Kingsway Discloses 18.2% ROE for 2-Q

Kingsway Financial Service Inc. (TSE: KFS) reported a return on equity of 18.2% for the 12 month period leading to the end of the second quarter of this year. This compares with the 11.8% ROE generated by the insurer for the comparable period for 2002.

Kingsway’s net income for the latest quarter grew by 68% to $27.3 million, (2002 2-Q: $16.2 million) with net earnings clocking in 55 a share compared with the 33 a share reported a year earlier. For the first six months of 2003, the company’s net income came in at $51.7 million against the $32.5 million posted for the first half of 2002. Earnings for the first six months of this year increased by 58% year-on-year to $1.04 a share.

For the latest quarter, Kingsway’s Canadian operations produced a combined ratio of 108.4% (2002 Q2: 105.4%) while the U.S. operations reported a combined ratio of 96.1% (2002 Q2: 96.6%). The insurer’s overall combined ratio for the latest quarter clocked in at 99.2% (2002 Q2: 99.7%) on the back of an underwriting profit of $4.7 million (Q2 2002: $0.3 million). For the six-month period, the combined ratio stood at 98.1% with an underwriting profit of $22.5 million. This compares with a combined ratio of 99.7% and an underwriting profit of $2.5 million reported for the first half of last year.

The insurer’s gross written premiums (GWP) rose to $629.9 million for the latest quarter compared with the $362.2 million shown a year ago. On a year-to-date basis, GWP was up to $1.3 billion from $919.0 million posted last year. Net earned premiums also rose by 65% for the first half of this year to $1.2 billion from 2002’s first-half tally of $709.6 million.