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Form 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the month of October, 2002
CONVERIUM HOLDING AG
-------------------------------------
(Translation of registrant's name into English)
Baarerstrasse 8
CH-6300 Zug
Switzerland
-------------------------------------
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
-------- --------
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
------- -------
If "Yes" is marked, indicate the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82- Not Applicable
Converium Holding Ltd, Zug
ZUG, Switzerland--(BUSINESS WIRE)--Oct. 28, 2003--Converium today
reports on its financial results for the third quarter 2003 and for
the first nine months of 2003.
Strong performance in non-life continues, both in Standard
Property & Casualty Reinsurance and in Specialty Lines
Strong reserve levels for Guaranteed Minimum Death Benefit (GMDB)
business
Strong capital position maintained
3Q 2003 3Q 2002 Change
quarter- quarter-
to-date to-date
----------------------------------
Gross premiums written US$ 1,009.6 US$ 745.0 +35.5%
million million
Net premiums written US$ 887.4 US$ 697.3 +27.3%
million million
Net premiums earned US$ 918.6 US$ 754.8 +21.7%
million million
Non-life combined ratio 95.7% 112.1% -16.4 pts
Total investment income yield(1) 2.9% 6.7% -3.8 pts
Total investment return(2) 3.5% 4.9% -1.4 pts
Operating income (loss) (pre-tax) US$ 56.4 US$ -71.2 +US$ 127.6
million million million
Net income (loss) US$ 44.3 US$ -5.6 +US$ 49.9
million million million
Earnings per share US$ 1.12 US$ -0.14 +US$ 1.26
Return on equity(3) 10.2% -1.4% +11.6 pts
Cash flows from operating activities US$ 331.4 US$ 235.2 +40.9%
million million
Shareholders' equity as per 9/30 US$ 1,940.0 US$ 1,659.5 +16.9%
million million
Book value per share as per 9/30 US$ 48.77 US$ 41.72 +16.9%
Dirk Lohmann, Converium's Chief Executive Officer, commented:
"Converium continued to benefit from the reshuffling in the
reinsurance industry. The strong performance of our non-life segments,
Standard Property & Casualty Reinsurance and Specialty Lines,
continued and reflects Converium's strong global franchise and the
disciplined execution of our strategy that allow us to benefit from
the current attractive market conditions."
Dirk Lohmann added: "We have as promised further addressed our
GMDB reserving position in the third quarter. Following a series of
claims audits, additional in-depth analyses and resulting enhancements
to our models, we have strengthened our total net reserves by US$ 14.3
million to US$ 58.1 million. In addition we have secured the ability
to call upon additional reinsurance protection of up to US$ 75.0
million in excess of the newly strengthened carried reserve levels as
at September 30, 2003. We presently believe that this additional
reinsurance protection provides adequate coverage to protect Converium
against any significant movement in the key variables and assumptions
within our existing models."
For the three months ended September 30, 2003, Converium reported
a net income (after-tax) of US$ 44.3 million; earnings per share were
US$ 1.12. For the three months ended September 30, 2003, Converium
reported a return on equity(3) of 10.2%. For the three months ended
September 30, 2003, gross premiums written were US$ 1,009.6 million,
net premiums written were US$ 887.4 million, and net premiums earned
were US$ 918.6 million. For the three months ended September 30, 2003,
Converium reported total investment results of US$ 52.9 million,
including net realized capital losses of US$ 1.3 million, resulting in
a total investment income yield(1) of 2.9%, a decrease of 3.8
percentage points compared to the same period of the previous year
(3Q 2002 quarter-to-date: 6.7%). Converium reported total investment
returns of US$ 63.8 million or 3.5%, a decrease of 1.4 percentage
points compared to the same period of the previous year (3Q 2002
quarter-to-date: 4.9%). Total revenues increased by 18.5% to US$ 971.5
million (3Q 2002 quarter-to-date: US$ 820.1 million). Cash flows from
operating activities increased by 40.9% to US$ 331.4 million (3Q 2002
quarter-to-date: US$ 235.2 million).
