XL Capital Q2 2005 net income, $135.9 million

XL Capital Ltd (NYSE: XL – News) recently reported net income available to ordinary shareholders for the quarter ended June 30, 2005 of $135.9 million, or $0.97 per ordinary share, compared with $363.6 million, or $2.62 per ordinary share, for the quarter ended June 30, 2004. Annualized net income return on ordinary shareholders’ equity for the quarter was 7.2% compared with 21.7% for the year ago quarter.
‘Net income excluding net realized gains and losses’ for the quarter was $101.3 million, or $0.72 per ordinary share, compared with $319.9 million, or $2.31 per ordinary share, for the year ago quarter. Annualized return on ordinary shareholders’ equity on the same basis was 5.3% compared with 19.1% for the year ago quarter.
Included in both net income and ‘net income excluding net realized gains and losses’ in the quarter is a charge of $63.3 million, after tax, relating to an increase in future policy benefit reserves and a write off of deferred acquisition costs with respect to certain novated blocks of U.S.- based term-life mortality reinsurance business. In addition, these results also include the previously announced prior year reserve strengthening for the Company’s North American Reinsurance operations of $186.3 million, after tax.
For the first half of 2005, net income available to ordinary shareholders was $578.8 million, or $4.14 per ordinary share, compared with $815.8 million or $5.88 per ordinary share in the first half of 2004. ‘Net income excluding net realized gains and losses’ for the same period was $447.8 million or $3.20 per ordinary share as compared with $652.5 million or $4.71 per ordinary share in the first half of 2004.
In the second quarter 2005 total revenues were up 30% to $4.1 billion with a combined ratio from general operations of 97.9%, or 86.8% excluding the reinsurance reserve increase. The net investment income from general operations increased 43% to $209.7 million and cash flow from operations represented $2.4 billion. The Company’s Q2 2005 total net invested assets rose 12% from Dec. 31, 2004 to reach $36.4 billion, and total assets rose 8% for the same time period to reach $53.3 billion, up 8%.