41.33 | 10.3 | �% | $ | 45.60 | $ | 41.33 | 10.3 | �% | ||||||||||||
Diluted book value per ordinary share | $ | 44.60 | $ | 40.43 | 10.3 | �% | $ | 44.60 | $ | 40.43 | 10.3 | �% | ||||||||||||
Ordinary shares outstanding at September 30, 2014 and September 30, 2013 (in millions of shares) | 63.350 | 65.701 | (3.6 | )% | 63.350 | 65.701 | (3.6 | )% | ||||||||||||||||
Diluted ordinary shares outstanding at September 30, 2014 and September 30, 2013 (in millions of shares) | 64.783 | 67.171 | (3.6 | )% | 64.783 | 67.171 | (3.6 | )% | ||||||||||||||||
Underwriting Ratios | ||||||||||||||||||||||||
Loss ratio | 56.1 | % | 53.3 | % | 54.0 | % | 55.8 | % | ||||||||||||||||
���Policy acquisition expense ratio | 18.9 | % | 20.3 | % | 18.8 | % | 20.2 | % | ||||||||||||||||
���General, administrative and corporate expense ratio | 19.6 | % | 18.2 | % | 18.1 | % | 17.1 | % | ||||||||||||||||
���General, administrative and corporate expense ratio (excluding non-recurring corporate expenses) | 16.3 | % | 18.2 | % | 16.5 | % | 17.1 | % | ||||||||||||||||
Expense ratio | 38.5 | % | 38.5 | % | 36.9 | % | 37.3 | % | ||||||||||||||||
Expense ratio (excluding non-recurring corporate expenses) | 35.2 | % | 38.5 | % | 35.3 | % | 37.3 | % | ||||||||||||||||
Combined ratio | 94.6 | % | 91.8 | % | 90.9 | % | 93.1 | % | ||||||||||||||||
Combined ratio (excluding non-recurring corporate expenses) | 91.3 | % | 91.8 | % | 89.2 | % | 93.1 | % | ||||||||||||||||
Return On Equity | ||||||||||||||||||||||||
Average equity (1) | $ | 2,943.8 | $ | 2,679.3 | $ | 2,875.5 | $ | 2,801.4 | ||||||||||||||||
Return on average equity | ||||||||||||||||||||||||
���Net income adjusted for preference share dividend | 1.0 | % | 3.7 | % | 9.0 | % | 7.6 | % | ||||||||||||||||
���Operating income adjusted for preference share dividend | 2.5 | % | 2.7 | % | 9.3 | % | 6.9 | % | ||||||||||||||||
Annualized return on average equity | ||||||||||||||||||||||||
Net income | 4.0 | % | 14.8 | % | 12.0 | % | 10.1 | % | ||||||||||||||||
Operating income | 10.0 | % | 10.8 | % | 12.4 | % | 9.2 | % | ||||||||||||||||
See pages 7 and 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||||||||||||
(1) Average equity excludes preference shares. | ||||||||||||||||||||||||
2
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Consolidated Statements of Operations - Quarterly Results | ||||||||||||||||||||||||||||||
(in US$ millions except for percentages and per share amounts) | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||
UNDERWRITING REVENUES | ||||||||||||||||||||||||||||||
Gross written premiums | $ | 652.5 | $ | 779.3 | $ | 855.5 | $ | 604.4 | $ | 581.6 | $ | 687.3 | $ | 773.4 | ||||||||||||||||
Premiums ceded | (75.2 | ) | (92.9 | ) | (158.0 | ) | (56.4 | ) | (39.6 | ) | (74.6 | ) | (176.4 | ) | ||||||||||||||||
Net written premiums | 577.3 | 686.4 | 697.5 | 548.0 | 542.0 | 612.7 | 597.0 | |||||||||||||||||||||||
Change in unearned premiums | 33.1 | (70.2 | ) | (131.0 | ) | 24.6 | 2.3 | (68.7 | ) | (86.1 | ) | |||||||||||||||||||
Net earned premiums | 610.4 | 616.2 | 566.5 | 572.6 | 544.3 | 544.0 | 510.9 | |||||||||||||||||||||||
UNDERWRITING EXPENSES | ||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 342.7 | 337.1 | 288.1 | 331.4 | 290.2 | 333.4 | 268.7 | |||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 115.5 | 108.9 | 112.0 | 99.7 | 110.5 | 107.2 | 104.6 | |||||||||||||||||||||||
General, administrative and corporate expenses (excluding non-recurring corporate expenses) | 99.6 | 103.5 | 92.6 | 94.9 | 98.9 | 87.7 | 86.6 | |||||||||||||||||||||||
Total underwriting expenses | 557.8 | 549.5 | 492.7 | 526.0 | 499.6 | 528.3 | 459.9 | |||||||||||||||||||||||
Underwriting income including corporate expenses | 52.6 | 66.7 | 73.8 | 46.6 | 44.7 | 15.7 | 51.0 | |||||||||||||||||||||||
OTHER OPERATING REVENUE AND EXPENSES | ||||||||||||||||||||||||||||||
Net investment income | 48.0 | 46.1 | 49.5 | 47.2 | 45.0 | 45.9 | 48.3 | |||||||||||||||||||||||
Interest expense | (7.4 | ) | (7.3 | ) | (7.4 | ) | (9.5 | ) | (7.7 | ) | (7.8 | ) | (7.7 | ) | ||||||||||||||||
Other(expense)/income | (7.8 | ) | 2.0 | (0.1 | ) | 3.5 | 1.6 | 0.9 | 0.5 | |||||||||||||||||||||
Total other operating revenue | 32.8 | 40.8 | 42.0 | 41.2 | 38.9 | 39.0 | 41.1 | |||||||||||||||||||||||
OPERATING INCOME BEFORE TAX | 85.4 | 107.5 | 115.8 | 87.8 | 83.6 | 54.7 | 92.1 | |||||||||||||||||||||||
Non-recurring corporate expenses | (20.2 | ) | (5.3 | ) | (3.0 | ) | ||||||||||||||||||||||||
Net realized and unrealized exchange (losses)/gains (1) | (26.5 | ) | 9.6 | 3.1 | (3.8 | ) | 13.3 | (13.8 | ) | (10.2 | ) | |||||||||||||||||||
Net realized and unrealized investment gains�(2) | 25.2 | 8.3 | 9.6 | 13.4 | 0.2 | 15.8 | ||||||||||||||||||||||||
INCOME BEFORE TAX | 38.7 | 137.0 | 124.2 | 93.6 | 110.3 | 41.1 | 97.7 | |||||||||||||||||||||||
Income tax expense | (1.3 | ) | (6.2 | ) | (3.8 | ) | (3.6 | ) | (2.9 | ) | (1.0 | ) | (5.9 | ) | ||||||||||||||||
NET INCOME AFTER TAX | 37.4 | 130.8 | 120.4 | 90.0 | 107.4 | 40.1 | 91.8 | |||||||||||||||||||||||
Dividends paid on ordinary shares | (13.1 | ) | (13.1 | ) | (11.7 | ) | (11.8 | ) | (12.2 | ) | (11.9 | ) | (11.9 | ) | ||||||||||||||||
Dividends paid on preference shares | (9.5 | ) | (9.4 | ) | (9.5 | ) | (9.4 | ) | (9.5 | ) | (8.0 | ) | (8.6 | ) | ||||||||||||||||
Dividends paid to non-controlling interest | (0.1 | ) | ||||||||||||||||||||||||||||
Change in redemption value of the PIERS (3) | (7.1 | ) | ||||||||||||||||||||||||||||
Proportion due to non-controlling interest | 0.1 | (0.1 | ) | 0.2 | 0.3 | |||||||||||||||||||||||||
Retained income | $ | 14.9 | $ | 108.3 | $ | 99.1 | $ | 68.9 | $ | 86.0 | $ | 13.1 | $ | 71.3 | ||||||||||||||||
Components of net income after tax | ||||||||||||||||||||||||||||||
Operating income | 81.7 | 102.8 | 112.7 | 84.4 | 82.0 | 52.2 | 85.7 | |||||||||||||||||||||||
Non-recurring corporate expenses | (20.2 | ) | (5.3 | ) | (3.0 | ) | ||||||||||||||||||||||||
Net realized and unrealized exchange (losses)/gains after tax (1) | (24.1 | ) | 8.2 | 2.6 | (3.8 | ) | 12.0 | (12.0 | ) | (9.5 | ) | |||||||||||||||||||
Net realized and unrealized investment gains/(losses) after tax (2) | 25.1 | 8.1 | 9.4 | 13.4 | (0.1 | ) | 15.6 | |||||||||||||||||||||||
NET INCOME AFTER TAX | $ | 37.4 | $ | 130.8 | $ | 120.4 | $ | 90.0 | $ | 107.4 | $ | 40.1 | $ | 91.8 | ||||||||||||||||
Loss ratio | 56.1 | % | 54.7 | % | 50.9 | % | 57.9 | % | 53.3 | % | 61.3 | % | 52.6 | % | ||||||||||||||||
Policy acquisition expense ratio | 18.9 | % | 17.7 | % | 19.8 | % | 17.4 | % | 20.3 | % | 19.7 | % | 20.5 | % | ||||||||||||||||
General, administrative and corporate expense ratio | 19.6 | % | 17.7 | % | 16.9 | % | 16.6 | % | 18.2 | % | 16.1 | % | 17.0 | % | ||||||||||||||||
General, administrative and corporate expense ratio (excluding non-recurring corporate expenses) | 16.3 | % | 16.8 | % | 16.3 | % | 16.6 | % | 18.2 | % | 16.1 | % | 17.0 | % | ||||||||||||||||
Expense ratio | 38.5 | % | 35.4 | % | 36.7 | % | 34.0 | % | 38.5 | % | 35.8 | % | 37.5 | % | ||||||||||||||||
Expense ratio (excluding non-recurring corporate expenses) | 35.2 | % | 34.5 | % | 36.1 | % | 34.0 | % | 38.5 | % | 35.8 | % | 37.5 | % | ||||||||||||||||
Combined ratio | 94.6 | % | 90.1 | % | 87.6 | % | 91.9 | % | 91.8 | % | 97.1 | % | 90.1 | % | ||||||||||||||||
Combined ratio (excluding non-recurring corporate expenses) | 91.3 | % | 89.2 | % | 87.0 | % | 91.9 | % | 91.8 | % | 97.1 | % | 90.1 | % | ||||||||||||||||
