Allied World Reports Strong 4th Quarter 2011 Results; Grows Diluted Book Value per Share 8% in 2011
15 Feb, 2012, 21:35 GMT
ZUG, Switzerland, February 15, 2012 /PRNewswire/ --
Allied World Assurance Company Holdings, AG (NYSE: AWH) today reported operating income of $94.7 million, or $2.40 per diluted share, for the fourth quarter of 2011 compared to operating income of $97.3 million, or $2.24 per diluted share, for the fourth quarter of 2010. Operating income for the year ended December 31, 2011 was $183.7 million, or $4.63 per diluted share, compared to operating income of $397.8 million, or $7.97 per diluted share, for the year ended December 31, 2010.
The company reported net income of $183.1 million, or $4.63 per diluted share, for the fourth quarter of 2011 compared to net income of $92.8 million, or $2.13 per diluted share, for the fourth quarter of 2010. Net income for the year ended December 31, 2011 was $274.5 million, or $6.92 per diluted share, compared to net income of $665.0 million, or $13.32 per diluted share, for the year ended December 31, 2010.
President and Chief Executive Officer Scott Carmilani commented, "In the face of a number of challenges that confronted our company and the insurance industry globally, Allied World continues to generate solid profitability and growth in book value. Our three operating segments all contributed, with each experiencing premium growth in 2011. We again benefited from focusing our efforts on targeted lines and select geographies throughout the world. Collectively, our gross production was up by 10% for the year with our new business initiatives driving the increase."
"The company had a strong fourth quarter of 2011, producing operating income of $95 million and net income of $183 million. For the full year, we made $275 million in net income in spite of it being the costliest catastrophe year in history. We benefited from continued favorable loss reserve emergence that significantly offset our catastrophe losses for the year as well as from a merger breakup fee. The investment returns underperformed 2010 due to lower interest rates and a weaker overall investment environment."
Mr. Carmilani concluded, "Ultimately, we judge ourselves by our ability to build shareholder value, and we grew diluted book value per share by 8% in what was a volatile 2011. This reflects our robust risk management controls, strong ratings and a healthy capital base. The company is well positioned as we move forward into 2012."
Underwriting Results
Gross premiums written were $416.5 million in the fourth quarter of 2011, a 9.1% increase compared to $381.9 million in the fourth quarter of 2010. For the year ended December 31, 2011, gross premiums written totaled $1,939.5 million, a 10.3% increase compared to $1,758.4 million for the year ended December 31, 2010. Net premiums written were $306.8 million in the fourth quarter of 2011, a 6.8% increase compared to $287.2 million in the fourth quarter of 2010. For the year ended December 31, 2011, net premiums written totaled $1,533.8 million, a 10.1% increase compared to $1,392.5 million for the year ended December 31, 2010.
The combined ratio was 83.5% in the fourth quarter of 2011 compared to 82.8% in the fourth quarter of 2010. The loss and loss expense ratio was 53.9% in the fourth quarter of 2011 compared to 46.7% in the fourth quarter of 2010. During the fourth quarter of 2011, the company recorded net favorable reserve development on prior loss years of $92.4 million. This favorable reserve development resulted in a benefit of 23.4 percentage points to the company's loss and loss expense ratio for the quarter. This compares to the fourth quarter of 2010, where the company recorded net favorable reserve development on prior loss years of $73.9 million, a benefit of 21.6 percentage points to the company's loss and loss expense ratio for that quarter. Absent these adjustments, the loss and loss expense ratio for the fourth quarter of 2011 was 77.3% compared to 68.3% for the fourth quarter of 2010. The fourth quarter 2011 loss and loss expense ratio was impacted by $59.1 million of net losses, or 14.9 percentage points, from the flooding in Thailand that occurred in the fourth quarter of 2011 and from other catastrophes that occurred earlier in 2011. These catastrophe losses were comprised of $23.6 million from our international insurance segment and $35.8 million from our reinsurance segment and were modestly offset by a $0.3 million reduction for prior quarter catastrophe losses recorded in our U.S. insurance segment. The fourth quarter 2010 loss and loss expense ratio was impacted by $21.4 million of net losses, or 6.2 percentage points, from major loss events occurring during 2010.
