FORT LAUDERDALE, Fla.,
Feb. 25, 2015 /PRNewswire/
-- Universal Insurance Holdings, Inc. (NYSE: UVE) (or
the "Company") today reported record fourth quarter net income in
2014 of $21.0 million, or
$0.59 diluted earnings per share
(diluted EPS), an increase of $5.4
million, or 35 percent, compared to net income of
$15.6 million, or $0.44 diluted EPS, for the same period in
2013.
For the full year of 2014, the Company reported record net
income of $73.0 million, or
$2.08 diluted EPS, an increase of
$14.0 million, or 24 percent,
compared to net income of $59.0, or
$1.56 diluted EPS, for the same
period of 2013.
"Our record fourth quarter and full year results concluded a
year in which we delivered increasing profits and significant
returns to shareholders," said Sean P.
Downes, the Company's Chairman, President and Chief
Executive Officer. "We generated strong operational and financial
momentum in 2014 thanks to a focus on maintaining high underwriting
standards and securing profitable, rate adequate business. Our
geographic expansion efforts, a key driver of our growth strategy,
also remained on track. We received approval to write business in
Delaware and Indiana in 2014 and more recently in
Pennsylvania, and achieved
increases in policy count during 2014 in all states, including
Florida. Our decision in 2014 to
reduce our quota share reinsurance allowed us to retain a greater
portion of our business and increase profitability. We enter 2015
with a clear opportunity to build on this operational
momentum. The proceeds from our recent transaction with
Nephila Capital coupled with our healthy balance sheet position us
to lower our quota share percentage to zero. This change will
enable us to retain 100% of our business, an estimated additional
$230 million of our own organically
grown premium, and further drive profitability and shareholder
value."
Fourth-Quarter 2014 & Recent Highlights
- Earned premiums grew by $28.9
million to $95.4 million.
- Total revenues increased by $26.9
million to $104.5
million.
- Net income and diluted EPS grew by $5.4
million and $0.15,
respectively, compared to Q4 2014.
- Sold 1 million registered shares of UVE common stock at a price
of $19.00 per share
in a privately negotiated transaction on December 2, 2014.
- Paid fourth quarter dividend of $0.25 per share, resulting in total payments of
$0.55 per share in dividends in
2014.
- The Pennsylvania Insurance Department issued a Certificate of
Authority in January 2015 to UPCIC, a
wholly-owned subsidiary of Universal Insurance Holdings, Inc.,
approving UPCIC as a licensed insurance entity in the state of
Pennsylvania.
- Wrote first homeowners insurance policy in Indiana in January
2015.
Fourth-Quarter 2014 Results
The increase in the
Company's net income for the fourth quarter of 2014 of $5.4 million, compared to the same period in
2013, primarily reflects an increase in net earned premiums,
partially offset by increases in operating expenses. Earned
premiums, total revenues, net income and diluted EPS were higher
than any other fourth quarter in the Company's history.
Diluted earnings per share for the fourth quarter of 2014
increased by $0.15, or 34 percent,
compared to the full year of 2013.
Full-Year 2014 Results
For the full year of 2014, the
Company's net income increased by $14.0
million, or 24 percent, compared to the same period in 2013.
Earned premiums, total revenues, net income and diluted EPS were
higher than any other year in the Company's history.
Diluted earnings per share for the full year of 2014 increased
by $0.52, or 33 percent, compared to
the full year of 2013. In addition to the increase in net
income, diluted EPS benefited from lower outstanding shares as a
result of the cumulative share repurchases made by the Company.
Share Repurchases
For the full year of 2014, the
Company repurchased 2,391,208 shares of its common stock at an
average price of $12.42 per share. As
announced on September 25, 2014, the
Company completed its $10 million
share repurchase program announced on June
17, 2014, having repurchased a total of 758,361 shares of
common stock in the open market at an average price of $13.15 per share. Additionally, the Company sold
1 million registered shares of common stock at a price of
$19.00 per share in a privately
negotiated transaction on December 2,
2014.
The Company noted that the completion of its share repurchase
program and the sale of treasury shares underscores its confident
outlook, solid financial position and commitment to effectively
deploying capital when it sees clear value. The shares were sold
out of treasury at a significant premium to the cost of the shares,
thereby adding significant value for Universal shareholders.
The Board of Directors and management team expect to continue to
consider ways to enhance shareholder value, both through strategic
growth initiatives and capital returns to shareholders.
Cash Dividends
On November 10,
2014, the Company announced that its board of directors
declared a cash dividend of $0.25 per
share of common stock, which was paid on December 15, 2014 to shareholders of record on
December 5, 2014. The $0.25 per share dividend includes the expected
$0.10 per share fourth quarter
dividend, in line with the dividends paid for each of the first
three quarters of 2014, and an additional special dividend of
$0.15 per share.