3Q 2003 3Q 2002 Change
year-to-date year-to-date
-------------------------------------
Gross premiums written US$ 3,222.1 US$ 2,518.7 +27.9%
million million
Net premiums written US$ 2,971.3 US$ 2,388.8 +24.4%
million million
Net premiums earned US$ 2,715.4 US$ 2,271.9 +19.5%
million million
Non-life combined ratio 97.7% 104.2% -6.5 pts
Total investment income yield(1) 3.5% 4.1% -0.6 pts
Total investment return(2) 5.7% 3.0% +2.7 pts
Operating income (pre-tax) US$ 144.7 US$ 32.5 +US$ 112.2
million million million
Net income US$ 128.9 US$ 26.0 +US$ 102.9
million million million
Earnings per share US$ 3.24 US$ 0.65 +US$ 2.59
Return on equity(3) 9.9% 2.2% +7.7 pts
Cash flows from operating US$ 904.0 US$ 511.9 +76.6%
activities million million(4)
For the nine months ended September 30, 2003, Converium reported a
net income (after-tax) of US$ 128.9 million; earnings per share for
the period were US$ 3.24. For the nine months ended September 30,
2003, Converium reported a return on equity(3) of 9.9%. For the nine
months ended September 30, 2003, gross premiums written were US$
3,222.1 million, net premiums written US$ 2,971.3 million, and net
premiums earned US$ 2,715.4 million. For the nine months ended
September 30, 2003, Converium reported total investment results of US$
183.4 million, including net realized capital gains of US$ 6.2
million, resulting in a total investment income yield(1) of 3.5%, a
decrease of 0.6 percentage points (3Q 2002 year-to-date: 4.1%).
Converium reported total investment returns of US$ 299.3 million or
5.7%, an increase of 2.7 percentage points compared to the same period
of the previous year (3Q 2002 year-to-date: 3.0%). Total revenues
increased by 20.0% to US$ 2,894.4 million (3Q 2002 year-to-date: US$
2,412.5 million). Cash flows from operating activities increased by
76.6% to US$ 904.0 million (3Q 2002 year-to-date: US$ 511.9
million(4)).
At September 30, 2003, total assets were US$ 13,891.7 million, an
increase of 15.3% (December 31, 2002: US$ 12,051.0 million);
shareholders' equity was US$ 1,940.0 million, an improvement of 11.6%
or US$ 202.0 million (December 31, 2002: US$ 1,738.0 million); book
value per share was US$ 48.77, an increase of 12.0% or US$ 5.22
compared to December 31, 2002 (December 31, 2002: US$ 43.55).
On October 3, 2003, Converium announced that the Board of
Directors of Converium Holding Ltd appointed four new members to the
Global Executive Committee, Dr Hans Peter Boller, Christian Felderer,
Christoph Ludemann, and Gary Prestia, and approved changes to the
organizational and financial reporting structures. The new management
structure centers on global functional areas; Converium started to
report in three new global business segments, Standard Property &
Casualty Reinsurance, Specialty Lines, and Life & Health Reinsurance.
Administration expenses related to the Board of Directors, the Global
Executive Committee, and other global functions are reported
separately within Converium's Corporate Center. With this structure,
Converium has fully aligned its operating platform with its global
strategy. At the same time, the new segment reporting structure allows
for a better assessment of the execution of Converium's strategy.
Business Development
Dirk Lohmann, Chief Executive Officer, said: "The strong
performance we continued to experience in Standard Property & Casualty
Reinsurance as well as in Specialty Lines reflects Converium's global
franchise as well as our strong distribution, both direct and via
broker. Today, our portfolio is well diversified by lines of business,
globally balanced by regions, and well spread between short-, mid-,
and long-tail business. The disciplined execution of our strategy
resulted in substantial cash flows that drove the strong growth of
total invested assets, the corresponding investment results will be a
key value driver for future earnings."
Martin Kauer, Chief Financial Officer, said: "Notwithstanding the
interest rate increase, the conservative positioning of our bond
portfolio in terms of duration and credit quality resulted in a
relatively moderate decrease of the unrealized capital gains on the
fixed income securities; however, this decrease has been compensated
by the positive impact of the continued rebound of the equity markets,
and overall we maintained the aggregate net unrealized gains positions
at the level that was reported at the end of June 2003. Since year-end
2002, Converium's shareholders' equity increased by 11.6%, or by more
than 13.0% including paid dividends, to US$ 1,940.0 million as per
September 30, 2003. Our claims supporting capital of US$ 2,330.4
million enables us to continue to benefit from today's hard
reinsurance market."
