Argo Group International (ARGO-PA) 8-K Results of Operations and Financial Condition

Exhibit 99.2

PXRE	Consolidated Balance Sheets
Group Ltd.	(Dollars in thousands, except par value per share)
		March 31, 2006			December 31, 2005
		(Unaudited)
Assets	Investments:
	Fixed maturities, at fair value:
	Available-for-sale (amortized cost $704,687 and $1,212,299, respectively)	$	696,733		$	1,208,248
	Trading (cost $35,359 and $28,225, respectively)		34,812			25,796
	Short-term investments, at fair value		623,114			261,076
	Hedge funds, at fair value (cost $124,637 and $132,690, respectively)		144,894			148,230
	Other invested assets, at fair value (cost $2,216 and $2,806, respectively)		2,661			3,142
	Total investments		1,502,214			1,646,492
	Cash		17,241			14,504
	Accrued investment income		5,437			10,809
	Premiums receivable, net		166,247			217,446
	Other receivables		9,055			17,000
	Reinsurance recoverable on paid losses		13,797			4,223
	Reinsurance recoverable on unpaid losses		68,668			107,655
	Ceded unearned premiums		25,313			1,379
	Deferred acquisition costs		10,206			5,487
	Income tax recoverable		6,081			6,295
	Other assets		64,832			84,757
	Total assets	$	1,889,091		$	2,116,047
Liabilities	Losses and loss expenses	$	1,010,038		$	1,320,126
	Unearned premiums		58,254			32,512
	Subordinated debt		167,083			167,081
	Reinsurance balances payable		24,693			30,244
	Deposit liabilities		64,733			68,270
	Other liabilities		60,580			32,496
	Total liabilities		1,385,381			1,650,729
Shareholders'	Serial convertible preferred shares, $1.00 par value, $10,000 stated
Equity	value – 30 million shares authorized, 0.01 million and 0.01 million shares
	issued and outstanding, respectively		58,132			58,132
	Common shares, $1.00 par value – 350 million shares authorized,
	72.4 million and 72.3 million shares issued and outstanding,
	respectively		72,410			72,281
	Additional paid-in capital		875,228			875,224
	Accumulated other comprehensive loss		(8,314	)		(5,468	)
	Accumulated deficit		(486,900	)		(527,349	)
	Restricted shares at cost (0.5 million and 0.5 million shares, respectively)		(6,846	)		(7,502	)
	Total shareholders' equity		503,710			465,318
	Total liabilities and shareholders' equity	$	1,889,091		$	2,116,047

PXRE	Consolidated Statements of Income and Comprehensive Income
Group Ltd.	(Dollars in thousands, except per share amounts)
		Three Months Ended  March 31,
		2006			2005
		(Unaudited)
Revenues	Net premiums earned	$	77,087		$	79,434
	Net investment income		17,912			10,442
	Net realized investment losses		(4,659	)		(107	)
	Fee income		191			211
			90,531			89,980
Losses and	Losses and loss expenses incurred		17,800			44,438
Expenses	Commission and brokerage		11,895			9,278
	Other reinsurance related expense		3,721			—
	Operating expenses		10,965			9,377
	Foreign exchange losses		927			598
	Interest expense		3,611			3,610
			48,919			67,301
	Income before income taxes and convertible preferred share dividends		41,612			22,679
	Income tax benefit		—			(64	)
	Net income before convertible preferred share dividends	$	41,612		$	22,743
	Convertible preferred share dividends		1,163			3,369
	Net income to common shareholders	$	40,449		$	19,374
Comprehensive	Net income before convertible preferred share dividends	$	41,612		$	22,743
Income, Net	Net change in unrealized depreciation on investments		(7,628	)		(7,347	)
of Tax	Reclassification adjustments for losses included in net income		4,659			56
	Minimum additional pension liability		123			—
	Comprehensive income	$	38,766		$	15,452
Per Share	Basic:
	Income before convertible preferred share dividends	$	0.58		$	1.13
	Convertible preferred share dividends		(0.02	)		(0.17	)
	Net income to common shareholders	$	0.56		$	0.96
	Average shares outstanding (000's)		71,889			20,200
	Diluted:
	Net income	$	0.54		$	0.69
	Average shares outstanding (000's)		76,975			32,980