Basic earnings per share�(4) | $ | 0.43 | $ | 1.85 | $ | 1.70 | $ | 1.23 | $ | 1.47 | $ | 0.38 | $ | 1.21 | ||||||||||||||||
Diluted earnings per share (4) | $ | 0.42 | $ | 1.82 | $ | 1.66 | $ | 1.21 | $ | 1.43 | $ | 0.36 | $ | 1.15 | ||||||||||||||||
Annualized return on average equity | ||||||||||||||||||||||||||||||
Net income | 4.0 | % | 16.8 | % | 16.0 | % | 12.0 | % | 14.8 | % | 4.4 | % | 11.6 | % | ||||||||||||||||
Operating income | 10.0 | % | 12.8 | % | 14.8 | % | 11.2 | % | 10.8 | % | 6.4 | % | 10.8 | % | ||||||||||||||||
See pages 7 and 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||||||||||||||||||
(1) Includes the net realized and unrealized gains/(losses) from foreign exchange contracts. | ||||||||||||||||||||||||||||||
(2) Includes the net realized and unrealized gains/(losses) from interest rate swaps. | ||||||||||||||||||||||||||||||
(3) 5.625% Preferred Income Equity Redemption Securities. | ||||||||||||||||||||||||||||||
(4) Adjusted for preference share dividends and non-controlling interest. | ||||||||||||||||||||||||||||||
3
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||
Consolidated Statements of Operations - Year To Date Results | ||||||||||||||
Nine Months Ended September 30, | ||||||||||||||
� | 2014 | 2013 | 2012 | |||||||||||
UNDERWRITING REVENUES | ||||||||||||||
Gross written premiums | $ | 2,287.3 | $ | 2,042.3 | $ | 2,007.1 | ||||||||
Premiums ceded | (326.1 | ) | (290.6 | ) | (284.6 | ) | ||||||||
Net written premiums | 1,961.2 | 1,751.7 | 1,722.5 | |||||||||||
Change in unearned premiums | (168.1 | ) | (152.5 | ) | (197.5 | ) | ||||||||
Net earned premiums | 1,793.1 | 1,599.2 | 1,525.0 | |||||||||||
UNDERWRITING EXPENSES | ||||||||||||||
Losses and loss adjustment expenses | 967.9 | 892.3 | 801.1 | |||||||||||
Amortization of deferred policy acquisition costs | 336.4 | 322.3 | 301.2 | |||||||||||
General, administrative and corporate expenses (excluding non-recurring corporate expenses)(1)� | 295.7 | 273.2 | 259.0 | |||||||||||
Total underwriting expenses | 1,600.0 | 1,487.8 | 1,361.3 | |||||||||||
Underwriting income including corporate expenses | 193.1 | 111.4 | 163.7 | |||||||||||
OTHER OPERATING REVENUE AND EXPENSES | ||||||||||||||
Net investment income | 143.6 | 139.2 | 153.8 | |||||||||||
Interest expense | (22.1 | ) | (23.2 | ) | (23.2 | ) | ||||||||
Other (expenses)/income | (5.9 | ) | 3.0 | 7.1 | ||||||||||
Total other operating revenue | 115.6 | 119.0 | 137.7 | |||||||||||
OPERATING INCOME BEFORE TAX | 308.7 | 230.4 | 301.4 | |||||||||||
Non-recurring corporate expenses | (28.5 | ) | ||||||||||||
Net realized and unrealized exchange (losses) (2) | (13.8 | ) | (10.7 | ) | (1.6 | ) | ||||||||
Net realized and unrealized investment gains/(losses)(3) | 33.5 | 29.4 | (1.8 | ) | ||||||||||
INCOME BEFORE TAX | 299.9 | 249.1 | 298.0 | |||||||||||
Income tax expense | (11.3 | ) | (9.8 | ) | (19.6 | ) | ||||||||
NET INCOME AFTER TAX | 288.6 | 239.3 | 278.4 | |||||||||||
Dividends paid on ordinary shares | (37.9 | ) | (36.0 | ) | (35.0 | ) | ||||||||
Dividends paid on preference shares | (28.4 | ) | (26.1 | ) | (22.6 | ) | ||||||||
Dividends paid to non controlling interest | (0.1 | ) | ||||||||||||
Change in redemption value of the PIERS | (7.1 | ) | ||||||||||||
Proportion due to non-controlling interest | 0.3 | 0.3 | ||||||||||||
Retained income | $ | 222.3 | $ | 170.4 | $ | 221.0 | ||||||||
Components of net income after tax | ||||||||||||||
Operating income | 297.2 | $ | 219.9 | $ | 282.8 | |||||||||
Non-recurring corporate expenses | (28.5 | ) | ||||||||||||
Net realized and unrealized exchange (losses) after tax�(2) | (13.3 | ) | (9.5 | ) | (1.8 | ) | ||||||||
Net realized and unrealized investment gains/(losses) after tax (3) | 33.2 | 28.9 | (2.6 | ) | ||||||||||
NET INCOME AFTER TAX | $ | 288.6 | $ | 239.3 | $ | 278.4 | ||||||||
Loss ratio | 54.0 | % | 55.8 | % | 52.5 | % | ||||||||
Policy acquisition expense ratio | 18.8 | % | 20.2 | % | 19.8 | % | ||||||||
General, administrative and corporate expense ratio (1)�� | 18.1 | % | 17.1 | % | 17.0 | % | ||||||||
General, administrative and corporate expense ratio (excluding non-recurring corporate expenses) (1) | 16.5 | % | 17.1 | % | 17.0 | % | ||||||||
Expense ratio | 36.9 | % | 37.3 | % | 36.8 | % | ||||||||
Expense ratio (excluding non-recurring corporate expenses) | 35.3 | % | 37.3 | % | 36.8 | % | ||||||||
Combined ratio | 90.9 | % | 93.1 | % | 89.3 | % | ||||||||
Combined ratio (excluding non-recurring corporate expenses) | 89.3 | % | 93.1 | % | 89.3 | % | ||||||||
See pages 7 and 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||
(1) In 2012, the Company adopted the provision of ASU 2010-26, Accounting for Costs Associated with Acquiring or Renewing Insurance Contracts. Under the standard, the Company is required to expense the proportion of its general and administrative deferred acquisition costs not directly related to successful business acquisition. The application of this standard has resulted in a net $16.0 million write down of deferred acquisition costs through retained earnings brought forward and the restatement of our quarterly balance sheets from December 31, 2010 to December 31, 2011. | ||||||||||||||
(2) Includes the net realized and unrealized gains/(losses) from foreign exchange contracts. | ||||||||||||||
(3) Includes the net realized and unrealized gains/(losses) from interest rate swaps. | ||||||||||||||
4
| � |  | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
| � | Consolidated Balance Sheets | ||||||||||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | (in US$ millions except for per share amounts) | September 30, 2014 | June 30, 2014 | March 31, 2014 | December 31, 2013 | September 30, 2013 | June 30, �2013 | March 31, 2013 | |||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | Investments | ||||||||||||||||||||||||||||||
| � | Fixed income maturities | $ | 6,271.9 | $ | 6,297.7 | $ | 6,256.1 | $ | 6,285.3 | $ | 6,263.5 | $ | 6,046.4 | $ | 5,961.9 | ||||||||||||||||
| � | Equity securities | 647.0 | 574.2 | 507.8 | 460.4 | 441.5 | 413.1 | 414.1 | |||||||||||||||||||||||
| � | Other investments | 8.7 | 8.7 | 8.7 | 48.0 | 46.1 | 44.9 | 45.0 | |||||||||||||||||||||||
| � | Catastrophe bonds | 32.2 | 30.0 | 18.0 | 5.8 | ||||||||||||||||||||||||||
| � | Short-term investments | 314.2 | 349.7 | 215.5 | 160.3 | 148.5 | 242.3 | 353.1 | |||||||||||||||||||||||
| � | Total investments | 7,274.0 | 7,260.3 | 7,006.1 | 6,959.8 | 6,899.6 | 6,746.7 | 6,774.1 | |||||||||||||||||||||||
| � | Cash and cash equivalents | 1,289.1 | 1,345.2 | 1,443.7 | 1,293.6 | 1,198.3 | 1,188.9 | 1,212.7 | |||||||||||||||||||||||
| � | Reinsurance recoverables | ||||||||||||||||||||||||||||||
| � | Unpaid losses | 384.7 | 360.0 | 352.1 | 332.7 | 442.2 | 472.3 | 479.2 | |||||||||||||||||||||||
| � | Ceded unearned premiums | 229.8 | 217.9 | 221.3 | 151.9 | 179.6 | 226.0 | 217.4 | |||||||||||||||||||||||
| � | Receivables | ||||||||||||||||||||||||||||||
| � | Underwriting premiums | 1,105.3 | 1,192.7 | 1,189.5 | 999.0 | 1,089.1 | 1,197.6 | 1,149.7 | |||||||||||||||||||||||
| � | Other | 92.0 | 106.4 | 107.8 | 90.3 | 76.3 | 71.8 | 66.0 | |||||||||||||||||||||||
| � | Funds withheld | 47.5 | 47.8 | 49.4 | 46.5 | 47.7 | 81.5 | 85.0 | |||||||||||||||||||||||
| � | Deferred policy acquisition costs | 301.6 | 306.4 | 289.6 | 262.2 | 262.1 | 264.4 | 238.5 | |||||||||||||||||||||||
