• 2Q21 total revenue up 10.5% to $279.2 million
  • 2Q21 direct premiums written up 17.0%
  • 2Q21 diluted GAAP earnings per share (“EPS”) of $0.70, non-GAAP adjusted EPS1 of $0.65
  • 2Q21 combined ratio of 97.3%
  • 2Q21 annualized return on average equity of 18.7%
  • Florida primary average rate increase of 14.9% for UPCIC filed during 2Q21

Universal Insurance Holdings (NYSE: UVE) (the “Company”) reported 2021 second quarter diluted EPS of $0.70 on a GAAP basis and $0.65 on a non-GAAP1 adjusted basis. Quarterly direct premiums written were up 17.0% from the year-ago quarter to $473.6 million, with an annualized return on average equity of 18.7%.

1

 

Excludes net realized and unrealized gains and losses on investments as well as extraordinary reinstatement premiums and associated commissions (“non-GAAP adjusted EPS”). Reconciliations of GAAP to non-GAAP financial measures are provided in the attached tables.

“We delivered solid second quarter results, highlighted by an 18.7% annualized return on average equity, despite continued social inflation within the state of Florida impacting loss costs,” said Stephen J. Donaghy, Chief Executive Officer. “We continue to address these trends, in part, with primary rate increase filings, which was a driver of our direct written premium growth during the quarter. We expect primary rate increases to be a tailwind over the medium to long term as they earn-in, but are relentlessly focused on performing through the near term pressure on carriers in the Florida property insurance marketplace, and lament about the unfortunate derivative consequence of price increases on consumers.”

Summary Financial Results

($thousands, except per share data)

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2021

 

2020

 

Change

 

 

2021

 

2020

 

Change

(GAAP comparison)

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$

279,181

 

 

$

252,704

 

 

10.5

%

 

 

$

541,938

 

 

$

487,979

 

 

11.1

%

Income (loss) before income taxes

 

 

30,059

 

 

 

27,438

 

 

9.6

%

 

 

 

66,410

 

 

 

55,022

 

 

20.7

%

Income (loss) before income taxes margin

 

 

10.8

%

 

 

10.9

%

 

(10.0

)bps

 

 

 

12.3

%

 

 

11.3

%

 

1.0

pt

Diluted EPS

 

$

0.70

 

 

$

0.62

 

 

12.9

%

 

 

$

1.54

 

 

$

1.23

 

 

25.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annualized return on average equity (ROE)

 

 

18.7

%

 

 

15.6

%

 

3.1

pts

 

 

 

20.7

%

 

 

15.5

%

 

5.2

pts

Book value per share, end of period

 

$

15.37

 

 

$

16.56

 

 

(7.2

)%

 

 

$

15.37

 

 

$

16.56

 

 

(7.2

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Non-GAAP comparison)2

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating income

 

 

28,372

 

 

 

23,416

 

 

21.2

%

 

 

 

64,695

 

 

 

58,777

 

 

10.1

%

Adjusted EPS

 

$

0.65

 

 

$

0.52

 

 

25.0

%

 

 

$

1.50

 

 

$

1.32

 

 

13.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2 Reconciliation of GAAP to non-GAAP financial measures are provided in the attached tables. Adjusted operating income excludes net realized and unrealized gains and losses on investments, interest expense, and extraordinary reinstatement premiums and associated commissions. Non-GAAP adjusted EPS excludes net realized and unrealized gains and losses on investments, as well as extraordinary reinstatement premiums and associated commissions.

Total revenue grew double digits for the quarter driven primarily by rate increases from 2020 earning through the book as policies renew, an increase in policies-in-force when compared to the prior years quarter, and commissions earned on ceded premiums. Total revenue growth was partially offset by the impact of higher reinsurance costs when compared to 2020 and the investment portfolio’s performance. GAAP diluted EPS and non-GAAP adjusted EPS results for the quarter were driven primarily by an improvement in weather events when compared to the prior years quarter, and the benefit of a reduced share count, partially offset by the impact of loss cost trends on prior and current accident years. The Company produced an annualized return on average equity of 18.7%.

