XL Capital has announced a net loss for the fourth quarter of $821.9m, compared with a net income of $288m for the fourth quarter 2004.
The net loss included net losses of $834.2m relating to the Winterthur actuarial decision, plus losses from Hurricane Wilma of $247.1m and additional pre-tax net losses of $210.8m related to the 2005 third quarter natural catastrophes.
For the quarter, the company recorded a combined ratio of 165.1%.
For the twelve months of 2005, XL recorded a net loss of $1,292.3m, compared with a net income of $1,126.3m or net income of $8.13 per ordinary share for 2004.
Brian O'Hara, president and CEO said: “We are extremely disappointed with the impact the third and fourth quarters events had on our financial performance. However, the natural catastrophes of 2005 have led to more attractive markets, and in true XL tradition, we are executing on these opportunities with a focus on maximising risk-adjusted returns.
"I believe that XL's solid balance sheet, geographic breadth and diversification of platforms will serve us well in 2006.”
The insurance operations recorded an underwriting loss for the quarter of $1,092.8m compared with an underwriting profit of $49.1m in the 2004 quarter.
These results included the pre-tax net impact of natural catastrophes of $285.1m and $110.5m in 2005 and 2004, respectively.
Fourth quarter underwriting losses for the reinsurance operations were $32.3m compared with an underwriting profit of $43.7m in the fourth quarter 2004. These results included the pre-tax net impact of catastrophes of $140.9m and $39.5m in 2005 and 2004, respectively.
The fourth quarter, however, also saw XL successfully raise $3.2bn through the issuance of ordinary shares and equity security units. The company also reported a marked improvement in its financial operation for the quarter, resulting in income of $71.2m, up 54%.
