Everest Re Group Notes Q4 Earnings

Everest Re Group, Ltd. reported fourth quarter 2003 after-tax operating income(1), which excludes realized capital gains and losses, of $118.6 million, or $2.09 per diluted share, a 95.9 percent increase compared to $60.6 million, or $1.17 per diluted share, in the fourth quarter of 2002. Fourth quarter 2003 net income increased 119.2 percent to $121.8 million, or $2.15 per diluted share, compared to $55.6 million, or $1.08 per diluted share, in the fourth quarter of 2002. Operating income differs from net income only by the exclusion of realized gains and losses on investments.

For the year ended Dec. 31, 2003, after-tax operating income(1), which excludes realized capital gains and losses, was $456.0 million, or $8.29 per diluted share, an increase of 73.6 percent compared to $262.8 million, or $5.14 per diluted share, in 2002. Net income was $426.0 million, or $7.74 per diluted share, an increase of 84.2 percent compared to $231.3 million, or $4.52 per diluted share, in 2002.

Gross premiums written for the fourth quarter of 2003 were $1.26 billion, a 38.5 percent increase compared to $912.2 million in 2002. Net premiums written were $1.19 billion, an increase of 46.8 percent from $811.3 million for the fourth quarter of 2002. The company’s GAAP combined ratio in the fourth quarter was 96.4 percent compared to 101.6 percent in 2002. Net investment income for the fourth quarter was $106.4 million compared to $87.8 million in the fourth quarter of 2002. Cash flow from operations for the fourth quarter of 2003 was $480.7 million, an increase of 71.0 percent from $281.2 million in the fourth quarter of 2002.

For the year ended Dec. 31, 2003, gross premiums written were $4.57 billion, a 60.7 percent increase from $2.85 billion in 2002. Net premiums written grew 63.6 percent to $4.32 billion from $2.64 billion in 2002. The GAAP combined ratio for 2003 was 95.2 percent compared to 99.0 percent in 2002. Net investment income for the year was $402.1 million, an increase of 14.7 percent from $350.6 million in 2002. Cash flow from operations for the year was $1.65 billion, compared to $736.1 million in 2002.

At Dec. 31, 2003, the company’s shareholders’ equity was $3.16 billion, or $56.84 per outstanding share. The change in book value per share reflects a 33.6 percent increase in shareholders’ equity from $2.37 billion, or $46.55 per outstanding share, at Dec. 31, 2002.

Commenting on the company’s results, Chairman and CEO Joseph Taranto said, “The company’s 2003 results were excellent as our financial security, broad product expertise and market leadership reinforced our position as a reinsurer of choice. As we enter 2004, those same strengths should allow us to continue to deliver superior results for our shareholders.”

The company also reaffirmed its estimate of 2004 operating earnings at $10.00 – $11.00 per share, absent any unusual losses or market developments.