| � | Derivatives at fair value | 7.0 | 1.6 | 6.8 | 7.0 | 5.6 | 2.0 | 2.0 | |||||||||||||||||||||||
| � | Receivable for securities sold | 1.6 | 9.1 | 14.8 | 5.2 | 5.9 | 5.8 | 20.7 | |||||||||||||||||||||||
| � | Office properties and equipment | 64.4 | 65.1 | 61.8 | 60.1 | 60.5 | 57.2 | 55.2 | |||||||||||||||||||||||
| � | Taxation | 4.0 | 2.8 | 0.5 | 1.6 | 3.1 | |||||||||||||||||||||||||
| � | Other assets | 10.4 | 1.5 | 1.5 | 2.2 | 13.1 | 20.9 | 17.0 | |||||||||||||||||||||||
| � | Intangible assets | 18.2 | 18.2 | 18.3 | 18.4 | 18.6 | 18.7 | 18.8 | |||||||||||||||||||||||
| � | Total assets | $ | 10,829.6 | $ | 10,935.0 | $ | 10,763.2 | $ | 10,230.5 | $ | 10,301.7 | $ | 10,353.8 | $ | 10,336.3 | ||||||||||||||||
| � | LIABILITIES | ||||||||||||||||||||||||||||||
| � | Insurance reserves | ||||||||||||||||||||||||||||||
| � | Losses and loss adjustment expenses | $ | 4,787.3 | $ | 4,795.8 | $ | 4,760.7 | $ | 4,678.9 | $ | 4,715.6 | $ | 4,734.9 | $ | 4,683.8 | ||||||||||||||||
| � | Unearned premiums | 1,508.7 | 1,568.5 | 1,479.7 | 1,280.6 | 1,334.6 | 1,375.3 | 1,295.7 | |||||||||||||||||||||||
| � | Total insurance reserves | 6,296.0 | 6,364.3 | 6,240.4 | 5,959.5 | 6,050.2 | 6,110.2 | 5,979.5 | |||||||||||||||||||||||
| � | Payables | ||||||||||||||||||||||||||||||
| � | Reinsurance premiums | 146.8 | 93.5 | 155.1 | 88.2 | 178.4 | 224.8 | 209.7 | |||||||||||||||||||||||
| � | Taxation | 25.7 | 28.0 | 16.5 | 15.7 | 17.7 | 16.4 | 14.7 | |||||||||||||||||||||||
| � | Accrued expenses and other payables | 290.3 | 284.5 | 361.6 | 265.6 | 282.8 | 258.7 | 285.6 | |||||||||||||||||||||||
| � | Liabilities under derivative contracts | 12.7 | 5.4 | 0.4 | 2.9 | 2.3 | 9.6 | 8.0 | |||||||||||||||||||||||
| � | Total payables | 475.5 | 411.4 | 533.6 | 372.4 | 481.2 | 509.5 | 518.0 | |||||||||||||||||||||||
| � | Long-term debt issued by Silverton | 64.5 | 56.0 | 53.4 | 50.0 | ||||||||||||||||||||||||||
| � | Long-term debt | 549.1 | 549.1 | 549.0 | 549.0 | 499.2 | 499.2 | 499.2 | |||||||||||||||||||||||
| � | Total liabilities | 7,385.1 | 7,380.8 | 7,376.4 | 6,930.9 | 7,030.6 | 7,118.9 | 6,996.7 | |||||||||||||||||||||||
| � | SHAREHOLDERS EQUITY | ||||||||||||||||||||||||||||||
| � | Ordinary shares | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | |||||||||||||||||||||||
| � | Non-controlling interest | (0.3 | ) | (0.2 | ) | (0.2 | ) | (0.3 | ) | (0.1 | ) | 0.2 | 0.2 | ||||||||||||||||||
| � | Preference shares | ||||||||||||||||||||||||||||||
| � | Additional paid-in capital | 1,186.4 | 1,276.7 | 1,269.9 | 1,297.4 | 1,297.6 | 1,346.7 | 1,318.2 | |||||||||||||||||||||||
| � | Retained earnings | 2,005.6 | 1,990.7 | 1,882.4 | 1,783.3 | 1,714.4 | 1,628.4 | 1,615.3 | |||||||||||||||||||||||
| � | Accumulated other comprehensive income, net of taxes | 252.7 | 286.9 | 234.6 | 219.1 | 259.1 | 259.5 | 405.8 | |||||||||||||||||||||||
| � | Total shareholders equity | 3,444.5 | 3,554.2 | 3,386.8 | 3,299.6 | 3,271.1 | 3,234.9 | 3,339.6 | |||||||||||||||||||||||
| � | Total liabilities and shareholders equity | $ | 10,829.6 | $ | 10,935.0 | $ | 10,763.2 | $ | 10,230.5 | $ | 10,301.7 | $ | 10,353.8 | $ | 10,336.3 | ||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | Book value per ordinary share | $ | 45.60 | $ | 45.81 | $ | 43.28 | $ | 41.87 | $ | 41.33 | $ | 39.98 | $ | 43.14 | ||||||||||||||||
| � | Book value per diluted ordinary share | $ | 44.60 | $ | 44.84 | $ | 42.72 | $ | 40.90 | $ | 40.43 | $ | 38.86 | $ | 40.67 | ||||||||||||||||
| � | See pages 7 and 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||||||||||||||||||
5
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||
Earnings Per Share and Book Value Per Share | ||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||
(in US$ except for number of shares) | September�30, 2014 | September�30, 2013 | September�30, 2014 | September�30, 2013 | ||||||||||||||
Basic earnings per ordinary share | ||||||||||||||||||
Net income adjusted for preference share dividend | $ | 0.43 | $ | 1.47 | $ | 3.99 | $ | 3.07 | ||||||||||
Operating income adjusted for preference share dividend | $ | 1.11 | $ | 1.09 | $ | 4.12 | $ | 2.89 | ||||||||||
Diluted earnings per ordinary share | ||||||||||||||||||
Net income adjusted for preference share dividend | $ | 0.42 | $ | 1.43 | $ | 3.91 | $ | 2.95 | ||||||||||
Operating income adjusted for preference share dividend | $ | 1.08 | $ | 1.05 | $ | 4.04 | $ | 2.78 | ||||||||||
Weighted average number of ordinary shares outstanding (in millions) | 65.116 | 66.716 | 65.284 | 67.303 | ||||||||||||||
Weighted average number of ordinary shares outstanding and dilutive potential ordinary shares (in millions) | 66.513 | 68.562 | 66.599 | 69.959 | ||||||||||||||
Book value per ordinary share | $ | 45.60 | $ | 41.33 | $ | 45.60 | $ | 41.33 | ||||||||||
Diluted book value per ordinary share | $ | 44.60 | $ | 40.43 | $ | 44.60 | $ | 40.43 | ||||||||||
Ordinary shares outstanding at end of the period (in millions) | 63.350 | 65.701 | 63.350 | 65.701 | ||||||||||||||
Ordinary shares outstanding and dilutive potential ordinary shares at end of the period (in millions) | 64.783 | 67.171 | 64.783 | 67.171 | ||||||||||||||
See pages 7 and 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||||||
6
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||
Return On Average Equity | ||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||
(in US$ millions except for percentages) | September�30, 2014 | September�30, 2013 | September�30, 2014 | September�30, 2013 | ||||||||||||||
Average shareholders' equity | $ | 3,499.4 | $ | 3,234.9 | $ | 3,431.1 | $ | 3,338.0 | ||||||||||
Average non-controlling interest | 0.2 | 0.2 | ||||||||||||||||
Average preference shares | (555.8 | ) | (555.6 | ) | (555.8 | ) | (536.6 | ) | ||||||||||
Average ordinary shareholders' equity | $ | 2,943.8 | $ | 2,679.3 | $ | 2,875.5 | $ | 2,801.4 | ||||||||||
Return on average equity: | ||||||||||||||||||
Net income adjusted for preference share dividend and non-controlling interest | 1.0 | % | 3.7 | % | 9.0 | % | 7.6 | % | ||||||||||
Operating income adjusted for preference share dividend and non-controlling interest | 2.5 | % | 2.7 | % | 9.3 | % | 6.9 | % | ||||||||||
Annualized return on average equity: | ||||||||||||||||||
Net income | 4.0 | % | 14.8 | % | 12.0 | % | 10.1 | % | ||||||||||
Operating income | 10.0 | % | 10.8 | % | 12.4 | % | 9.2 | % | ||||||||||
Components of return on average equity: | ||||||||||||||||||
Return on average equity from underwriting activity�(1) | 1.8 | % | 1.7 | % | 6.7 | % | 4.0 | % | ||||||||||
Return on average equity from investment and other activity (2) | 0.8 | % | 1.1 | % | 3.0 | % | 3.3 | % | ||||||||||
Pre-tax operating income return on average equity | 2.6 | % | 2.8 | % | 9.7 | % | 7.3 | % | ||||||||||
Post-tax operating income return on average equity (3) | 2.5 | % | 2.7 | % | 9.3 | % | 6.9 | % | ||||||||||
See page 23 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. | ||||||||||||||||||
(1) Calculated by using underwriting income. | ||||||||||||||||||
(2) Calculated by using total other operating revenue and other income/(expense) adjusted for preference share dividends. | ||||||||||||||||||
(3) Calculated by using operating income after-tax adjusted for preference share dividends. | ||||||||||||||||||
7
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||||||||
