Wesco Financial, a provider of insurance, furniture rental, and steel service center services, has reported a net loss of $53.5m, or $7.51 per share, for the first quarter of 2011, compared to a net income of $12.3m, or $1.73 per share in the year-ago quarter.
The consolidated earnings, excluding realized net investment gains and losses and OTTI losses, decreased by $32.89m for the first quarter of 2011, from the corresponding 2010 figure.
Wesco said that the decrease was due principally to an increase in catastrophic worldwide reinsurance losses, including losses from the Japanese earthquake and tsunami and the earthquake in New Zealand, in connection with its quota-share reinsurance of 2% of Swiss Re’s property-casualty insurance risks.
For the first quarter of 2011, investment income was $20.3, compared to $16.1 for the same period of 2010.
In the Wesco-Financial and Kansas Bankers insurance businesses segment, underwriting loss for the first quarter was $43.2m, compared to underwriting loss of $5.2m last year.
Wesco determined that an Other-than-temporary impairment losses on investments loss of $34.3m, after taxes, had occurred with respect to certain purchase lots of its equity investments in Wells Fargo & Company and Kraft Foods Incorporated whose fair values had been below cost for an extended period of time.