On January 13, 2015, the Company
announced that its board of directors had declared an increased
cash dividend of $0.12 per share of
common stock up $0.02 from the
$0.10 per share paid the past three
quarters. Payment will be made on March 2,
2015 to shareholders of record on February 18, 2015. If declared and paid as
intended, the annual aggregate dividend in 2015 will be
$0.48 for each common share.
Financial Results Presentation
The Company will make
available an audio recording of a presentation discussing its
fourth quarter and full-year 2014 financial results on Wednesday, February 25, 2015, at approximately
5:00 p.m. Eastern. The presentation
will be pre-recorded and there will be no opportunity for live
questions. The audio recording will be available at
www.universalinsuranceholdings.com until March 25, 2015.
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, Maryland, Delaware and Indiana. American Platinum Property and
Casualty Insurance Company, 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, 2014.
UNIVERSAL
INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
BALANCE SHEETS (Unaudited)
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
December
31,
|
ASSETS
|
|
2014
|
|
2013
|
Cash and cash
equivalents
|
|
$
115,397
|
|
$ 117,275
|
Restricted cash and
cash equivalents
|
|
2,635
|
|
2,600
|
Fixed maturities, at
fair value
|
|
353,949
|
|
289,418
|
Equity securities, at
fair value
|
|
19,642
|
|
65,022
|
Short-term
investments, at fair value
|
|
49,990
|
|
—
|
Prepaid reinsurance
premiums
|
|
190,505
|
|
241,214
|
Reinsurance
recoverable
|
|
55,187
|
|
107,847
|
Reinsurance
receivable, net
|
|
7,468
|
|
203
|
Premiums receivable,
net
|
|
50,987
|
|
46,461
|
Other
receivables
|
|
2,763
|
|
2,587
|
Property and
equipment, net
|
|
17,254
|
|
9,289
|
Deferred policy
acquisition costs, net
|
|
25,660
|
|
15,899
|
Income taxes
recoverable
|
|
5,675
|
|
8,152
|
Deferred income tax
asset, net
|
|
11,850
|
|
12,051
|
Other
assets
|
|
2,812
|
|
2,072
|
Total assets
|
|
$
911,774
|
|
$ 920,090
|
LIABILITIES, CONTINGENTLY REDEEMABLE
COMMON STOCK AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
LIABILITIES:
|
|
|
|
|
Unpaid losses and
loss adjustment expenses
|
|
$
134,353
|
|
$ 159,222
|
Unearned
premiums
|
|
395,748
|
|
383,488
|
Advance
premium
|
|
17,919
|
|
22,959
|
Accounts
payable
|
|
4,121
|
|
3,441
|
Book
overdraft
|
|
5,924
|
|
14,947
|
Reinsurance payable,
net
|
|
66,066
|
|
86,232
|
Income taxes
payable
|
|
1,799
|
|
2,566
|
Other liabilities and
accrued expenses
|
|
36,318
|
|
34,386
|
Long-term
debt
|
|
30,610
|
|
37,240
|
Total liabilities
|
|
692,858
|
|
744,481
|
Contingently
redeemable common stock (pro-forma
12/31/14
balance of zero)1
|
|
19,000
|
|
—
|
Issued shares -
1,000
|
|
|
|
|
Outstanding shares -
1,000
|
|
|
|
|
STOCKHOLDERS'
EQUITY:
|
|
|
|
|
Cumulative
convertible preferred stock, $.01 par value
|
|
—
|
|
—
|
Authorized shares -
1,000
|
|
|
|
|
Issued shares - 12 and
30
|
|
|
|
|
Outstanding shares - 12 and
30
|
|
|
|
|
Minimum liquidation
preference, $8.49 and $6.98 per share
|
|
|
|
|
Common stock, $.01
par value
|
|
448
|
|
436
|
Authorized shares -
55,000
|
|
|
|
|
Issued shares - 43,769 and
43,641
|
|
|
|
|
Outstanding shares - 34,102
and 35,366
|
|
|
|
|
Treasury shares, at
cost - 9,667 and 8,275
|
|
(62,153)
|
|
(35,467)
|
Additional paid-in
capital (pro-forma 12/31/14 balance of
$60.0
million)1
|
|
40,987
|
|
42,282
|
Accumulated other
comprehensive income (loss), net of taxes
|
|
(1,835)
|
|
(376)
|
Retained
earnings
|
|
222,469
|
|
168,734
|
Total stockholders' equity (pro-forma 12/31/14
balance of $218.9
million)1
|
|
199,916
|
|
175,609
|
Total liabilities, contingently redeemable
common stock
and stockholders' equity
|
|
$
911,774
|
|
$ 920,090
|
|
|
|
|
|
|
|
1 As
disclosed in the Company's Form 10-K filed earlier today with the
Securities and Exchange Commission, on February 19, 2015, the
Company modified the terms of a previously disclosed agreement with
a third party relating to the sale of 1 million registered shares
of UVE common stock which resulted in a reclassification of
mezzanine equity to permanent equity. As a result of this
reclassification, the pro-forma balance of contingently redeemable
common stock, additional paid-in capital and stockholders equity as
of December 31, 2014 is zero, $60.0 million and $218.9 million,
respectively.