Underwriting

($thousands, except policies in force)

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2021

 

2020

 

Change

 

 

2021

 

2020

 

Change

Policies in force (as of end of period)

 

 

977,251

 

 

 

937,277

 

 

4.3

%

 

 

 

977,251

 

 

 

937,277

 

 

4.3

%

Premiums in force (as of end of period)

 

$

1,618,576

 

 

$

1,389,703

 

 

16.5

%

 

 

$

1,618,576

 

 

$

1,389,703

 

 

16.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct premiums written

 

$

473,627

 

 

$

404,685

 

 

17.0

%

 

 

$

838,941

 

 

$

739,238

 

 

13.5

%

Direct premiums earned

 

 

392,574

 

 

 

337,639

 

 

16.3

%

 

 

 

768,180

 

 

 

663,590

 

 

15.8

%

Net premiums earned

 

 

256,172

 

 

 

226,370

 

 

13.2

%

 

 

 

499,477

 

 

 

447,199

 

 

11.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expense ratio3

 

 

32.0

%

 

 

32.6

%

 

(60.0

)bps

 

 

 

32.9

%

 

 

32.8

%

 

10.0

bps

Loss & LAE ratio

 

 

65.3

%

 

 

66.9

%

 

(1.6

)pts

 

 

 

62.3

%

 

 

64.0

%

 

(1.7

)pts

Combined ratio

 

 

97.3

%

 

 

99.5

%

 

(2.2

)pts

 

 

 

95.2

%

 

 

96.8

%

 

(1.6

)pts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3 Expense ratio excludes interest expense.

Direct premiums written were up 17.0% for the quarter, led by direct premium growth of 19.6% in Florida.

On the expense side, the combined ratio improved 2.2 points for the quarter. The improvement was driven primarily by decreased weather events, partially offset by prior year's reserve development, current year strengthening and higher reinsurance costs impact on the ratio.

  • The expense ratio decreased 1.0 pointon a direct premiums earned basis due to continued focus on operating efficiencies, which was partially offset by the impact of increased reinsurance costs on the net ratio, resulting in a 60 basis point improvement in the net expense ratio for the quarter.
  • The net loss and LAE ratio improved 1.6 points for the quarter. Quarterly drivers include:
    • A 7.5 point net improvement related to no weather events being above plan.
    • Adverse prior year’s reserve development of $7.7 million ($0.5 million in 2Q20) resulted in a 2.8 point net increase for the quarter. Net adverse development in the current quarter was driven primarily by continued adjusting and settlement of non-CAT claims on prior accident years.
    • Core losses of $159.5 million for the quarter ($133.9 million in 2Q20) resulted in a 90 basis point increase on a direct premium earned basis, driven by current year strengthening, which was further magnified by the impact of increased reinsurance costs on the net ratio, which led to a 3.1 point increase for the quarter on a net basis.

Services

($thousands)

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2021

 

2020

 

Change

 

 

2021

 

2020

 

Change

Commission revenue

 

$

9,860

 

$

7,758

 

27.1

%

 

 

$

18,986

 

$

14,773

 

28.5

%

Policy fees

 

 

6,575

 

 

6,546

 

0.4

%

 

 

 

11,962

 

 

12,086

 

(1.0

)%

Other revenue

 

 

1,991

 

 

1,812

 

9.9

%

 

 

 

3,896

 

 

4,594

 

(15.2

)%

Total

 

$

18,426

 

$

16,116

 

14.3

%

 

 

$

34,844

 

$

31,453

 

10.8

%

Total services revenue increased 14.3% for the quarter. The increase was primarily driven by commission revenue earned on ceded premiums.

Investments

($thousands)

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2021

 

2020

 

Change

 

 

2021

 

2020

 

Change

Net investment income

 

$

2,858

 

$

6,179

 

(53.7

)%

 

 

$

5,844

 

$

13,013

 

 

(55.1

)%

Realized gains (losses)

 

 

496

 

 

168

 

195.2

%

 

 

 

1,038

 

 

467

 

 

122.3

%

Unrealized gains (losses)

 

 

1,229

 

 

3,871

 

(68.3

)%

 

 

 

735

 

 

(4,153

)

 

NM

 

NM = Not Meaningful

Net investment income decreased 53.7% for the quarter. The decrease is largely attributable to significantly lower yields on the reinvested portfolio following the sale of a majority of securities in the portfolio that were in an unrealized gain position in the third and fourth quarters of 2020.