For the year ended December 31, 2011, the combined ratio was 95.9% compared to 84.9% for the year ended December 31, 2010. For the year ended December 31, 2011, the company recorded net favorable reserve development on prior loss years of $253.5 million, a benefit of 17.4 percentage points to the company's loss and loss expense ratio. For the year ended December 31, 2010, the company recorded net favorable reserve development on prior loss years of $313.3 million, a benefit of 23.1 percentage points to the company's loss and loss expense ratio. Absent prior year reserve adjustments, the loss and loss expense ratio related to 2011 was 83.2% compared to 75.2% for 2010. The 2011 loss and loss expense ratio was impacted by $292.2 million of net losses, or 20.1 percentage points, from global catastrophes occurring during 2011. This compares to 2010 which was impacted by $164.6 million of net losses, or 12.1 percentage points, from major loss events occurring during 2010.
The company's expense ratio was 29.6% for the fourth quarter of 2011 compared to 36.1% for the fourth quarter of 2010. The expense ratio was 30.1% for the year ended December 31, 2011 compared to 32.8% for the year ended December 31, 2010. The decreases in these ratios for the three months and year ended December 31, 2011 were driven by increases in earned premiums and decreases in performance-based incentive compensation expenses. In 2010, we also incurred one-time expenses in connection with our redomestication to Switzerland.
Investment Results
The total return on the company's investment portfolio for the three months and year ended December 31, 2011 was 0.9% and 2.0%, respectively. See the table below for the components of our investment returns for the three months and year ended December 31, 2011:
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
FINANCIAL STATEMENT PORTFOLIO RETURN
(expressed in thousands of THREE MONTHS ENDED YEAR ENDED
U.S. Dollars) DECEMBER 31, 2011 DECEMBER 31, 2011
Net investment income $ 45,489 $ 195,948
Net realized investment gains 31,632 10,077
Decrease in unrealized investment gains (3,297) (45,686)
Net investment income, realized
gains and unrealized gains $ 73,824 $ 160,339
Average invested assets $ 8,062,561 $ 7,902,633
Financial statement portfolio
return 0.9% 2.0%
Note: net investment income, net realized gains/losses and change in
unrealized gains/losses are disclosed on a pre-tax basis.
Other Income
Other income for the three months and year ended December 31, 2011 was $66.7 million and $101.7 million, respectively. This represented the termination fee resulting from our previously announced merger agreement with Transatlantic Holdings, Inc., which was terminated on September 15, 2011. Given the non-recurring nature of this item, it has been excluded from the computation of the company's operating returns.
Shareholders' Equity
As of December 31, 2011, our total shareholders' equity was $3,149.0 million, compared to $3,075.8 million as of December 31, 2010.
The company's annualized net income return on average shareholders' equity for the three months and year ended December 31, 2011 was 23.9% and 8.9%, respectively. The company's annualized operating return on average shareholders' equity for the three months and year ended December 31, 2011 was 12.4% and 6.0%, respectively.
As of December 31, 2011, diluted book value per share was $80.11, an increase of 5.7% and 7.8% compared to $75.82 and $74.29, respectively, as of September 30, 2011 and December 31, 2010.
Share Repurchase Program
During the fourth quarter 2011, the company repurchased 450,000 of its common shares through its share repurchase program in the open market at an average repurchase price of $59.33 per share for an aggregate cost of $26.7 million. For the year ended December 31, 2011, the company repurchased 1,419,163 of its common shares through its program in the open market at an average repurchase price of $61.09 per share for an aggregate cost of $86.7 million. As of December 31, 2011, the company had $174.2 million of remaining capacity available under its share repurchase program.
Investment Supplement
Allied World will be providing additional information on its investment portfolio as of December 31, 2011. This information will be available at the "Investor Relations" section of the company's website at http://www.awac.com.
Financial Supplement
A financial supplement relating to the fourth quarter and year ended December 31, 2011 will be available at the "Investor Relations" section of the company's website at http://www.awac.com.
Conference Call
Allied World will host a conference call on Thursday, February 16, 2012 at 9:00 a.m. (Eastern Time) to discuss the results for the fourth quarter and year ended December 31, 2011. The public may access a live webcast of the conference call at the "Investor Relations" section of the company's website at http://www.awac.com. In addition, the conference call can be accessed by dialing (866) 843-0890 (U.S. and Canada callers) or +1-412-317-9250 (international callers) and entering the passcode 6211936 approximately ten minutes prior to the call.
Following the conclusion of the presentation, a replay of the call will be available through Thursday, March 1, 2012 by dialing (877) 344-7529 (U.S. and Canada callers) or +1-412-317-0088 (international callers) and entering the passcode 10008556. In addition, the webcast will remain available online through Thursday, March 1, 2012 at http://www.awac.com.