Standard Property & Casualty Reinsurance, which represented
approximately 38.2% of total net premiums written for the three months
ended September 30, 2003, reported gross premiums written of US$ 383.4
million, an increase of 25.3% (3Q 2002 quarter-to-date: US$ 306.0
million), net premiums written of US$ 338.9 million, an increase of
11.2% (3Q 2002 quarter-to-date: US$ 304.7 million), and net premiums
earned of US$ 422.9 million, an increase of 25.2% (3Q 2002
quarter-to-date: US$ 337.9 million). The growth was spread across most
lines of business and primarily resulted from increased rates,
increasing the share of clients' business upon renewing existing
business or writing new business. A substantial part of this business
was written on a proportional basis in lines of business that exhibit
lower volatility in their performance over time and, therefore, carry
higher expected non-life loss ratios compared to non-proportional
catastrophe business. The non-life combined ratio was 93.7% for the
three months ended September 30, 2003, an improvement of 15.4
percentage points (3Q 2002 quarter-to-date: 109.1%, including 14.8
percentage points caused by the European floods); the segment income
for the third quarter 2003 was not materially impacted by developments
of prior years' reserves. Total investment results decreased by 41.9%
to US$ 20.9 million (3Q 2002 quarter-to-date: US$ 36.0 million). The
segment income was US$ 50.8 million for the three months ended
September 30, 2003, an increase of 647.1% or US$ 44.0 million (3Q 2002
quarter-to-date: US$ 6.8 million) that was primarily attributable to
an improved non-life combined ratio. For the nine months ended
September 30, 2003, gross premiums written increased by 19.9% to US$
1,384.3 million, net premiums written by 14.5% to US$ 1,279.6 million,
and net premiums earned by 16.4% to US$ 1,210.1 million; the non-life
combined ratio improved by 7.6 percentage points to 92.6% (3Q 2002
year-to-date: 100.2% including 4.8 percentage points caused by the
European floods); total investment results increased by 11.8% to US$
73.1 million; and the segment income increased by 169.9% to US$ 160.6
million.
Frank Schaar, Executive Vice President, Standard Property &
Casualty Reinsurance, commented: "The profitable growth of Standard
Property & Casualty Reinsurance - net premiums written increased 14.5%
to US$ 1,279.6 million for the first nine months of 2003 - was driven
by the general third party liability and property lines of business.
The non-life combined ratio of 92.6% for our Standard Property &
Casualty Reinsurance segment for the first nine months of 2003
properly reflects the profitability of the business written in the
last two years and modest claims from catastrophes."
Specialty Lines, representing approximately 53.5% of total net
premiums written for the three months ended September 30, 2003,
reported gross premiums written of US$ 543.5 million, an increase of
45.6% (3Q 2002 quarter-to-date: US$ 373.3 million), net premiums
written of US$ 474.7 million, an increase of 41.2% (3Q 2002
quarter-to-date: US$ 336.2 million), and net premiums earned of US$
408.2 million, an increase of 16.4% (3Q 2002 quarter-to-date: US$
350.6 million). The growth was spread across most lines of business,
particularly professional liability and other specialty liability,
aviation and space, and agribusiness, and primarily resulted from
increased rates, increasing the share of clients' business upon
renewing existing business or writing new business. The non-life
combined ratio was 97.8% for the three months ended September 30,
2003, an improvement of 17.1 percentage points (3Q 2002
quarter-to-date: 114.9%); the segment income for the third quarter
2003 was not materially impacted by developments of prior years'
reserves. Total investment results decreased by 39.4% to US$ 28.0
million (3Q 2002 quarter-to-date: US$ 46.2 million). The segment
income was US$ 34.1 million for the third quarter ended September 30,
2003, an increase of US$ 39.4 million (3Q 2002 quarter-to-date:
segment loss US$ 5.3 million) that was primarily attributable to the
improved non-life combined ratio. For the nine months ended September
30, 2003, gross premiums written increased by 36.6% to US$ 1,532.3
million, net premiums written by 34.6% to US$ 1,405.6 million, and net
premiums earned by 22.0% to US$ 1,231.7 million; the non-life combined
ratio improved by 5.5 percentage points to 102.7%; total investment
results increased by 16.1% to US$ 96.5 million; and the segment income
increased by US$ 57.9 million to US$ 56.3 million.
Benjamin Gentsch, Executive Vice President, Specialty Lines, said:
"Net premiums written of the Specialty Lines segment increased by
34.6% to US$ 1,405.6 million for the first three quarters of 2003; the
lines of business professional liability and other specialty
liability, aviation and space, and agribusiness contributed
substantially to this profitable growth. For the first three quarters
of 2003, the non-life combined ratio improved by 5.5 percentage points
to 102.7%. Due to the mid- to long-tail character of most of the
Specialty Lines business, the invested assets offsetting reserves are
expected to generate substantial investment results in the future and
to contribute to the segment income."