Capital Deployment

On July 19, 2021, the Board of Directors declared a quarterly cash dividend of 16 cents per share of common stock, payable on August 9, 2021, to shareholders of record as of the close of business on August 2, 2021.

Guidance

The Company is maintaining its guidance for 2021 (assuming no further extraordinary weather events and no realized or unrealized gains in 2021):

  • GAAP and Non-GAAP Adjusted EPS in a range of $2.75 - $3.00
  • Annualized return on average equity in a range of 17.0% - 19.0%

Conference Call and Webcast

  • Thursday, July 29, 2021 at 9:00 a.m. ET
  • U.S. Dial-in Number: (855) 752-6647
  • International: (503) 343-6667
  • Participant code: 5571912
  • Listen to live webcast: UniversalInsuranceHoldings.com
  • Replay of the call will be available on the UVE website and by phone at (855) 859-2056 or internationally at (404) 537-3406 using the participant code: 5571912 through August 13, 2021

About Universal Insurance Holdings, Inc.

Universal Insurance Holdings (UVE) is a holding company offering property and casualty insurance and value-added insurance services. We develop, market, and write insurance products for consumers predominantly in the personal residential homeowners lines of business and perform substantially all other insurance-related services for our primary insurance entities, including risk management, claims management and distribution. We sell insurance products through both our appointed independent agents and through our direct online distribution channels in the United States across 19 states (primarily Florida). Learn more at UniversalInsuranceHoldings.com.

Non-GAAP Financial Measures and Key Performance Indicators

This press release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission (“SEC”), including adjusted earnings per diluted share, which excludes the impact of the net realized and unrealized gains and losses on investments as well as extraordinary reinstatement premiums and associated commissions. Extraordinary reinstatement premiums are not covered by reinstatement premium protection and attach just below the Florida Hurricane Catastrophe Fund (“FHCF”) reinsurance layer. Adjusted operating income excludes the impact of the net realized and unrealized gains and losses on investments, as well as interest expense and extraordinary reinstatement premiums and associated commissions. A “non-GAAP financial measure” is generally defined as a numerical measure of a company’s historical or future performance that excludes or includes amounts, or is subject to adjustments, so as to be different from the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles (“GAAP”). UVE management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. UVE management also believes that these non-GAAP financial measures enhance the ability of investors to analyze UVE’s business trends and to understand UVE’s performance. UVE’s management utilizes these non-GAAP financial measures as guides in long-term planning. Non-GAAP financial measures should be considered in addition to, and not as a substitute for or superior to, financial measures presented in accordance with GAAP. For more information regarding our key performance indicators, please refer to the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Key Performance Indicators” in our forthcoming Quarterly Report on Form 10-Q for the quarter ended June 30, 2021.

Forward-Looking Statements

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,” “will,” “plan,” 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, including those risks and uncertainties described under the heading “Risk Factors” and “Liquidity and Capital Resources” in our 2020 Annual Report on Form 10-K, and supplemented in our subsequent Quarterly Reports on Form 10-Q. Future results could differ materially from those described, and the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. 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 Company’s Annual Report on Form 10-K and the most recent quarterly reports on Form 10-Q.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except per share data)

 

 

 

June 30,

 

December 31,

 

 

2021

 

2020

ASSETS:

 

 

 

 

Invested Assets

 

 

 

 

Fixed maturities, at fair value

 

$

921,800

 

 

$

819,861

 

Equity securities, at fair value

 

 

95,690

 

 

 

84,887

 

Assets held for sale

 

 

7,053

 

 

 

 

Investment real estate, net

 

 

5,981

 

 

 

15,176

 

Total invested assets

 

 

1,030,524

 

 