Consolidated Underwriting Results by Operating Segment | |||||||||||||||||||||||||
Three Months Ended September 30, 2014 | Three Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in US$ millions except for percentages) | Reinsurance | Insurance | Total | Reinsurance | Insurance | Total | |||||||||||||||||||
Gross written premiums | $ | 256.9 | $ | 395.6 | $ | 652.5 | $ | 219.5 | $ | 362.1 | $ | 581.6 | |||||||||||||
Net written premiums | 250.9 | 326.4 | 577.3 | 218.4 | 323.6 | 542.0 | |||||||||||||||||||
Gross earned premiums | 291.0 | 403.9 | 694.9 | 268.6 | 356.5 | 625.1 | |||||||||||||||||||
Net earned premiums | 279.6 | 330.8 | 610.4 | 255.7 | 288.6 | 544.3 | |||||||||||||||||||
Losses and loss adjustment expenses | 132.0 | 210.7 | 342.7 | 122.2 | 168.0 | 290.2 | |||||||||||||||||||
Amortization of deferred policy acquisition costs | 52.1 | 63.4 | 115.5 | 49.1 | 61.4 | 110.5 | |||||||||||||||||||
General and administrative expenses | 38.4 | 45.6 | 84.0 | 34.6 | 49.5 | 84.1 | |||||||||||||||||||
Underwriting income | $ | 57.1 | $ | 11.1 | $ | 68.2 | $ | 49.8 | $ | 9.7 | $ | 59.5 | |||||||||||||
Net investment income | 48.0 | 45.0 | |||||||||||||||||||||||
Net realized and unrealized investment gains (1) | 13.4 | ||||||||||||||||||||||||
Corporate expenses | (15.6 | ) | (14.8 | ) | |||||||||||||||||||||
Non-recurring corporate expenses | (20.2 | ) | |||||||||||||||||||||||
Other (expense)/income | (7.8 | ) | 1.6 | ||||||||||||||||||||||
Interest expense | (7.4 | ) | (7.7 | ) | |||||||||||||||||||||
Net realized and unrealized foreign exchange (losses)/gains (2) | (26.5 | ) | 13.3 | ||||||||||||||||||||||
Income before tax | $ | 38.7 | $ | 110.3 | |||||||||||||||||||||
Income tax expense | (1.3 | ) | (2.9 | ) | |||||||||||||||||||||
Net income | $ | 37.4 | $ | 107.4 | |||||||||||||||||||||
Ratios | |||||||||||||||||||||||||
Loss ratio | 47.2 | % | 63.7 | % | 56.1 | % | 47.8 | % | 58.2 | % | 53.3 | % | |||||||||||||
�Policy acquisition expense ratio | 18.6 | % | 19.2 | % | 18.9 | % | 19.2 | % | 21.3 | % | 20.3 | % | |||||||||||||
�General and administrative expense ratio (3) | 13.7 | % | 13.8 | % | 19.6 | % | 13.5 | % | 17.2 | % | 18.2 | % | |||||||||||||
�General and administrative expense ratio (excluding non-recurring corporate expenses)(3) | 13.7 | % | 13.8 | % | 16.3 | % | 13.5 | % | 17.2 | % | 18.2 | % | |||||||||||||
Expense ratio | 32.3 | % | 33.0 | % | 38.5 | % | 32.7 | % | 38.5 | % | 38.5 | % | |||||||||||||
Expense ratio (excluding non-recurring corporate expenses) | 32.3 | % | 33.0 | % | 35.2 | % | 32.7 | % | 38.5 | % | 38.5 | % | |||||||||||||
Combined ratio | 79.5 | % | 96.7 | % | 94.6 | % | 80.5 | % | 96.7 | % | 91.8 | % | |||||||||||||
Combined ratio (excluding non-recurring corporate expenses) | 79.5 | % | 96.7 | % | 91.3 | % | 80.5 | % | 96.7 | % | 91.8 | % | |||||||||||||
(1) Includes the net realized and unrealized gains/(losses) from interest rate swaps. | |||||||||||||||||||||||||
(2) Includes the net realized and unrealized gains/(losses) from foreign exchange contracts. | |||||||||||||||||||||||||
(3) The total group general and administrative expense ratio includes the impact from corporate expenses. | |||||||||||||||||||||||||
8
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||||||||
Consolidated Underwriting Results by Operating Segment | |||||||||||||||||||||||||
Nine Months Ended September 30, 2014 | Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
(in US$ millions except for percentages) | Reinsurance | Insurance | Total | Reinsurance | Insurance | Total | |||||||||||||||||||
Gross written premiums | $ | 1,027.5 | $ | 1,259.8 | $ | 2,287.3 | $ | 957.7 | $ | 1,084.6 | $ | 2,042.3 | |||||||||||||
Net written premiums | 980.4 | 980.8 | 1,961.2 | 907.5 | 844.2 | 1,751.7 | |||||||||||||||||||
Gross earned premiums | 859.2 | 1,182.0 | 2,041.2 | 828.9 | 1,000.7 | 1,829.6 | |||||||||||||||||||
Net earned premiums | 825.1 | 968.0 | 1,793.1 | 788.2 | 811.0 | 1,599.2 | |||||||||||||||||||
Losses and loss adjustment expenses | 367.4 | 600.5 | 967.9 | 394.9 | 497.4 | 892.3 | |||||||||||||||||||
Amortization of deferred policy acquisition costs | 152.3 | 184.1 | 336.4 | 161.0 | 161.3 | 322.3 | |||||||||||||||||||
General and administrative expenses | 107.0 | 142.6 | 249.6 | 97.2 | 134.0 | 231.2 | |||||||||||||||||||
Underwriting income | $ | 198.4 | $ | 40.8 | $ | 239.2 | $ | 135.1 | $ | 18.3 | $ | 153.4 | |||||||||||||
Net investment income | 143.6 | 139.2 | |||||||||||||||||||||||
Net realized and unrealized investment gains (1) | 33.5 | 29.4 | |||||||||||||||||||||||
Corporate expenses | (46.1 | ) | (42.0 | ) | |||||||||||||||||||||
Non-recurring corporate expenses | (28.5 | ) | |||||||||||||||||||||||
Other (expense)/income | (5.9 | ) | 3.0 | ||||||||||||||||||||||
Interest expense | (22.1 | ) | (23.2 | ) | |||||||||||||||||||||
Net realized and unrealized foreign exchange (losses) (2) | (13.8 | ) | (10.7 | ) | |||||||||||||||||||||
Income before tax | $ | 299.9 | $ | 249.1 | |||||||||||||||||||||
Income tax expense | (11.3 | ) | (9.8 | ) | |||||||||||||||||||||
Net income | $ | 288.6 | $ | 239.3 | |||||||||||||||||||||
Ratios | |||||||||||||||||||||||||
Loss ratio | 44.5 | % | 62.0 | % | 54.0 | % | 50.1 | % | 61.3 | % | 55.8 | % | |||||||||||||
�Policy acquisition expense ratio | 18.5 | % | 19.0 | % | 18.8 | % | 20.4 | % | 19.9 | % | 20.2 | % | |||||||||||||
�General and administrative expense ratio (3) | 13.0 | % | 14.7 | % | 18.1 | % | 12.3 | % | 16.5 | % | 17.1 | % | |||||||||||||
�General and administrative expense ratio (excluding non-recurring corporate expenses)(3) | 13.0 | % | 14.7 | % | 16.5 | % | 12.3 | % | 16.5 | % | 17.1 | % | |||||||||||||
Expense ratio | 31.5 | % | 33.7 | % | 36.9 | % | 32.7 | % | 36.4 | % | 37.3 | % | |||||||||||||
Expense ratio (excluding non-recurring corporate expenses) | 31.5 | % | 33.7 | % | 35.3 | % | 32.7 | % | 36.4 | % | 37.3 | % | |||||||||||||
Combined ratio | 76.0 | % | 95.7 | % | 90.9 | % | 82.8 | % | 97.7 | % | 93.1 | % | |||||||||||||
Combined ratio (excluding non-recurring corporate expenses) | 76.0 | % | 95.7 | % | 89.3 | % | 82.8 | % | 97.7 | % | 93.1 | % | |||||||||||||
(1) Includes the net realized and unrealized gains/(losses) from interest rate swaps. | |||||||||||||||||||||||||
(2) Includes the net realized and unrealized gains/(losses) from foreign exchange contracts. | |||||||||||||||||||||||||
(3) The total group general and administrative expense ratio includes the impact from corporate expenses. | |||||||||||||||||||||||||
9
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Reinsurance Segment - Quarterly Results | ||||||||||||||||||||||||||||||
(in US$ millions except for percentages) | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||
Gross written premiums | $ | 256.9 | $ | 298.4 | $ | 472.2 | $ | 176.2 | $ | 219.5 | $ | 298.6 | $ | 439.6 | ||||||||||||||||
Net written premiums | 250.9 | 286.9 | 442.6 | 174.5 | 218.4 | 288.6 | 400.5 | |||||||||||||||||||||||
Gross earned premiums | 291.0 | 289.7 | 278.5 | 297.7 | 268.6 | 288.4 | 271.9 | |||||||||||||||||||||||
Net earned premiums | 279.6 | 278.8 | 266.7 | 284.8 | 255.7 | 275.8 | 256.7 | |||||||||||||||||||||||
Net losses and loss adjustment expenses | 132.0 | 125.0 | 110.4 | 86.8 | 122.2 | 158.4 | 114.3 | |||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 52.1 | 49.8 | 50.4 | 46.2 | 49.1 | 56.6 | 55.3 | |||||||||||||||||||||||
