EGI Financial reports 70% increase in 2006 Q4 profit

EGI Financial Holdings Inc. (TSX:EFH) announced a 2006 Q4 profit of $5.2 million – an increase of 70% over its 2005 Q4 profit of $3.1 million.

The improvement was primarily attributable to the year-over-year improvement in the combined ratio, as well as the increase in investment income in 2006, the company reported.

The company’s 2006 Q4 combined ratio (COR) was 85.6%, an improvement over its 2005 Q4 COR of 88.1%.

“EGI’s business continued to perform well in the fourth quarter of 2006,” said EGI Financial CEO Douglas McIntyre in a press release. “Despite the ongoing competitive conditions in our core automobile business, we continue to produce strong bottom-line results.

“I would note further that we are accomplishing this while maintaining a very conservative reserving strategy.”

The company said the benefits of its decision to develop its niche products business were reflected in the its consolidated revenue. “While competitive markets in Echelon’s traditional personal lines (formerly the automobile) division resulted in a 14% decline in direct written premiums,” the company noted in a press release, “the niche products division experienced a 31% increase.”