 

919,924

 

Cash and cash equivalents

 

 

286,493

 

 

 

167,156

 

Restricted cash and cash equivalents

 

 

6,134

 

 

 

12,715

 

Prepaid reinsurance premiums

 

 

532,308

 

 

 

215,723

 

Reinsurance recoverable

 

 

196,294

 

 

 

160,417

 

Premiums receivable, net

 

 

74,072

 

 

 

66,883

 

Property and equipment, net

 

 

53,023

 

 

 

53,572

 

Deferred policy acquisition costs

 

 

115,971

 

 

 

110,614

 

Goodwill

 

 

2,319

 

 

 

2,319

 

Other assets

 

 

44,397

 

 

 

49,418

 

TOTAL ASSETS

 

$

2,341,535

 

 

$

1,758,741

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

LIABILITIES:

 

 

 

 

Unpaid losses and loss adjustment expenses

 

$

278,658

 

 

$

322,465

 

Unearned premiums

 

 

853,896

 

 

 

783,135

 

Advance premium

 

 

68,287

 

 

 

49,562

 

Reinsurance payable, net

 

 

581,818

 

 

 

10,312

 

Long-term debt

 

 

7,721

 

 

 

8,456

 

Other liabilities

 

 

70,313

 

 

 

135,549

 

Total liabilities

 

 

1,860,693

 

 

 

1,309,479

 

STOCKHOLDERS' EQUITY:

 

 

 

 

Cumulative convertible preferred stock ($0.01 par value) 4

 

 

 

 

 

 

Common stock ($0.01 par value) 5

 

 

470

 

 

 

468

 

Treasury shares, at cost - 15,695 and 15,680

 

 

(225,751

)

 

 

(225,506

)

Additional paid-in capital

 

 

105,904

 

 

 

103,445

 

Accumulated other comprehensive income (loss), net of taxes

 

 

(5,571

)

 

 

3,343

 

Retained earnings

 

 

605,790

 

 

 

567,512

 

Total stockholders' equity

 

 

480,842

 

 

 

449,262

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

2,341,535

 

 

$

1,758,741

 

 

 

 

 

 

Notes:

 

 

 

 

4 Cumulative convertible preferred stock ($0.01 par value): Authorized - 1,000 shares; Issued - 10 and 10 shares; Outstanding - 10 and 10 shares; Minimum liquidation preference - $9.99 and $9.99 per share.

5 Common stock ($0.01 par value): Authorized - 55,000 shares; Issued - 46,964 and 46,817 shares; Outstanding 31,269 and 31,137 shares.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

June 30,

 

 

2021

 

2020

 

 

2021

 

2020

REVENUES

 

 

 

 

 

 

 

 

 

Net premiums earned

 

$

256,172

 

$

226,370

 

 

$

499,477

 

$

447,199

 

Net investment income

 

 

2,858

 

 

6,179

 

 

 

5,844

 

 

13,013

 

Net realized gains/(losses) on investments

 

 

496

 

 

168

 

 

 

1,038

 

 

467

 

Net change in unrealized gains/(losses) of equity securities

 

 

1,229

 

 

3,871

 

 

 

735

 

 

(4,153

)

Commission revenue

 

 

9,860

 

 

7,758

 

 

 

18,986

 

 

14,773

 

Policy fees

 

 

6,575

 

 

6,546

 

 

 

11,962

 

 

12,086

 

Other revenue

 

 

1,991

 

 

1,812

 

 

 

3,896

 

 

4,594

 

Total revenues

 

 

279,181

 

 

252,704

 

 

 

541,938

 

 

487,979

 

 

 

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

 

 

 

Losses and loss adjustment expenses

 

 

167,221

 

 

151,345

 

 

 

311,184

 

 

286,393

 

Policy acquisition costs

 

 

56,766

 

 

48,524

 

 

 

113,224

 

 

95,388

 

Other operating expenses

 

 

25,097

 

 

25,380

 

 

 

51,062

 

 

51,107

 

Interest expense

 

 

38

 

 

17

 

 

 

58

 

 

69

 

Total expenses

 

