XL Group Earnings: Net Income Falls

S&P 500 (NYSE:SPY) component XL Group PLC (NYSE:XL) reported its results for the second quarter. XL Group, through its subsidiaries, provides global insurance and reinsurance coverages to industrial, commercial and professional service firms and insurance companies.

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XL Group PLC Earnings Cheat Sheet

Results: Net income for XL Group PLC fell to $224.6 million (71 cents per share) vs. $225.7 million (69 cents per share) a year earlier. This is a decline of 0.5% from the year-earlier quarter.

Revenue: Rose 3% to $1.75 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: XL Group PLC beat the mean analyst estimate of 56 cents per share. It beat the average revenue estimate of $1.55 billion.

Quoting Management: Commenting on the Company’s performance, Chief Executive Officer Mike McGavick said, “In absolute and relative terms, this was a solid quarter for XL, demonstrating our continued progress. We again expanded margins in both our Insurance and Reinsurance segments and reported a total P&C combined ratio of 90.8 percent, more than four percentage points better than the second quarter last year. Our semi-annual reserve review resulted in both Insurance and Reinsurance releases. And we grew book value as we continued to buy back shares. We are resolved to continue this progress across all of our businesses.”

Key Stats:

Revenue has increased for four quarters in a row. Revenue increased 8.5% to $1.75 billion in the first quarter. The figure rose 8.8% in the fourth quarter of the last fiscal year from the year earlier and climbed 2.3% in the third quarter of the last fiscal year from the year-ago quarter.

The company has beaten estiamtes for two quarters in a row. In the first quarter, it topped expectations with net income of 52 cents versus a mean estimate of net income of 40 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from 36 cents a share to 34 cents over the last thirty days. The average estimate for the fiscal year is $1.99 per share, a rise from $1.86 ninety days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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