Non-GAAP Financial Measures
In presenting the company's results, management has included and discussed in this press release certain non-generally accepted accounting principles ("non-GAAP") financial measures within the meaning of Regulation G as promulgated by the U.S. Securities and Exchange Commission. Management believes that these non-GAAP measures, which may be defined differently by other companies, better explain the company's results of operations in a manner that allows for a more complete understanding of the underlying trends in the company's business. However, these measures should not be viewed as a substitute for those determined in accordance with generally accepted accounting principles ("U.S. GAAP").
"Operating income" is an internal performance measure used in the management of the company's operations and represents after-tax operational results excluding, as applicable, net realized investment gains or losses, net impairment charges recognized in earnings, net foreign exchange gain or loss and impairment of intangible assets, and other non-recurring items. The company excludes net realized investment gains or losses, net impairment charges recognized in earnings, net foreign exchange gain or loss, and other non-recurring items from the calculation of operating income because these amounts are heavily influenced by and fluctuate in part according to the availability of market opportunities and other factors. The company excludes impairment of intangible assets as these are non-recurring charges. In addition to presenting net income determined in accordance with U.S. GAAP, the company believes that showing operating income enables investors, analysts, rating agencies and other users of the company's financial information to more easily analyze our results of operations and underlying business performance. Operating income should not be viewed as a substitute for U.S. GAAP net income.
The company has included "diluted book value per share" because it takes into account the effect of dilutive securities; therefore, the company believes it is an important measure of calculating shareholder returns.
"Annualized net income return on average shareholders' equity" ("ROAE") is calculated using average shareholders' equity, excluding the average after tax unrealized gains (or losses) on investments. Unrealized gains (losses) on investments are primarily the result of interest rate and credit spread movements and the resultant impact on fixed income securities. Such gains (losses) are not related to management actions or operational performance, nor are they likely to be realized. Therefore, the company believes that excluding these unrealized gains (losses) provides a more consistent and useful measurement of operating performance, which supplements U.S. GAAP information. In calculating ROAE, the net income (loss) available to shareholders for the period is multiplied by the number of such periods in a calendar year in order to arrive at annualized net income (loss) available to shareholders. The company presents ROAE as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information.
"Annualized operating return on average shareholders' equity" is calculated using operating income (as defined above and annualized in the manner described for net income (loss) available to shareholders under ROAE above), and average shareholders' equity, excluding the average after tax unrealized gains (losses) on investments. Unrealized gains (losses) are excluded from equity for the reasons outlined in the annualized net income return on average shareholders' equity explanation above.
Reconciliations of these financial measures to their most directly comparable U.S. GAAP measures are included in the attached tables.
About Allied World Assurance Company
Allied World Assurance Company Holdings, AG, through its subsidiaries, is a global provider of innovative property, casualty and specialty insurance and reinsurance solutions, offering superior client service through a global network of offices and branches. All of Allied World's rated insurance and reinsurance subsidiaries are rated A by A.M. Best Company, A by Standard & Poor's, and A2 by Moody's, and our Lloyd's Syndicate 2232 is rated A+ by Standard & Poor's and Fitch. Please visit http://www.awac.com for further information on Allied World.
Cautionary Statement Regarding Forward-Looking Statements
Any forward-looking statements made in this press release reflect our current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in these statements. For example, our forward-looking statements could be affected by pricing and policy term trends; increased competition; the impact of acts of terrorism and acts of war; greater frequency or severity of unpredictable catastrophic events; negative rating agency actions; the adequacy of our loss reserves; the company or its subsidiaries becoming subject to significant income taxes in the United States or elsewhere; changes in regulations or tax laws; changes in the availability, cost or quality of reinsurance or retrocessional coverage; adverse general economic conditions; and judicial, legislative, political and other governmental developments, as well as management's response to these factors, and other factors identified in our filings with the U.S. Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We are under no obligation (and expressly disclaim any such obligation) to update or revise any forward-looking statement that may be made from time to time, whether as a result of new information, future developments or otherwise.
