SOURCE: Universal Insurance Holdings, Inc.

Universal Insurance Holdings, Inc.

May 07, 2013 16:36 ET

Universal Insurance Holdings, Inc. Reports First-Quarter 2013 Financial Results

FORT LAUDERDALE, FL--(Marketwired - May 7, 2013) - Universal Insurance Holdings, Inc. (Company) (NYSE MKT: UVE) reported net income of $12.0 million, or $0.29 per diluted share, an increase of 20.8 percent, for the first quarter of 2013, compared to net income of $9.9 million, or $0.24 per diluted share, for the same period in 2012.

President and CEO Sean Downes commented, "Universal began 2013 with strong operating results driven by continued strengthening of underwriting margins. We are pleased to have delivered a 21 percent increase in first quarter 2013 net income versus last year. We have continued to follow our business model and if not for the first quarter 2013 investment losses, our results would have been significantly better. We believe we are well-positioned going forward as we have engaged Deutsche Bank Investment Asset Division to manage our investment portfolio."

First-Quarter 2013 Results
Direct premiums written collectively by Universal Property & Casualty Insurance Company and American Platinum Property and Casualty Insurance Company, the Company's wholly-owned insurance company subsidiaries, rose 7.4 percent during the first quarter of 2013. Net earned premiums grew $16.8 million, or 34.5 percent, in the first quarter of 2013 compared to the same quarter in 2012, primarily as a result of increases in premium rates over the past 24 months, and a reduction in the quota-share cession rate from 50 percent for the 2011-2012 reinsurance program to 45 percent for the 2012-2013 reinsurance program.

First-quarter 2013 operating costs increased by 8.3 percent compared to the same quarter last year, as general and administrative expenses increased $3.4 million, or 18.9 percent, while losses and loss adjustment expenses increased nominally by $0.3 million, or 1.2 percent.

At March 31, 2013, stockholders' equity was $172.1 million compared to $163.5 million at December 31, 2012, and $156.6 million at March 31, 2012.

Cash Dividends
On February 8, 2013, the Company announced that its board of directors declared a cash dividend of $0.08 per share of common stock, which was paid on April 5, 2013 to shareholders of record on March 14, 2013. 

Also, on April 18, 2013, the Company announced that its board of directors declared a cash dividend of $0.08 per share of common stock to be paid on June 17, 2013, to shareholders of record on June 3, 2013. The dividend declaration is consistent with the Company's previously announced intention to declare a dividend of $0.08 per share in the second, third and fourth quarters of 2013. If declared and paid as intended, the annual dividend in 2013 would be $0.32 for each common share.

About Universal Insurance Holdings, Inc.
Universal Insurance Holdings, Inc., with its wholly-owned subsidiaries, is a vertically integrated insurance holding company performing all aspects of insurance underwriting, distribution and claims. Universal Property & Casualty Insurance Company (UPCIC), a wholly-owned subsidiary of the Company, is one of the leading writers of homeowners insurance in Florida and is now fully licensed and has commenced its operations in North Carolina, South Carolina, Hawaii, Georgia, Massachusetts and Maryland. American Platinum Property and Casualty Insurance Company (APPCIC), also a wholly-owned subsidiary, currently writes homeowners multi-peril insurance on Florida homes valued in excess of $1 million, which are limits and coverages currently not targeted through its affiliate UPCIC. For additional information on the Company, please visit our investor relations website at www.universalinsuranceholdings.com.

Forward-Looking Statements and Risk Factors
This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such statements may include commentary on plans, products and lines of business, marketing arrangements, reinsurance programs and other business developments and assumptions relating to the foregoing. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future results could differ materially from those described and the Company undertakes no obligation to correct or update any forward-looking statements. For further information regarding risk factors that could affect the Company's operations and future results, refer to the Company's reports filed with the Securities and Exchange Commission, including the Form 10-K for the year ended December 31, 2012 and the Form 10-Q for the quarter ended March 31, 2013.

