Table of Contents
Exhibit 99.1
Aspen Insurance Holdings Limited
Financial Supplement
As of September 30, 2008
This financial supplement is for information purposes only. It should be read in
conjunction with other documents filed or to be filed shortly by Aspen Insurance
Holdings Limited with the United States Securities and Exchange Commission.
conjunction with other documents filed or to be filed shortly by Aspen Insurance
Holdings Limited with the United States Securities and Exchange Commission.
AHL:NYSE
www.aspen.bm
Investor Contact:
Aspen Insurance Holdings Limited
Noah Fields, Head of Investor Relations
T: +1441-297-9382
email: noah.fields@aspen-re.com
Aspen Insurance Holdings Limited
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Table of Contents
Aspen Insurance Holdings Limited
Basis of Presentation
Definitions and presentation: All financial information contained herein is unaudited except for information for the fiscal year ended December 31, 2007. Unless otherwise noted, all data is in U.S. dollars millions, except for per share, percentage and ratio information.
In presenting the Company’s results, management has included and discussed certain “non-GAAP financial measures”, as such term is defined in Regulation G. Management believes that these non-GAAP measures, which may be defined differently by other companies, better explain the Company’s results of operations in a manner that allows for a more complete understanding of the underlying trends in the Company’s business. However, these measures should not be viewed as a substitute for those determined in accordance with GAAP. The reconciliation of such non-GAAP financial measures to their respective most directly comparable GAAP financial measures in accordance with Regulation G is included in this financial supplement.
Operating income(a non-GAAP financial measure): Operating income is an internal performance measure used by the Company in the management of its operations and represents after-tax operational results excluding, as applicable, after-tax net realized capital gains or losses and after-tax net foreign exchange gains or losses.
The Company excludes after-tax net realized capital gains or losses and after-tax net foreign exchange gains or losses from its calculation of operating income because the amount of these gains or losses is heavily influenced by, and fluctuates in part, according to the availability of market opportunities. The Company believes these amounts are largely independent of its business and underwriting process and including them distorts the analysis of trends in its operations. In addition to presenting net income determined in accordance with GAAP, the Company believes that showing operating income enables investors, analysts, rating agencies and other users of its financial information to more easily analyze the Company’s results of operations in a manner similar to how management analyzes the Company’s underlying business performance. Operating income should not be viewed as a substitute for GAAP net income. Please see page 28 for a reconciliation of operating income to net income.
Net income excluding net income or losses from investments accounted for by the equity method(a non-GAAP financial measure). This is an internal performance measure used by the Company in the management of its operations and represents net income adjusted for preference share dividends excluding after-tax net income or losses from investments accounted for using the equity method.
The Company excludes net income or loss from investments accounted for using the equity method from its calculation of net income because the amount of these gains or losses are largely independent of its business and underwriting process and including them distorts the anlaysis of trends in its operations. In addition to presenting net income determined in accordance with GAAP, the Company believes that showing net income excluding net income or losses for other investments accounted for by the equity method enables investors, analysts, rating agencies and other users of its financial information to more easily analyze the Company’s results of operations in a manner similar to how management analyzes the Company’s underlying business performance. Net income excluding net income or losses for investments accounted for by the equity method should not be viewed as a substitute for GAAP net income. Please see page 29 for a reconciliation of net income excluding net income or losses for other investments accounted for by the equity method income to net income.
Annualized Operating Return on Average Equity (“Operating ROE”)(a non-GAAP financial measure): Annualized Operating Return on Average Equity 1) is calculated using operating income, as defined above and 2) excludes from average equity, the average after-tax unrealized appreciation or depreciation on investments and the average after-tax unrealized foreign exchange gains or losses and the aggregate value of the liquidation preferences of our preference shares. Unrealized appreciation (depreciation) on investments is primarily the result of interest rate movements and the resultant impact on fixed income securities, and unrealized appreciation (depreciation) on foreign exchange is the result of exchange rate movements between the U.S. dollar and the British pound. Such appreciation (depreciation) is not related to management actions or operational performance (nor is it likely to be realized). Therefore the Company believes that excluding these unrealized appreciations (depreciations) provides a more consistent and useful measurement of operating performance, which supplements GAAP information. Average equity is calculated as the arithmetic average on a monthly basis for the stated periods.
The Company presents Operating ROE as a measure that is commonly recognized as a standard of performance by investors, analysts, rating agencies and other users of its financial information. See page 28 for a reconciliation of operating income to net income and page 7 for a reconciliation of average equity to closing shareholders’ equity.
Diluted book value per ordinary share(a non-GAAP financial measure): The Company has included diluted book value per ordinary share because it takes into account the effect of dilutive securities; therefore, the Company believes it is a better measure of calculating shareholder returns than book value per share. Please see page 26 for a reconciliation of diluted book value per share to basic book value per share.
Underwriting ratios(GAAP financial measures): The Company, along with others in the industry, uses underwriting ratios as measures of performance. The loss ratio is the ratio of net claims and claims adjustment expenses to net premiums earned. The acquisition expense ratio is the ratio of underwriting expenses (commissions; premium taxes, licenses and fees; as well as other underwriting expenses) to net premiums earned. The general and administrative expense ratio is the ratio of general and administrative expenses to net premiums earned. The combined ratio is the sum of the loss ratio, the acquisition expense ratio and the general and administrative expense ratio. These ratios are relative measurements that describe for every $100 of net premiums earned or written, the cost of losses and expenses, respectively. The combined ratio presents the total cost per $100 of earned premium. A combined ratio below 100% demonstrates underwriting profit; a combined ratio above 100% demonstrates underwriting loss.
GAAP combined ratios differ from US statutory combined ratios primarily due to the deferral of certain third party acquisition expenses for GAAP reporting purposes and the use of net premiums earned rather than net premiums written in the denominator when calculating the acquisition expense and the general and administrative expense ratios.
Accident Year Loss Ratios(a non-GAAP financial measure): In addition to the underwriting ratios described above, management also uses accident year loss ratios to evaluate current underwriting performance. The accident year loss ratio excludes the effect of prior years’ premium adjustments and reserve developments. This ratio focuses on the relationship between current premiums earned and losses incurred related to the current year. Please see pages 15 and 16 for a reconciliation of accident year loss ratios to underwriting ratios calculated in accordance with U.S. GAAP.
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Table of Contents
Aspen Insurance Holdings Limited
Financial Highlights
Financial Highlights
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
| (in US$ millions except for percentages, share and per share amounts) | 2008 | 2007 | Change | 2008 | 2007 | Change | ||||||||||||||||||
| Gross written premium | $ | 441.3 | $ | 373.5 | 18.2 | % | $ | 1,566.3 | $ | 1,513.5 | 3.5% | |||||||||||||
| Net written premium | $ | 403.8 | $ | 348.8 | 15.8 | % | $ | 1,429.4 | $ | 1,322.4 | 8.1% | |||||||||||||
| Net earned premium | $ | 434.2 | $ | 419.7 | 3.5 | % | $ | 1,223.1 | $ | 1,309.9 | (6.6%) | |||||||||||||
| Net income (loss) after tax | $ | (126.1 | ) | $ | 117.2 | (207.6 | %) | $ | 82.0 | $ | 353.8 | (76.8%) | ||||||||||||
| Operating income (loss) after tax | $ | (76.2 | ) | $ | 109.2 | (169.7 | %) | $ | 131.0 | $ | 340.6 | (61.5%) | ||||||||||||
Earnings Per Share and Book Value Per Share | ||||||||||||||||||||||||
| Basic earnings (loss) per ordinary share | ||||||||||||||||||||||||
| Net income adjusted for preference share dividend | $ | (1.63 | ) | $ | 1.24 | (231.5 | %) | $ | 0.73 | $ | 3.77 | (80.6%) | ||||||||||||
| Operating income adjusted for preference share dividend | $ | (1.02 | ) | $ | 1.15 | (189.2 | %) | $ | 1.32 | $ | 3.62 | (63.4%) | ||||||||||||
| Diluted earnings (loss) per ordinary share | ||||||||||||||||||||||||
| Net income adjusted for preference share dividend | $ | (1.63 | ) | $ | 1.21 | (234.7 | %) | $ | 0.71 | $ | 3.67 | (80.6%) | ||||||||||||
| Operating income adjusted for preference share dividend | $ | (1.02 | ) | $ | 1.12 | (191.0 | %) | $ | 1.28 | $ | 3.52 | (63.6%) | ||||||||||||
| Book value per ordinary share | $ | 27.14 | $ | 26.46 | 2.6 | % | $ | 27.14 | $ | 26.46 | 2.6% | |||||||||||||
| Diluted book value per ordinary share (treasury stock method) | $ | 26.21 | $ | 25.68 | 2.1 | % | $ | 26.21 | $ | 25.68 | 2.1% | |||||||||||||
| Weighted average number of ordinary shares outstanding (in millions of shares) | 81.376 | 88.712 | (8.3 | %) | 83.459 | 88.250 | (5.4%) | |||||||||||||||||
| Diluted weighted average number of ordinary shares outstanding (in millions of shares) | 81.376 | 91.082 | (10.7 | %) | 86.114 | 90.758 | (5.1%) | |||||||||||||||||
Underwriting Ratios | ||||||||||||||||||||||||
| Loss ratio | 95.2 | % | 52.4 | % | 66.1 | % | 54.8 | % | ||||||||||||||||
| Policy acquisition cost ratio | 16.2 | % | 18.1 | % | 17.3 | % | 18.0 | % | ||||||||||||||||
| General and administrative expense ratio | 11.9 | % | 14.0 | % | 13.1 | % | 11.3 | % | ||||||||||||||||
| Expense ratio | 28.1 | % | 32.1 | % | 30.4 | % | 29.3 | % | ||||||||||||||||
| Combined ratio | 123.3 | % | 84.5 | % | 96.5 | % | 84.1 | % | ||||||||||||||||
Return On Equity | ||||||||||||||||||||||||
Average equity(1) | $ | 2,289.3 | $ | 2,188.0 | $ | 2,314.2 | $ | 2,099.0 | ||||||||||||||||
| Return on average equity | ||||||||||||||||||||||||
| Net income adjusted for preference share dividend | (5.8 | %) | 5.0 | % | 2.6 | % | 15.9 | % | ||||||||||||||||
| Operating income adjusted for preference share dividend | (3.6 | %) | 4.7 | % | 4.8 | % | 15.2 | % | ||||||||||||||||
| Annualized return on average equity | ||||||||||||||||||||||||
| Net income | (23.2 | %) | 20.2 | % | 3.5 | % | 21.2 | % | ||||||||||||||||
| Operating income | (14.4 | %) | 18.7 | % | 6.4 | % | 20.3 | % | ||||||||||||||||
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would be anti-dilutive.