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in thousands of United States dollars, except share and per share amounts)
Quarter Ended Year Ended
December 31, December 31,
2011 2010 2011 2010
Revenues:
Gross premiums
written $ 416,537 $ 381,942 $ 1,939,521 $ 1,758,397
Premiums ceded (109,705) (94,743) (405,755) (365,942)
Net premiums
written 306,832 287,199 1,533,766 1,392,455
Change in unearned
premiums 88,637 55,605 (76,774) (32,907)
Net premiums
earned 395,469 342,804 1,456,992 1,359,548
Net investment
income 45,489 50,168 195,948 244,143
Net realized
investment gains
(losses) 31,632 (3,738) 10,077 285,612
Net impairment
charges recognized
in earnings - - - (168)
Other income 66,744 - 101,744 913
Total revenue 539,334 389,234 1,764,761 1,890,048
Expenses:
Net losses and
loss expenses 213,345 160,019 959,156 707,883
Acquisition costs 46,562 38,848 167,295 159,489
General and
administrative
expenses 70,492 85,134 271,656 286,557
Amortization and
impairment of
intangible assets 678 808 2.978 3.483
Interest expense 13,754 11,650 54,989 40.242
Foreign exchange
(gain) loss (549) 196 3,159 444
Total expenses 344,282 296,655 1,459,233 1,198,098
Income before income
taxes 195,052 92,579 305,528 691,950
Income tax expense
(benefit) 11,952 (207) 30,980 26,945
NET INCOME $ 183.100 $ 92.786 $ 274.548 $ 665.005
PER SHARE DATA:
Basic earnings per
share $ 4.80 $ 2.30 $ 7.21 $ 14.30
Diluted earnings
per share $ 4.63 $ 2.13 $ 6.92 $ 13.32
Weighted average
common shares
outstanding 38,138,558 40,291,620 38,093,351 46,491,279
Weighted average
common shares and
common share
equivalents
outstanding 39,524,273 43,501,068 39,667,905 49,913,317
Dividends paid per
share $ 0.375 $ 0.45 $ 0.75 $ 1.05
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of United States dollars, except share and per share amounts)
As of As of
December 31, December 31,
ASSETS: 2011 2010
Fixed maturity investments available for
sale, at fair value (amortized cost: 2011:
$226,397; 2010: $828,544) $ 244,016 $ 891,849
Fixed maturity investments trading, at fair
value (amortized cost: 2011: $6,207,991;
2010: $5,714,322) 6,254,686 5,769,097
Equity securities trading, at fair value
(cost: 2011: $356,370; 2010: $160,513) 367,483 174,976
Other invested assets trading, at fair
value 540,409 347,632
Total investments 7,406,594 7,183,554
Cash and cash equivalents 716,604 853,368
Insurance balances receivable 652,158 529,927
Prepaid reinsurance 226,721 187,287
Reinsurance recoverable 1,002,919 927,588
Accrued investment income 38,263 40,520
Net deferred acquisition costs 100,334 96,803
Goodwill 268,376 268,376
Intangible assets 53,898 56,876
Net deferred tax assets 22,646 19,740
Other assets 53,202 75,184
Total assets $ 10,541,715 $ 10,239,223
LIABILITIES:
Reserve for losses and loss expenses $ 5,225,143 $ 4,879,188
Unearned premiums 1,078,412 962,203
Reinsurance balances payable 124,539 99,732
Net balances payable on purchases and sales
of investments 36,285 318,570
Dividends payable 14,302 -
Senior notes 797,949 797,700
Accounts payable and accrued liabilities 116,063 106,010
Total liabilities $ 7,392,693 $ 7,163,403
SHAREHOLDERS' EQUITY:
Common shares: 2011: par value CHF 14.03
per share and 2010: par value CHF 15.00 per
share (2011: 40,003,642; 2010: 40,003,642
shares issued and 2011: 37,742,131; 2010:
38,089,226 shares outstanding) 557,153 600,055
Additional paid-in capital 78,225 170,239
Treasury shares, at cost (2011: 2,261,511;
2010: 1,914,416) (136,590) (112,811)
Retained earnings 2,635,750 2,361,202
Accumulated other comprehensive income, net
of tax 14,484 57,135
Total shareholders' equity 3,149,022 3,075,820
Total liabilities and shareholders' equity $ 10,541,715 $ 10,239,223
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONSOLIDATED SEGMENT DATA
(Expressed in thousands of United States dollars, except for ratio information)
Quarter Ended U.S. International