 

249,122

 

 

225,266

 

 

 

475,528

 

 

432,957

 

 

 

 

 

 

 

 

 

 

 

Income before income tax expense

 

 

30,059

 

 

27,438

 

 

 

66,410

 

 

55,022

 

Income tax expense (benefit)

 

 

8,118

 

 

7,556

 

 

 

18,061

 

 

15,073

 

NET INCOME

 

$

21,941

 

$

19,882

 

 

$

48,349

 

$

39,949

 

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SHARE AND PER SHARE INFORMATION

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

June 30,

 

 

2021

 

2020

 

 

2021

 

2020

Weighted average common shares outstanding - basic

 

 

31,240

 

 

 

32,102

 

 

 

 

31,224

 

 

 

32,347

 

Weighted average common shares outstanding - diluted

 

 

31,310

 

 

 

32,170

 

 

 

 

31,292

 

 

 

32,440

 

Shares outstanding, end of period

 

 

31,269

 

 

 

31,853

 

 

 

 

31,269

 

 

 

31,853

 

Basic earnings (loss) per common share

 

$

0.70

 

 

$

0.62

 

 

 

$

1.55

 

 

$

1.23

 

Diluted earnings (loss) per common share

 

$

0.70

 

 

$

0.62

 

 

 

$

1.54

 

 

$

1.23

 

Cash dividend declared per common share

 

$

0.16

 

 

$

0.16

 

 

 

$

0.32

 

 

$

0.32

 

Book value per share, end of period

 

$

15.37

 

 

$

16.56

 

 

 

$

15.37

 

 

$

16.56

 

Annualized return on average equity (ROE)

 

 

18.7

%

 

 

15.6

%

 

 

 

20.7

%

 

 

15.5

%

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SUPPLEMENTARY INFORMATION

(in thousands, except for Policies In Force data)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

June 30,

 

 

2021

 

2020

 

 

2021

 

2020

Premiums

 

 

 

 

 

 

 

 

 

Direct premiums written - Florida

 

$

400,370

 

 

$

334,769

 

 

 

$

707,381

 

 

$

613,280

 

Direct premiums written - Other States

 

 

73,257

 

 

 

69,916

 

 

 

 

131,560

 

 

 

125,958

 

Direct premiums written - Total

 

$

473,627

 

 

$

404,685

 

 

 

$

838,941

 

 

$

739,238

 

Direct premiums earned

 

$

392,574

 

 

$

337,639

 

 

 

$

768,180

 

 

$

663,590

 

Net premiums earned

 

$

256,172

 

 

$

226,370

 

 

 

$

499,477

 

 

$

447,199

 

 

 

 

 

 

 

 

 

 

 

Underwriting Ratios - Net

 

 

 

 

 

 

 

 

 

Loss and loss adjustment expense ratio

 

 

65.3

%

 

 

66.9

%

 

 

 

62.3

%

 

 

64.0

%

Policy acquisition cost ratio

 

 

22.2

%

 

 

21.5

%

 

 

 

22.7

%

 

 

21.4

%

Other operating expense ratio6

 

 

9.8

%

 

 

11.2

%

 

 

 

10.2

%

 

 

11.4

%

General and administrative expense ratio6

 

 

32.0

%

 

 

32.6

%

 

 

 

32.9

%

 

 

32.8

%

Combined ratio

 

 

97.3

%

 

 

99.5

%

 

 

 

95.2

%

 

 

96.8

%

 

 

 

 

 

 

 

 

 

 

Other Items

 

 

 

 

 

 

 

 

 

(Favorable)/Unfavorable prior year's reserve development

 

$

7,731

 

 

$

478

 

 

 

$

6,494

 

 

$

4,819

 

 

Points on the loss and loss adjustment expense ratio

 

 

300

bps

 

 

21

bps

 

 

 

130

bps

 

 

108

bps

 

 

 

 

 

 

 

 

 

 

6 Expense ratio excludes interest expense.

 

 

As of

 

 

June 30,

 

 

2021

 

2020

Policies in force

 

 

 

 

Florida

 

 