See pages 7, 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
| 1. | Average equity excludes the average after tax unrealized appreciation or depreciation on investments and average after tax unrealized foreign exchange gains or losses. |
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Aspen Insurance Holdings Limited
Consolidated Statements Of Operations — Quarterly
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q3 2006 | ||||||||||||||||||
| UNDERWRITING REVENUES | ||||||||||||||||||||||||
| Gross written premiums | 441.3 | 528.8 | $596.2 | $305.0 | $373.5 | $457.5 | ||||||||||||||||||
| Premiums ceded | (37.5 | ) | (22.8 | ) | (76.6 | ) | (26.0 | ) | (24.7 | ) | (24.0 | ) | ||||||||||||
| Net written premiums | 403.8 | 506.0 | 519.6 | 279.0 | 348.8 | 433.5 | ||||||||||||||||||
| Change in unearned premiums | 30.4 | (108.7 | ) | (128.0 | ) | 144.7 | 70.9 | (4.2 | ) | |||||||||||||||
| Net earned premiums | 434.2 | 397.3 | 391.6 | 423.7 | 419.7 | 429.3 | ||||||||||||||||||
| UNDERWRITING EXPENSES | ||||||||||||||||||||||||
| Losses and loss expenses | 413.4 | 188.3 | 207.2 | 201.7 | 219.9 | 232.0 | ||||||||||||||||||
| Acquisition expenses | 70.4 | 65.0 | 76.4 | 78.4 | 76.1 | 78.9 | ||||||||||||||||||
| General and administrative expenses | 51.6 | 57.1 | 50.8 | 56.5 | 58.6 | 36.8 | ||||||||||||||||||
| Total underwriting expenses | 535.4 | 310.4 | 334.4 | 336.6 | 354.6 | 347.7 | ||||||||||||||||||
| Underwriting (loss) income | (101.2 | ) | 86.9 | 57.2 | 87.1 | 65.1 | 81.6 | |||||||||||||||||
| OTHER OPERATING REVENUE | ||||||||||||||||||||||||
| Net investment income | 19.3 | 70.5 | 39.1 | 80.3 | 72.4 | 47.3 | ||||||||||||||||||
| Interest expense | (3.8 | ) | (4.0 | ) | (3.9 | ) | (2.9 | ) | (4.2 | ) | (4.6 | ) | ||||||||||||
| Total other operating revenue | 15.5 | 66.5 | 35.2 | 77.4 | 68.2 | 42.7 | ||||||||||||||||||
| Other income (expense) | 0.6 | — | (2.2 | ) | (3.8 | ) | (2.7 | ) | (7.1 | ) | ||||||||||||||
| OPERATING (LOSS) INCOME BEFORE TAX | (85.1 | ) | 153.4 | 90.2 | 160.7 | 130.6 | 117.2 | |||||||||||||||||
| OTHER | ||||||||||||||||||||||||
| Net realized and unrealized exchange (losses) gains | (2.7 | ) | (5.0 | ) | 4.3 | (2.1 | ) | 9.2 | 2.5 | |||||||||||||||
| Net realized investment (losses) gains | (58.1 | ) | 0.8 | 1.0 | (0.8 | ) | (1.9 | ) | (1.0 | ) | ||||||||||||||
| (LOSS) INCOME BEFORE TAX | (145.9 | ) | 149.2 | 95.5 | 157.8 | 137.9 | 118.7 | |||||||||||||||||
| Income tax recovery (expense) | 19.8 | (22.3 | ) | (14.3 | ) | (22.6 | ) | (20.7 | ) | (23.7 | ) | |||||||||||||
| NET (LOSS) INCOME AFTER TAX | (126.1 | ) | 126.9 | 81.2 | 135.2 | 117.2 | 95.0 | |||||||||||||||||
| Dividends paid on ordinary shares | (12.2 | ) | (12.8 | ) | (12.9 | ) | (13.3 | ) | (13.3 | ) | (14.4 | ) | ||||||||||||
| Dividend paid on preference shares | (6.9 | ) | (7.0 | ) | (6.9 | ) | (6.9 | ) | (6.9 | ) | (3.2 | ) | ||||||||||||
| Retained (loss) income | $(145.2 | ) | $107.1 | $61.4 | $115.0 | $97.0 | $77.4 | |||||||||||||||||
| Components of net (loss) income after tax | ||||||||||||||||||||||||
| Operating (loss) income | $(76.2 | ) | $131.2 | $76.0 | $138.0 | $109.2 | $93.5 | |||||||||||||||||
| Net realized and unrealized exchange (losses) gains after tax | (2.7 | ) | (5.0 | ) | 4.3 | (2.1 | ) | 9.2 | 2.5 | |||||||||||||||
| Net realized investment (losses) gains after tax | (47.2 | ) | 0.7 | 0.9 | (0.7 | ) | (1.2 | ) | (1.0 | ) | ||||||||||||||
| NET (LOSS) INCOME AFTER TAX | $(126.1 | ) | $126.9 | $81.2 | $135.2 | $117.2 | $95.0 | |||||||||||||||||
| Loss ratio | 95.2% | 47.4% | 52.9% | 47.6% | 52.4% | 54.0% | ||||||||||||||||||
| Policy acquistion expense ratio | 16.2% | 16.4% | 19.5% | 18.5% | 18.1% | 18.4% | ||||||||||||||||||
| General and administrative expense ratio | 11.9% | 14.4% | 13.0% | 13.3% | 14.0% | 8.6% | ||||||||||||||||||
| Expense ratio | 28.1% | 30.8% | 32.5% | 31.8% | 32.1% | 27.0% | ||||||||||||||||||
| Combined ratio | 123.3% | 78.2% | 85.4% | 79.4% | 84.5% | 81.0% | ||||||||||||||||||
| Basic earnings per share | $(1.63 | ) | $1.44 | $0.87 | $1.48 | $1.24 | $0.96 | |||||||||||||||||
| Diluted earnings per share | $(1.63 | ) | $1.39 | $0.85 | $1.44 | $1.21 | $0.94 | |||||||||||||||||
| Annualized return on average equity | ||||||||||||||||||||||||
| Net income | (23.2% | ) | 20.4% | 12.8% | 22.8% | 20.2% | 18.0% | |||||||||||||||||
| Operating income | (14.4% | ) | 21.2% | 12.0% | 23.2% | 18.7% | 17.6% | |||||||||||||||||
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would be anti-dilutive.
See pages 7, 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
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Aspen Insurance Holdings Limited
Consolidated Statements of Operations — Year To Date
| Nine Months Ended September 30, | ||||||||||||
| (in US$ millions) | 2008 | 2007 | 2006 | |||||||||
| UNDERWRITING REVENUES | ||||||||||||
| Gross written premiums | $ | 1,566.3 | $ | 1,513.5 | $ | 1,658.6 | ||||||
| Premiums ceded | (136.9 | ) | (191.1 | ) | (273.1 | ) | ||||||
| Net written premiums | 1,429.4 | 1,322.4 | 1,385.5 | |||||||||
| Change in unearned premiums | (206.3 | ) | (12.5 | ) | (124.6 | ) | ||||||
| Net earned premiums | 1,223.1 | 1,309.9 | 1,260.9 | |||||||||
| UNDERWRITING EXPENSES | ||||||||||||
| Losses and loss expenses | 808.9 | 718.1 | 688.2 | |||||||||
| Acquisition expenses | 211.8 | 235.5 | 255.4 | |||||||||
| General and administrative expenses | 159.5 | 148.3 | 118.0 | |||||||||
| Total underwriting expenses | 1,180.2 | 1,101.9 | 1,061.6 | |||||||||
| Underwriting income | 42.9 | 208.0 | 199.3 | |||||||||
| OTHER OPERATING REVENUE | ||||||||||||
| Net investment income | 128.9 | 218.7 | 141.7 | |||||||||
| Interest expense | (11.7 | ) | (12.8 | ) | (12.5 | ) | ||||||
| Total other operating revenue | 117.2 | 205.9 | 129.2 | |||||||||
| Other expense | (1.6 | ) | (8.1 | ) | (9.6 | ) | ||||||
| OPERATING INCOME BEFORE TAX | 158.5 | 405.8 | 318.9 | |||||||||
| OTHER | ||||||||||||
| Net realized and unrealized exchange (losses) gains | (3.4 | ) | 22.7 | 10.4 | ||||||||
| Net realized investment (losses) gains | (56.3 | ) | (12.3 | ) | (6.1 | ) | ||||||
| INCOME BEFORE TAX | 98.8 | 416.2 | 323.2 | |||||||||
| Income taxes | (16.8 | ) | (62.4 | ) | (64.6 | ) | ||||||
| NET INCOME AFTER TAX | 82.0 | 353.8 | 258.6 | |||||||||
| Dividends paid on ordinary shares | (37.9 | ) | (39.7 | ) | (42.9 | ) | ||||||
| Dividends paid on preference shares | (20.8 | ) | (20.8 | ) | (10.4 | ) | ||||||
| Retained income | $ | 23.3 | $ | 293.3 | $ | 205.3 | ||||||
| Components of net income after tax | ||||||||||||
| Operating income | $ | 131.0 | $ | 340.6 | $ | 253.5 | ||||||
| Net realized and unrealized exchange (losses) gains after tax | (3.4 | ) | 22.7 | 10.4 | ||||||||
| Net realized investment (losses) gains after tax | (45.6 | ) | (9.5 | ) | (5.3 | ) | ||||||
| NET INCOME AFTER TAX | $ | 82.0 | $ | 353.8 | $ | 258.6 | ||||||
| Loss ratio | 66.1% | 54.8% | 54.6% | |||||||||
| Policy acquistion expense ratio | 17.3% | 18.0% | 20.3% | |||||||||
| General and administrative expense ratio | 13.1% | 11.3% | 9.3% | |||||||||
| Expense ratio | 30.4% | 29.3% | 29.6% | |||||||||
| Combined ratio | 96.5% | 84.1% | 84.2% | |||||||||
See pages 7, 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
