Northbridge Posts Strong 1-Q Underwriting Result

The Fairfax group’s Canadian arm, Northbridge Financial Corp. (TSX: NB), posted an underwriting profit of $20.3 million for the first quarter of this year. This was achieved on the back of a 92.8% combined ratio. The company’s latest financial return reflects a doubling of the underwriting profit of $10.1 million posted for the first quarter of 2003. Northbridge posted net earnings of $32.2 million (63 a share) for the first quarter of this year, up from the $29.0 million (60 a share) reported a year ago. The company’s gross written premiums rose to $432.1 million for the first quarter of 2004 from the $377.9 million shown a year ago. Net written premiums climbed by more than 10% year-on-year to $263.2 million compared with the $238.6 million reported for the same period in 2003. Northbridge also benefited from investment income which increased moderately to $30.4 million for the first quarter of this year from the $29.6 million posted a year go. As of the end March this year, the company’s net unrealized gains stood at $179.5 million, versus $125.7 million at the end of 2003.

The company will pay a dividend of 15 per every outstanding common share for the latest reporting period. Fairfax also recently announced an offering which would see its stake in Northbridge reduced from 71% to a 59% share.