TORONTO, May 1 (Reuters) - Fairfax Financial, the Canadian property and casualty insurer run by investor Prem Watsa, reported a smaller than expected quarterly loss because of stronger underwriting results and lower investment losses.
The Toronto-based company said on Tuesday it lost $1.3 million, or 69 cents a share, in its first quarter, compared with a loss of $240.6 million, or $12.42 a share, a year earlier.
Analysts had expected a loss of $3.10 a share, according to Thomson Reuters I/B/E/S.
Underwriting results improved from a year ago, when Fairfax took a $217.7 million loss from the Japanese earthquake and tsunami.
Net investment losses narrowed to $40.9 million from $101.5 million, but remained in the red as Fairfax maintained its equity hedges.
Fairfax CEO Watsa hedged the company’s stock portfolio in 2010, convinced that global equity markets have further to fall.
Since taking over the company in 1985, Watsa has built a reputation as a shrewd contrarian investor by moves such as betting against the U.S. housing market in the last decade and reaping billions when the market collapsed.
Recently, Fairfax has taken a substantial position in Research in Motion, while Watsa has taken a position on the BlackBerry maker’s board.
Fairfax’s shares closed at C$403.50 on the Toronto Stock Exchange. The results were released after markets closed.