Exhibit 99.1
Navigators' Net Income up 40%
NEW YORK--(BUSINESS WIRE)--May 12, 2003--The Navigators Group,
Inc. (NAVG/NASDAQ) reported net income increased 40% for the first
three months of 2003 to $4,834,000 or $0.55 per share, compared to
$3,450,000 or $0.40 per share reported for the same period in 2002.
The combined loss and expense ratio for the first three months of
2003 was 96.4%, compared to 97.0% for the same period in 2002.
Total revenue increased 58% to $72,605,000 for the first quarter
of 2003, compared to $45,809,000 for the same period during 2002.
Gross written premium for the first quarter 2003 was $174,702,000, an
increase of 43% from the first quarter of 2002. Net written premium
increased to $91,033,000, up 29%.
Net investment income for the first quarter of 2003 was
$4,661,000, down from $4,942,000 in the first quarter of 2002. Net
realized capital gains amounted to $218,000, or $0.02 per share, for
the first quarter of 2003, compared to net realized capital losses of
$293,000, or $0.02 per share for the same period in 2002.
"Market conditions continue to be favorable, as we were able to
achieve our targeted rate increases in virtually all of our specialty
lines. Marine rates increased an average of 21% in the quarter,"
commented Terence N. Deeks, Chairman of Navigators. "Cash flow from
underwriting remains robust; however, lower investment yields dampened
our investment income. The good news is that the prevailing low
interest rates should help maintain current underwriting conditions
for the foreseeable future. Our underwriting results remain profitable
and we continue to emphasize the importance of maintaining adequate
loss reserves to fund the ultimate claims that will develop over
time," Mr. Deeks added.
The Navigators Group, Inc. is an international insurance holding
company with insurance company operations, underwriting management
companies, and operations at Lloyd's of London. Headquartered in New
York City, Navigators has offices in major insurance centers in the
United States and the United Kingdom.
This press release may contain "forward looking statements" as
defined in the Private Securities Litigation Act of 1995. We cannot
assure that results which we anticipate will be achieved, since
results may differ materially because of known and unknown risks and
uncertainties which we face. Please refer to Navigators' most recent
Form 10-K for a description of Navigators' business and the important
factors which may affect that business. Navigators undertakes no
obligation to publicly update or revise any forward looking statement.
THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Financial Highlights
(In thousands, except book value and net income per share)
(All figures are on a GAAP basis)
Three Months Ended
March 31,
--------------------
(Unaudited)
Financial Highlights 2003 2002 Change
- -------------------- --------- --------- ------
Gross written premium $174,702 $121,916 43%
Net written premium 91,033 70,349 29%
Revenues:
Net earned premium 66,314 39,849 66%
Commission income 1,239 1,101 13%
Net investment income 4,661 4,942 -6%
Net realized capital gains (losses) 218 (293) NM
Other income 173 210 -18%
--------- ---------
Total revenues 72,605 45,809 58%
--------- ---------
Operating expenses:
Net losses and loss adjustment
expenses incurred 44,040 23,783 85%
Commission expense 10,627 7,658 39%
Other operating expenses 11,587 9,887 17%
Interest expense 97 160 -39%
--------- ---------
Total operating expenses 66,351 41,488 60%
--------- ---------
Income before income taxes 6,254 4,321 45%
--------- ---------
Income tax expense 1,420 871 63%
--------- ---------
Net income $4,834 $3,450 40%
========= =========
Per Share Data
- --------------
Net income per common share:
Basic $0.57 $0.41 39%
Diluted $0.55 $0.40 38%
Average common shares outstanding:
Basic 8,494 8,436
Diluted 8,721 8,626
Underwriting Ratios
- -------------------
Loss Ratio 67.0% 59.7%
Expense Ratio 29.4% 37.3%
--------- ---------
Combined Ratio 96.4% 97.0%
March 31, December 31,
Balance Sheet Data 2003 2002
- ------------------ --------- ---------
Stockholders' equity $176,793 $171,275 3%
Book value per share 20.76 20.18 3%
NM - not meaningful
Note: Certain amounts for the prior period have been reclassified
to conform to the presentation in the current period.
CONTACT: The Navigators Group, Inc., New York
Brad Wiley, 212/613-4251