Alea PLC yesterday reported a first half pretax loss of $10.7 million compared to a profit of $10.9 million in the first half of 2005 as it has stopped writing new and renewal reinsurance business since it was placed into run-off at the end of 2005 following the hurricane season.

The company said that it was still looking for a sale, in an effort to create shareholder value from the collapsed company, but would still continue to manage the portfolio in the meantime.

?A lot of people out there specialise in these sort of portfolios,? Mark Cloutier, Alea?s chief executive said.

?But currently we are concentrating on managing the portfolio and creating value for shareholders.?

First half net premium value fell to $209.7 million from $610.7 million first half of 2005, reflecting the company?s decision to stop writing business.

First half net asset value fell to $2.57 per share compared to $4.12 per share in the first half of 2005.

Following the announcement of the Group?s intention to cease underwriting and place its insurance operations into run-off, the Group adopted a run-off plan that includes a proactive cost management programme including consolidation of certain operations to improve operational efficiency.

The company said it is also planning an aggressive claims management and commutation strategy.

The key elements of the plan are to preserve net assets through effective management of the run-off of the Group?s balance sheet, manage other operating expenses and finance costs to levels less than or equal to investment income by year end 2007 and return capital to shareholders.

On September 1, Mr. Cloutier was appointed CEO of the Group and with Kirk Lusk, Group Chief Financial Officer, joined the Board of Directors.

?The Group?s performance for the first half of 2006 with respect to commutations is on plan. In addition, headcount and expenses are running as expected,? an Alea Group press release said.

?Notwithstanding our performance, there can be no certainty as to the timing or amounts of future distributions to shareholders.

?Any future distributions will be subject to execution of commutations on economic terms acceptable to the Group, appropriate regulatory approvals being obtained to fund intra-group distributions, applicable legal restrictions, repayment of the Group?s $150 million term loan and $50 million revolver and the retention of adequate capital to meet other obligations.

John Reeve, non-executive Chairman of the Board of Directors said: ?The first half of 2006 has been a challenging time for Alea, despite which the Group?s results and run-off strategy are on plan.

?The Group is making progress in its efforts to reduce volatility in the balance sheet while at the same time achieving the operating efficiencies needed to sustain a successful run-off.

?We are pleased with the partnership of Mark Cloutier as Group CEO and Kirk Lusk as Group CFO and welcome them as executive members of the Board of Directors.?

?The company has not proposed an interim dividend for 2006,? Mr. Cloutier added: ?The Group?s operating results excluding finance costs are slightly better than plan, which is encouraging given the significant changes implemented in the transition to run-off.

?We made considerable improvements in the areas of staff and organisational restructuring, claims and commutation strategies, and expense and cash flow management.

?Additional progress has been made with respect to reducing volatility in the portfolio and accelerating our exit from active exposures through commutations and unearned premium cut-offs.

?As we move ahead, we will remain keenly focused on expense reduction initiatives, further embedding of cash and claim management strategies, and an acceleration of commutation activity.?