 
 
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES      
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)      
(in thousands, except per share data)   
 
    Three Months Ended March 31,  
    2013     2012  
PREMIUMS EARNED AND OTHER REVENUES            
Direct premiums written   $ 204,139     $ 190,003  
Ceded premiums written     (141,317 )     (163,434 )
Net premiums written     62,822       26,569  
Change in net unearned premium     2,587       22,071  
  Premiums earned, net     65,409       48,640  
  Net investment income (expense)     12       (36 )
  Net realized gains (losses) on investments (trading)     (16,037 )     (7,449 )
  Net change in unrealized gains (losses) on investments (trading)     7,874       9,187  
  Net foreign currency gains (losses) on investments     -       23  
  Commission revenue     4,986       4,541  
  Policy fees     3,687       3,901  
  Other revenue     1,524       1,440  
Total premiums earned and other revenues     67,455       60,247  
OPERATING COSTS AND EXPENSES                
  Losses and loss adjustment expenses     26,483       26,174  
  General and administrative expenses     21,210       17,844  
Total operating costs and expenses     47,693       44,018  
INCOME BEFORE INCOME TAXES     19,762       16,229  
  Income taxes, current     3,947       774  
  Income taxes, deferred     3,856       5,582  
    Income taxes, net     7,803       6,356  
NET INCOME   $ 11,959     $ 9,873  
                 
Basic earnings per common share   $ 0.30     $ 0.24  
Weighted average common shares outstanding - Basic     39,917       39,388  
                 
Fully diluted earnings per common share   $ 0.29     $ 0.24  
Weighted average common shares outstanding - Diluted     41,199       40,544  
                 
Cash dividend declared per common share   $ 0.08     $ 0.10  
                 
                 
 
 
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in thousands, except per share data)
 
    As of  
ASSETS   March 31, 2013     December 31, 2012  
Cash and cash equivalents   $ 482,876     $ 347,392  
Restricted cash and cash equivalents     2,653       33,009  
Fixed maturities (trading), at fair value     -       4,009  
Equity securities (trading), at fair value     -       85,041  
Fixed maturities (available for sale), at fair value     13,968       -  
Prepaid reinsurance premiums     252,479       239,921  
Reinsurance recoverable     87,231       89,191  
Reinsurance receivable, net     4,480       24,334  
Premiums receivable, net     50,832       50,125  
Receivable from securities sold     21,991       1,096  
Other receivables     2,269       2,017  
Property and equipment, net     9,128       8,968  
Deferred policy acquisition costs, net     17,377       17,282  
Income taxes recoverable     1,977       2,594  
Deferred income tax asset, net     15,322       19,178  
Other assets     1,540       1,578  
  Total assets   $ 964,123     $ 925,735  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
LIABILITIES:                
Unpaid losses and loss adjustment expenses   $ 182,528     $ 193,241  
Unearned premiums     398,042       388,071  
Advance premium     27,210       15,022  
Accounts payable     4,316       4,368  
Bank overdraft     27,068       25,994  
Payable for securities purchased     -       1,275  
Reinsurance payable, net     104,881       85,259  
Income taxes payable     -       699  
Dividends payable to shareholders     3,270       -  
Other liabilities and accrued expenses     24,811       28,071  
Long-term debt     19,853       20,221  
  Total liabilities     791,979       762,221  
                 
                 
STOCKHOLDERS' EQUITY:                
Cumulative convertible preferred stock, $.01 par value     1       1  
  Authorized shares - 1,000                
  Issued shares - 108                
  Outstanding shares - 108                
  Minimum liquidation preference, $2.66 per share                
Common stock, $.01 par value     417       419  
  Authorized shares - 55,000                
  Issued shares - 41,690 and 41,889                
  Outstanding shares - 40,672 and 40,871                
  Treasury shares, at cost - 1,018     (3,101 )     (3,101 )
Additional paid-in capital     38,631       38,684  
Retained earnings     136,196       127,511  
    Total stockholders' equity     172,144       163,514  
    Total liabilities and stockholders' equity   $ 964,123     $ 925,735  
                     
                     

Contact Information

  • Investor Contact:
    Philip Kranz
    Dresner Corporate Services
    312-780-7240
    Email Contact