05/02/2013 06:13 EDT | Updated 07/02/2013 05:12 EDT

Fairfax Financial Holdings reports first-quarter profit of $161.6 million

TORONTO - Fairfax Financial Holdings Ltd. (TSX:FFH) said it earned $161.6 million in its latest quarter, boosted by strong underwriting results and an income tax recovery.

The property and casualty insurance company, which keeps its books in U.S. dollars, said Thursday the profit amounted to $7.12 per diluted share for the quarter ended March 31 compared with a loss of $2.6 million or 76 cents per share a year ago.

Net earned premiums totalled $1.46 billion, up from $1.34 billion in the first quarter of 2012.

"We had a strong underwriting result in the first quarter of 2013 on increased premiums while maintaining disciplined underwriting," chairman and chief executive Prem Watsa said in a statement.

"We are maintaining our defensive equity hedges as we remain concerned about the financial markets and the economic outlook."

During the quarter, the company earned $9.4 million on its investments compared with a loss of $40.9 million a year ago.

Shares in the company, which reported its results after the end of trading Thursday, closed up $5.69 at $408.49.