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Aspen Insurance Holdings Limited
Consolidated Balance Sheets
Consolidated Balance Sheets
| September 30, | June 30, | March 31, | December 31, | September 30, | ||||||||||||||||
| (in US$ millions, except for per share amounts) | 2008 | 2008 | 2008 | 2007 | 2007 | |||||||||||||||
| ASSETS | ||||||||||||||||||||
| Investments | ||||||||||||||||||||
| Fixed maturities | $ | 4,410.7 | $ | 4,612.7 | $ | 4,472.2 | $ | 4,385.8 | $ | 4,176.4 | ||||||||||
| Other investments | 513.1 | 555.3 | 544.5 | 561.4 | 489.5 | |||||||||||||||
| Short-term investments | 226.3 | 193.6 | 309.3 | 280.1 | 553.3 | |||||||||||||||
| Total investments | 5,150.1 | 5,361.6 | 5,326.0 | 5,227.3 | 5,219.2 | |||||||||||||||
| Cash and cash equivalents | 741.6 | 620.8 | 695.7 | 651.4 | 567.2 | |||||||||||||||
| Reinsurance recoverables | ||||||||||||||||||||
| Unpaid losses | 241.5 | 231.7 | 276.0 | 304.7 | 315.8 | |||||||||||||||
| Ceded unearned premiums | 77.5 | 98.9 | 121.8 | 77.0 | 102.1 | |||||||||||||||
| Receivables | ||||||||||||||||||||
| Underwriting premiums | 675.4 | 792.0 | 716.2 | 575.6 | 718.8 | |||||||||||||||
| Other | 102.6 | 79.0 | 50.3 | 59.8 | 84.8 | |||||||||||||||
| Funds withheld | 77.4 | 76.9 | 100.0 | 104.5 | 99.2 | |||||||||||||||
| Deferred policy acquisition costs | 166.7 | 167.4 | 151.6 | 133.9 | 152.9 | |||||||||||||||
| Derivatives at fair value | 10.9 | 11.3 | 15.4 | 17.3 | 19.2 | |||||||||||||||
| Office properties and equipment | 32.4 | 30.4 | 28.0 | 27.8 | 25.1 | |||||||||||||||
| Other assets | 19.8 | 20.9 | 17.7 | 13.8 | 13.6 | |||||||||||||||
| Intangible assets | 8.2 | 8.2 | 8.2 | 8.2 | 8.2 | |||||||||||||||
| Total assets | $ | 7,304.1 | $ | 7,499.1 | $ | 7,506.9 | $ | 7,201.3 | $ | 7,326.1 | ||||||||||
| LIABILITIES | ||||||||||||||||||||
| Insurance reserves | ||||||||||||||||||||
| Losses and loss adjustment expenses | $ | 3,081.9 | $ | 2,944.4 | $ | 2,950.3 | $ | 2,946.0 | $ | 2,963.0 | ||||||||||
| Unearned premiums | 940.8 | 1,018.9 | 930.1 | 757.6 | 931.7 | |||||||||||||||
| Total insurance reserves | 4,022.7 | 3,963.3 | 3,880.4 | 3,703.6 | 3,894.7 | |||||||||||||||
| Payables | ||||||||||||||||||||
| Reinsurance premiums | 98.0 | 115.6 | 133.1 | 81.3 | 89.1 | |||||||||||||||
| Taxation | 33.4 | 82.6 | 114.3 | 120.2 | 109.9 | |||||||||||||||
| Accrued expenses and other payables | 246.2 | 219.7 | 189.6 | 210.1 | 229.0 | |||||||||||||||
| Liabilities under derivative contracts | 16.7 | 14.5 | 17.3 | 19.0 | 20.7 | |||||||||||||||
| Total payables | 394.3 | 432.4 | 454.3 | 430.6 | 448.7 | |||||||||||||||
| Long-term debt | 249.5 | 249.5 | 249.5 | 249.5 | 249.5 | |||||||||||||||
| Total liabilities | 4,666.5 | 4,645.2 | 4,584.2 | 4,383.7 | 4,592.9 | |||||||||||||||
| SHAREHOLDERS’ EQUITY | ||||||||||||||||||||
| Ordinary shares | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | |||||||||||||||
| Preference shares | — | — | — | — | — | |||||||||||||||
| Additional paid-in capital | 1,754.1 | 1,753.3 | 1,849.5 | 1,846.1 | 1,890.5 | |||||||||||||||
| Retained earnings | 882.1 | 1,027.3 | 920.2 | 858.8 | 743.8 | |||||||||||||||
| Accumulated other comprehensive income, net of taxes | 1.3 | 73.2 | 152.9 | 112.6 | 98.8 | |||||||||||||||
| Total shareholders’ equity | 2,637.6 | 2,853.9 | 2,922.7 | 2,817.6 | 2,733.2 | |||||||||||||||
| Total liabilities and shareholders’ equity | $ | 7,304.1 | $ | 7,499.1 | $ | 7,506.9 | $ | 7,201.3 | $ | 7,326.1 | ||||||||||
| Book value per ordinary share | $ | 27.14 | $ | 29.84 | $ | 29.22 | $ | 27.95 | $ | 26.46 | ||||||||||
See pages 7, 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
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Aspen Insurance Holdings Limited
Earnings Per Share and Book Value Per Share
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | September 30, | September 30, | |||||||||||||
| (in US$ except for number of shares) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
| Basic earnings (loss) per ordinary share | ||||||||||||||||
| Net income adjusted for preference share dividend | $(1.63 | ) | $1.24 | $0.73 | $3.77 | |||||||||||
| Operating income adjusted for preference share dividend | $(1.02 | ) | $1.15 | $1.32 | $3.62 | |||||||||||
| Diluted earnings (loss) per ordinary share | ||||||||||||||||
| Net income adjusted for preference share dividend | $(1.63 | ) | $1.21 | $0.71 | $3.67 | |||||||||||
| Operating income adjusted for preference share dividend | $(1.02 | ) | $1.12 | $1.28 | $3.52 | |||||||||||
| Weighted average number of ordinary shares outstanding (in millions) | 81.376 | 88.712 | 83.459 | 88.250 | ||||||||||||
| Weighted average number of ordinary shares outstanding and dilutive potential ordinary shares (in millions) | 81.376 | 91.082 | 86.114 | 90.758 | ||||||||||||
| Book value per ordinary share | $27.14 | $26.46 | ||||||||||||||
| Diluted book value (treasury stock method) | $26.21 | $25.68 | ||||||||||||||
| Ordinary shares outstanding at end of the period (in millions) | 81.450 | 87.146 | ||||||||||||||
| Ordinary shares outstanding and dilutive potential ordinary shares at end of the period (treasury stock method) (in millions) | 84.325 | 89.794 | ||||||||||||||
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would be anti-dilutive.
See pages 7, 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
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Aspen Insurance Holdings Limited
Return On Average Equity
| Three Months Ended | Nine Months Ended | |||||||||||||||
| (in US$ millions except for percentages) | September 30, 2008 | September 30, 2007 | September 30, 2008 | September 30, 2007 | ||||||||||||
| Closing shareholders’ equity | $ | 2,637.6 | $2,733.2 | $2,637.6 | $2,733.2 | |||||||||||
| Average adjustment | (348.3 | ) | (545.2 | ) | (323.4 | ) | (634.2 | ) | ||||||||
Average equity(1) | $ | 2,289.3 | $2,188.0 | $2,314.2 | $2,099.0 | |||||||||||
| Return on average equity: | ||||||||||||||||
| Net income adjusted for preference share dividend | (5.8 | %) | 5.0 | % | 2.6 | % | 15.9 | % | ||||||||
| Operating income adjusted for preference share dividend | (3.6 | %) | 4.7 | % | 4.8 | % | 15.2 | % | ||||||||
| Annualized return on average equity: | ||||||||||||||||
| Net income | (23.2 | %) | 20.2 | % | 3.5 | % | 21.2 | % | ||||||||
| Operating income | (14.4 | %) | 18.7 | % | 6.4 | % | 20.3 | % | ||||||||
| Components of return on average equity: | ||||||||||||||||
Return on average equity from underwriting activity(2) | (4.4 | %) | 3.0 | % | 1.9 | % | 9.9 | % | ||||||||
Return on average equity from investment and other activity(3) | 0.4 | % | 2.7 | % | 4.1 | % | 8.4 | % | ||||||||
| Pre-tax operating income return on average equity | (4.0 | %) | 5.7 | % | 6.0 | % | 18.3 | % | ||||||||
Post-tax operating income return on average equity(4) | (3.6 | %) | 4.7 | % | 4.8 | % | 15.2 | % | ||||||||
See pages 26, 27, 28 and 29 for a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures.
1. Average equity is calculated by taking the simple average at latest quarter end and the previous quarter end of the closing shareholders’ equity excluding (i) preference shares, (ii) after tax unrealized appreciation or depreciation on investments and (iii) the average after tax unrealized foreign exchange gains and losses.