Life & Health Reinsurance, which represented approximately 8.3% of
total net premiums written for the three months ended September 30,
2003, reported gross premiums written of US$ 82.7 million, an increase
of 25.9% (3Q 2002 quarter-to-date: US$ 65.7 million), net premiums
written of US$ 73.8 million, an increase of 30.9% (3Q 2002
quarter-to-date: US$ 56.4 million), and net premiums earned of US$
87.5 million, an increase of 32.0% (3Q 2002 quarter-to-date: US$ 66.3
million). The growth was primarily driven by the accident and health
line of business in North America and in Continental Europe. In the
three months ended September 30, 2003, based on in-depth analyses, a
substantially enhanced model, and best estimates applied as
assumptions for all key parameters, the Life & Health Reinsurance
segment strengthened the total net reserves of its Guaranteed Minimum
Death Benefit (GMDB) business by US$ 14.3 million to US$ 58.1 million.
Converium has secured the ability to call upon additional reinsurance
protection of up to US$ 75.0 million over the strengthened reserve
levels at September 30, 2003. Based on information available today,
this additional reinsurance protection adequately addresses potential
adverse deviations to the key assumptions - i.e. mortality risks,
lapse rate risks, withdrawal rate-risks, and investment risks -
incorporated in our models. The net amount at risk further decreased
to US$ 1,032.8 million as per September 30, 2003. For the three months
ended September 30, 2003, Converium's Life & Health Reinsurance
segment reported a technical result(5) of minus US$ 14.1 million
(3Q 2002 quarter-to-date: minus US$ 10.5 million), this was due to the
developments on the closed block of Guaranteed Minimum Death Benefit
(GMDB) business that contributed a technical result of minus US$ 20.7
million (3Q 2002 quarter-to-date: minus US$ 4.0 million); the Life &
Health segment excluding GMDB reported a technical result of US$ 6.6
million, an improvement of US$ 13.1 million (3Q 2002 quarter-to-date:
minus US$ 6.5 million). Total investment results decreased by 39.4% to
US$ 4.0 million (3Q 2002 quarter-to-date: US$ 6.6 million). For the
three months ended September 30, 2003, the segment loss was US$ 14.8
million (3Q 2002 quarter-to-date: segment loss US$ 8.4 million). For
the nine months ended September 30, 2003, gross premiums written
increased by 25.9% to US$ 305.5 million, net premiums written by 26.4%
to US$ 286.1 million, and net premiums earned by 22.9% to US$ 273.6
million. The technical result for the first nine months of 2003 was
minus US$ 16.0 million (3Q 2002 year-to-date: minus US$ 5.2 million),
including minus US$ 35.3 million from the GMDB-book (3Q 2002
year-to-date: minus US$ 4.0 million); the Life & Health segment
excluding GMDB reported a technical result of US$ 19.3 million, an
improvement of US$ 20.5 million (3Q 2002 year-to-date: minus US$ 1.2
million). Total investment results increased by 15.0% to US$ 13.8
million; the segment loss was US$ 13.4 million (3Q 2002 year-to-date:
segment loss US$ 2.9 million).
Christoph Ludemann, Executive Vice President, Life & Health
Reinsurance, commented: "The execution of our Life & Health strategy
continued to contribute to Converium's overall performance - the
growth of the Life & Health Reinsurance segment, where net premiums
written increased 26.4% to US$ 286.1 million for the first nine months
of 2003 - was primarily attributable to the accident and health line
of business. We addressed the reserving position for our GMDB-book: we
now carry strong reserves for the GMDB-exposures and have the ability
to call upon additional broad protection against future life benefit
increases arising out of adverse movements in the many variables
included in our models."
The company has made it a policy not to provide any quarterly or
annual earnings guidance and it will not update any past outlook for
full year earnings. It will however provide investors with
perspectives on its value drivers, its strategic initiatives and those
factors critical to understanding its business and operating
environment.
About Converium
Converium is an independent leading global multi-line reinsurer
known for its innovation, professionalism and service. Today Converium
ranks among the top ten professional reinsurers and employs more than
800 people in 22 offices around the globe. Converium is organized into
three business segments: Standard Property & Casualty Reinsurance,
Specialty Lines and Life & Health Reinsurance. Converium's net losses
for the September 11th terrorist attacks in the United States are
capped at US$ 289.2 million by its former parent, Zurich Financial
Services. Converium has minimal A&E exposures. Converium has an "A"
rating (stable outlook) both from Standard & Poor's and A.M. Best
Company.
