DUBLIN, Ireland, Aug. 6, 2014 /PRNewswire/ -- Global Indemnity plc (NASDAQ: GBLI) today reported net income for the three months ended June 30, 2014 of $33.2 million or $1.31 per share compared to net income of $8.7 million or $0.34 per share at June 30, 2013. Net income for the six months ended June 30, 2014 was $42.0 million or $1.66 per share compared to net income of $21.0 million or $0.84 per share at June 30, 2013. As of June 30th, book value per share was $35.43, an increase of 1.8% compared to book value per share of $34.82 at March 31, 2014, and an increase of 2.3% compared to book value per share of $34.65 at December 31, 2013.
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Selected Operating and Balance Sheet Data (Dollars in millions, except per share data)
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||
Gross Premiums Written |
$ |
82.9 |
$ |
84.2 |
$ |
160.1 |
$ |
159.2 |
|||
Net Premiums Written |
$ |
76.4 |
$ |
78.3 |
$ |
149.2 |
$ |
149.8 |
|||
Net income |
$ |
33.2 |
$ |
8.7 |
$ |
42.0 |
$ |
21.0 |
|||
Net income per share |
$ |
1.31 |
$ |
0.34 |
$ |
1.66 |
$ |
0.84 |
|||
Operating income |
$ |
8.8 |
$ |
6.8 |
$ |
18.5 |
$ |
15.4 |
|||
Operating income per share |
$ |
0.35 |
$ |
0.27 |
$ |
0.73 |
$ |
0.61 |
|||
Combined ratio analysis: |
|||||||||||
Loss ratio |
58.0 |
59.5 |
57.5 |
58.2 |
|||||||
Expense ratio |
41.2 |
41.7 |
40.2 |
42.7 |
|||||||
Combined ratio |
99.2 |
101.2 |
97.7 |
100.9 |
As of June 30, 2014 |
As of March 31, 2014 |
As of December 31, 2013 |
|||
Book value per share |
$ 35.43 |
$ 34.82 |
$ 34.65 |
||
Shareholders' equity |
$ 896.8 |
$ 880.8 |
$ 873.3 |
||
Cash and invested assets (1) |
$ 1,602.5 |
$ 1,552.8 |
$ 1,568.1 |
||
(1) Including receivable/(payable) for securities sold/(purchased) |
Cynthia Y. Valko, Chief Executive Officer, commented: "For the first six months of 2014, despite numerous weather related losses suffered by clients as a result of this year's unusually harsh winter, Global Indemnity continued to enhance profitability, as reflected by its 98% combined ratio and 20% increase in Operating Income (which excludes the company's substantial realized and unrealized investment portfolio capital gains). While premium revenue from small business property and general liability lines increased 10% and program lines grew by 7%, overall revenue growth was muted as a result of challenging competitive pressures, particularly in respect of catastrophe exposed property risks."
About Global Indemnity plc and its subsidiaries
Global Indemnity plc (NASDAQ: GBLI), through its several direct and indirect wholly owned subsidiary insurance and reinsurance companies, provides both admitted and non-admitted specialty property and casualty insurance coverages in the United States, as well as reinsurance worldwide. Global Indemnity plc's two primary segments are:
- United States Based Insurance Operations
- Bermuda Based Reinsurance Operations
For more information, visit the Global Indemnity plc website at http://www.globalindemnity.ie.
Teleconference and Webcast for Interested Parties
Cynthia Valko, Chief Executive Officer of Global Indemnity plc, and Thomas McGeehan, Chief Financial Officer of Global Indemnity plc, will conduct a teleconference for interested parties on August 7, 2014 at 8:30 a.m. Eastern Time to discuss the second quarter 2014 results.
To participate in the teleconference, please telephone (800) 288-8967 (U.S. and Canada) or (612) 332-0523 (International) and you will be greeted by an operator. Please reference Global Indemnity plc Earnings Release Call or the host Cynthia Valko.
The teleconference is being webcast by AT&T and can be accessed at the company's website at www.globalindemnity.ie. Please access the site at least 15 minutes prior to the teleconference to register, click on the Webcast link, enter Conference ID number 333025 and click GO. Please download and install any necessary software.
The teleconference will be available for replay beginning at 10:30 a.m. Eastern Time on August 7, 2014 until 11:59 p.m. August 7, 2015. To listen to the replay, please telephone (800) 475-6701 (U.S. and Canada) or (320) 365-3844 (International) then enter 333025.
Forward-Looking Information
Forward-looking statements contained in this press release are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. We caution investors that our actual results may be materially different from the estimates expressed in, or implied, or projected by, the forward looking statements. Please see our periodic reports filed with the Securities and Exchange Commission for a discussion of the risks and uncertainties which may affect us and for a more detailed discussion of our cautionary note regarding forward-looking statements.
