in the workers' compensation market has hurt Bermuda-based Mutual Risk Management Ltd. share price.

The shares slid 32 percent yesterday to a new 52 week low of $12 7/8, down $6 1/16 for the day. The company's stock closed yesterday at $13.75. The fall follows a plunge in Mutual Risk's share price on Friday on heavy trading volumes to $18 15/16 from about $22.50 the day before. Yesterday the stock opened at $15, far from the $43.25 of the company's 52 week high.

In the wake of the stock price fall on Friday, company management yesterday reported they expected third-quarter diluted operating earnings of 33 to 38 cents a share for the quarter compared to 37 cents for the same period in 1998.

The company said it expected to make provisions of up to $8 million or 16 cents a share for losses incurred on a number of terminated programmes.

The actual results are expected to be announced on November 4.

Company management also held a conference call with analysts yesterday to explain the situation more fully.

Mutual Risk sets up and manages alternative insurance arrangements for corporations and groups. Under its programme business segment the company arranges insurance or reinsurance for pools of similar companies.

"The shortfall in earnings is due to slower growth and lower margins in the company's programme business segment and in particular at its underwriting management subsidiary, Small Business Underwriters (SBU),'' the statement said. SBU is specialised in the workers' compensation insurance market.

Fielding questions from analysts, chairman and chief executive officer Robert Mulderig said the company was in a strong position and had expected fees from its programme and workers' compensation business to decline as competition heated up.

He said the company also expects to get more corporate risk management business to balance the declining areas.

Mutual Risk also expects price increases in the workers' compensation business.

"We will be working with somewhat smaller margins,'' he said. "...We would still expect to see growth from the remainder of the business.'' Mutual Risk purchased SBU in 1997 and over the years the subsidiary has had "tremendous growth'' Mr. Mulderig said.

That growth has now slowed he said.

SBU has had increased competition for its workers' compensation product from traditional insurers and lower rates especially in Massachusetts, he said.

"Despite the lower level of earnings expected in the quarter, we still expect to record an operating profit,'' he said.

"We continue to experience lower levels of fees from the reduced pace of programme business for the remainder of 1999 and into 2000. We believe, however, that the pricing will firm and then our corporate risk management business will grow as a result.'' Robert Mulderig