PXRE	Consolidated Statements of Shareholders' Equity
Group Ltd.	(Dollars in thousands)
		Three Months Ended March 31,
		2006			2005
		(Unaudited)
Convertible	Balance at beginning of period	$	58,132		$	163,871
Preferred Shares	Conversion of convertible preferred shares		—			(103,869	)
	Dividends to convertible preferred shareholders		—			3,369
	Balance at end of period	$	58,132		$	63,371
Common Shares	Balance at beginning of period	$	72,281		$	20,469
	Issuance of common shares, net		129			8,177
	Balance at end of period	$	72,410		$	28,646
Additional	Balance at beginning of period	$	875,224		$	329,730
Paid-in Capital	Issuance of common shares, net		4			103,713
	Tax effect of stock options exercised		—			368
	Balance at end of period	$	875,228		$	433,811
Accumulated	Balance at beginning of period	$	(5,468	)	$	(4,855	)
Other	Change in unrealized losses on investments		(2,969	)		(7,291	)
Comprehensive	Change in minimum additional pension liability		123			—
Income
	Balance at end of period	$	(8,314	)	$	(12,146	)
(Accumulated	Balance at beginning of period	$	(527,349	)	$	194,081
Deficit)/	Net income before convertible preferred share dividends		41,612			22,743
Retained Earnings	Dividends to convertible preferred shareholders		(1,163	)		(3,369	)
	Dividends to common shareholders		—			(1,234	)
	Balance at end of period	$	(486,900	)	$	212,221
Restricted Shares	Balance at beginning of period	$	(7,502	)	$	(6,741	)
	Issuance of restricted shares, net		(140	)		(5,452	)
	Amortization of restricted shares		796			889
	Balance at end of period	$	(6,846	)	$	(11,304	)
Total	Balance at beginning of period	$	465,318		$	696,555
Shareholders'	Conversion of convertible preferred shares		—			(103,869	)
Equity	Issuance of common shares, net		133			111,890
	Restricted shares, net		656			(4,563	)
	Unrealized depreciation on investments		(2,969	)		(7,291	)
	Minimum additional pension liability		123			—
	Net income before convertible preferred share dividends		41,612			22,743
	Dividends to convertible preferred shareholders		(1,163	)		—
	Dividends to common shareholders		—			(1,234	)
	Tax effect of stock options exercised		—			368
	Balance at end of period	$	503,710		$	714,599

PXRE	Consolidated Statements of Cash Flows
Group Ltd.	(Dollars in thousands)
		Three Months Ended March 31,
		2006			2005
		(Unaudited)
Cash Flows	Premiums collected, net of reinsurance	$	142,658		$	109,891
from Operating	Loss and loss adjustment expenses paid, net of reinsurance		(263,321	)		(46,336	)
Activities	Commission and brokerage paid, net of fee income		(8,995	)		(18,704	)
	Operating expenses paid		(13,141	)		(10,945	)
	Net investment income received		17,928			7,303
	Interest paid		(5,794	)		(5,794	)
	Income taxes recovered		214			7,186
	Trading portfolio purchased		(49,539	)		(14,396	)
	Trading portfolio disposed		40,121			—
	Deposit paid		(3,537	)		(3,052	)
	Other		(2,881	)		(57	)
	Net cash (used) provided by operating activities		(146,287	)		25,096
Cash Flows	Fixed maturities available for sale purchased		(66,991	)		(187,990	)
from Investing	Fixed maturities available for sale disposed or matured		569,533			56,546
Activities	Hedge funds purchased		(4,000	)		(105,352	)
	Hedge funds disposed		13,116			98,805
	Other invested assets disposed		573			1,367
	Net change in short-term investments		(362,038	)		110,481
	Receivable for securities		—			(11,860	)
	Payable for securities		—			21,916
	Net cash provided (used) by investing activities		150,193			(16,087	)
Cash Flows	Proceeds from issuance of common shares		257			3,129
from Financing	Cash dividends paid to common shareholders		—			(1,234	)
Activities	Cash dividends paid to preferred shareholders		(1,163	)		—
	Cost of shares repurchased		(263	)		(561	)
	Net cash (used) provided by financing activities		(1,169	)		1,334
	Net change in cash		2,737			10,343
	Cash, beginning of period		14,504			15,668
	Cash, end of period	$	17,241		$	26,011
	Reconciliation of net income to net cash (used) provided by operating activities:
	Net income before convertible preferred share dividends	$	41,612		$	22,743
	Adjustments to reconcile net income to net cash (used) provided by
	operating activities:
	Losses and loss expenses		(310,086	)		481
	Unearned premiums		1,807			34,172
	Deferred acquisition costs		(4,719	)		(5,052	)
	Receivables		77,259			(12,636	)
	Reinsurance balances payable		(5,551	)		3,965
	Reinsurance recoverable		29,414			(2,379	)
	Income taxes		214			7,121
	Equity in earnings of limited partnerships		(5,872	)		(4,403	)
	Trading portfolio purchased		(49,539	)		(14,396	)
	Trading portfolio disposed		40,121			—
	Deposit liability		(3,537	)		(3,052	)
	Receivable on commutation		35,154			—
	Other		7,436			(1,468	)
	Net cash (used) provided by operating activities	$	(146,287	)	$	25,096