2. Calculated by using underwriting income.
3. Calculated by using total other operating revenue and other income/expense adjusted for preference share dividend.
4. Calculated by using operating income after tax adjusted for preference share dividend.
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Aspen Insurance Holdings Limited
Consolidated Underwriting Results by Operating Segment
| Three Months Ended September 30, 2008 | Three Months Ended September 30, 2007 | ||||||||||||||||||||||||||||||||||||||
| Property | Casualty | International | U.S. | Property | Casualty | International | U.S. | ||||||||||||||||||||||||||||||||
| (in US$ millions except for percentages) | Reinsurance | Reinsurance | Insurance | Insurance | Total | Reinsurance | Reinsurance | Insurance | Insurance | Total | |||||||||||||||||||||||||||||
| Gross written premiums | $152.8 | $79.7 | $180.8 | $28.0 | $441.3 | $139.5 | $77.5 | $129.0 | $27.5 | $373.5 | |||||||||||||||||||||||||||||
| Net written premiums | 140.2 | 79.8 | 162.2 | 21.6 | 403.8 | 131.5 | 77.1 | 118.1 | 22.1 | 348.8 | |||||||||||||||||||||||||||||
| Gross earned premiums | 152.3 | 113.7 | 185.4 | 31.5 | 482.9 | 150.2 | 125.5 | 164.2 | 33.2 | 473.1 | |||||||||||||||||||||||||||||
| Net earned premiums | 138.8 | 112.9 | 158.6 | 23.9 | 434.2 | 125.3 | 123.7 | 146.7 | 24.0 | 419.7 | |||||||||||||||||||||||||||||
| Losses and loss expenses | 164.6 | 75.9 | 141.8 | 31.1 | 413.4 | 42.9 | 92.2 | 75.3 | 9.5 | 219.9 | |||||||||||||||||||||||||||||
| Policy acquisition expenses | 23.4 | 16.6 | 26.5 | 3.9 | 70.4 | 25.4 | 19.8 | 26.4 | 4.5 | 76.1 | |||||||||||||||||||||||||||||
| Operating and administration expenses | 14.7 | 9.6 | 21.1 | 6.2 | 51.6 | 18.3 | 13.8 | 17.2 | 9.3 | 58.6 | |||||||||||||||||||||||||||||
| Underwriting (loss) income | $(63.9) | $10.8 | $(30.8 | ) | $(17.3 | ) | $(101.2 | ) | $38.7 | $(2.1 | ) | $27.8 | $0.7 | $65.1 | |||||||||||||||||||||||||
| Net reserves for loss and loss adjustment expenses | $495.6 | $1,324.7 | $886.3 | $133.8 | $2,840.4 | $480.0 | $1,201.9 | $909.7 | $55.6 | $2,647.2 | |||||||||||||||||||||||||||||
Ratios | |||||||||||||||||||||||||||||||||||||||
| Loss ratio | 118.6% | 67.2% | 89.4% | 130.1% | 95.2% | 34.2% | 74.5% | 51.3% | 39.6% | 52.4% | |||||||||||||||||||||||||||||
| Policy acquisition expense ratio | 16.8% | 14.7% | 16.7% | 16.3% | 16.2% | 20.3% | 16.0% | 18.0% | 18.8% | 18.1% | |||||||||||||||||||||||||||||
| Operating and administration expense ratio | 10.6% | 8.5% | 13.3% | 25.7% | 11.9% | 14.6% | 11.2% | 11.7% | 38.9% | 14.0% | |||||||||||||||||||||||||||||
| Expense ratio | 27.4% | 23.2% | 30.0% | 42.0% | 28.1% | 34.9% | 27.2% | 29.7% | 57.7% | 32.1% | |||||||||||||||||||||||||||||
| Combined ratio | 146.0% | 90.4% | 119.4% | 172.1% | 123.3% | 69.1% | 101.7% | 81.0% | 97.3% | 84.5% | |||||||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
Consolidated Underwriting Results by Operating Segment
| Nine Months Ended September 30, 2008 | Nine Months Ended September 30, 2007 | ||||||||||||||||||||||||||||||||||||||
| Property | Casualty | International | U.S. | Property | Casualty | International | U.S. | ||||||||||||||||||||||||||||||||
| (in US$ millions except for percentages) | Reinsurance | Reinsurance | Insurance | Insurance | Total | Reinsurance | Reinsurance | Insurance | Insurance | Total | |||||||||||||||||||||||||||||
| Gross written premiums | $507.5 | $318.6 | $639.0 | $101.2 | $1,566.3 | $521.9 | $380.2 | $513.2 | $98.2 | $1,513.5 | |||||||||||||||||||||||||||||
| Net written premiums | 481.1 | 314.3 | 555.8 | 78.2 | 1,429.4 | 424.2 | 371.8 | 454.9 | 71.5 | 1,322.4 | |||||||||||||||||||||||||||||
| Gross earned premiums | 437.1 | 297.1 | 529.3 | 87.1 | 1,350.6 | 462.8 | 364.3 | 496.7 | 105.4 | 1,429.2 | |||||||||||||||||||||||||||||
| Net earned premiums | 389.4 | 293.4 | 471.7 | 68.6 | 1,223.1 | 423.0 | 355.8 | 449.5 | 81.6 | 1,309.9 | |||||||||||||||||||||||||||||
| Losses and loss expenses | 240.9 | 191.7 | 323.1 | 53.2 | 808.9 | 170.7 | 244.6 | 252.3 | 50.5 | 718.1 | |||||||||||||||||||||||||||||
| Policy acquisition expenses | 72.9 | 46.0 | 80.5 | 12.4 | 211.8 | 83.9 | 56.3 | 80.1 | 15.2 | 235.5 | |||||||||||||||||||||||||||||
| Operating and administration expenses | 49.7 | 32.8 | 58.2 | 18.8 | 159.5 | 49.6 | 33.9 | 45.2 | 19.6 | 148.3 | |||||||||||||||||||||||||||||
| Underwriting income (loss) | $25.9 | $22.9 | $9.9 | $(15.8 | ) | $42.9 | $118.8 | $21.0 | $71.9 | $(3.7 | ) | $208.0 | |||||||||||||||||||||||||||
| Net reserves for loss and loss adjustment expenses | $495.6 | $1,324.7 | $886.3 | $133.8 | $2,840.4 | $480.0 | $1,201.9 | $909.7 | $55.6 | $2,647.2 | |||||||||||||||||||||||||||||
Ratios | |||||||||||||||||||||||||||||||||||||||
| Loss ratio | 61.9% | 65.3% | 68.5% | 77.6% | 66.1% | 40.4% | 68.7% | 56.1% | 61.9% | 54.8% | |||||||||||||||||||||||||||||
| Policy acquisition expense ratio | 18.7% | 15.7% | 17.1% | 18.1% | 17.3% | 19.8% | 15.8% | 17.8% | 18.6% | 18.0% | |||||||||||||||||||||||||||||
| Operating and administration expense ratio | 12.8% | 11.2% | 12.3% | 27.4% | 13.1% | 11.7% | 9.5% | 10.1% | 24.1% | 11.3% | |||||||||||||||||||||||||||||
| Expense ratio | 31.5% | 26.9% | 29.4% | 45.5% | 30.4% | 31.5% | 25.3% | 27.9% | 42.7% | 29.3% | |||||||||||||||||||||||||||||
| Combined ratio | 93.4% | 92.2% | 97.9% | 123.1% | 96.5% | 71.9% | 94.0% | 84.0% | 104.6% | 84.1% | |||||||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
Property Reinsurance Segment — Quarterly Results
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | Q3 2006 | ||||||||||||||||||||||||
| Gross written premiums | $152.8 | $170.5 | $184.2 | $79.6 | $139.5 | $190.3 | $192.1 | $201.7 | ||||||||||||||||||||||||
| Net written premiums | 140.2 | 165.5 | 175.4 | 70.8 | 131.5 | 115.6 | 177.1 | 194.5 | ||||||||||||||||||||||||
| Gross earned premiums | 152.3 | 144.5 | 140.3 | 161.5 | 150.2 | 151.3 | 161.3 | 176.3 | ||||||||||||||||||||||||
| Net earned premiums | 138.8 | 123.6 | 127.0 | 132.6 | 125.3 | 144.3 | 153.4 | 128.7 | ||||||||||||||||||||||||
| Net losses and loss expenses | 164.6 | 38.3 | 38.0 | 50.0 | 42.9 | 63.7 | 64.1 | 58.6 | ||||||||||||||||||||||||
| Acquisition costs | 23.4 | 23.6 | 25.9 | 33.5 | 25.4 | 31.1 | 27.4 | 32.3 | ||||||||||||||||||||||||
| Operating and administrative expenses | 14.7 | 18.4 | 16.6 | 15.7 | 18.3 | 16.8 | 14.5 | 9.3 | ||||||||||||||||||||||||
| Total underwriting (loss) income | $(63.9 | ) | $43.3 | $46.5 | $33.4 | $38.7 | $32.7 | $47.4 | $28.5 | |||||||||||||||||||||||
Ratios | ||||||||||||||||||||||||||||||||
| Loss ratio | 118.6% | 31.0% | 29.9% | 37.7% | 34.2% | 44.1% | 41.8% | 45.5% | ||||||||||||||||||||||||
| Policy acquisition expense ratio | 16.8% | 19.1% | 20.4% | 25.3% | 20.3% | 21.6% | 17.9% | 25.1% | ||||||||||||||||||||||||
| Operating and administrative expense ratio | 10.6% | 14.9% | 13.1% | 11.8% | 14.6% | 11.6% | 9.4% | 7.2% | ||||||||||||||||||||||||
| Expense ratio | 27.4% | 34.0% | 33.5% | 37.1% | 34.9% | 33.2% | 27.3% | 32.3% | ||||||||||||||||||||||||
| Combined ratio | 146.0% | 65.0% | 63.4% | 74.8% | 69.1% | 77.3% | 69.1% | 77.8% | ||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
Casualty Reinsurance Segment — Quarterly Results
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | Q3 2006 | ||||||||||||||||||||||||
| Gross written premiums | $79.7 | $56.8 | $182.1 | $51.3 | $77.5 | $79.4 | $223.3 | $96.6 | ||||||||||||||||||||||||
| Net written premiums | 79.8 | 54.5 | 180.0 | 53.3 | 77.1 | 78.1 | 216.6 | 96.2 | ||||||||||||||||||||||||
| Gross earned premiums | 113.7 | 87.7 | 95.7 | 119.0 | 125.5 | 127.8 | 111.0 | 132.0 | ||||||||||||||||||||||||
| Net earned premiums | 112.9 | 85.8 | 94.7 | 119.5 | 123.7 | 125.7 | 106.4 | 128.3 | ||||||||||||||||||||||||
| Losses and loss expenses | 75.9 | 54.3 | 61.5 | 87.5 | 92.2 | 91.6 | 60.8 | 82.0 | ||||||||||||||||||||||||
| Policy acquisition expenses | 16.6 | 11.7 | 17.7 | 13.3 | 19.8 | 17.2 | 19.3 | 19.5 | ||||||||||||||||||||||||
| Operating and administration expenses | 9.6 | 12.5 | 10.7 | 14.0 | 13.8 | 10.2 | 9.9 | 8.1 | ||||||||||||||||||||||||
| Underwriting income (loss) | $10.8 | $7.3 | $4.8 | $4.7 | $(2.1 | ) | $6.7 | $16.4 | $18.7 | |||||||||||||||||||||||