December 31, 2011 Insurance Insurance Reinsurance Total
Gross premiums
written $ 227,005 $ 130,920 $ 58,612 $ 416,537
Net premiums written 169,097 79,813 57,922 306,832
Net premiums earned 152,491 80,585 162,393 395,469
Net losses and loss
expenses (92,953) (19,661) (100,731) (213,345)
Acquisition costs (18,449) (165) (27,948) (46,562)
General and
administrative
expenses (33,437) (21,351) (15,704) (70,492)
Underwriting income 7,652 39,408 18,010 65,070
Net investment
income 45,489
Net realized
investment gains 31,632
Other income -
termination fee 66,744
Amortization and
impairment of
intangible assets (678)
Interest expense (13,754)
Foreign exchange
gain 549
Income before income
taxes $ 195,052
GAAP Ratios:
Loss and loss
expense ratio 61.0% 24.4% 62.0% 53.9%
Acquisition cost
ratio 12.1% 0.2% 17.2% 11.8%
General and
administrative
expense ratio 21.9% 26.5% 9.7% 17.8%
Combined ratio 95.0% 51.1% 88.9% 83.5%
Quarter Ended U.S. International
December 31, 2010 Insurance Insurance Reinsurance Total
Gross premiums
written $ 196,287 $ 115,056 $ 70,599 $ 381,942
Net premiums written 143,789 73,973 69,437 287,199
Net premiums earned 133,930 81,764 127,110 342,804
Net losses and loss
expenses (74,750) (27,084) (58,185) -(160,019)
Acquisition costs (16,902) 431 (22,377) (38,848)
General and
administrative
expenses (38,978) (26,905) (19,251) (85,134)
Underwriting income 3,300 28,206 27,297 58,803
Net investment
income 50,168
Net realized
investment losses (3,738)
Amortization and
impairment of
intangible assets (808)
Interest expense (11,650)
Foreign exchange
loss (196)
Income before income
taxes $ 92,579
GAAP Ratios:
Loss and loss
expense ratio 55.8% 33.1% 45.8% 46.7%
Acquisition cost
ratio 12.6% (0.5%) 17.6% 11.3%
General and
administrative
expense ratio 29.1% 32.9% 15.1% 24.8%
Combined ratio 97.5% 65.5% 78.5% 82.8%
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED CONSOLIDATED SEGMENT DATA
(Expressed in thousands of United States dollars, except for ratio information)
Year Ended U.S. International
December 31, 2011 Insurance Insurance Reinsurance Total
Gross premiums
written $ 838,567 $ 530,450 $ 570,504 $ 1,939,521
Net premiums written 639,196 325,094 569,476 1,533,766
Net premiums earned 584,303 317,006 555,683 1,456,992
Net losses and loss
expenses (387,099) (206,593) (365,464) (959,156)
Acquisition costs (74,976) 2,781 (95,100) (167,295)
General and
administrative
expenses (124,434) (84,290) (62,932) (271,656)
Underwriting (loss)
income (2,206) 28,904 32,187 58,885
Net investment
income 195,948
Net realized
investment gains 10,077
Other income -
termination fee 101,744
Amortization and
impairment of
intangible assets (2,978)
Interest expense (54,989)
Foreign exchange
loss (3,159)
Income before income
taxes $ 305,528
GAAP Ratios:
Loss and loss
expense ratio 66.2% 65.2% 65.8% 65.8%
Acquisition cost
ratio 12.8% (0.9%) 17.1% 11.5%
General and
administrative
expense ratio 21.3% 26.6% 11.3% 18.6%
Combined ratio 100.3% 90.9% 94.2% 95.9%
Year Ended U.S. International
December 31, 2010 Insurance Insurance Reinsurance Total
Gross premiums
written $ 729,267 $ 504,937 $ 524,193 $ 1,758,397
Net premiums written 551,063 319,083 522,309 1,392,455
Net premiums earned 518,444 338,791 502,313 1,359,548
Other income 913 - - 913
Net losses and loss
expenses (297,517) (160,153) (250,213) (707,883)
Acquisition costs (67,797) 460 (92,152) (159,489)
General and
administrative
expenses (128,556) (94,226) (63,775) (286,557)
Underwriting income 25,487 84,872 96,173 206,532
Net investment
income 244,143
Net realized
investment gains 285,612
Net impairment
charges recognized
in earnings (168)
Amortization and
impairment of
intangible assets (3,483)
Interest expense (40,242)
Foreign exchange
loss (444)
Income before income
taxes $ 691,950
GAAP Ratios:
Loss and loss
expense ratio 57.4% 47.3% 49.8% 52.1%
Acquisition cost
ratio 13.1% (0.1%) 18.3% 11.7%
General and
