Kingsway reports decreasing profits

Kingsway Financial Services Inc. (TSE:KFS) reported a net loss of US$103.5 million for 2007 Q4 and a net loss of US$18.5 million for the year, marking a decrease of 716% and 115% over the same periods of 2006, respectively.
The combined ratio was 130.2% in the quarter (109.3% for the year), with Canadian operations reporting a combined ratio of 99.8% (95.0% for the year), a Kingsway release says.
Its U.S. operations reported a combined ratio of 143.3% (115.3% for the year), the release adds.
Gross premiums written increased 10% to US$449.0 million in the quarter compared to US$409.1 million in Q4 last year, the statement says.
“Overall, 2007 was an extremely disappointing year for the company due to the significant reserve increases which were necessary at our largest subsidiary, Lincoln,” said Shaun Jackson, president and CEO, Kingsway.
“The increase in reserves at Lincoln [US$124.8 million] has overshadowed the strong operating performance from most of our U.S. subsidiaries and all of our Canadian subsidiaries, as well as healthy investment returns from our securities portfolio.”