General and administrative expenses | 38.4 | 35.8 | 32.8 | 33.8 | 34.6 | 30.4 | 32.2 | |||||||||||||||||||||||
Underwriting income | $ | 57.1 | $ | 68.2 | $ | 73.1 | $ | 118.0 | $ | 49.8 | $ | 30.4 | $ | 54.9 | ||||||||||||||||
Ratios | ||||||||||||||||||||||||||||||
Loss ratio | 47.2 | % | 44.8 | % | 41.4 | % | 30.5 | % | 47.8 | % | 57.4 | % | 44.5 | % | ||||||||||||||||
�Policy acquisition expense ratio | 18.6 | % | 17.9 | % | 18.9 | % | 16.2 | % | 19.2 | % | 20.5 | % | 21.5 | % | ||||||||||||||||
�General and administrative expense ratio | 13.7 | % | 12.8 | % | 12.3 | % | 11.9 | % | 13.5 | % | 11.0 | % | 12.5 | % | ||||||||||||||||
Expense ratio | 32.3 | % | 30.7 | % | 31.2 | % | 28.1 | % | 32.7 | % | 31.5 | % | 34.0 | % | ||||||||||||||||
Combined ratio | 79.5 | % | 75.5 | % | 72.6 | % | 58.6 | % | 80.5 | % | 88.9 | % | 78.5 | % | ||||||||||||||||
10
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Insurance Segment - Quarterly Results | ||||||||||||||||||||||||||||||
(in US$ millions except for percentages) | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||
Gross written premiums | $ | 395.6 | $ | 480.9 | $ | 383.3 | $ | 428.2 | $ | 362.1 | $ | 388.7 | $ | 333.8 | ||||||||||||||||
Net written premiums | 326.4 | 399.5 | 254.9 | 373.5 | 323.6 | 324.1 | 196.5 | |||||||||||||||||||||||
Gross earned premiums | 403.9 | 404.5 | 373.6 | 366.1 | 356.5 | 331.3 | 312.9 | |||||||||||||||||||||||
Net earned premiums | 330.8 | 337.4 | 299.8 | 287.8 | 288.6 | 268.2 | 254.2 | |||||||||||||||||||||||
Net losses and loss adjustment expenses | 210.7 | 212.1 | 177.7 | 244.6 | 168.0 | 175.0 | 154.4 | |||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 63.4 | 59.1 | 61.6 | 53.5 | 61.4 | 50.6 | 49.3 | |||||||||||||||||||||||
General and administrative expenses | 45.6 | 51.1 | 45.9 | 51.9 | 49.5 | 42.1 | 42.4 | |||||||||||||||||||||||
Underwriting income/(loss) | $ | 11.1 | $ | 15.1 | $ | 14.6 | $ | (62.2 | ) | $ | 9.7 | $ | 0.5 | $ | 8.1 | |||||||||||||||
Ratios | ||||||||||||||||||||||||||||||
Loss ratio | 63.7 | % | 62.9 | % | 59.3 | % | 85.0 | % | 58.2 | % | 65.2 | % | 60.7 | % | ||||||||||||||||
�Policy acquisition expense ratio | 19.2 | % | 17.5 | % | 20.5 | % | 18.6 | % | 21.3 | % | 18.9 | % | 19.4 | % | ||||||||||||||||
�General and administrative expense ratio | 13.8 | % | 15.1 | % | 15.3 | % | 18.0 | % | 17.2 | % | 15.7 | % | 16.7 | % | ||||||||||||||||
Expense ratio | 33.0 | % | 32.6 | % | 35.8 | % | 36.6 | % | 38.5 | % | 34.6 | % | 36.1 | % | ||||||||||||||||
Combined ratio | 96.7 | % | 95.5 | % | 95.1 | % | 121.6 | % | 96.7 | % | 99.8 | % | 96.8 | % | ||||||||||||||||
11
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Written and Earned Premiums by Segment and Lines of Business | ||||||||||||||||||||||||||||||
(in US$ millions) | ||||||||||||||||||||||||||||||
Gross Written Premiums | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 40.0 | $ | 91.6 | $ | 168.8 | $ | 6.8 | $ | 37.8 | $ | 83.2 | $ | 145.5 | ||||||||||||||||
Other Property Reinsurance | 95.4 | 89.8 | 102.4 | 61.5 | 70.8 | 91.0 | 79.5 | |||||||||||||||||||||||
Casualty Reinsurance | 70.7 | 60.6 | 113.3 | 55.0 | 68.6 | 63.4 | 125.3 | |||||||||||||||||||||||
Specialty Reinsurance | 50.8 | 56.4 | 87.7 | 52.9 | 42.3 | 61.0 | 89.3 | |||||||||||||||||||||||
Total Reinsurance | $ | 256.9 | $ | 298.4 | $ | 472.2 | $ | 176.2 | $ | 219.5 | $ | 298.6 | $ | 439.6 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property and Casualty Insurance | $ | 200.9 | $ | 221.3 | $ | 176.3 | $ | 181.5 | $ | 164.6 | $ | 176.8 | $ | 131.2 | ||||||||||||||||
Marine, Aviation and Energy Insurance | 88.2 | 153.6 | 131.7 | 129.9 | 112.9 | 143.8 | 136.8 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 106.5 | 106.0 | 75.3 | 116.8 | 84.6 | 68.1 | 65.8 | |||||||||||||||||||||||
Total Insurance | $ | 395.6 | $ | 480.9 | $ | 383.3 | $ | 428.2 | $ | 362.1 | $ | 388.7 | $ | 333.8 | ||||||||||||||||
Total Gross Written Premiums | $ | 652.5 | $ | 779.3 | $ | 855.5 | $ | 604.4 | $ | 581.6 | $ | 687.3 | $ | 773.4 | ||||||||||||||||
Net Written Premiums | ||||||||||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 37.4 | $ | 80.9 | $ | 147.9 | $ | 6.3 | $ | 37.6 | $ | 75.2 | $ | 124.0 | ||||||||||||||||
Other Property Reinsurance | 92.0 | 88.3 | 96.6 | 61.1 | 70.8 | 89.8 | 65.6 | |||||||||||||||||||||||
Casualty Reinsurance | 70.7 | 61.5 | 111.4 | 54.2 | 67.7 | 62.6 | 123.1 | |||||||||||||||||||||||
Specialty Reinsurance | 50.8 | 56.2 | 86.7 | 52.9 | 42.3 | 61.0 | 87.8 | |||||||||||||||||||||||
Total Reinsurance | $ | 250.9 | $ | 286.9 | $ | 442.6 | $ | 174.5 | $ | 218.4 | $ | 288.6 | $ | 400.5 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property and Casualty Insurance | $ | 166.4 | $ | 171.0 | $ | 101.5 | $ | 141.4 | $ | 147.2 | $ | 157.1 | $ | 67.2 | ||||||||||||||||
Marine, Aviation and Energy Insurance | 64.2 | 131.1 | 119.5 | 118.5 | 107.1 | 102.7 | 126.4 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 95.8 | 97.4 | 33.9 | 113.6 | 69.3 | 64.3 | 2.9 | |||||||||||||||||||||||
Total Insurance | $ | 326.4 | $ | 399.5 | $ | 254.9 | $ | 373.5 | $ | 323.6 | $ | 324.1 | $ | 196.5 | ||||||||||||||||
Total Net Written Premiums | $ | 577.3 | $ | 686.4 | $ | 697.5 | $ | 548.0 | $ | 542.0 | $ | 612.7 | $ | 597.0 | ||||||||||||||||
Net Earned Premiums | ||||||||||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 62.5 | $ | 62.7 | $ | 62.4 | $ | 64.0 | $ | 60.4 | $ | 65.1 | $ | 58.7 | ||||||||||||||||
Other Property Reinsurance | 84.1 | 81.5 | 79.2 | 73.0 | 62.5 | 79.1 | 71.0 | |||||||||||||||||||||||
Casualty Reinsurance | 75.0 | 78.8 | 72.2 | 84.8 | 78.9 | 75.2 | 66.6 | |||||||||||||||||||||||
Specialty Reinsurance | 58.0 | 55.8 | 52.9 | 63.0 | 53.9 | 56.4 | 60.4 | |||||||||||||||||||||||
Total Reinsurance | $ | 279.6 | $ | 278.8 | $ | 266.7 | $ | 284.8 | $ | 255.7 | $ | 275.8 | $ | 256.7 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property and Casualty Insurance | $ | 148.0 | $ | 146.9 | $ | 119.5 | $ | 113.2 | $ | 112.8 | $ | 105.5 | $ | 101.6 | ||||||||||||||||
Marine, Aviation and Energy Insurance | 107.2 | 119.9 | 115.1 | 117.7 | 123.3 | 116.8 | 101.6 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 75.6 | 70.6 | 65.2 | 56.9 | 52.5 | 45.9 | 51.0 | |||||||||||||||||||||||
Total Insurance | $ | 330.8 | $ | 337.4 | $ | 299.8 | $ | 287.8 | $ | 288.6 | $ | 268.2 | $ | 254.2 | ||||||||||||||||
Total Net Earned Premiums | $ | 610.4 | $ | 616.2 | $ | 566.5 | $ | 572.6 | $ | 544.3 | $ | 544.0 | $ | 510.9 | ||||||||||||||||
12
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||
Consolidated Statements of Changes in Shareholders' Equity | ||||||||||
Nine Months Ended September 30, | ||||||||||
(in US$ millions) | 2014 | 2013 | ||||||||
Ordinary shares | ||||||||||
Beginning and end of period | $ | 0.1 | $ | 0.1 | ||||||
Preference shares | ||||||||||
Beginning and end of period | ||||||||||
Non-controlling interest | ||||||||||
Beginning of period | (0.3 | ) | 0.2 | |||||||
Net change for the period | (0.3 | ) | ||||||||
End of period | (0.3 | ) | (0.1 | ) | ||||||
Additional paid-in capital | ||||||||||
Beginning of period | 1,297.4 | 1,516.7 | ||||||||
New shares issued | 1.9 | 16.7 | ||||||||
Ordinary shares repurchased | (120.9 | ) | (294.9 | ) | ||||||
Preference shares issued | 270.4 | |||||||||
Preference shares repurchased and cancelled | (230.0 | ) | ||||||||
Changes in redemption value | 7.1 | |||||||||
