Fairfax Financial hammered by impact of Japanese crisis, investment losses
The devastating earthquake and tsunami that struck Japan in March has had a major impact on Fairfax Financial Holdings Ltd., a property and casualty insurance company based in Toronto.
Fairfax had a US$240.6-million loss in the first quarter, or $12.42 per share, due to the combined impact of the Japanese crisis and investment losses, the company announced Thursday
Revenue from all sources, including investments fell, to US$1.56 billion from $1.98 billion in the first quarter of 2010.
Fairfax’s revenue from insurance premiums was up but the company, which reports in U.S. currency, had $101.5-million in losses on investments, compared with $597.8 million in investment gains a year earlier.
The investment losses were overshadowed by the impact of the Japan earthquake losses, which were $311.3 million of pre-tax and $217.7 million after tax, net of reinsurance and reinstatement premiums.
“During the first quarter, the company suffered losses from the Japan earthquake as well as from the New Zealand earthquake and Australian floods,” said Prem Watsa, chairman and chief executive officer of Fairfax.
“Despite these events, the company continues to be soundly financed, and we continue to hold $1 billion in cash and marketable securities at the holding company level.”
In the comparable first-quarter of 2010, Fairfax had a net profit of $418.4 million or $20.38 per share.
