Navigators’ Net Income Increases 66%

The Navigators Group, Inc. reported net income increased 66% for the three months ended June 30, 2003 to $6,274,000 or $0.72 per share, compared to $3,774,000 or $0.43 per share reported for the same period in 2002.

Included in these results were net realized capital gains of $0.06 per share and $0.01 per share for the three months ended June 30, 2003 and 2002, respectively. The combined loss and expense ratio for the second quarter of 2003 was 95.3 percent, compared to 98.9% for the same period in 2002.

Total revenue increased 27 percent to $72,386,000 for the second quarter of 2003, compared to $56,920,000 for the same period during 2002. Gross written premium for the second quarter of 2003 was $141,192,000, an increase of 55% from the second quarter of 2002. Net written premium increased to $71,410,000, up 27 percent. Net investment income increased to $4,552,000, up 9 percent.

Net income for the six month period ended June 30, 2003 was $11,108,000 or $1.27 per share, compared to $7,224,000 or $0.84 per share in 2002. Included in these results were net realized capital gains (losses) of $0.08 per share and $(0.01) per share for the six months ended June 30, 2003 and 2002, respectively. The combined loss and expense ratio for the first six months of 2003 was 95.9 percent compared to 98.1 percent for the same period in 2002.

Total revenue increased 41 percent to $144,991,000 for the six months ended June 30, 2003 compared to $102,729,000 for the same period in 2002. Gross written premium for the first six months of 2003 was $315,894,000, an increase of 48 percent from the comparable period in 2002. Net written premium increased to $162,443,000, up 28 percent. Net investment income increased to $9,213,000, up 1 percent.

Commenting on the results, Stanley Galanski, CEO, stated, “Each of our active businesses generated an underwriting profit, which is our primary objective. We continue to emphasize the importance of price adequacy over new business production and we are very encouraged by the level of rate increases attained in the second quarter over all product lines. While rate increases were largest in the professional liability and California casualty classes, ocean marine pricing continues to show positive rate change both in our insurance companies and at Lloyd’s.”

“Navigators Marine & Energy Division had another strong quarter, with a relatively low level of loss activity and solid growth. Our Lloyd’s operation, Syndicate 1221, made a meaningful contribution to our net income.” Galanski continued, “Navigators Pro further solidified its market presence and continues to attain significant rate increases along with new business levels consistent with our expectations. Navigators Specialty achieved an underwriting profit for the quarter, executing its strategy of targeted rate increases while reducing policy count in its construction segment. Overall, the company’s cash flow from operations is very strong.”