Share-based compensation | 8.0 | 11.6 | ||||||||
End of period | 1,186.4 | 1,297.6 | ||||||||
Retained earnings | ||||||||||
Beginning of period | 1,783.3 | 1,544.0 | ||||||||
Net income for the period | 288.6 | 239.3 | ||||||||
Dividends paid on ordinary and preference shares | (66.3 | ) | (62.1 | ) | ||||||
Change in redemption value | (7.1 | ) | ||||||||
Proportion due to non-controlling interest | 0.3 | |||||||||
End of period | 2,005.6 | 1,714.4 | ||||||||
Accumulated other comprehensive income: | ||||||||||
Cumulative foreign currency translation adjustments, net of taxes: | ||||||||||
Beginning of period | 88.6 | 112.7 | ||||||||
Change for the period | 14.7 | (21.0 | ) | |||||||
End of period | 103.3 | 91.7 | ||||||||
Loss on derivatives: | ||||||||||
Beginning of period | (0.5 | ) | ||||||||
Reclassification to interest payable | 0.2 | |||||||||
End of period | (0.3 | ) | ||||||||
Unrealized appreciation/(depreciation) on investments, net of taxes: | ||||||||||
Beginning of period | 130.5 | 315.2 | ||||||||
Change for the period | 18.9 | (147.5 | ) | |||||||
End of period | 149.4 | 167.7 | ||||||||
Total accumulated other comprehensive income | 252.7 | 259.1 | ||||||||
Total shareholders' equity | $ | 3,444.5 | $ | 3,271.1 | ||||||
13
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||
Consolidated Statements of Comprehensive Income | ||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
(in US$ millions) | 2014 | 2013 | 2014 | 2013 | ||||||||||||||
Net income | $ | 37.4 | $ | 107.4 | $ | 288.6 | $ | 239.3 | ||||||||||
Other comprehensive income, net of taxes: | ||||||||||||||||||
Available for sale investments: | ||||||||||||||||||
����Reclassification adjustment for net realized (gains) included in net income | (3.7 | ) | (8.1 | ) | (5.7 | ) | (18.6 | ) | ||||||||||
����Change in net unrealized gains and (losses) on available for sale securities held | (27.2 | ) | 4.3 | 24.6 | (128.9 | ) | ||||||||||||
����Loss on derivatives reclassified to interest expense | 0.2 | |||||||||||||||||
Change in foreign currency translation adjustment | (3.3 | ) | 3.4 | 14.7 | (21.0 | ) | ||||||||||||
Other comprehensive (loss)/income | (34.2 | ) | (0.4 | ) | 33.6 | (168.3 | ) | |||||||||||
Comprehensive income | $ | 3.2 | $ | 107.0 | $ | 322.2 | $ | 71.0 | ||||||||||
14
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||
Condensed Consolidated Statements of Cash Flows | ||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
(in US$ millions) | 2014 | 2013 | 2014 | 2013 | ||||||||||||||
Net cash from operating activities | $ | 178.0 | $ | 184.8 | $ | 475.1 | $ | 433.0 | ||||||||||
Net cash (used in) investing activities | (130.0 | ) | (109.0 | ) | (300.6 | ) | (393.2 | ) | ||||||||||
Net cash (used in) financing activities | (112.5 | ) | (72.6 | ) | (185.3 | ) | (299.9 | ) | ||||||||||
Effect of exchange rate movements on cash and cash equivalents | 8.4 | 6.2 | 6.3 | (5.2 | ) | |||||||||||||
(Decrease)/increase in cash and cash equivalents | (56.1 | ) | 9.4 | (4.5 | ) | (265.3 | ) | |||||||||||
Cash at beginning of period | 1,345.2 | 1,188.9 | 1,293.6 | 1,463.6 | ||||||||||||||
Cash at end of period | $ | 1,289.1 | $ | 1,198.3 | $ | 1,289.1 | $ | 1,198.3 | ||||||||||
15
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||
Reserves for Losses and Loss Adjustment Expenses | |||||||||
(in US$ millions) | For the Nine Months Ended September 30, 2014 | For the Twelve Months Ended December�31, 2013 | |||||||
Provision for losses and loss adjustment expenses at the start of the period | $ | 4,678.9 | $ | 4,779.7 | |||||
Reinsurance recoverables | (332.7 | ) | (499.0 | ) | |||||
Net loss and loss adjustment expenses at the start of the period | 4,346.2 | 4,280.7 | |||||||
Net loss and loss adjustment expenses disposed | (24.2 | ) | (34.6 | ) | |||||
Provision for losses and loss adjustment expenses for claims incurred | |||||||||
����Current period | 1,060.5 | 1,331.4 | |||||||
����Prior period release | (92.6 | ) | (107.7 | ) | |||||
����Total incurred | 967.9 | 1,223.7 | |||||||
Losses and loss adjustment expenses payments for claims incurred | (842.3 | ) | (1,085.1 | ) | |||||
Foreign exchange losses/(gains) | (45.0 | ) | (38.5 | ) | |||||
Net loss and loss adjustment expenses reserves at the end of the period | 4,402.6 | 4,346.2 | |||||||
Reinsurance recoverables on unpaid losses at the end of the period | 384.7 | 332.7 | |||||||
Gross loss and loss adjustment expenses reserves at the end of the period | $ | 4,787.3 | $ | 4,678.9 | |||||
16
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||||||||
Reserves by Operating Segment | |||||||||||||||||||||||||
As at September 30, 2014 | As at December 31, 2013 | ||||||||||||||||||||||||
(in US$ millions) | Gross | Reinsurance Recoverables | Net | Gross | Reinsurance Recoverables | Net | |||||||||||||||||||
Reinsurance | $ | 2,593.8 | $ | (39.6 | ) | $ | 2,554.2 | $ | 2,707.0 | $ | (60.2 | ) | $ | 2,646.8 | |||||||||||
Insurance | 2,193.5 | (345.1 | ) | 1,848.4 | 1,971.9 | (272.5 | ) | 1,699.4 | |||||||||||||||||
Total losses and loss adjustment expense reserves | $ | 4,787.3 | $ | (384.7 | ) | $ | 4,402.6 | $ | 4,678.9 | $ | (332.7 | ) | $ | 4,346.2 | |||||||||||
17
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||||||||
Prior Year Reserve Releases | |||||||||||||||||||||||||
(in US$ millions) | Three Months Ended September 30, 2014 | Three Months Ended September 30, 2013 | |||||||||||||||||||||||
Gross | �Reinsurance Recoverables | Net | Gross | �Reinsurance Recoverables | Net | ||||||||||||||||||||
Reinsurance | $ | 25.3 | $ | 0.7 | $ | 26.0 | $ | 46.6 | $ | (14.3 | ) | $ | 32.3 | ||||||||||||
Insurance | (1.9 | ) | 8.5 | 6.6 | 9.4 | (8.1 | ) | 1.3 | |||||||||||||||||
Release in reserves for prior years during the period | $ | 23.4 | $ | 9.2 | $ | 32.6 | $ | 56.0 | $ | (22.4 | ) | $ | 33.6 | ||||||||||||
Nine Months Ended September 30, 2014 | Nine Months Ended September 30, 2013 | ||||||||||||||||||||||||
Gross | �Reinsurance Recoverables | Net | Gross | �Reinsurance Recoverables | Net | ||||||||||||||||||||
Reinsurance | $ | 78.3 | $ | (2.7 | ) | $ | 75.6 | $ | 90.7 | $ | (14.2 | ) | $ | 76.5 | |||||||||||
Insurance | (6.6 | ) | 23.6 | 17.0 | 2.0 | 8.7 | 10.7 | ||||||||||||||||||
Release in reserves for prior years during the period | $ | 71.7 | $ | 20.9 | $ | 92.6 | $ | 92.7 | $ | (5.5 | ) | $ | 87.2 | ||||||||||||
18
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||
Worldwide Natural Catastrophe Exposures: Major Peril Zones as at October 1, 2014 | |||||||
 |  | ||||||
1 in 100 year tolerance: 17.5% of total shareholders' equity | 1 in 250 year tolerance: 25.0% of total shareholders' equity | ||||||
Based on shareholders' equity of $3,444.8 million (excluding non-controlling interest) as at September 30, 2014. The estimates reflect Aspen's own view of the modelled maximum losses ("PML's") at the return periods shown which include input from various third party vendor models and our own proprietary adjustments to these models. Catastrophe loss experience may materially differ from the modelled PMLs due to limitations in one or more of the models or uncertainties in the application of policy terms and limits. | |||||||
19
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Consolidated Investment Portfolio | ||||||||||||||||||||||||||||||
(in US$ millions) | Fair Market Value | |||||||||||||||||||||||||||||