administrative
expense ratio 24.8% 27.8% 12.7% 21.1%
Combined ratio 95.3% 75.0% 80.8% 84.9%
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED OPERATING INCOME RECONCILIATION
(Expressed in thousands of United States dollars, except share and per share amounts)
Quarter Ended Year Ended
December 31, December 31,
2011 2010 2011 2010
Net income $ 183,100 $ 92,786 $ 274,548 $ 665,005
Add after tax affect of:
Net realized
investment (gains)
losses (26,332) 4,306 (213) (267,727)
Net impairment
charges recognized
in earnings - - - 109
Other Income -
termination fee (61,538) - (93,808) -
Foreign exchange
(gain) / loss (549) 196 3,159 444
Operating income $ 94,681 $ 97,288 $ 183,686 $ 397,831
Weighted average common
shares outstanding:
Basic 38,138,558 40,291,620 38,093,351 46,491,279
Diluted 39,524,273 43,501,068 39,667,905 49,913,317
Basic per share data:
Net income $ 4.80 $ 2.30 $ 7.21 $ 14.30
Add after tax affect of:
Net realized
investment (gains)
losses (0.69) 0.11 (0.01) (5,75)
Net impairment
charges recognized
in earnings - - - -
Other Income -
termination fee (1.62) - (2.46) -
Foreign exchange
(gain) / loss (0.01) - 0.08 0,01
Operating income $ 2.48 $ 2.41 $ 4.82 $ 8.56
Diluted per share data
Net income $ 4.63 $ 2.13 $ 6.92 $ 13.32
Add after tax affect of:
Net realized
investment (gains)
losses (0.67) 0.10 (0.01) (5,36)
Net impairment
charges recognized
in earnings - - - -
Other Income -
termination fee (1.56) - (2.36) -
Foreign exchange
(gain) / loss - 0.01 0.08 0,01
Operating income $ 2.40 $ 2.24 $ 4.63 $ 7.97
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED DILUTED BOOK VALUE PER SHARE RECONCILIATION
(Expressed in thousands of United States dollars, except share and per share amounts)
As of As of
December 31, December 31,
2011 2010
Price per share at period end $ 62.93 $ 59.44
Total shareholders' equity $ 3,149,022 $ 3,075,820
Basic common shares outstanding 37,742,131 38,089,226
Add: unvested restricted share units 249,251 571,178
Add: Performance based equity awards 889,939 1,440,017
Add: employee share purchase plan 11,053 10,576
Add: dilutive options/warrants outstanding 1,525,853 3,272,739
Weighted average exercise price per share $ 45.72 $ 35.98
Deduct: options bought back via treasury
method (1,108,615) (1,980,884)
Common shares and common share
equivalents outstanding 39,309,612 41,402,852
Basic book value per common share $ 83.44 $ 80.75
Diluted book value per common share $ 80.11 $ 74.29
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG
UNAUDITED ANNUALIZED RETURN ON SHAREHOLDERS' EQUITY RECONCILIATION
(Expressed in thousands of United States dollars, except for percentage information)
Quarter Ended December 31, Year Ended December 31,
2011 2010 2011 2010
Opening
shareholders'
equity $ 3,003,074 $ 3,341,314 $ 3,075,820 $ 3,213,295
Deduct: accumulated
other comprehensive
income (17,796) (111,760) (57,135) (149,849)
Adjusted opening
shareholders'
equity 2,985,278 3,229,554 3,018,685 3,063,446
- -
Closing
shareholders'
equity $ 3,149,022 $ 3,075,820 $ 3,149,022 $ 3,075,820
Deduct: accumulated
other comprehensive
income (14,484) (57,135) (14,484) (57,135)
Adjusted closing
shareholders'
equity 3,134,538 3,018,685 3,134,538 3,018,685
Average
shareholders'
equity $ 3,059,908 $ 3,124,120 $ 3,076,612 $ 3,041,066
Net income
available to
shareholders $ 183,100 $ 92,786 $ 274,548 $ 665,005
Annualized net
income available to
shareholders 732,400 371,144 274,548 665,005
Annualized return
on average
shareholders'
equity - net income
available to
shareholders 23.9% 11.9% 8.9% 21.9%
Operating income
available to
shareholders $ 94,681 $ 97,288 $ 183,686 $ 397,831
Annualized
operating income
available to
shareholders 378,724 389,152 183,686 397,831
Annualized return
on average
shareholders'
equity - operating
income available to
shareholders 12.4% 12.5% 6.0% 13.1%
SOURCE Allied World Assurance Company Holdings, AG