Important Disclaimer
This document contains forward-looking statements as defined in
the U.S. Private Securities Litigation Reform Act of 1995. It contains
forward-looking statements and information relating to the Company's
financial condition, results of operations, business, strategy and
plans, based on currently available information. These statements are
often, but not always, made through the use of words or phrases such
as 'expects', 'should continue', 'believes', 'anticipates',
'estimates' and 'intends'. The specific forward-looking statements
cover, among other matters, the improving reinsurance market, the
expected losses related to the September 11, 2001 attack on the United
States, the outcome of insurance regulatory reviews, the Company's
operating results, the rating environment and the prospect for
improving results. Such statements are inherently subject to certain
risks and uncertainties. Actual future results and trends could differ
materially from those set forth in such statements due to various
factors. Such factors include general economic conditions, including
in particular economic conditions; the frequency, severity and
development of insured loss events arising out of catastrophes, as
well as man-made disasters such as the September 11, 2001 attack in
the United States; the ability to exclude and to reinsure the risk of
loss from terrorism; fluctuations in interest rates; returns on and
fluctuations in the value of fixed income investments, equity
investments and properties; fluctuations in foreign currency exchange
rates; rating agency actions; changes in laws and regulations and
general competitive factors, and other risks and uncertainties,
including those detailed in the Company's filings with the U.S.
Securities and Exchange Commission and the SWX Swiss Exchange. The
Company does not assume any obligation to update any forward-looking
statements, whether as a result of new information, future events or
otherwise.
Converium: Interim statements of income (unaudited)
(In US$ million, unless Three months Nine months Year
noted) ended ended ended
September 30 September 30 Dec 31
2002
2003 2002 2003 2002 (audited)
----------------------------------------------------------------------
Revenues
----------------------------------------------------------------------
Gross premiums written 1,009.6 745.0 3,222.1 2,518.7 3,535.8
----------------------------------------------------------------------
Less ceded premiums written -122.2 -47.7 -250.8 -129.9 -213.6
----------------------------------------------------------------------
Net premiums written 887.4 697.3 2,971.3 2,388.8 3,322.2
----------------------------------------------------------------------
Net changed in unearned
premiums 31.2 57.5 -255.9 -116.9 -156.7
----------------------------------------------------------------------
Net premiums earned 918.6 754.8 2,715.4 2,271.9 3,165.5
----------------------------------------------------------------------
Net investment income 54.2 58.9 177.2 191.9 251.8
----------------------------------------------------------------------
Net realized capital
(losses) gains -1.3 29.9 6.2 -31.4 -10.3
----------------------------------------------------------------------
Other (loss) income - -23.5 -4.4 -19.9 -1.2
----------------------------------------------------------------------
Total revenues 971.5 820.1 2,894.4 2,412.5 3,405.8
----------------------------------------------------------------------
Benefits, losses and expenses
----------------------------------------------------------------------
Losses, loss adjustment
expenses and life benefits -662.2 -678.5 -1,994.9 -1,789.0 -2,492.0
----------------------------------------------------------------------
Underwriting acquisition
costs -201.8 -131.3 -582.3 -478.7 -666.7
----------------------------------------------------------------------
Other operating and
administration expenses -45.5 -48.2 -142.4 -132.3 -173.3
----------------------------------------------------------------------
Interest expense -6.9 -3.4 -23.9 -11.4 -16.4
----------------------------------------------------------------------
Total benefits, losses and
expenses -916.4 -861.4 -2,743.5 -2,411.4 -3,348.4
----------------------------------------------------------------------
Income (loss) before taxes 55.1 -41.3 150.9 1.1 57.4
----------------------------------------------------------------------
Income tax (expense) benefit -10.8 35.7 -22.0 24.9 49.4
----------------------------------------------------------------------
Net income (loss) 44.3 -5.6 128.9 26.0 106.8
----------------------------------------------------------------------
Basic earnings (loss) per
share 1.12 -0.14 3.24 0.65 2.68
----------------------------------------------------------------------
Diluted earnings (loss) per
share 1.10 -0.14 3.20 0.64 2.64
----------------------------------------------------------------------
Converium: Interim balance sheets
(In US$ million, unless noted) Sept 30
2003 Dec 31
(unaudited) 2002
----------------------------------------------------------------------
Assets
----------------------------------------------------------------------
Invested assets
----------------------------------------------------------------------
Held-to-maturity securities:
Fixed maturities 416.6 -
----------------------------------------------------------------------
Available-for-sale securities:
Fixed maturities 3,969.5 3,443.1
Equity securities 735.8 530.8
----------------------------------------------------------------------
Other investments 181.0 177.3
----------------------------------------------------------------------
Short-term investments 217.2 318.0
----------------------------------------------------------------------
Total investments 5,520.1 4,469.2
----------------------------------------------------------------------
Funds Withheld Asset 1,582.9 1,648.1
----------------------------------------------------------------------
Total invested assets 7,103.0 6,117.3
----------------------------------------------------------------------
Other Assets
----------------------------------------------------------------------
Cash and cash equivalents 294.3 361.5
----------------------------------------------------------------------
Premiums receivables:
Current 195.8 131.9
Accrued 2,031.0 1,589.4
----------------------------------------------------------------------
Reinsurance assets:
Underwriting reserves 1,667.4 1,627.7
Insurance balances receivable, net 245.8 239.9
----------------------------------------------------------------------
Funds held by reinsureds 1,154.1 935.9
----------------------------------------------------------------------
Deferred policy acquisition costs 364.9 264.9
----------------------------------------------------------------------
Deferred income taxes 338.9 391.8
----------------------------------------------------------------------
Other assets 496.5 390.7
----------------------------------------------------------------------
Total Assets 13,891.7 12,051.0
----------------------------------------------------------------------
Liabilities and equity
----------------------------------------------------------------------
Liabilities
----------------------------------------------------------------------
Losses and loss adjustment expenses, gross
7,508.2 6,821.3
----------------------------------------------------------------------
Unearned premiums, gross 1,481.5 1,170.7
----------------------------------------------------------------------
Future life benefits, gross 478.7 371.7
----------------------------------------------------------------------
Other reinsurance liabilities 1,022.4 661.6
----------------------------------------------------------------------
Funds held under reinsurance contracts 506.6 429.5
----------------------------------------------------------------------
Deferred income taxes 140.3 133.9
----------------------------------------------------------------------
Accrued expenses and other liabilities 423.6 333.9
----------------------------------------------------------------------
Debt 390.4 390.4
----------------------------------------------------------------------
Total liabilities 11,951.7 10,313.0
----------------------------------------------------------------------
Equity
----------------------------------------------------------------------
Common stock 253.0 253.0
----------------------------------------------------------------------
Additional paid-in capital 1,332.3 1,330.9
----------------------------------------------------------------------
Treasury stock -8.7 -3.3
----------------------------------------------------------------------
Unearned stock compensation -5.0 -10.0
----------------------------------------------------------------------
Accumulated other comprehensive income (loss):
Net unrealized gains (losses) on investments,
net of taxes 93.2 -53.3
Cumulative translation adjustments 72.4 113.9
----------------------------------------------------------------------
Total accumulated other comprehensive income 165.6 60.6
----------------------------------------------------------------------
Retained earnings 202.8 106.8
----------------------------------------------------------------------
Total equity 1,940.0 1,738.0
----------------------------------------------------------------------
Total liabilities and equity 13,891.7 12,051.0
----------------------------------------------------------------------
Converium: Interim statements of cash flows (unaudited)
(In US$ million, unless noted) Nine months Year
ended ended
September 30 Dec 31
2002
2003 2002 (audited)
----------------------------------------------------------------------
Cash flows from operating activities
----------------------------------------------------------------------
Cash provided by operating activities 904.0 648.6 870.4
----------------------------------------------------------------------
----------------------------------------------------------------------
Cash flows from investing activities
----------------------------------------------------------------------
Purchases of fixed maturities held-to-
maturity -108.9 - -
Proceeds from sales and maturities of
fixed maturities available-for-sale 2,786.1 2,045.5 4,573.3
Purchases of fixed maturities available-
for- sale -3,553.3 -1,878.9 -5,375.3
----------------------------------------------------------------------
Cash flows from investing activities (fixed
maturities) -876.1 166.6 -802.0
----------------------------------------------------------------------
Proceeds from sales of equity securities 41.0 375.5 599.2
Purchases of equity securities -182.0 -582.0 -651.1
----------------------------------------------------------------------
Cash flows from investing activities
(equity securities) -141.0 -206.5 -51.9