Ratios | ||||||||||||||||||||||||||||||||
| Loss ratio | 67.2% | 63.3% | 64.9% | 73.2% | 74.5% | 72.9% | 57.2% | 63.9% | ||||||||||||||||||||||||
| Policy acquisition expense ratio | 14.7% | 13.6% | 18.7% | 11.1% | 16.0% | 13.7% | 18.1% | 15.2% | ||||||||||||||||||||||||
| Operating and administration expense ratio | 8.5% | 14.6% | 11.3% | 11.8% | 11.2% | 8.1% | 9.3% | 6.3% | ||||||||||||||||||||||||
| Expense ratio | 23.2% | 28.2% | 30.0% | 22.9% | 27.2% | 21.8% | 27.4% | 21.5% | ||||||||||||||||||||||||
| Combined ratio | 90.4% | 91.5% | 94.9% | 96.1% | 101.7% | 94.7% | 84.6% | 85.4% | ||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
International Insurance Segment — Quarterly Results
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | Q3 2006 | ||||||||||||||||||||||||
| Gross written premiums | $180.8 | $258.9 | $199.3 | $149.8 | $129.0 | $198.9 | $185.3 | $123.5 | ||||||||||||||||||||||||
| Net written premiums | 162.2 | 251.6 | 142.0 | 135.2 | 118.1 | 196.9 | 139.9 | 112.3 | ||||||||||||||||||||||||
| Gross earned premiums | 185.4 | 178.6 | 165.3 | 162.2 | 164.2 | 169.7 | 162.8 | 165.6 | ||||||||||||||||||||||||
| Net earned premiums | 158.6 | 162.9 | 150.2 | 147.7 | 146.7 | 156.0 | 146.8 | 145.2 | ||||||||||||||||||||||||
| Losses and loss expenses | 141.8 | 83.6 | 97.7 | 56.6 | 75.3 | 95.7 | 81.3 | 63.8 | ||||||||||||||||||||||||
| Policy acquisition expenses | 26.5 | 26.0 | 28.0 | 25.6 | 26.4 | 28.3 | 25.4 | 21.6 | ||||||||||||||||||||||||
| Operating and administration expenses | 21.1 | 19.2 | 17.9 | 22.0 | 17.2 | 13.3 | 14.7 | 14.4 | ||||||||||||||||||||||||
| Underwriting (loss) income | $(30.8 | ) | $34.1 | $6.6 | $43.5 | $27.8 | $18.7 | $25.4 | $45.4 | |||||||||||||||||||||||
Ratios | ||||||||||||||||||||||||||||||||
| Loss ratio | 89.4% | 51.3% | 65.0% | 38.3% | 51.3% | 61.3% | 55.4% | 43.9% | ||||||||||||||||||||||||
| Policy acquisition expense ratio | 16.7% | 16.1% | 18.6% | 17.3% | 18.0% | 18.2% | 17.3% | 14.9% | ||||||||||||||||||||||||
| Operating and administration expense ratio | 13.3% | 11.8% | 11.9% | 14.9% | 11.7% | 8.5% | 10.0% | 9.9% | ||||||||||||||||||||||||
| Expense ratio | 30.0% | 27.9% | 30.5% | 32.2% | 29.7% | 26.7% | 27.3% | 24.8% | ||||||||||||||||||||||||
| Combined ratio | 119.4% | 79.2% | 95.5% | 70.5% | 81.0% | 88.0% | 82.7% | 68.7% | ||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
US Insurance Segment — Quarterly Results
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | Q3 2006 | ||||||||||||||||||||||||
| Gross written premiums | $28.0 | $42.6 | $30.6 | $24.3 | $27.5 | $34.9 | $35.8 | $35.7 | ||||||||||||||||||||||||
| Net written premiums | 21.6 | 34.4 | 22.2 | 19.7 | 22.1 | 27.9 | 21.5 | 30.5 | ||||||||||||||||||||||||
| Gross earned premiums | 31.5 | 29.6 | 26.0 | 31.4 | 33.2 | 33.3 | 38.9 | 39.6 | ||||||||||||||||||||||||
| Net earned premiums | 23.9 | 25.0 | 19.7 | 23.9 | 24.0 | 25.2 | 32.4 | 27.1 | ||||||||||||||||||||||||
| Losses and loss expenses | 31.1 | 12.1 | 10.0 | 7.6 | 9.5 | 21.7 | 19.3 | 27.6 | ||||||||||||||||||||||||
| Policy acquisition expenses | 3.9 | 3.7 | 4.8 | 6.0 | 4.5 | 5.1 | 5.6 | 5.5 | ||||||||||||||||||||||||
| Operating and administration expenses | 6.2 | 7.0 | 5.6 | 4.8 | 9.3 | 4.1 | 6.2 | 5.0 | ||||||||||||||||||||||||
| Underwriting (loss) income | $(17.3 | ) | $2.2 | $(0.7 | ) | $5.5 | $0.7 | $(5.7 | ) | $1.3 | $(11.0 | ) | ||||||||||||||||||||
Ratios | ||||||||||||||||||||||||||||||||
| Loss ratio | 130.1% | 48.4% | 50.8% | 31.8% | 39.6% | 86.1% | 59.6% | 101.8% | ||||||||||||||||||||||||
| Policy acquisition expense ratio | 16.3% | 14.7% | 24.3% | 25.1% | 18.8% | 20.2% | 17.3% | 20.3% | ||||||||||||||||||||||||
| Operating and administration expense ratio | 25.7% | 27.9% | 28.4% | 20.1% | 38.9% | 16.3% | 19.1% | 18.5% | ||||||||||||||||||||||||
| Expense ratio | 42.0% | 42.6% | 52.7% | 45.2% | 57.7% | 36.5% | 36.4% | 38.8% | ||||||||||||||||||||||||
| Combined ratio | 172.1% | 91.0% | 103.6% | 77.0% | 97.3% | 122.6% | 96.0% | 140.6% | ||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
| (in US$ millions) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | Q3 2006 | ||||||||||||||||||||||||
Property Reinsurance | ||||||||||||||||||||||||||||||||
| Treaty Catastrophe | $65.0 | $79.2 | $111.6 | $20.6 | $60.1 | $85.2 | $118.6 | $99.7 | ||||||||||||||||||||||||
| Treaty Risk Excess | 36.3 | 40.0 | 29.9 | 9.0 | 35.7 | 66.6 | 23.0 | 55.8 | ||||||||||||||||||||||||
| Treaty Pro Rata | 36.5 | 36.5 | 32.7 | 39.9 | 34.1 | 29.2 | 42.0 | 32.2 | ||||||||||||||||||||||||
| Property Facultative | 15.0 | 14.8 | 10.0 | 10.1 | 9.6 | 9.3 | 8.5 | 14.0 | ||||||||||||||||||||||||
| $152.8 | $170.5 | $184.2 | $79.6 | $139.5 | $190.3 | $192.1 | $201.7 | |||||||||||||||||||||||||
Casualty Reinsurance | ||||||||||||||||||||||||||||||||
| Treaty | $60.1 | $46.9 | $89.6 | $37.2 | $53.5 | $55.3 | $131.3 | $55.8 | ||||||||||||||||||||||||
| Non - US Treaty | 15.3 | 5.7 | 89.5 | 11.6 | 20.5 | 22.2 | 88.4 | 29.9 | ||||||||||||||||||||||||
| Casualty Facultative | 4.3 | 4.2 | 3.0 | 2.5 | 3.5 | 1.9 | 3.6 | 10.9 | ||||||||||||||||||||||||
| $79.7 | $56.8 | $182.1 | $51.3 | $77.5 | $79.4 | $223.3 | $96.6 | |||||||||||||||||||||||||
International Insurance | ||||||||||||||||||||||||||||||||
| Marine and Specialty Liability | $14.1 | $47.4 | $54.8 | $30.0 | $13.8 | $40.1 | $54.5 | $22.7 | ||||||||||||||||||||||||
| Energy Property | 22.3 | 41.7 | 23.4 | 8.1 | 21.3 | 45.0 | 28.2 | 17.4 | ||||||||||||||||||||||||
| Marine Hull | 10.7 | 17.5 | 18.6 | 14.1 | 11.2 | 18.2 | 16.4 | 7.6 | ||||||||||||||||||||||||
| Aviation | 19.3 | 23.1 | 11.2 | 42.2 | 23.7 | 26.6 | 10.8 | 21.3 | ||||||||||||||||||||||||
| U.K. Commercial Property | 14.1 | 22.7 | 9.4 | 7.4 | 16.0 | 19.1 | 7.5 | 8.7 | ||||||||||||||||||||||||
| U.K. Commercial Liability | 23.3 | 17.1 | 20.1 | 29.6 | 26.9 | 24.6 | 22.0 | 11.2 | ||||||||||||||||||||||||
| Non - Marine and Transportation Liability | 8.7 | 14.3 | 7.1 | 7.1 | — | — | — | — | ||||||||||||||||||||||||
| Professional Liability | 13.3 | 7.4 | 7.6 | 5.0 | — | — | — | — | ||||||||||||||||||||||||
| Excess Casualty | 8.9 | 6.3 | 2.0 | — | — | — | — | — | ||||||||||||||||||||||||
| Financial Institutions | 15.8 | 9.2 | 2.9 | — | — | — | — | — | ||||||||||||||||||||||||
| Financial and Political Risks | 5.5 | 21.3 | 4.5 | — | — | — | — | — | ||||||||||||||||||||||||
| U.K. Commercial Property — Construction | 4.4 | 4.5 | — | — | — | — | — | — | ||||||||||||||||||||||||
| Specialty Reinsurance | 20.4 | 26.4 | 37.7 | 6.3 | 16.1 | 25.3 | 46.0 | 34.6 | ||||||||||||||||||||||||
| $180.8 | $258.9 | $199.3 | $149.8 | $129.0 | $198.9 | $185.4 | $123.5 | |||||||||||||||||||||||||
US Insurance | ||||||||||||||||||||||||||||||||
| Property | $10.7 | $21.1 | $10.5 | $6.8 | $7.9 | $13.9 | $12.4 | $17.8 | ||||||||||||||||||||||||
| Casualty | 17.3 | 21.5 | 20.1 | 17.5 | 19.6 | 21.0 | 23.3 | 17.9 | ||||||||||||||||||||||||
| $28.0 | $42.6 | $30.6 | $24.3 | $27.5 | $34.9 | $35.7 | $35.7 | |||||||||||||||||||||||||
Total Gross Written Premiums | $441.3 | $528.8 | $596.2 | $305.0 | $373.5 | $503.5 | $636.5 | $457.5 | ||||||||||||||||||||||||
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| Three Months Ended September 30, 2008 | Three Months Ended September 30, 2007 | |||||||||||||||||||||||||||||||||||||||
| Property | Casualty | International | U.S. | Property | Casualty | International | U.S. | |||||||||||||||||||||||||||||||||
| Reinsurance | Reinsurance | Insurance | Insurance | Total | Reinsurance | Reinsurance | Insurance | Insurance | Total | |||||||||||||||||||||||||||||||
Before Accident Year Adjustment | ||||||||||||||||||||||||||||||||||||||||
| Loss ratio | 118.6 | % | 67.2 | % | 89.4 | % | 130.1 | % | 95.2 | % | 34.2 | % | 74.5 | % | 51.3 | % | 39.6 | % | 52.4 | % | ||||||||||||||||||||
| Policy acquisition expense ratio | 16.8 | % | 14.7 | % | 16.7 | % | 16.3 | % | 16.2 | % | 20.3 | % | 16.0 | % | 18.0 | % | 18.8 | % | 18.1 | % | ||||||||||||||||||||
| Operating and administration expense ratio | 10.6 | % | 8.5 | % | 13.3 | % | 25.7 | % | 11.9 | % | 14.6 | % | 11.2 | % | 11.7 | % | 38.9 | % | 14.0 | % | ||||||||||||||||||||
| Expense ratio | 27.4 | % | 23.2 | % | 30.0 | % | 42.0 | % | 28.1 | % | 34.9 | % | 27.2 | % | 29.7 | % | 57.7 | % | 32.1 | % | ||||||||||||||||||||
