We are pleased to report that Terra had another great year in 2014. Book Value per Share (BVPS) rose to an all-time high of $360.65 and Earnings per Share (EPS) equaled $22.51 and was the highest EPS in the Company’s history.
Terra RRG has now generated earnings and growth in its share value in every calendar year of its existence. Since inception, Terra’s stock performance has exceeded the performance of the DOW, the NASDAQ, the S&P 500 and other major stock indices over the same period. Terra’s stock value has appreciated 3,500% since its formation in 1988. A mere $28,000 investment in Terra then, is now valued at over $1,000,000.
At the same time and according to A.M. Best Company and its Capital Adequacy Ratio analysis (BCAR), Terra is the highest rated professional liability insurer in America. Terra’s current BCAR score is 696. This score exceeds the insurance industry's average BCAR score of 255 by 273%. BCAR is the most relevant measure and rating of an insurers’ success and its ability to meet its obligations.
Hal Arditti will provide you with a more detailed analysis of Terra’s 2014 performance in the coming weeks along with a bound copy of its audited financial statements. In addition, he will describe an exciting new change in the Company’s stock purchase window that will provide shareholders with additional time to consider a purchase of more common shares in Terra. Past guidelines allowed shareholders to purchase new common shares in Terra only during a relatively tight “window” of time (roughly between March 1 and May 1 which is the period after annual financial results are announced and before first quarter financial results are released).
Our new guideline will allow shareholders to purchase additional shares in Terra through September 30. In this way, shareholders will be able to observe and digest Terra’s financial performance through two full calendar quarters, before they invest in new shares at the previous year-end audited BVPS. While there are inherent risks with the purchase of any stock whether it be in Terra or in the open market, the effect of this change will help to stimulate additional capital growth in the Company, while providing shareholders with more time and financial analysis of the Company’s operating performance to make a share purchase decision.
We are extremely proud of the Company’s achievements. It could not have happened without a strong group of risk-conscious policyholders and a dedicated Board and management team. Thanks for your support of the Terra program.