|
UNIVERSAL
INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF INCOME (Unaudited)
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
December
31,
|
|
|
2014
|
|
2013
|
PREMIUMS EARNED AND
OTHER REVENUES
|
|
|
|
|
Direct premiums
written
|
|
$ 182,216
|
|
$ 173,730
|
Ceded premiums
written
|
|
(98,106)
|
|
(121,941)
|
Net premiums
written
|
|
84,110
|
|
51,789
|
Change in net
unearned premium
|
|
11,310
|
|
14,663
|
Premiums earned,
net
|
|
95,420
|
|
66,452
|
Net investment income
(expense)
|
|
801
|
|
1,397
|
Net realized gains (losses)
on investments
|
|
274
|
|
1,242
|
Net change in unrealized
gains (losses) on investments
|
|
—
|
|
(62)
|
Commission
revenue
|
|
3,323
|
|
4,178
|
Policy fees
|
|
3,155
|
|
2,924
|
Other revenue
|
|
1,509
|
|
1,449
|
Total premiums earned
and other revenues
|
|
104,482
|
|
77,580
|
OPERATING COSTS AND
EXPENSES
|
|
|
|
|
Losses and loss adjustment
expenses
|
|
34,590
|
|
28,598
|
General and administrative
expenses
|
|
32,966
|
|
22,989
|
Total operating costs
and expenses
|
|
67,556
|
|
51,587
|
INCOME BEFORE INCOME
TAXES
|
|
36,926
|
|
25,993
|
Income taxes,
current
|
|
15,665
|
|
8,776
|
Income taxes,
deferred
|
|
289
|
|
1,635
|
Income
taxes, net
|
|
15,954
|
|
10,411
|
NET INCOME
|
|
$ 20,972
|
|
$ 15,582
|
Basic earnings per
common share
|
|
$
0.63
|
|
$
0.46
|
Weighted average
common shares outstanding - Basic
|
|
33,457
|
|
33,602
|
Fully diluted
earnings per common share
|
|
$
0.59
|
|
$
0.44
|
Weighted average
common shares outstanding - Diluted
|
|
35,271
|
|
35,685
|
Cash dividend
declared per common share
|
|
$
0.25
|
|
$
0.23
|
UNIVERSAL
INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF INCOME (Unaudited)
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
December
31,
|
|
|
2014
|
|
2013
|
PREMIUMS EARNED AND
OTHER REVENUES
|
|
|
|
|
Direct premiums
written
|
|
$ 789,577
|
|
$ 783,894
|
Ceded premiums
written
|
|
(399,730)
|
|
(522,116)
|
Net premiums
written
|
|
389,847
|
|
261,778
|
Change in net
unearned premium
|
|
(62,970)
|
|
5,877
|
Premiums earned,
net
|
|
326,877
|
|
267,655
|
Net investment income
(expense)
|
|
2,375
|
|
1,928
|
Net realized gains (losses)
on investments
|
|
5,627
|
|
(14,740)
|
Net change in unrealized
gains (losses) on investments
|
|
—
|
|
7,850
|
Commission
revenue
|
|
14,205
|
|
18,615
|
Policy fees
|
|
13,982
|
|
13,661
|
Other revenue
|
|
6,210
|
|
6,190
|
Total premiums earned
and other revenues
|
|
369,276
|
|
301,159
|
OPERATING COSTS AND
EXPENSES
|
|
|
|
|
Losses and loss adjustment
expenses
|
|
123,275
|
|
108,615
|
General and administrative
expenses
|
|
118,397
|
|
91,988
|
Total operating costs
and expenses
|
|
241,672
|
|
200,603
|
INCOME BEFORE INCOME
TAXES
|
|
127,604
|
|
100,556
|
Income taxes,
current
|
|
53,498
|
|
34,216
|
Income taxes,
deferred
|
|
1,118
|
|
7,363
|
Income
taxes, net
|
|
54,616
|
|
41,579
|
NET INCOME
|
|
$ 72,988
|
|
$ 58,977
|
Basic earnings per
common share
|
|
$
2.17
|
|
$
1.64
|
Weighted average
common shares outstanding - Basic
|
|
33,569
|
|
35,866
|
Fully diluted
earnings per common share
|
|
$
2.08
|
|
$
1.56
|
Weighted average
common shares outstanding - Diluted
|
|
35,150
|
|
37,776
|
Cash dividend
declared per common share
|
|
$
0.55
|
|
$
0.49
|
Investor Contact:
Andy Brimmer / Mahmoud Siddig
Joele Frank, Wilkinson Brimmer
Katcher
212-355-4449
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/universal-insurance-holdings-inc-reports-record-fourth-quarter-and-full-year-2014-financial-results-300041534.html
SOURCE Universal Insurance Holdings, Inc.