Exhibit 99.2
PXRE Consolidated Balance Sheets
Group Ltd. (Dollars in thousands, except par value per share)
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June 30, December 31,
2003 2002
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(Unaudited)
Assets Investments:
Fixed maturities:
Available-for-sale (amortized cost $554,667 and $465,963, respectively) $ 571,265 $ 478,878
Trading (cost $18,323 and $19,521, respectively) 20,976 21,871
Short-term investments 143,766 133,318
Hedge funds (cost $79,448 and $84,915, respectively) 110,757 113,105
Other invested assets (cost $9,833 and $10,522, respectively) 10,968 11,529
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Total investments 857,732 758,701
Cash 101,544 46,630
Accrued investment income 6,535 5,788
Premiums receivable, net 62,897 77,290
Other receivables 31,884 27,052
Reinsurance recoverable on paid losses 24,072 29,653
Reinsurance recoverable on unpaid losses 164,658 207,444
Ceded unearned premiums 7,586 10,496
Deferred acquisition costs 9,427 22,721
Income tax recoverable 6,169 -
Other assets 47,913 51,367
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Total assets $ 1,320,417 $ 1,237,142
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Liabilities Losses and loss expenses $ 442,997 $ 447,829
Unearned premiums 43,447 63,756
Debt payable - 30,000
Reinsurance balances payable 66,502 81,090
Deposit liabilities 69,367 35,149
Income tax payable - 2,486
Payable for securities purchased 37,393 22
Other liabilities 33,342 29,011
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Total liabilities 693,048 689,343
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Minority interest in consolidated subsidiaries:
Company-obligated mandatorily redeemable capital trust
pass-through securities of subsidiary trusts holding solely a
company-guaranteed related subordinated debt 126,838 94,335
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Stockholders' Serial convertible preferred stock, $1.00 par value, $10,000
Equity stated value -- 10 million shares authorized, 0.02 million shares
issued and outstanding 165,504 159,077
Common stock, $1.00 par value -- 50 million shares
authorized, 12.2 million and 12.0 million shares issued
and outstanding, respectively 12,169 12,030
Additional paid-in capital 172,096 168,866
Accumulated other comprehensive income net of deferred income
tax expense of $4,044 and $2,866, respectively 9,834 7,142
Retained earnings 145,256 108,062
Restricted stock at cost (0.3 million and 0.2 million shares, respectively) (4,328) (1,713)
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Total stockholders' equity 500,531 453,464
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Total liabilities and stockholders' equity $ 1,320,417 $ 1,237,142
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The accompanying notes are an integral part of these statements.
PXRE Consolidated Statements of Income and Comprehensive Income
Group Ltd. (Dollars in thousands, except per share amounts)
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Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
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(Unaudited)
Revenues Net premiums earned $ 84,015 $ 45,763 $ 168,788 $ 104,919
Net investment income 8,557 8,445 14,032 12,532
Net realized investment gains 110 514 109 1,003
Fee income 1,108 586 2,384 1,839
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93,790 55,308 185,313 120,293
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Losses and Losses and loss expenses incurred 44,799 18,863 77,653 36,086
Expenses Commissions and brokerage 14,618 5,276 34,645 17,719
Other operating expenses 9,851 6,223 19,013 15,094
Interest expense 245 754 2,504 1,499
Minority interest in consolidated subsidiary 2,428 2,199 4,533 4,423
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71,941 33,315 138,348 74,821
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Income before income taxes 21,849 21,993 46,965 45,472
Income tax provision 371 2,949 1,880 8,196
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Net income before preferred stock dividends $ 21,478 $ 19,044 $ 45,085 $ 37,276
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Preferred stock dividends 3,245 2,900 6,427 2,900
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Net income available to common stockholders $ 18,233 $ 16,144 $ 38,658 $ 34,376
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Comprehensive Net income before preferred stock dividends $ 21,478 $ 19,044 $ 45,085 $ 37,276
Income, Net Net unrealized appreciation on investments 1,635 5,923 1,746 4,508
of Tax Net unrealized (depreciation) appreciation on cash flow hedge - (140) 946 62
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Comprehensive income $ 23,113 $ 24,827 $ 47,777 $ 41,846
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Per Share Basic:
Net income before preferred stock dividends $ 1.80 $ 1.62 $ 3.79 $ 3.18
Preferred stock dividends (0.27) (0.25) (0.54) (0.25)
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Net income available to common stockholders $ 1.53 $ 1.37 $ 3.25 $ 2.93
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Average shares outstanding (000's) 11,921 11,768 11,911 11,752
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Diluted:
Net income $ 0.93 $ 0.88 $ 1.96 $ 2.21
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Average shares outstanding (000's) 23,183 21,655 22,959 16,863
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The accompanying notes are an integral part of these statements.