Global Indemnity plc's Combined Ratio for the Six Months Ended June 30, 2014 and 2013
The combined ratio is a key measure of insurance profitability. The components comprising the combined ratio are as follows:
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||
2014 |
2013 |
2014 |
2013 |
||||
Loss Ratio: |
|||||||
Current Accident Year |
|||||||
Excluding Catastrophes |
44.4 |
46.1 |
47.4 |
49.7 |
|||
Catastrophes |
19.7 |
14.6 |
14.7 |
11.4 |
|||
Current Accident Year |
64.1 |
60.7 |
62.1 |
61.1 |
|||
Changes to Prior Accident Year |
(6.1) |
(1.2) |
(4.6) |
(2.9) |
|||
Loss Ratio – Calendar Year |
58.0 |
59.5 |
57.5 |
58.2 |
|||
Expense Ratio |
41.2 |
41.7 |
40.2 |
42.7 |
|||
Combined Ratio |
99.2 |
101.2 |
97.7 |
100.9 |
For the three months ended June 30th, the calendar year loss ratio decreased by 1.5 points to 58.0 in 2014 from 59.5 in 2013.
For the three months ended June 30, 2014, the current accident year loss ratio increased to 64.1 compared to 60.7 for the same period in 2013. Excluding catastrophes, the current accident year loss ratio decreased 1.7 points, from 46.1 in 2013 to 44.4 in 2014.
- The current accident year property loss ratio increased 6.9 points to 58.6 in 2014 from 51.7 in 2013. Excluding catastrophes the current accident year property loss ratio decreased 0.6 points, from 29.9 in 2013 to 29.3 in 2014.
- The current accident year casualty loss ratio decreased 2.0 points to 75.3 in 2014 from 77.3 in 2013.
Calendar year results for the three months ended include a 6.1 point reduction in the loss ratio related to prior accident years, which was primarily driven by better than expected emergence in the professional and general liability lines.
For the three months ended June 30th, the expense ratio decreased from 41.7 in 2013 to 41.2 in 2014.
The decrease is primarily due to growth in earned premium volume in the Insurance Operations.
For the six months ended June 30th, the calendar year loss ratio decreased by 0.7 points to 57.5 in 2014 from 58.2 in 2013.
For the six months ended June 30, 2014, the current accident year loss ratio increased 1.0 points to 62.1 compared to 61.1 for the same period in 2013. Excluding catastrophes, the current accident year loss ratio decreased 2.3 points, from 49.7 in 2013 to 47.4 in 2014.
- The current accident year property loss ratio increased 2.8 points to 56.6 in 2014 from 53.8 in 2013. Excluding catastrophes the current accident year property loss ratio decreased 1.7 points, from 36.3 in 2013 to 34.6 in 2014.
- The current accident year casualty loss ratio decreased 1.4 points to 73.3 in 2014 from 74.7 in 2013.
Calendar year results for the six months ended include a 4.6 point reduction in the loss ratio related to prior accident years, which was primarily driven by better than expected emergence in the professional and general liability lines.
For the six months ended June 30th, the expense ratio decreased from 42.7 in 2013 to 40.2 in 2014.
The decrease in the expense ratio is primarily due to growth in earned premium volume in both the Insurance and Reinsurance Operations.
Global Indemnity plc's Gross and Net Premiums Written Results by Segment
(Dollars in thousands) |
Three Months Ended June 30, |
|||||||
Gross Premiums Written |
Net Premiums Written |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
Insurance Operations |
$ 60,556 |
$ 61,879 |
$ 55,039 |
$ 56,387 |
||||
Reinsurance Operations |
22,349 |
22,366 |
21,333 |
21,959 |
||||
Total |
$ 82,905 |
$ 84,245 |
$ 76,372 |
$ 78,346 |
Six Months Ended June 30, |
||||||||
Gross Premiums Written |
Net Premiums Written |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
Insurance Operations |
$ 113,548 |
$ 112,967 |
$ 103,695 |
$ 104,015 |
||||
Reinsurance Operations |
46,554 |
46,217 |
45,538 |
45,809 |
||||
Total |
$ 160,102 |
$ 159,184 |
$ 149,233 |
$ 149,824 |
Insurance Operations: For the three months ended June 30, 2014, gross premiums written and net premiums written decreased 2.1% and 2.4%, respectively, compared to the same period in 2013. Excluding commercial auto business ($0.7 million in 2014), gross premiums written and net premiums written increased approximately 5.0% compared to the same period in 2013. Growth was realized in small business, property brokerage, and programs.