----------------------------------------------------------------------
Net decrease (increase) in short-term
investments 108.3 0.1 -228.5
Proceeds from sales of other assets 25.1 24.5 33.0
Purchases of other assets -62.7 -41.5 -43.9
----------------------------------------------------------------------
Cash flows from investing activities
(other) 70.7 -16.9 -239.4
----------------------------------------------------------------------
Net cash used in investing activities -946.4 -56.8 -1,093.3
----------------------------------------------------------------------
----------------------------------------------------------------------
Cash flows from financing activities
----------------------------------------------------------------------
Issuance of guaranteed subordinated
notes - - 193.7
Purchases of common shares
Proceeds from issuance of common -5.4 -10.3 -14.7
shares - 0.2 -
Dividends to shareholders -29.2 - -
----------------------------------------------------------------------
Net cash used in financing activities -34.6 -10.1 179.0
----------------------------------------------------------------------
Effect of exchange rate changes on cash and
cash equivalents 9.8 19.2 -15.1
----------------------------------------------------------------------
Change in cash and cash equivalents -67.2 600.9 -59.0
----------------------------------------------------------------------
Cash and cash equivalents as of January 1 361.5 420.5 420.5
----------------------------------------------------------------------
Cash and cash equivalents as of September
30, respectively December 31 294.3 1,021.4 361.5
----------------------------------------------------------------------
Converium: Standard Property & Casualty Reinsurance
(Unaudited; in US$ million, unless Three months Nine months
noted) ended ended
September 30 September 30
2003 2002 2003 2002
----------------------------------------------------------------------
Gross premiums written 383.4 306.0 1,384.3 1,154.4
-growth (%) +25.3% +19.9%
----------------------------------------------------------------------
Net premiums written 338.9 304.7 1,279.6 1,118.0
-growth (%) +11.2% +14.5%
----------------------------------------------------------------------
Net premiums earned 422.9 337.9 1,210.1 1,039.6
-growth (%) +25.2% +16.4%
----------------------------------------------------------------------
Non-life loss ratio(6) 66.2% 87.7% 66.0% 73.1%
-change in percentage points -21.5 pts -7.1 pts
----------------------------------------------------------------------
Non-life underwriting expense 23.5% 16.0% 22.6% 22.6%
ratio(7)
-change in percentage points +7.5 pts -
----------------------------------------------------------------------
Non-life administration expense 4.0% 5.4% 4.0% 4.5%
ratio(8)
-change in percentage points -1.4 pts -0.5 pts
----------------------------------------------------------------------
Non-life combined ratio(9) 93.7% 109.1% 92.6% 100.2%
-change in percentage points -15.4 pts -7.6 pts
----------------------------------------------------------------------
Total investment results(10) 20.9 36.0 73.1 65.4
-growth (%) -41.9% +11.8%
----------------------------------------------------------------------
Average annualized total investment 2.9% 6.7% 3.5% 4.1%
income yield (pre-tax)(11)
-change in percentage points -3.8 pts -0.6 pts
----------------------------------------------------------------------
Segment income 50.8 6.8 160.6 59.5
-growth (%) n.m. +169.9%
----------------------------------------------------------------------
Retention ratio(12) 88.4% 99.6% 92.4% 96.8%
----------------------------------------------------------------------
Converium: Specialty Lines
(Unaudited; in US$ million, unless Three months Nine months
noted) ended ended
September 30 September 30
2003 2002 2003 2002
----------------------------------------------------------------------
Gross premiums written 543.5 373.3 1,532.3 1,121.6
-growth (%) +45.6% +36.6%
----------------------------------------------------------------------
Net premiums written 474.7 336.2 1,405.6 1,044.4
-growth (%) +41.2% +34.6%
----------------------------------------------------------------------
Net premiums earned 408.2 1,231.7
-growth (%) +16.4% 350.6 +22.0% 1,009.7
----------------------------------------------------------------------
Non-life loss ratio(6) 72.3% 92.1% 78.0% 83.8%
-change in percentage points -19.8 pts -5.8 pts
----------------------------------------------------------------------
Non-life underwriting expense 21.5% 17.0% 20.7% 19.7%
ratio(7)
-change in percentage points +4.5 pts +1.0 pt
----------------------------------------------------------------------
Non-life administration expense 4.0% 5.8% 4.0% 4.7%
ratio(8)
-change in percentage points -1.8 pts -0.7 pts
----------------------------------------------------------------------
Non-life combined ratio(9) 97.8% 114.9% 102.7% 108.2%
-change in percentage points -17.1 pts -5.5 pts
----------------------------------------------------------------------
Total investment results(10) 28.0 46.2 96.5 83.1
-growth (%) -39.4% +16.1%
----------------------------------------------------------------------
Average annualized total investment 2.9% 6.7% 3.5% 4.1%
income yield (pre-tax)( 11)
-change in percentage points -3.8 pts -0.6 pts
----------------------------------------------------------------------
Segment income (loss) 34.1 -5.3 56.3 -1.6
-growth (%) n.m. n.m.