PXRE Consolidated Statements of Stockholders' Equity
Group Ltd. (Dollars in thousands)
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Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
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(Unaudited)
Preferred Stock Balance at beginning of period $ 162,259 $ - $ 159,077 $ -
Issuance of shares, net - 150,000 - 150,000
Dividends to preferred stockholders 3,245 2,900 6,427 2,900
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Balance at end of period $ 165,504 $ 152,900 $ 165,504 $ 152,900
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Common Stock Balance at beginning of period $ 12,177 $ 11,944 $ 12,030 $ 11,873
Issuance of shares, net (8) 22 139 93
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Balance at end of period $ 12,169 $ 11,966 $ 12,169 $ 11,966
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Additional Balance at beginning of period $ 172,271 $ 176,694 $ 168,866 $ 175,405
Paid-in Capital Issuance of shares (201) (8,643) 3,140 (7,336)
Other 26 (17) 90 (35)
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Balance at end of period $ 172,096 $ 168,034 $ 172,096 $ 168,034
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Accumulated Balance at beginning of period $ 8,198 $ (1,512) $ 7,142 $ (299)
Other Change in unrealized gains 1,636 5,924 1,746 4,509
Comprehensive Change in cash flow hedge - (140) 946 62
Income --------- --------- --------- ---------
Balance at end of period $ 9,834 $ 4,272 $ 9,834 $ 4,272
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Retained Balance at beginning of period $ 127,755 $ 72,989 $ 108,062 $ 55,473
Earnings Net income before preferred stock dividends 21,478 19,044 45,085 37,276
Dividends to preferred stockholders (3,245) (2,900) (6,427) (2,900)
Dividends to common stockholders (732) (719) (1,464) (1,435)
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Balance at end of period $ 145,256 $ 88,414 $ 145,256 $ 88,414
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Restricted Stock Balance at beginning of period $ (4,782) $ (2,798) $ (1,713) $ (2,672)
Issuance of restricted stock (764) (237) (4,609) (1,040)
Amortization of restricted stock 1,218 391 1,994 1,068
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Balance at end of period $ (4,328) $ (2,644) $ (4,328) $ (2,644)
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Total Balance at beginning of period $ 477,878 $ 257,317 $ 453,464 $ 239,780
Stockholders' Issuance of preferred shares - 150,000 - 150,000
Equity Issuance of shares (209) (8,621) 3,279 (7,243)
Restricted stock, net 454 154 (2,615) 28
Unrealized appreciation on investments, net of deferred
income tax 1,636 5,924 1,746 4,509
Unrealized (depreciation) appreciation on cash flow hedge,
net of deferred income tax - (140) 946 62
Net income before preferred stock dividends 21,478 19,044 45,085 37,276
Dividends to common stockholders (732) (719) (1,464) (1,435)
Other 26 (17) 90 (35)
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Balance at end of period $ 500,531 $ 422,942 $ 500,531 $ 422,942
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The accompanying notes are an integral part of these statements.
PXRE Consolidated Statements of Cash Flows
Group Ltd. (Dollars in thousands)
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Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
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(Unaudited)
Cash Flow Net income before preferred stock dividends $ 21,478 $ 19,044 $ 45,085 $ 37,276
from Operating Adjustments to reconcile net income to net cash
Activities provided by operating activities:
Losses and loss expenses 5,386 (17,078) (4,831) (28,538)
Unearned premiums (25,971) (25,039) (17,399) 19,430
Deferred acquisition costs 6,221 (1,228) 13,294 (6,413)
Receivables 11,206 16,077 9,561 (7,088)
Reinsurance balances payable (10,093) 5,394 (14,588) 20,081
Reinsurance recoverable 14,916 2,719 48,367 (411)
Income taxes (7,727) (65) (9,742) 7,688
Equity in earnings of limited partnerships (5,472) (3,706) (7,849) (5,407)
Trading portfolio purchased 0 (19,973) (5,688) (19,973)
Trading portfolio disposed 8,496 - 8,496 -
Deposit liability 3,281 16,261 34,218 16,695
Other 9,770 860 8,486 (52)
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Net cash provided (used) by operating activities 31,491 (6,734) 107,410 33,288
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Cash Flow Fixed maturities available for sale purchased (147,979) (243,445) (151,793) (243,648)
from Investing Fixed maturities available for sale disposed or matured 26,748 9,494 61,910 11,713
Activities Payable for securities 37,138 14,385 37,371 14,292
Net change in short-term investments 74,027 108,805 (10,448) 52,381
Hedge funds purchased (3,000) (26,366) (7,000) (26,366)
Hedge funds disposed 9,005 1,365 16,841 33,154
Other invested assets purchased (16) - (121) -
Other invested assets disposed 660 5,257 1,038 7,715
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Net cash used by investing activities (3,417) (130,505) (52,202) (150,759)
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Cash Flow Proceeds from issuance of preferred stock - 140,938 - 140,938
from Financing Proceeds from issuance of common stock 256 308 542 1,194
Activities Proceeds from issuance of minority interest in consolidated 32,500 - 32,500 -
subsidiary
Cash dividends paid to common stockholders (732) (719) (1,464) (1,435)
Repayment of debt (10,000) (10,000) (30,000) (20,000)
Repurchase of minority interest in consolidated subsidiary - (2,187) - (2,967)
Cost of stock repurchased (1,230) (105) (1,872) (558)
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Net cash provided (used) by financing activities 20,794 128,235 (294) 117,172
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Net change in cash 48,868 (9,004) 54,914 (299)
Cash, beginning of period 52,676 31,593 46,630 22,888
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Cash, end of period $ 101,544 $ 22,589 $ 101,544 $ 22,589
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The accompanying notes are an integral part of these statements.