EGI Financial reports 2006 1Q increases

EGI Financial Holdings Inc. (TSX:EFH) announced strong results for the first quarter ended Mar. 31, 2006, including “solid increases in net written premiums, investment income and income before extraordinary gains, as the company continues to build its specialty general insurance business.”
EGI Financial generated direct written premiums totaling CD$26.1 million for the 2006 period, compared with CD$25.9 million in the corresponding period last year.
Net written premiums (after reinsurance) rose 27% in 2006 from CD$18.4 million to CD$23.5 million. Underwriting profit in the quarter increased strongly to CD$900,000, compared with CD$400,000 last year.
“The increase was attributable to a combination of reduced loss ratio and increase in net earned premiums in the automobile division during the first quarter of this year,” the company reported.
The combined ratio for 2006 1Q was 96.3%, compared with 97.6% for the same period last year. The annualized return on equity (ROE) was 20.4%. Investment income during 2006 1Q was CD$2.6 million compared to CD$1.9 million last year, an increase of 37%.
“We are very pleased with our financial results in the first quarter,” EGI Financial CEO Douglas McIntyre said. “The performance reflects continued strong underwriting results in our automobile division and solid top-line growth in our niche products division. Greater retention of business, which had previously been passed to reinsurers, was also an important factor.”
Direct written premiums in the automobile division for 2006 1Q were CD$22.3 million, down 7% from CD$24 million in 2005. However, net written premiums for the 2006 period were up 21%, to CD$20.6 million from CD$17 million in 2005.
In the niche products division, direct written premiums for 2006 1Q were CD$3.8 million, up 100% from CD$1.9 million in the same period last year, and net written premiums for 2006 1Q were CD$2.9 million, up 93% from CD$1.5 million in 2005.