For the six months ended June 30, 2014, gross premiums written increased 0.5% and net written premiums decreased by 0.3% compared to the same period in 2013. Excluding commercial auto business ($2.0 million in 2014), gross premiums written and net premiums written increased approximately 6.0% compared to the same period in 2013. Growth was realized in small business and programs.
Reinsurance Operations: For the three months ended June 30, 2014, gross premiums written and net premiums written decreased 0.1% and 2.9%, respectively, compared to the same period in 2013.
For the six months ended June 30, 2014, gross premiums written increased 0.7% and net written premiums decreased 0.6% compared to the same period in 2013.
Global Indemnity plc |
|||||||
Consolidated Statements of Operations |
|||||||
(Unaudited) |
|||||||
(Dollars and shares in thousands, except per share data) |
|||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||
2014 |
2013 |
2014 |
2013 |
||||
Gross premiums written |
$ 82,905 |
$ 84,245 |
$ 160,102 |
$ 159,184 |
|||
Net premiums written |
$ 76,372 |
$ 78,346 |
$ 149,233 |
$ 149,824 |
|||
Net premiums earned |
$ 66,017 |
$ 58,671 |
$ 133,561 |
$ 114,667 |
|||
Net investment income |
7,677 |
9,765 |
15,961 |
19,799 |
|||
Net realized investment gains |
39,881 |
2,806 |
39,068 |
8,563 |
|||
Other income (loss) |
155 |
247 |
323 |
301 |
|||
Total revenues |
113,730 |
71,489 |
188,913 |
143,330 |
|||
Net losses and loss adjustment expenses |
38,270 |
34,924 |
76,842 |
66,712 |
|||
Acquisition costs and other underwriting expenses |
27,171 |
24,472 |
53,656 |
48,949 |
|||
Corporate and other operating expenses |
3,172 |
2,472 |
6,133 |
4,817 |
|||
Interest expense |
319 |
1,181 |
510 |
2,354 |
|||
Income before income taxes |
44,798 |
8,440 |
51,772 |
20,498 |
|||
Income tax expense (benefit) |
11,590 |
(224) |
9,741 |
(531) |
|||
Net income |
$ 33,208 |
$ 8,664 |
$ 42,031 |
$ 21,029 |
|||
Weighted average shares outstanding–basic |
25,128 |
25,050 |
25,121 |
25,052 |
|||
Weighted average shares outstanding–diluted |
25,313 |
25,119 |
25,302 |
25,121 |
|||
Net income per share – basic |
$ 1.32 |
$ 0.35 |
$ 1.67 |
$ 0.84 |
|||
Net income per share – diluted |
$ 1.31 |
$ 0.34 |
$ 1.66 |
$ 0.84 |
|||
Combined ratio analysis: |
|||||||
Loss ratio |
58.0 |
59.5 |
57.5 |
58.2 |
|||
Expense ratio |
41.2 |
41.7 |
40.2 |
42.7 |
|||
Combined ratio |
99.2 |
101.2 |
97.7 |
100.9 |
The loss ratio, expense ratio and combined ratio are GAAP financial measures that are generally viewed in the insurance industry as indicators of underwriting profitability. The loss ratio is the ratio of net losses and loss adjustment expenses to net premiums earned. The expense ratio is the ratio of acquisition costs and other underwriting expenses to net premiums earned. The combined ratio is the sum of the loss and expense ratios.
GLOBAL INDEMNITY PLC |
||||||
CONSOLIDATED BALANCE SHEETS |
||||||
(Dollars in thousands) |
||||||
ASSETS |
(Unaudited) June 30, 2014 |
December 31, 2013 |
||||
Fixed Maturities: |
||||||
Available for sale securities, at fair value (amortized cost: 2014 - $1,187,660 and 2013 - $1,187,685) |
$ 1,205,713 |
$ 1,204,364 |
||||
Equity securities: |
||||||
Available for sale, at fair value (cost: 2014 - $95,021 and 2013 - $191,425) |
125,010 |
254,070 |
||||
Other invested assets: |
||||||
Available for sale securities, at fair value (cost: 2014 - $15,040 and 2013 - $3,065) |
15,034 |
3,489 |
||||
Total investments |
1,345,757 |
1,461,923 |
||||
Cash and cash equivalents |
118,353 |
105,492 |
||||
Premiums receivable, net |
70,459 |
49,888 |
||||
Reinsurance receivables, net |
182,042 |
197,887 |
||||
Funds held by ceding insurers |
25,822 |
18,662 |
||||
Deferred federal income taxes |
13,891 |
4,206 |
||||
Deferred acquisition costs |
26,864 |
22,177 |
||||
Intangible assets |
17,813 |
17,990 |
||||
Goodwill |
4,820 |
4,820 |
||||