| Combined ratio | 146.0 | % | 90.4 | % | 119.4 | % | 172.1 | % | 123.3 | % | 69.1 | % | 101.7 | % | 81.0 | % | 97.3 | % | 84.5 | % | ||||||||||||||||||||
Accident Year Adjustment | ||||||||||||||||||||||||||||||||||||||||
| Loss ratio | 3.1 | % | 14.9 | % | — | (3.5 | )% | 4.9 | % | (4.3 | )% | 3.6 | % | 18.3 | % | 14.6 | % | 6.5 | % | |||||||||||||||||||||
| Policy acquisition expense ratio | (0.1 | )% | (0.3 | )% | — | 0.2 | % | (0.1 | )% | 1.1 | % | 0.5 | % | 0.6 | % | (3.0 | )% | 0.6 | % | |||||||||||||||||||||
| Operating and administration expense ratio | 0.1 | % | 0.7 | % | (0.2 | )% | (0.3 | )% | 0.2 | % | (2.6 | )% | (1.2 | )% | (0.3 | )% | 0.2 | % | (1.2 | )% | ||||||||||||||||||||
| Expense ratio | — | 0.4 | % | (0.2 | )% | (0.1 | )% | 0.1 | % | (1.5 | )% | (0.7 | )% | 0.4 | % | (2.8 | )% | (0.6 | )% | |||||||||||||||||||||
| Combined ratio | 3.1 | % | 15.3 | % | (0.2 | )% | (3.6 | )% | 5.0 | % | (5.8 | )% | 2.9 | % | 18.7 | % | 11.9 | % | 5.9 | % | ||||||||||||||||||||
Accident Year Ratios | ||||||||||||||||||||||||||||||||||||||||
| Current accident year loss ratio | 121.7 | % | 82.1 | % | 89.4 | % | 126.6 | % | 100.1 | % | 29.9 | % | 78.1 | % | 69.6 | % | 54.2 | % | 58.9 | % | ||||||||||||||||||||
| Policy acquisition expense ratio | 16.7 | % | 14.4 | % | 16.7 | % | 16.5 | % | 16.1 | % | 21.4 | % | 16.5 | % | 18.6 | % | 15.8 | % | 18.7 | % | ||||||||||||||||||||
| Operating and administration expense ratio | 10.7 | % | 9.2 | % | 13.1 | % | 25.4 | % | 12.1 | % | 12.0 | % | 10.0 | % | 11.4 | % | 39.1 | % | 12.8 | % | ||||||||||||||||||||
| Expense ratio | 27.4 | % | 23.6 | % | 29.8 | % | 41.9 | % | 28.2 | % | 33.4 | % | 26.5 | % | 30.1 | % | 54.9 | % | 31.5 | % | ||||||||||||||||||||
| Combined ratio | 149.1 | % | 105.7 | % | 119.2 | % | 168.5 | % | 128.3 | % | 63.3 | % | 104.6 | % | 99.7 | % | 109.2 | % | 90.4 | % | ||||||||||||||||||||
| Impact from hurricanes (Ike and Gustav) | (89.4 | )% | — | (28.7 | )% | (62.7 | )% | (41.7 | )% | |||||||||||||||||||||||||||||||
| Adjusted accident year combined ratio | 59.7 | % | 105.7 | % | 90.5 | % | 105.8 | % | 86.6 | % | ||||||||||||||||||||||||||||||
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Accident Year Loss Ratios
| Nine Months Ended September 30, 2008 | Nine Months Ended September 30, 2007 | |||||||||||||||||||||||||||||||||||||||
| Property | Casualty | International | U.S. | Property | Casualty | International | U.S. | |||||||||||||||||||||||||||||||||
| Reinsurance | Reinsurance | Insurance | Insurance | Total | Reinsurance | Reinsurance | Insurance | Insurance | Total | |||||||||||||||||||||||||||||||
Before Accident Year Adjustment | ||||||||||||||||||||||||||||||||||||||||
| Loss ratio | 61.9 | % | 65.3 | % | 68.5 | % | 77.6 | % | 66.1 | % | 40.4 | % | 68.7 | % | 56.1 | % | 61.9 | % | 54.8 | % | ||||||||||||||||||||
| Policy acquisition expense ratio | 18.7 | % | 15.7 | % | 17.1 | % | 18.1 | % | 17.3 | % | 19.8 | % | 15.8 | % | 17.8 | % | 18.6 | % | 18.0 | % | ||||||||||||||||||||
| Operating and administration expense ratio | 12.8 | % | 11.2 | % | 12.3 | % | 27.4 | % | 13.1 | % | 11.7 | % | 9.5 | % | 10.1 | % | 24.1 | % | 11.3 | % | ||||||||||||||||||||
| Expense ratio | 31.5 | % | 26.9 | % | 29.4 | % | 45.5 | % | 30.4 | % | 31.5 | % | 25.3 | % | 27.9 | % | 42.7 | % | 29.3 | % | ||||||||||||||||||||
| Combined ratio | 93.4 | % | 92.2 | % | 97.9 | % | 123.1 | % | 96.5 | % | 71.9 | % | 94.0 | % | 84.0 | % | 104.6 | % | 84.1 | % | ||||||||||||||||||||
Accident Year Adjustment | ||||||||||||||||||||||||||||||||||||||||
| Loss ratio | 7.2 | % | 11.9 | % | 5.9 | % | 11.8 | % | 8.2 | % | (2.4 | )% | 4.8 | % | 15.2 | % | 4.7 | % | 6.2 | % | ||||||||||||||||||||
| Policy acquisition expense ratio | (0.2 | )% | (0.2 | )% | (0.1 | )% | 0.3 | % | (0.1 | )% | 0.2 | % | (0.1 | )% | 0.1 | % | (0.4 | )% | — | |||||||||||||||||||||
| Operating and administration expense ratio | 0.4 | % | (0.7 | )% | 0.3 | % | (0.1 | )% | — | (0.5 | )% | (0.2 | )% | 0.1 | % | (0.5 | )% | (0.2 | )% | |||||||||||||||||||||
| Expense ratio | 0.2 | % | (0.9 | )% | 0.2 | % | 0.2 | % | (0.1 | )% | (0.3 | )% | (0.3 | )% | 0.1 | % | (0.9 | )% | (0.2 | )% | ||||||||||||||||||||
| Combined ratio | 7.4 | % | 11.0 | % | 6.1 | % | 12.0 | % | 8.1 | % | (2.8 | )% | 4.5 | % | 15.3 | % | 3.8 | % | 6.0 | % | ||||||||||||||||||||
Accident Year Ratios | ||||||||||||||||||||||||||||||||||||||||
| Current accident year loss ratio | 69.1 | % | 77.2 | % | 74.4 | % | 89.4 | % | 74.3 | % | 38.0 | % | 73.5 | % | 71.3 | % | 66.6 | % | 61.0 | % | ||||||||||||||||||||
| Policy acquisition expense ratio | 18.5 | % | 15.5 | % | 17.0 | % | 18.4 | % | 17.2 | % | 20.0 | % | 15.7 | % | 17.9 | % | 18.2 | % | 18.0 | % | ||||||||||||||||||||
| Operating and administration expense ratio | 13.2 | % | 10.5 | % | 12.6 | % | 27.3 | % | 13.1 | % | 11.2 | % | 9.3 | % | 10.2 | % | 23.6 | % | 11.1 | % | ||||||||||||||||||||
| Expense ratio | 31.7 | % | 26.0 | % | 29.6 | % | 45.7 | % | 30.3 | % | 31.2 | % | 25.0 | % | 28.0 | % | 41.8 | % | 29.1 | % | ||||||||||||||||||||
| Combined ratio | 100.8 | % | 103.2 | % | 104.0 | % | 135.1 | % | 104.6 | % | 69.1 | % | 98.5 | % | 99.3 | % | 108.4 | % | 90.1 | % | ||||||||||||||||||||
| Impact from hurricanes (Ike and Gustav) | (31.7 | )% | — | (9.6 | )% | (21.8 | )% | (14.8 | )% | |||||||||||||||||||||||||||||||
| Adjusted accident year combined ratio | 69.1 | % | 103.2 | % | 94.4 | % | 113.4 | % | 89.8 | % | ||||||||||||||||||||||||||||||
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| Nine Months Ended September 30, | ||||||||
| (in US$ millions) | 2008 | 2007 | ||||||
| Ordinary shares | ||||||||
| Beginning and end of period | $0.1 | $0.1 | ||||||
| Preference shares | ||||||||
| Beginning and end of period | — | — | ||||||
| Additional paid-in capital | ||||||||
| Beginning of period | 1,846.1 | 1,921.7 | ||||||
| New shares issued | — | 11.0 | ||||||
| Shares repurchased | (100.2 | ) | (50.1 | ) | ||||
| Share-based compensation | 8.2 | 7.9 | ||||||
| End of period | 1,754.1 | 1,890.5 | ||||||
| Retained earnings | ||||||||
| Beginning of period | 858.8 | 450.5 | ||||||
| Net income for the period | 82.0 | 353.8 | ||||||
| Dividends paid on ordinary and preference shares | (58.7 | ) | (60.5 | ) | ||||
| End of period | 882.1 | 743.8 | ||||||
| Accumulated other comprehensive income: | ||||||||
| Cumulative foreign currency translation adjustments, net of taxes: | ||||||||
| Beginning of period | 80.2 | 59.1 | ||||||
| Change for the period | (15.0 | ) | 56.4 | |||||
| End of period | 65.2 | 115.5 | ||||||
| Loss on derivatives | ||||||||
| Beginning and end of period | (1.6 | ) | (1.8 | ) | ||||
| Reclassification to interest payable | 0.1 | 0.1 | ||||||
| End of period | (1.5 | ) | (1.7 | ) | ||||
| Unrealized appreciation (depreciation) on investments, net of taxes: | ||||||||
| Beginning of period | 34.0 | (40.3 | ) | |||||
| Change for the period | (96.4 | ) | 25.3 | |||||
| End of period | (62.4 | ) | (15.0 | ) | ||||
| Total accumulated other comprehensive income | 1.3 | 98.8 | ||||||
| Total shareholders’ equity | $2,637.6 | $2,733.2 | ||||||
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Aspen Insurance Holdings Limited
| Nine Months Ended September 30, | ||||||||
| (in US$ millions) | 2008 | 2007 | ||||||
| Net income | $82.0 | $353.8 | ||||||
| Other comprehensive (loss) income, net of taxes: | ||||||||
| Reclassification adjustment for net realized (gains) losses included in net income | (2.7 | ) | 6.4 | |||||
| Change in net unrealized gains and losses on available for sale securities held | (93.7 | ) | 18.9 | |||||
| Loss on derivatives reclassified to interest expense | 0.1 | 0.1 | ||||||
| Change in foreign currency translation adjustment | (15.0 | ) | 56.4 | |||||
| Other comprehensive (loss) income | (111.3 | ) | 81.8 | |||||
| Comprehensive (loss) income | $(29.3 | ) | $435.6 | |||||
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| Nine Months Ended September 30, | ||||||||
| (in US$ millions) | 2008 | 2007 | ||||||
| Net cash from operating activities | $444.3 | $626.1 | ||||||
| Net cash used in investing activities | (209.7 | ) | (455.8 | ) | ||||
