SEATTLE–(BUSINESS WIRE)–SeaBright Holdings, Inc. (NYSE: SBX) today announced results for the quarter ended March 31, 2011.
For the first quarter of 2011, the Company recorded net income of $0.2 million or $0.01 per diluted share compared to $7.6 million or $0.35 per diluted share for the same period in 2010. Total revenue for the quarter was $63.8 million versus $74.7 million in the year-earlier period. For the first quarter of 2011, net premiums earned were $56.7 million compared to $60.6 million for the same period in 2010. Net realized gains totaled $0.3 million in the first quarter of 2011 compared to $6.5 million recorded in the same period last year.
“The operating environment within our niche of the workers’ compensation insurance market continued to be challenging in the quarter. Competition remained intense and both high unemployment and elevated medical costs persisted. During the first quarter, we strengthened our 2010 accident year reserves slightly to reflect increased medical costs in California. On the positive side, we again achieved meaningful price increases in California, consistent with our emphasis on enhanced profitability and not market share. While not pleased with our results, we continue to take aggressive actions on pricing, risk selection and claims cost management to position ourselves to produce stronger bottom line performance once operational conditions improve,” said John G. Pasqualetto, SeaBright’s Chairman, President and Chief Executive Officer.
The net loss ratio for the first quarter of 2011 was 75.8% compared to 71.5% for the same period in 2010. During the first quarter of 2011, on a pre-tax basis, the Company recognized a net increase of approximately $1.2 million in prior years’ loss reserve estimates.
Total underwriting, acquisition and insurance expenses for the first quarter of 2011 were $18.4 million compared to $18.8 million for the same period in 2010. The net underwriting expense ratio for the first quarter was 32.3% compared to 30.9% in the first quarter of 2010.
The net combined ratio for the first quarter of 2011 was 108.1% compared to 102.4% in the same period in 2010.
Net investment income for the first quarter of 2011 was $5.4 million compared to $6.1 million in the first quarter of 2010.
At March 31, 2011, SeaBright had approximately 1,600 customers. Customer count in the Company’s core business, which includes everything other than program business, decreased by 242 year-over-year. Average premium size at March 31, 2011 was approximately $104,000 in the program business (flat year-over-year) and the core business was approximately $240,000 compared to $230,000 at March 31, 2010.
At March 31, 2011, the Company had $667.0 million in fixed income securities, none of which were rated below investment grade and 91.0% were rated A- or above, excluding the impact of secondary insurance on the municipal bond portfolio. As of March 31, 2011, the Company had $96.0 million in insured municipal bonds and $216.0 million in uninsured municipal bonds.
The full earnings release is available here.