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Echelon Financial Holdings has posted its financial results for the fourth quarter of 2017, taking a net operating loss during the period.
Specifically, the company reported net loss attributable to shareholders on continued operations of $5.0 million ($0.42 per diluted share) for the three months ended December 31, 2017.
Other highlights of the report include:
• Net operating loss on continued operations of $0.51 per share compared to income of $0.40 per share in the fourth quarter of 2016.
• A combined operating ratio of 115% compared to 90% in the fourth quarter of 2016, primarily due to increased severity of claims compared to the prior year quarter, especially in Atlantic Auto.
• A 38% increase in direct written premiums over the same period in 2016 to $68.1 million as a result of organic growth in personal lines and growth in new commercial lines products launched in 2016.
• A pre-tax gain on invested assets of $3.6 million in the quarter compared to a pre-tax loss of $0.6 million in the prior year quarter, attributable to positive returns on the fixed income portfolio driven by spread compression in provincial and corporate bonds in addition to strong returns in the preferred share and equity portfolios.
• Closing book value per share of $12.01, a decrease of 1% over the third quarter of 2017.
“Despite unsatisfactory results in the fourth quarter of 2017, we have made significant progress in achieving the strategic objectives that were set out at the beginning of the year,” said Echelon CEO Serge Lavoie. “2017 marked the launch of new products and our policy management system, and Echelon received strong support from our broker partners.”
Lavoie also noted that the company’s financial results for the quarter were affected by an increase in the severity of personal auto claims (particularly in Atlantic Canada), and increased auto claims frequency in Ontario.