Marketable Securities - Available For Sale | September 30, 2014 | June 30, 2014 | March 31, 2014 | December 31, 2013 | September 30, 2013 | June 30, 2013 | March 31, 2013 | |||||||||||||||||||||||
U.S. government securities | $ | 973.9 | $ | 994.0 | $ | 1,014.7 | $ | 1,020.4 | $ | 1,021.1 | $ | 1,118.4 | $ | 1,175.3 | ||||||||||||||||
U.S. agency securities | 201.9 | 205.0 | 245.2 | 269.1 | 281.5 | 308.7 | 314.0 | |||||||||||||||||||||||
Municipal securities | 31.7 | 26.9 | 33.6 | 32.8 | 29.9 | 33.1 | 38.0 | |||||||||||||||||||||||
Corporate securities | 2,278.4 | 2,244.9 | 2,154.1 | 2,069.4 | 2,018.1 | 2,027.3 | 2,006.0 | |||||||||||||||||||||||
Foreign government securities | 752.6 | 766.5 | 735.0 | 778.9 | 822.2 | 755.7 | 644.6 | |||||||||||||||||||||||
Asset-backed securities | 143.9 | 140.3 | 130.0 | 122.3 | 116.5 | 86.8 | 74.5 | |||||||||||||||||||||||
Bonds backed by foreign government | 75.5 | 83.9 | 91.5 | 84.6 | 78.9 | 87.0 | 85.3 | |||||||||||||||||||||||
Mortgage-backed securities | 1,039.9 | 1,065.3 | 1,117.6 | 1,191.6 | 1,176.7 | 1,125.6 | 1,155.4 | |||||||||||||||||||||||
��Total fixed income maturities | 5,497.8 | 5,526.8 | 5,521.7 | 5,569.1 | 5,544.9 | 5,542.6 | 5,493.1 | |||||||||||||||||||||||
Short-term investments | 307.2 | 335.7 | 215.5 | 160.3 | 148.3 | 231.7 | 352.3 | |||||||||||||||||||||||
Equity securities | 125.9 | 142.1 | 147.4 | 149.5 | 163.2 | 183.2 | 209.1 | |||||||||||||||||||||||
��Total Available For Sale | $ | 5,930.9 | $ | 6,004.6 | $ | 5,884.6 | $ | 5,878.9 | $ | 5,856.4 | $ | 5,957.5 | $ | 6,054.5 | ||||||||||||||||
Marketable Securities - Trading | ||||||||||||||||||||||||||||||
U.S. government securities | $ | 16.5 | $ | 12.9 | $ | 16.8 | $ | 22.0 | $ | 31.1 | $ | 39.0 | $ | 27.7 | ||||||||||||||||
U.S. agency securities | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | |||||||||||||||||||||||
Municipal securities | 1.1 | 1.2 | 1.2 | 1.1 | 0.6 | 0.6 | 2.8 | |||||||||||||||||||||||
Corporate securities | 521.1 | 524.5 | 494.8 | 474.8 | 471.0 | 365.6 | 395.9 | |||||||||||||||||||||||
Foreign government securities | 139.2 | 139.3 | 136.4 | 136.2 | 136.3 | 27.5 | 27.3 | |||||||||||||||||||||||
Asset-backed securities | 15.2 | 11.4 | 12.3 | 12.8 | 6.6 | 5.7 | 5.8 | |||||||||||||||||||||||
Bank loans | 80.8 | 81.4 | 72.7 | 69.1 | 72.8 | 65.2 | 9.1 | |||||||||||||||||||||||
��Total fixed income maturities | 774.1 | 770.9 | 734.4 | 716.2 | 718.6 | 503.8 | 468.8 | |||||||||||||||||||||||
Short-term investments | 7.0 | 14.0 | 0.2 | 10.6 | 0.8 | |||||||||||||||||||||||||
Equity securities | 521.1 | 432.1 | 360.4 | 310.9 | 278.3 | 229.9 | 205.0 | |||||||||||||||||||||||
Catastrophe bonds | 32.2 | 30.0 | 18.0 | 5.8 | ||||||||||||||||||||||||||
�Total Trading | $ | 1,334.4 | $ | 1,247.0 | $ | 1,112.8 | $ | 1,032.9 | $ | 997.1 | $ | 744.3 | $ | 674.6 | ||||||||||||||||
Other Investments | $ | 8.7 | $ | 8.7 | $ | 8.7 | $ | 48.0 | $ | 46.1 | $ | 44.9 | $ | 45.0 | ||||||||||||||||
Cash | 1,289.1 | 1,345.2 | 1,443.7 | 1,293.6 | 1,198.3 | 1,188.9 | 1,212.7 | |||||||||||||||||||||||
Accrued interest | 45.7 | 49.7 | 46.5 | 47.9 | 48.5 | 48.3 | 45.0 | |||||||||||||||||||||||
��Total Cash and Accrued Interest | $ | 1,334.8 | $ | 1,394.9 | $ | 1,490.2 | $ | 1,341.5 | $ | 1,246.8 | $ | 1,237.2 | $ | 1,257.7 | ||||||||||||||||
��Total Cash and Investments | $ | 8,608.8 | $ | 8,655.2 | $ | 8,496.3 | $ | 8,301.3 | $ | 8,146.4 | $ | 7,983.9 | $ | 8,031.8 | ||||||||||||||||
20
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||||||||||||
Investment Analysis | |||||||||||||||||||||||||||||
(in US$ millions except for percentages) | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | ||||||||||||||||||||||
Net investment income from fixed income investments and cash | $ | 43.5 | $ | 42.0 | $ | 44.1 | $ | 44.8 | $ | 42.0 | $ | 42.0 | $ | 45.0 | |||||||||||||||
Net investment income from equity securities | 4.5 | 4.1 | 5.4 | 2.4 | 3.0 | 3.9 | 3.3 | ||||||||||||||||||||||
Net investment income | 48.0 | 46.1 | 49.5 | 47.2 | 45.0 | 45.9 | 48.3 | ||||||||||||||||||||||
Net realized and unrealized investment gains/(losses) excluding the interest rate swaps | (0.9 | ) | 29.4 | 10.2 | 19.4 | 17.7 | (6.6 | ) | 15.2 | ||||||||||||||||||||
Net realized investment (losses)/gains from the interest rate swaps | 0.9 | (3.5 | ) | (1.9 | ) | (0.5 | ) | (4.3 | ) | 6.8 | 0.6 | ||||||||||||||||||
Realized loss on the debt extinguishment | (9.3 | ) | |||||||||||||||||||||||||||
Other-than-temporary impairment charges | (0.7 | ) | |||||||||||||||||||||||||||
Net realized and unrealized investment gains | 25.2 | 8.3 | 9.6 | 13.4 | 0.2 | 15.8 | |||||||||||||||||||||||
Change in unrealized gains/(losses) on available for sale investments (gross of tax) | (36.3 | ) | 33.4 | 22.6 | (41.1 | ) | (9.7 | ) | (138.4 | ) | (17.5 | ) | |||||||||||||||||
Total return/(loss) on investments | $ | 11.7 | $ | 104.7 | $ | 80.4 | $ | 15.7 | $ | 48.7 | $ | (92.3 | ) | $ | 46.6 | ||||||||||||||
Portfolio Characteristics | |||||||||||||||||||||||||||||
Fixed income portfolio book yield (excluding the impact of the interest rate swaps) | 2.65 | % | 2.61 | % | 2.68 | % | 2.74 | % | 2.82 | % | 2.71 | % | 2.80 | % | |||||||||||||||
Fixed income portfolio duration (excluding the impact of the interest rate swaps) | 3.5 years | 3.4 years | 3.5 years | 3.5 years | 3.5 years | 3.4 years | 3.2 years | ||||||||||||||||||||||
21
| � |  | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
| � | Book Value Per Ordinary Share | ||||||||||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | (in US$ millions except for number of shares and per share amounts) | September 30, 2014 | June 30, 2014 | March 31, 2014 | December 31, 2013 | September 30, 2013 | June 30, 2013 | March 31, 2013 | |||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | Net assets | $ | 3,444.5 | $ | 3,554.2 | $ | 3,386.8 | $ | 3,299.6 | $ | 3,271.1 | $ | 3,234.9 | $ | 3,339.6 | ||||||||||||||||
| � | Less: Preference shares | (555.8 | ) | (555.8 | ) | (555.8 | ) | (555.8 | ) | (555.6 | ) | (555.6 | ) | (508.1 | ) | ||||||||||||||||
| � | Less: Non-controlling interest | 0.3 | 0.2 | 0.2 | 0.3 | 0.1 | (0.2 | ) | (0.2 | ) | |||||||||||||||||||||
| � | Total | $ | 2,889.0 | $ | 2,998.6 | $ | 2,831.2 | $ | 2,744.1 | $ | 2,715.6 | $ | 2,679.1 | $ | 2,831.3 | ||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | Ordinary shares outstanding (in millions) | 63.350 | 65.463 | 65.419 | 65.547 | 65.701 | 67.003 | 65.634 | |||||||||||||||||||||||
| � | Ordinary shares and dilutive potential ordinary shares (in millions) | 64.783 | 66.871 | 66.281 | 67.090 | 67.171 | 68.934 | 69.611 | |||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | Book value per ordinary share | $ | 45.60 | $ | 45.81 | $ | 43.28 | $ | 41.87 | $ | 41.33 | $ | 39.98 | $ | 43.14 | ||||||||||||||||
| � | Diluted book value per ordinary share | $ | 44.60 | $ | 44.84 | $ | 42.72 | $ | 40.90 | $ | 40.43 | $ | 38.86 | $ | 40.67 | ||||||||||||||||
| � | |||||||||||||||||||||||||||||||
| � | The dilutive effect of options has been calculated using the treasury stock method. The treasury stock method assumes that the proceeds received from the exercise of options will be used to purchase the Company's ordinary shares at the average market price during the period of calculation. | ||||||||||||||||||||||||||||||
| � | |||||||||||||||||||||||||||||||
22
 | ASPEN INSURANCE HOLDINGS LIMITED | ||||||||||||||||||
