Alleghany (Y) Tops Q4 EPS by 96c

Alleghany (NYSE: Y) reported Q4 EPS of ($4.35), $0.96 better than the analyst estimate of ($5.31). Revenue for the quarter came in at $1.23 billion versus the consensus estimate of $1.73 billion.

• Book value per common share1was $527.75 as of December 31, 2018, a decrease of 4.6%from book value per common shareas of December 31, 2017, and a decrease of 8.4% from book value per common share1as of September 30, 2018. Book value per share decreased 2.8% for the full year,adjusted for the $10.00 per share special dividend paid in March 2018.
• Net premiums written increased 1.7% and8.5% for the yearand three monthsended December 31, 2018, respectively. Excluding PacificComp, which was sold on December 31, 2017,net premiums written increased 5.1% and 12.1% for the year and three months ended December 31,2018, respectively.
• Noninsurance revenue increased 77.1% and 120.0%for the year and three monthsended December 31, 2018, respectively.Current year noninsurance revenue includes the effects of acquisition activity, primarily W&W|AFCO Steel’s acquisition of Hirschfeld Industries.
• Earnings per diluted share and operating earnings per diluted share were $2.62and $16.13, respectively,for the year-ended December 31, 2018,compared with earnings per diluted share and operating earnings per diluted share of $5.85 and $2.87, respectively,for the year-ended December 31, 2017.
• Earnings (losses) per diluted share and operating (losses) earnings per diluted share were $(48.30) and $(4.35), respectively,for the three months ended December 31, 2018,compared with earnings per diluted share and operating earnings per diluted share of $9.96 and $10.12, respectively,for the three months ended December 31, 2017.
• After-tax catastrophe losses, net of reinsurance and reinstatement premium,were $494.4 million and $300.6million for the yearand three months ended December 31, 2018, respectively.

Weston Hicks, President and chief executive officer, stated, “Our 2018 results reflect record earnings at Alleghany Capital, profitable but depressed operating results at TransReand RSUI due to above-average catastrophe losses, and solid growth and improved earnings at CapSpecialty. In addition, although our equity portfolio outperformed the broader equity markets, absolute returns were negative and higher interest rates caused a decline in the value of our fixed income portfolio. These market value adjustments resulted in a modest decline in book value for the year.”

For earnings history and earnings-related data on Alleghany (Y) click here.

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