Prepaid reinsurance premiums |
6,486 |
5,199 |
||||
Receivable for securities sold |
138,359 |
723 |
||||
Other assets |
27,021 |
22,812 |
||||
Total assets |
$ 1,977,687 |
$ 1,911,779 |
||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||
Liabilities: |
||||||
Unpaid losses and loss adjustment expenses |
$ 754,595 |
$ 779,466 |
||||
Unearned premiums |
133,589 |
116,629 |
||||
Federal income taxes payable |
6,610 |
1,595 |
||||
Ceded balances payable |
5,896 |
5,177 |
||||
Contingent commissions |
10,622 |
12,677 |
||||
Margin borrowing facility |
142,560 |
100,000 |
||||
Other liabilities |
26,987 |
22,955 |
||||
Total liabilities |
1,080,859 |
1,038,499 |
||||
Shareholders' equity: |
||||||
Ordinary shares, $0.0001 par value, 900,000,000 ordinary shares authorized; A ordinary shares issued: 16,313,147 and 16,200,406 respectively; A ordinary shares outstanding: 13,248,332 and 13,141,035, respectively; B ordinary shares issued and outstanding: 12,061,370 and 12,061,370, respectively |
3 |
3 |
||||
Additional paid-in capital |
518,336 |
516,653 |
||||
Accumulated other comprehensive income, net of taxes |
34,001 |
54,028 |
||||
Retained earnings |
445,892 |
403,861 |
||||
A ordinary shares in treasury, at cost: 3,064,815 and 3,059,371 shares, respectively |
(101,404) |
(101,265) |
||||
Total shareholders' equity |
896,828 |
873,280 |
||||
Total liabilities and shareholders' equity |
1,977,687 |
$ 1,911,779 |
||||
GLOBAL INDEMNITY PLC |
|||
SELECTED INVESTMENT DATA |
|||
(Dollars in millions) |
|||
Market Value as of |
|||
(Unaudited) June 30, 2014 |
December 31, 2013 |
||
Fixed Maturities |
$ 1,205.7 |
$ 1,204.4 |
|
Cash and cash equivalents |
118.4 |
105.5 |
|
Total bonds and cash and cash equivalents |
1,324.1 |
1,309.9 |
|
Equities and other invested assets |
140.0 |
257.5 |
|
Total cash and invested assets, gross |
1,464.1 |
1,567.4 |
|
Receivable / (payable) for securities |
138.4 |
0.7 |
|
Total cash and invested assets, net |
$ 1,602.5 |
$ 1,568.1 |
(Unaudited) Three Months Ended June 30, 2014 (a) |
(Unaudited) Six Months Ended June 30, 2014 (a) |
||
Net investment income |
$ 7.7 |
$ 16.0 |
|
Net realized investment gains |
39.9 |
39.1 |
|
Net unrealized investment loss |
(29.2) |
(31.8) |
|
Net realized and unrealized investment returns |
10.7 |
7.3 |
|
Total investment return |
$ 18.4 |
$ 23.3 |
|
Average total cash and invested assets (b) |
$ 1,577.6 |
$ 1,585.3 |
|
Total investment return % annualized |
4.7% |
2.9% |
|
(a) Amounts in this table are shown on a pre-tax basis. |
|||
(b) Simple average of beginning and end of period, net of payable/receivable for securities. |
GLOBAL INDEMNITY PLC |
||||||||
SUMMARY OF OPERATING INCOME |
||||||||
(Unaudited) |
||||||||
(Dollars and shares in thousands, except per share data) |
||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
Operating income |
$ 8,758 |
$ 6,840 |
$ 18,522 |
$ 15,377 |
||||
Adjustments: |
||||||||
Net realized investment gains, net of tax |
24,450 |
1,824 |
23,509 |
5,652 |
||||
Total after-tax adjustments |
24,450 |
1,824 |
23,509 |
5,652 |
||||
Net income |
$ 33,208 |
$ 8,664 |
$ 42,031 |
$ 21,029 |
||||
Weighted average shares outstanding – basic |
25,128 |
25,050 |
25,121 |
25,052 |
||||
Weighted average shares outstanding – diluted |
25,313 |
25,119 |
25,302 |
25,121 |
||||
Operating income per share – basic |
$ 0.35 |
$ 0.27 |
$ 0.74 |
$ 0.61 |
||||
Operating income per share – diluted |
$ 0.35 |
$ 0.27 |
$ 0.73 |
$ 0.61 |
||||
Note Regarding Operating Income
Operating income, a non-GAAP financial measure, is equal to net income excluding after-tax net realized investment gains (losses). Operating income is not a substitute for net income determined in accordance with GAAP, and investors should not place undue reliance on this measure.
Contact: |
Media |
Linda Hohn |
|
Associate General Counsel |
|
+1-610-660-6862 |
|
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