| Net cash used in financing activities | (158.9 | ) | (99.5 | ) | ||||
| Effect of exchange rate movements on cash and cash equivalents | 14.5 | 1.4 | ||||||
| Increase/(decrease) in cash and cash equivalents | 90.2 | 72.2 | ||||||
| Cash at beginning of the period | 651.4 | 495.0 | ||||||
| Cash at end of the period | $741.6 | $567.2 | ||||||
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Aspen Insurance Holdings Limited
| As at | As at | |||||||
| September 30, | December 31, | |||||||
| (in US$ millions) | 2008 | 2007 | ||||||
| Provision for losses and loss expenses at start of period | $2,946.0 | $2,820.0 | ||||||
| Less reinsurance recoverable | (304.7 | ) | (468.3 | ) | ||||
| Net loss and loss expenses at start of period | 2,641.3 | 2,351.7 | ||||||
| Net loss and loss expenses (disposed) acquired | (16.3 | ) | 11.0 | |||||
| Provision for losses and loss expenses for claims incurred: | ||||||||
| Current period | 904.5 | 1,027.2 | ||||||
| Prior period release | (95.6 | ) | (107.4 | ) | ||||
| Total incurred | 808.9 | 919.8 | ||||||
| Losses and loss expense payments for claims incurred | (510.9 | ) | (695.6 | ) | ||||
| Foreign exchange (gains) losses | (82.6 | ) | 54.4 | |||||
| Net loss and loss expense reserves at end of period | 2,840.4 | 2,641.3 | ||||||
| Plus reinsurance recoverables on unpaid losses at end of period | 241.5 | 304.7 | ||||||
| Gross loss and loss expense reserves at end of period | $3,081.9 | $2,946.0 | ||||||
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| As at September 30, 2008 | As at December 31, 2007 | |||||||||||||||||||||||
| Reinsurance | Reinsurance | |||||||||||||||||||||||
| (in US$ millions) | Gross | Recoverable | Net | Gross | Recoverable | Net | ||||||||||||||||||
| Property Reinsurance | $543.3 | $(47.7 | ) | $495.6 | $537.5 | $(78.2 | ) | $459.3 | ||||||||||||||||
| Casualty Reinsurance | 1,331.4 | (6.7 | ) | 1,324.7 | 1,276.3 | (13.7 | ) | 1,262.6 | ||||||||||||||||
| International Insurance | 1,010.4 | (124.1 | ) | 886.3 | 999.2 | (139.2 | ) | 860.0 | ||||||||||||||||
| U.S. Insurance | 196.8 | (63.0 | ) | 133.8 | 133.0 | (73.6 | ) | 59.4 | ||||||||||||||||
| Total losses and loss expense reserves | $3,081.9 | $(241.5 | ) | $2,840.4 | $2,946.0 | $(304.7 | ) | $2,641.3 | ||||||||||||||||
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| Nine Months Ended September 30, 2008 | Nine Months Ended September 30, 2007 | |||||||||||||||||||||||
| Reinsurance | Reinsurance | |||||||||||||||||||||||
| (in US$ millions) | Gross | Recoverable | Net | Gross | Recoverable | Net | ||||||||||||||||||
| Property Reinsurance | $12.0 | $7.5 | $19.5 | $(10.0 | ) | $0.4 | $(9.6 | ) | ||||||||||||||||
| Casualty Reinsurance | 50.3 | (2.3 | ) | 48.0 | 14.5 | 4.5 | 19.0 | |||||||||||||||||
| International Insurance | 23.8 | (3.8 | ) | 20.0 | 39.3 | 20.7 | 60.0 | |||||||||||||||||
| U.S. Insurance | 9.6 | (1.5 | ) | 8.1 | (0.1 | ) | 3.6 | 3.5 | ||||||||||||||||
| Release in reserves for prior years during the period | $95.7 | $(0.1 | ) | $95.6 | $43.7 | $29.2 | $72.9 | |||||||||||||||||
| Three Months Ended September 30, 2008 | Three Months Ended September 30, 2007 | |||||||||||||||||||||||
| Reinsurance | Reinsurance | |||||||||||||||||||||||
| (in US$ millions) | Gross | Recoverable | Net | Gross | Recoverable | Net | ||||||||||||||||||
| Property Reinsurance | $4.5 | $(1.2 | ) | $3.3 | $0.6 | $(1.3 | ) | $(0.7 | ) | |||||||||||||||
| Casualty Reinsurance | 11.5 | (1.8 | ) | 9.7 | 1.5 | 0.1 | 1.6 | |||||||||||||||||
| International Insurance | 6.3 | (4.4 | ) | 1.9 | 13.7 | 10.4 | 24.1 | |||||||||||||||||
| U.S. Insurance | 0.7 | — | 0.7 | 2.4 | 1.1 | 3.5 | ||||||||||||||||||
| Release in reserves for prior years during the period | $23.0 | $(7.4 | ) | $15.6 | $18.2 | $10.3 | $28.5 | |||||||||||||||||
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| (in US$ millions except for percentages) | As at September 30, 2008 | As at December 31, 2007 | ||||||||||||||
S&P | ||||||||||||||||
| AAA | $21.5 | 8.9 | % | $31.0 | 10.2 | % | ||||||||||
| AA+ | — | — | 2.1 | 0.7 | % | |||||||||||
| AA− | 71.1 | 29.4 | % | 74.1 | 24.3 | % | ||||||||||
| A+ | 97.8 | 40.5 | % | 118.3 | 38.8 | % | ||||||||||
| A | 1.0 | 0.4 | % | 1.7 | 0.6 | % | ||||||||||
| A− | 28.6 | 11.8 | % | 46.5 | 15.3 | % | ||||||||||
| Fully collateralised | 2.6 | 1.1 | % | 3.3 | 1.1 | % | ||||||||||
| Not rated | 18.9 | 7.9 | % | 27.7 | 9.0 | % | ||||||||||
| $241.5 | 100.0 | % | $304.7 | 100.0 | % | |||||||||||
A.M. Best | ||||||||||||||||
| A++ | $21.5 | 8.9 | % | $31.0 | 10.2 | % | ||||||||||
| A+ | 52.6 | 21.8 | % | 46.3 | 15.2 | % | ||||||||||
| A | 131.6 | 54.5 | % | 166.9 | 54.8 | % | ||||||||||
| A− | 23.5 | 9.7 | % | 37.2 | 12.2 | % | ||||||||||
| Fully collateralised | 2.6 | 1.1 | % | 3.3 | 1.1 | % | ||||||||||
| Not rated | 9.7 | 4.0 | % | 20.0 | 6.5 | % | ||||||||||
| $241.5 | 100.0 | % | $304.7 | 100.0 | % | |||||||||||
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Aspen Insurance Holdings Limited
Consolidated Investment Portfolio
| As at September 30, 2008 | Percentage of Total Fair Value | |||||||||||||||||||||||||||||||||||
| Gross | Gross | As at | As at | As at | As at | As at | ||||||||||||||||||||||||||||||
| Amortized | Unrealized | Unrealized | Fair | September 30, | June 30, | March 31, | December 31, | December 31, | ||||||||||||||||||||||||||||
| (in US$ millions except for percentages) | Cost | Gains | Losses | Value | 2008 | 2008 | 2008 | 2007 | 2006 | |||||||||||||||||||||||||||
| U.S. government | $650.2 | $18.9 | $(1.5 | ) | $667.6 | 11.2 | % | 11.3 | % | 12.0 | % | 10.9 | % | 19.4 | % | |||||||||||||||||||||
| U.S government agency securities | 351.2 | 5.8 | (1.1 | ) | 355.9 | 6.0 | % | 5.6 | % | 6.2 | % | 5.6 | % | 6.3 | % | |||||||||||||||||||||
| Municipal securities | 7.8 | — | — | 7.8 | 0.1 | % | — | — | — | — | ||||||||||||||||||||||||||
| Corporate securities | 1,453.7 | 3.7 | (74.1 | ) | 1,383.3 | 23.3 | % | 26.7 | % | 25.1 | % | 25.6 | % | 20.6 | % | |||||||||||||||||||||
| Foreign government | 414.6 | 5.2 | (0.4 | ) | 419.4 | 7.1 | % | 6.8 | % | 6.8 | % | 7.2 | % | 8.5 | % | |||||||||||||||||||||
| Asset-backed securities | 232.0 | — | (6.1 | ) | 225.9 | 3.8 | % | 4.1 | % | 3.5 | % | 3.8 | % | 5.6 | % | |||||||||||||||||||||
| Mortgage-backed securities | 1,372.1 | 7.8 | (29.1 | ) | 1,350.8 | 22.8 | % | 22.2 | % | 20.1 | % | 20.8 | % | 12.9 | % | |||||||||||||||||||||
| Total fixed maturities | 4,481.6 | 41.4 | (112.3 | ) | 4,410.7 | 74.3 | % | 76.7 | % | 73.7 | % | 73.9 | % | 73.3 | % | |||||||||||||||||||||
| Short-term investments | 226.3 | — | — | 226.3 | 3.8 | % | 3.2 | % | 5.1 | % | 4.8 | % | 13.4 | % | ||||||||||||||||||||||
| Total investments | $4,707.9 | $41.4 | $(112.3 | ) | $4,637.0 | 78.1 | % | 79.9 | % | 78.8 | % | 78.7 | % | 86.7 | % | |||||||||||||||||||||
| Other investments | 513.1 | 8.7 | % | 9.2 | % | 9.0 | % | 9.5 | % | 3.0 | % | |||||||||||||||||||||||||
| Cash | 741.6 | 12.5 | % | 10.3 | % | 11.5 | % | 11.0 | % | 9.5 | % | |||||||||||||||||||||||||
| Accrued interest | 44.3 | 0.7 | % | 0.6 | % | 0.7 | % | 0.8 | % | 0.8 | % | |||||||||||||||||||||||||
| Total investments | $5,936.0 | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||||||||||||
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Aspen Insurance Holdings Limited
Investment Analysis
| (in US$ millions except for percentages) | Q3 2008 | Q2 2008 | Q1 2008 | Q4 2007 | Q3 2007 | Q2 2007 | Q1 2007 | |||||||||||||||||||||
| Net investment income from fixed income investments | $61.5 | $59.7 | $56.0 | $68.4 | $64.5 | $64.0 | $57.6 | |||||||||||||||||||||
| Net investment (loss) income from investments accounted for by the equity method | (42.2 | ) | 10.8 | (16.9 | ) | 11.9 | 7.9 | 14.8 | 9.9 | |||||||||||||||||||
| Net investment income | 19.3 | 70.5 | 39.1 | 80.3 | 72.4 | 78.8 | 67.5 | |||||||||||||||||||||
| Net realized investment (losses) gains | (58.1 | ) | 0.8 | 1.0 | (0.8 | ) | (1.9 | ) | (5.6 | ) | (4.8 | ) | ||||||||||||||||
| Change in unrealized (losses) gains on investments (gross of tax) | (57.9 | ) | (110.4 | ) | 44.4 | 65.0 | 68.1 | (56.1 | ) | 13.6 | ||||||||||||||||||