Operating Income Reconciliation | |||||||||||||||||||
Net income is adjusted to exclude after-tax change in net foreign exchange gains and losses, realized gains and losses in investments and non-recurring items. | |||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||
(in US$ millions except where stated) | September�30, 2014 | September�30, 2013 | September 30, 2014 | September 30, 2013 | |||||||||||||||
Net income as reported | $ | 37.4 | $ | 107.4 | $ | 288.6 | $ | 239.3 | |||||||||||
Changes in redemption value of the PIERS | (7.1 | ) | |||||||||||||||||
Net change attributable to non-controlling interest | 0.1 | 0.3 | 0.3 | ||||||||||||||||
Preference share dividends | (9.5 | ) | (9.5 | ) | (28.4 | ) | (26.1 | ) | |||||||||||
Net income available to ordinary shareholders | 28.0 | 98.2 | 260.2 | 206.4 | |||||||||||||||
Add (deduct) after tax income: | |||||||||||||||||||
Net foreign exchange losses/(gains) | 24.1 | (12.0 | ) | 13.3 | 9.5 | ||||||||||||||
Net realized (gains) on investments | (13.4 | ) | (33.2 | ) | (28.9 | ) | |||||||||||||
Changes in redemption value of the PIERS | 7.1 | ||||||||||||||||||
Non-recurring corporate expenses | 20.2 | 28.5 | |||||||||||||||||
Operating income after tax available to ordinary shareholders | 72.3 | 72.8 | 268.8 | 194.1 | |||||||||||||||
Tax expense on operating income | 3.7 | 1.3 | 11.5 | 10.2 | |||||||||||||||
Operating income before tax available to ordinary shareholders | $ | 76.0 | $ | 74.1 | $ | 280.3 | $ | 204.3 | |||||||||||
Basic earnings per ordinary share | |||||||||||||||||||
Net income adjusted for preference share dividends and non-controlling interest | $ | 0.43 | $ | 1.47 | $ | 3.99 | $ | 3.07 | |||||||||||
Add (deduct) after tax income: | |||||||||||||||||||
Net foreign exchange losses/(gains) | 0.37 | (0.18 | ) | 0.20 | 0.14 | ||||||||||||||
Net realized (gains) on investments | (0.20 | ) | (0.51 | ) | (0.43 | ) | |||||||||||||
Changes in redemption value of the PIERS | 0.11 | ||||||||||||||||||
Non-recurring corporate expenses | 0.31 | 0.44 | |||||||||||||||||
Operating income adjusted for preference shares dividends and non-controlling interest | $ | 1.11 | $ | 1.09 | $ | 4.12 | $ | 2.89 | |||||||||||
Diluted earnings per ordinary share | |||||||||||||||||||
Net income adjusted for preference share dividends and non-controlling interest | $ | 0.42 | $ | 1.43 | $ | 3.91 | $ | 2.95 | |||||||||||
Add (deduct) after tax income: | |||||||||||||||||||
Net foreign exchange losses/(gains) | 0.36 | (0.18 | ) | 0.20 | 0.14 | ||||||||||||||
Net realized (gains) on investments | (0.20 | ) | (0.50 | ) | (0.41 | ) | |||||||||||||
Changes in redemption value of the PIERS | 0.10 | ||||||||||||||||||
Non-recurring corporate expenses | 0.30 | 0.43 | |||||||||||||||||
Operating income adjusted for preference shares dividends and non-controlling interest | $ | 1.08 | $ | 1.05 | $ | 4.04 | $ | 2.78 | |||||||||||
23
A-1
 | ASPEN INSURANCE HOLDINGS LIMITED | |||||||||||||||||||||||||||||
Written and Earned Premiums by Segment and Prior Lines of Business | ||||||||||||||||||||||||||||||
(in US$ millions) | ||||||||||||||||||||||||||||||
Gross Written Premiums | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 40.0 | $ | 91.6 | $ | 168.8 | $ | 6.8 | $ | 37.8 | $ | 83.2 | $ | 145.5 | ||||||||||||||||
Other Property Reinsurance | 95.4 | 89.8 | 102.4 | 61.5 | 70.8 | 91.0 | 79.5 | |||||||||||||||||||||||
Casualty Reinsurance | 70.7 | 60.6 | 113.3 | 55.0 | 68.6 | 63.4 | 125.3 | |||||||||||||||||||||||
Specialty Reinsurance | 50.8 | 56.4 | 87.7 | 52.9 | 42.3 | 61.0 | 89.3 | |||||||||||||||||||||||
Total Reinsurance | $ | 256.9 | $ | 298.4 | $ | 472.2 | $ | 176.2 | $ | 219.5 | $ | 298.6 | $ | 439.6 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property Insurance | $ | 59.7 | $ | 85.6 | $ | 63.0 | $ | 54.6 | $ | 52.8 | $ | 74.0 | $ | 54.6 | ||||||||||||||||
Casualty Insurance | 93.8 | 88.5 | 61.3 | 83.1 | 74.7 | 63.9 | 43.7 | |||||||||||||||||||||||
Marine, Energy and Transportation Insurance | 88.2 | 153.6 | 131.7 | 129.9 | 112.9 | 143.8 | 136.8 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 106.5 | 106.0 | 75.3 | 116.8 | 84.6 | 68.1 | 65.8 | |||||||||||||||||||||||
Programs | 47.4 | 47.2 | 52.0 | 43.8 | 37.1 | 38.9 | 32.9 | |||||||||||||||||||||||
Total Insurance | $ | 395.6 | $ | 480.9 | $ | 383.3 | $ | 428.2 | $ | 362.1 | $ | 388.7 | $ | 333.8 | ||||||||||||||||
Total Gross Written Premiums | $ | 652.5 | $ | 779.3 | $ | 855.5 | $ | 604.4 | $ | 581.6 | $ | 687.3 | $ | 773.4 | ||||||||||||||||
Net Written Premiums | ||||||||||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 37.4 | $ | 80.9 | $ | 147.9 | $ | 6.3 | $ | 37.6 | $ | 75.2 | $ | 124.0 | ||||||||||||||||
Other Property Reinsurance | 92.0 | 88.3 | 96.6 | 61.1 | 70.8 | 89.8 | 65.6 | |||||||||||||||||||||||
Casualty Reinsurance | 70.7 | 61.5 | 111.4 | 54.2 | 67.7 | 62.6 | 123.1 | |||||||||||||||||||||||
Specialty Reinsurance | 50.8 | 56.2 | 86.7 | 52.9 | 42.3 | 61.0 | 87.8 | |||||||||||||||||||||||
Total Reinsurance | $ | 250.9 | $ | 286.9 | $ | 442.6 | $ | 174.5 | $ | 218.4 | $ | 288.6 | $ | 400.5 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property Insurance | $ | 42.3 | $ | 54.6 | $ | 16.6 | $ | 48.2 | $ | 50.9 | $ | 67.1 | $ | 16.3 | ||||||||||||||||
Casualty Insurance | 82.4 | 74.3 | 41.4 | 63.2 | 61.6 | 56.2 | 24.6 | |||||||||||||||||||||||
Marine, Energy and Transportation Insurance | 64.2 | 131.1 | 119.5 | 118.5 | 107.1 | 102.7 | 126.4 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 95.8 | 97.4 | 33.9 | 113.6 | 69.3 | 64.3 | 2.9 | |||||||||||||||||||||||
Programs | 41.7 | 42.1 | 43.5 | 30.0 | 34.7 | 33.8 | 26.3 | |||||||||||||||||||||||
Total Insurance | $ | 326.4 | $ | 399.5 | $ | 254.9 | $ | 373.5 | $ | 323.6 | $ | 324.1 | $ | 196.5 | ||||||||||||||||
Total Net Written Premiums | $ | 577.3 | $ | 686.4 | $ | 697.5 | $ | 548.0 | $ | 542.0 | $ | 612.7 | $ | 597.0 | ||||||||||||||||
Net Earned Premiums | ||||||||||||||||||||||||||||||
Reinsurance | ||||||||||||||||||||||||||||||
Property Catastrophe Reinsurance | $ | 62.5 | $ | 62.7 | $ | 62.4 | $ | 64.0 | $ | 60.4 | $ | 65.1 | $ | 58.7 | ||||||||||||||||
Other Property Reinsurance | 84.1 | 81.5 | 79.2 | 73.0 | 62.5 | 79.1 | 71.0 | |||||||||||||||||||||||
Casualty Reinsurance | 75.0 | 78.8 | 72.2 | 84.8 | 78.9 | 75.2 | 66.6 | |||||||||||||||||||||||
Specialty Reinsurance | 58.0 | 55.8 | 52.9 | 63.0 | 53.9 | 56.4 | 60.4 | |||||||||||||||||||||||
Total Reinsurance | $ | 279.6 | $ | 278.8 | $ | 266.7 | $ | 284.8 | $ | 255.7 | $ | 275.8 | $ | 256.7 | ||||||||||||||||
Insurance | ||||||||||||||||||||||||||||||
Property Insurance | $ | 40.7 | $ | 54.7 | $ | 42.3 | $ | 42.4 | $ | 46.2 | $ | 44.1 | $ | 45.7 | ||||||||||||||||
Casualty Insurance | 67.6 | 53.3 | 49.6 | 40.7 | 44.5 | 40.7 | 34.6 | |||||||||||||||||||||||
Marine, Energy and Transportation Insurance | 107.2 | 119.9 | 115.1 | 117.7 | 123.3 | 116.8 | 101.6 | |||||||||||||||||||||||
Financial and Professional Lines Insurance | 75.6 | 70.6 | 65.2 | 56.9 | 52.5 | 45.9 | 51.0 | |||||||||||||||||||||||
Programs | 39.7 | 38.9 | 27.6 | 30.1 | 22.1 | 20.7 | 21.3 | |||||||||||||||||||||||
Total Insurance | $ | 330.8 | $ | 337.4 | $ | 299.8 | $ | 287.8 | $ | 288.6 | $ | 268.2 | $ | 254.2 | ||||||||||||||||
Total Net Earned Premiums | $ | 610.4 | $ | 616.2 | $ | 566.5 | $ | 572.6 | $ | 544.3 | $ | 544.0 | $ | 510.9 | ||||||||||||||||
A-2
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