----------------------------------------------------------------------
Retention ratio(12) 87.3% 90.1% 91.7% 93.1%
----------------------------------------------------------------------
Converium: Life & Health Reinsurance
(Unaudited; in US$ million, unless Three months Nine months
noted) ended ended
September 30 September 30
2003 2002 2003 2002
----------------------------------------------------------------------
Gross premiums written 82.7 65.7 305.5 242.7
-growth (%) +25.9% +25.9%
----------------------------------------------------------------------
Net premiums written 73.8 56.4 286.1 226.4
-growth (%) +30.9% +26.4%
----------------------------------------------------------------------
Net premiums earned 87.5 66.3 273.6 222.6
-growth (%) +32.0% +22.9%
----------------------------------------------------------------------
Underwriting expense ratio life & 16.8% 26.8% 19.9% 20.3%
health(13)
-change in percentage points -10.0 pts -0.4 pts
----------------------------------------------------------------------
Administration expense ratio life & 5.4% 6.8% 4.1% 4.4%
health(14)
-change in percentage points -1.4 pts -0.3 pts
----------------------------------------------------------------------
Total investment results(10) 4.0 6.6 13.8 12.0
-growth (%) -39.4% +15.0%
----------------------------------------------------------------------
Average annualized total investment 2.9% 6.7% 3.5% 4.1%
income yield (pre-tax)(11 )
-change in percentage points -3.8 pts -0.6 pts
----------------------------------------------------------------------
Segment loss -14.8 -8.4 -13.4 -2.9
----------------------------------------------------------------------
Retention ratio(12) 89.2% 85.8% 93.6% 93.3%
----------------------------------------------------------------------
Converium: Corporate Center
(Unaudited; in US$ million, unless Three months Nine months
noted) ended ended
September 30 September 30
2003 2002 2003 2002
----------------------------------------------------------------------
Operating and administration expenses -8.1 -7.5 -24.3 -22.6
- change (%) +8.0% +7.5%
----------------------------------------------------------------------
Other (loss) income - -23.5 -4.4 -19.9
- change (%) -100.0% -77.9%
----------------------------------------------------------------------
Interest expense -6.9 -3.4 -23.9 -11.4
-change (%) +102.9% +109.6%
----------------------------------------------------------------------
(1) Total investment income yield is defined as net investment income
plus net realized capital gains (losses) divided by average total
invested assets (including cash and cash equivalents), pre-tax and
annualized.
(2) Total investment return is defined as net investment income plus
net realized capital gains (losses) plus change in unrealized
gains (losses) divided by average total invested assets (including
cash and cash equivalents), pre-tax and annualized.
(3) Return on equity is defined as net income (after-tax) divided by
shareholders' equity at the beginning of the period, annualized.
(4) Excluding US$ 136.7 million received reimbursement of reinsurance
recoverable in dispute in the second quarter of 2002.
(5) Technical result is defined as net premiums earned minus losses,
loss adjustment expenses & life benefits minus underwriting
acquisition costs.
(6) Non-life loss ratio is defined as losses and loss adjustment
expenses divided by net premiums earned.
(7) Non-life underwriting expense ratio is defined as underwriting
acquisition costs divided by net premiums earned.
(8) Non-life administration expense ratio is defined as other
operating and administration expenses divided by net premiums
written.
(9) Non-life combined ratio is defined as non-life loss ratio plus
non-life underwriting expense ratio plus non-life administration
expense ratio.
(10)Total investment results are defined as net investment income plus
net realized capital gains (losses).
(11)Average annualized total investment income yield (pre-tax) is
defined as annualized total investment results divided by the
average of beginning and ending investment balances (including
cash and cash equivalents).
(12)Retention ratio is defined as net premiums written divided by
gross premiums written.
(13)The underwriting expense ratio is defined as underwriting expenses
divided by net premiums earned.
(14)The administration expense ratio is defined as other operating and
administration expenses divided by net premiums written.
CONTACT: Converium Holding Ltd
Media Relations:
Michael Schiendorfer, +41 0 1 639 96 57
michael.schiendorfer@converium.com
Investor Relations:
Zuzana Drozd, +41 0 1 639 91 20
zuzana.drozd@converium.com
www.converium.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CONVERIUM HOLDING AG
By:
---------------------------
Name: Martin Kauer
Title: CFO
By:
---------------------------
Name: Christian Felderer
Title: General Legal Counsel
Date: October 28, 2003