(Corrects to remove reference to Lloyd’s in first paragraph in story published July 25.)
Lancashire Holdings Ltd. (LRE), an insurer of the Costa Concordia, rallied the most in five weeks yesterday after it reported better-than-expected profit for the second quarter.
The stock climbed 4 percent to 814.5 pence in London trading, the biggest intraday gain since June 14. Lancashire said pretax profit fell 3.8 percent to $58.3 million from a year earlier, in a statement today. That beat the average analyst estimate of $39.1 million provided by the company. Net investment income dropped 23 percent to $6.5 million.
“These are good results, despite the hit to profit from investment losses,” Joanna Parsons, an analyst at Westhouse Securities Ltd. in London wrote in a note to clients. “The statement is sounding a positive tone and combined with the good results we would expect the shares to go better.”
The insurer said its loss on the Carnival Corp. (CCL:US)’s Costa Concordia, which was shipwrecked on the Italian island of Giglio in January 2012, increased by $37.7 million in the period. Even so, its combined ratio, or claims and expenses as a percentage of premiums, was 66.9 percent in the second quarter, surpassing the average analyst estimate provided by the company of 70.8 percent.
Numis Corp. today increased its full-year pretax profit estimate for the insurer by $31 million to $232 million and reiterated its add rating.
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