(Adds CEO comment in fourth paragraph, shares in sixth.)
July 22 (Bloomberg) -- Beazley Plc, the Lloyd’s of London insurer that tried to buy Hardy Underwriting Bermuda Ltd., swung into a loss in the first half after record claims from natural disasters in Japan, Australia and New Zealand.
The firm had a net loss of $14.1 million in the first six months of the year, compared with a profit of $97.9 million in the year-earlier period, Dublin-based Beazley said today.
The insurer, which writes policies protecting clients from hurricanes, lawsuits and terrorism, was hurt by the biggest Japanese earthquake on record earlier this year as well as catastrophes in Australia and New Zealand. The net cost of the disasters is likely to be $154 million, an estimate that’s unchanged from April, Beazley said today.
“The Japanese loss is the second-largest insured loss ever,” Chief Executive Officer Andrew Horton said in a telephone interview today. “It’s quite unusual to have so many losses in one half.”
The insurer still expects to meet analysts’ estimates for full-year profit of $70 million to $100 million, so long as there are no major hurricane losses in the second half, Horton said. The company raised its first-half dividend to 2.5 pence a share, from 2.4 pence a year earlier.
The stock rose almost 2 percent to 129.4 pence as of 9:20 a.m. in London trading, valuing the firm at about 670 million pounds ($1.1 billion).
Beazley is on the lookout for acquisitions to expand in the U.S. and Europe, following the failure of its bid for Hardy at the end of last year. Premium rates have failed to rise substantially so far this year, putting pressure on smaller firms to seek mergers or acquisitions to grow.
“In these more stressed times when results aren’t that good, there will be opportunities to acquire people or books of business, or small- or medium-sized companies,” Horton said.
The insurer named Dennis Holt, former CEO of Axa SA’s U.K. division, as a director, it said in a separate statement today. He will succeed Jonathan Agnew as chairman in March next year, subject to regulatory approval, Beazley said.
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