DOW JONES NEWSWIRES
Ace Ltd.'s (ACE) fourth-quarter earnings rose 5% and operating profit handily beat analysts' estimates as the company's net premiums written increased.
But shares fell 5.1% after hours to $59.30 as the company also forecast new-year earnings of $6.10 to $6.50 a share, below the $7.47 consensus projection of analysts surveyed by Thomson Reuters.
Chairman and Chief Executive Evan Greenberg said the company had a "very good fourth quarter and a strong finish to an excellent year, both financially and operationally."
The commercial insurer, which is a unit of ACE Group in Zurich, has seen its core profit decline of late as the percentage of premiums paid out has risen. Like many insurers, its bottom line can be vastly affected by investment gains and losses. In December, Standard & Poor's Ratings Services lifted its rating on Ace, saying the company had met or exceeded all of the agency's expectations since it had revised its outlook on the company to positive in late 2008.
Ace reported a profit of $1 billion, or $2.92 a share, up from $953 million, or $2.81 a share, a year earlier. Excluding items such as investment gains and losses, operating income rose to $2.05 from $2.01. Analysts polled by Thomson Reuters had most recently forecast operating earnings of $1.84.
Net premiums written rose 3.5% to $3.42 billion.
Investment income increased 3.9%, and net realized investment gains declined 18% to $305 million.
The company's property-and-casualty combined ratio, which indicates the percentage of premiums paid out, rose to 90.3% from 89.6%.
-By Nathan Becker, Dow Jones Newswires; 212-416-2855; email@example.com