| Total return on investments | $(96.7 | ) | $(39.1 | ) | $84.5 | $144.5 | $138.6 | $17.1 | $76.3 | |||||||||||||||||||
Portfolio Characteristics | ||||||||||||||||||||||||||||
| Fixed income portfolio book yield | 4.87 | % | 4.84 | % | 4.90 | % | 5.05 | % | 5.08 | % | 4.94 | % | 4.77 | % | ||||||||||||||
| Fixed income portfolio duration | 3.51 years | 3.58 years | 3.35 years | 3.40 years | 3.46 years | 3.59 years | 3.25 years | |||||||||||||||||||||
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Aspen Insurance Holdings Limited
Book Value Per Ordinary Share
| Nine Months Ended September 30, | ||||||||
| (in US$ except for number of shares) | 2008 | 2007 | ||||||
| Net assets | $2,637.6 | $2,733.2 | ||||||
| Less: Intangible assets | (8.2 | ) | (8.2 | ) | ||||
| Preference shares | (419.2 | ) | (419.2 | ) | ||||
| Total | $2,210.2 | $2,305.8 | ||||||
| Ordinary shares outstanding (in millions) | 81.450 | 87.146 | ||||||
| Ordinary shares and dilutive potential ordinary shares (in millions) | 84.325 | 89.794 | ||||||
| Book value per ordinary share | $27.14 | $26.46 | ||||||
| Diluted book value per ordinary share (treasury stock method) | $26.21 | $25.68 | ||||||
The dilutive effect of options has been calculated using the treasury stock method. The treasury stock method assumes that the proceeds received from the exercise of options will be used to purchase the Company’s ordinary shares at the average market price during the period of calculation.
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Aspen Insurance Holdings Limited
Diluted Share Analysis
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
Weighted average ordinary shares outstanding (millions) | ||||||||||||||||
| Basic | 81.376 | 88.712 | 83.459 | 88.250 | ||||||||||||
| Dilutive share equivalents: | ||||||||||||||||
| Employee options | — | 1.243 | 1.178 | 1.436 | ||||||||||||
| Options issued to Appleby Trust (Bermuda) Limited | — | 0.104 | 0.267 | 0.265 | ||||||||||||
| Performance shares | — | 0.757 | 0.978 | 0.567 | ||||||||||||
| Restricted share units | — | 0.266 | 0.232 | 0.240 | ||||||||||||
| Weighted average diluted shares outstanding | 81.376 | 91.082 | 86.114 | 90.758 | ||||||||||||
The dilutive effect of options has been calculated using the treasury stock method. The treasury stock method assumes that the proceeds received from the exercise of options will be used to purchase the Company’s ordinary shares at the average market price during the period of calculation.
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would be anti-dilutive.
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Aspen Insurance Holdings Limited
Operating Income Reconciliation
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | September 30, | September 30, | |||||||||||||
| (in US$ millions except where stated) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
| Net income adjusted for preference share dividend | $(133.0 | ) | $110.3 | $61.2 | $333.0 | |||||||||||
| Add (deduct) after tax income: | ||||||||||||||||
| Net foreign exchange losses (gains) | 2.7 | (9.2 | ) | 3.4 | (22.7 | ) | ||||||||||
| Net realized losses (gains) on investments | 47.2 | 1.2 | 45.6 | 9.5 | ||||||||||||
| Operating (loss) income adjusted for preference share dividend | (83.1 | ) | 102.3 | 110.2 | 319.8 | |||||||||||
| Tax on operating income | (8.9 | ) | 21.4 | 27.5 | 65.2 | |||||||||||
| Operating (loss) income before tax adjusted for preference share dividend | $(92.0 | ) | $123.7 | $137.7 | $385.0 | |||||||||||
Weighted average ordinary shares outstanding(millions) | ||||||||||||||||
| Basic | 81.376 | 88.712 | 83.459 | 88.250 | ||||||||||||
| Dilutive share equivalents: | ||||||||||||||||
| Employee Options | — | 1.243 | 1.178 | 1.436 | ||||||||||||
| Options Issued To Appleby Trust (Bermuda) Limited (Names Trust) | — | 0.104 | 0.267 | 0.130 | ||||||||||||
| Options Issued To Wellington Investment Holding (Jersey) Limited | 0.135 | |||||||||||||||
| Performance Shares | — | 0.757 | 0.978 | 0.567 | ||||||||||||
| Restricted share units | — | 0.266 | 0.232 | 0.240 | ||||||||||||
| Weighted average diluted shares outstanding | 81.376 | 91.082 | 86.114 | 90.758 | ||||||||||||
Basic earnings (loss) per ordinary share | ||||||||||||||||
| Net income adjusted for preference share dividend | $(1.63 | ) | $1.24 | $0.73 | $3.77 | |||||||||||
| Add (deduct) after tax income | ||||||||||||||||
| Net foreign exchange losses (gains) | $0.03 | $(0.10 | ) | $0.04 | $(0.26 | ) | ||||||||||
| Net realized losses on investments | $0.58 | $0.01 | $0.55 | $0.11 | ||||||||||||
| Operating (loss) income adjusted for preference shares dividend | $(1.02 | ) | $1.15 | $1.32 | $3.62 | |||||||||||
Diluted earnings (loss) per ordinary share | ||||||||||||||||
| Net (loss) income adjusted for preference share dividend | $(1.63 | ) | $1.21 | $0.71 | $3.67 | |||||||||||
| Add (deduct) after tax income | ||||||||||||||||
| Net foreign exchange losses (gains) | $0.03 | $(0.10 | ) | $0.04 | $(0.25 | ) | ||||||||||
| Net realized losses on investments | $0.58 | $0.01 | $0.53 | $0.10 | ||||||||||||
| Operating (loss) income adjusted for preference share dividend | $(1.02 | ) | $1.12 | $1.28 | $3.52 | |||||||||||
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would beanti-dilutive.
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Aspen Insurance Holdings Limited
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | September 30, | September 30, | |||||||||||||
| (in US$ millions except where stated) | 2008 | 2007 | 2008 | 2007 | ||||||||||||
| Net (loss) income adjusted for preference share dividend | $(133.0 | ) | $110.3 | $61.2 | $333.0 | |||||||||||
| Add (deduct) after tax income: | ||||||||||||||||
| Loss (income) from investments accounted for by the equity method | 42.2 | (7.9 | ) | 48.3 | (32.6 | ) | ||||||||||
| Tax on income/loss from investments accounted for by the equity method | (7.9 | ) | 1.2 | (8.8 | ) | 5.0 | ||||||||||
| Net (loss) income adjusted for preference share dividend excluding net income or loss from investments accounted for by the equity method | $(98.7 | ) | $103.6 | $100.7 | $305.4 | |||||||||||
Weighted average ordinary shares outstanding(millions) | ||||||||||||||||
| Basic | 81.376 | 88.712 | 83.459 | 88.250 | ||||||||||||
| Dilutive share equivalents: | ||||||||||||||||
| Employee options | — | 1.243 | 1.178 | 1.436 | ||||||||||||
| Options Issued To Appleby Trust (Bermuda) Limited (Names Trust) | — | 0.104 | 0.267 | 0.265 | ||||||||||||
| Performance shares | — | 0.757 | 0.978 | 0.567 | ||||||||||||
| Restricted share units | — | 0.266 | 0.232 | 0.240 | ||||||||||||
| Weighted average diluted shares outstanding | 81.376 | 91.082 | 86.114 | 90.758 | ||||||||||||
Basic earnings (loss) per ordinary share | ||||||||||||||||
| Net income adjusted for preference share dividend | $(1.63 | ) | $1.24 | $0.73 | $3.77 | |||||||||||
| Add (deduct) after tax income | ||||||||||||||||
| Loss (income) from investments accounted for by the equity method | $0.52 | $(0.09 | ) | $0.58 | $(0.37 | ) | ||||||||||
| Tax on income/loss from investments accounted for by the equity method | ($0.10 | ) | $0.01 | $(0.10 | ) | $0.06 | ||||||||||
| Net (loss) income adjusted for preference share dividend excluding net income or loss from other investments accounted for by the equity method | $(1.21 | ) | $1.16 | $1.21 | $3.46 | |||||||||||
Diluted earnings (loss) per ordinary share | ||||||||||||||||
| Net income adjusted for preference share dividend | $(1.63 | ) | $1.21 | $0.71 | $3.67 | |||||||||||
| Add (deduct) after tax income | ||||||||||||||||
| Loss (income) from investments accounted for by the equity method | $0.52 | $(0.09 | ) | $0.56 | $(0.36 | ) | ||||||||||
| Tax on income/loss from investments accounted for by the equity method | $(0.10 | ) | $0.01 | $(0.10 | ) | $0.06 | ||||||||||
| Net (loss) income adjusted for preference share dividend excluding net income or loss from other investments accounted for by the equity method | $(1.21 | ) | $1.13 | $1.17 | $3.37 | |||||||||||
The basic and diluted number of ordinary shares for the three months ended September 30, 2008 are the same, as the inclusion of dilutive securities in a loss making period would be anti-dilutive.
29