Property and casualty insurer Ace Ltd. said Tuesday that its fourth-quarter net income improved, but losses tied to Superstorm Sandy drove down its operating profit. It also forecast weak 2013 forecast and its shares fell in after-market trading on the news.
The Zurich-based company's net income increased to $765 million, or $2.22 per share, for the period that ended in Dec. 31. That's compared with net income of $735 million, or $2.15 per share, in the same quarter a year earlier.
Ace's operating income, a common insurance industry measure of income that excludes realized gains or losses, fell to $1.43 per share from $1.90 per share. Analysts polled by FactSet had forecast earnings of $1.34 per share.
The company said its after-tax catastrophe losses for the fourth quarter hit $400 million, driven largely by Sandy, compared with $137 million last year. Management also noted that drought conditions also weighed on its performance.
Ace's net premiums written edged up only slightly to $3.66 billion from $3.63 billion last year due to the drag of its crop insurance business.
The company said that it anticipates operating income between $6.60 and $7.00 per share for 2013. Analysts polled by FactSet had forecast $7.96 per share.
Ace's shares fell $3.83, about 4.5 percent, to $81.11 in after-hours trading on the forecast. Its stock increased 28 cents to close regular trading at $84.94.
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