723,390

 

 

696,829

Other States

 

 

253,861

 

 

240,448

Total

 

 

977,251

 

 

937,277

 

 

 

 

 

Premiums in force

 

 

 

 

Florida

 

$

1,345,532

 

$

1,144,326

Other States

 

 

273,044

 

 

245,377

Total

 

$

1,618,576

 

$

1,389,703

 

 

 

 

 

Total Insured Value

 

 

 

 

Florida

 

$

200,600,028

 

$

177,854,339

Other States

 

 

112,637,726

 

 

99,662,951

Total

 

$

313,237,754

 

$

277,517,290

 

 

Three Months Ended June 30, 2021

 

 

Direct

 

Loss Ratio

 

Ceded

 

Loss Ratio

 

Net

 

Loss Ratio

Premiums earned

 

$

392,574 

 

 

 

 

$

136,402 

 

 

 

 

$

256,172 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss and loss adjustment expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Core losses

 

$

159,412 

 

 

40.6 

%

 

$

(78)

 

 

(0.1)

%

 

$

159,490 

 

 

62.3 

%

Weather events7

 

— 

 

 

— 

%

 

— 

 

 

— 

%

 

— 

 

 

— 

%

Prior year’s reserve development

 

116,890 

 

 

29.8 

%

 

109,159 

 

 

80.0 

%

 

7,731 

 

 

3.0 

%

Total losses and loss adjustment expenses

 

$

276,302 

 

 

70.4 

%

 

$

109,081 

 

 

80.0 

%

 

$

167,221 

 

 

65.3 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

7 Includes only current year weather events beyond those expected.

 

 

 

Six Months Ended June 30, 2021

 

 

Direct

 

Loss Ratio

 

Ceded

 

Loss Ratio

 

Net

 

Loss Ratio

Premiums earned

 

$

768,180 

 

 

 

 

$

268,703 

 

 

 

 

$

499,477 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss and loss adjustment expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Core losses

 

$

304,640 

 

 

39.7 

%

 

$

(50)

 

 

— 

%

 

$

304,690 

 

 

61.0 

%

Weather events7

 

— 

 

 

— 

%

 

— 

 

 

— 

%

 

— 

 

 

— 

%

Prior year’s reserve development

 

208,960 

 

 

27.2 

%

 

202,466 

 

 

75.3 

%

 

6,494 

 

 

1.3 

%

Total losses and loss adjustment expenses

 

$

513,600 

 

 

66.9 

%

 

$

202,416 

 

 

75.3 

%

 

$

311,184 

 

 

62.3 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

7 Includes only current year weather events beyond those expected.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(in thousands, except for per share data)

   

 

 

Three Months Ended

 

 

Six Months Ended

 

 

Guidance

 

 

June 30,

 

 

June 30,

 

 

Full Year 2021E

 

 

2021

 

2020

 

 

2021

 

2020

 

 

 

Income (Loss) Before Income Taxes

 

$

30,059

 

 

$

27,438

 

 

 

$

66,410

 

 

$

55,022

 

 

 

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Reinstatement premium, net of commissions8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net unrealized (gains)/losses on equity securities

 

 

(1,229

)

 

 

(3,871

)

 

 

 

(735

)

 

 

4,153

 

 

 

 

Net realized (gains)/losses on investments

 

 

(496

)

 

 

(168

)

 

 

 

(1,038

)

 

 

(467

)

 

 

 

Interest Expense

 

 

38

 

 

 

17

 

 

 

 

58

 

 

 

69

 

 

 

 

Total Adjustments

 

 

(1,687

)

 

 

(4,022

)

 

 

 

(1,715

)

 

 

3,755

 

 

 

 

Non-GAAP Adjusted Operating Income

 

$

28,372

 

 

$

23,416

 

 

 

$

64,695

 

 

$

58,777

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Diluted EPS

 

$

0.70

 

 

$

0.62

 

 

 

$

1.54

 

 

$

1.23

 

 

 

$ 2.75 - 3.00

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Reinstatement premium, net of commissions8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net unrealized (gains)/losses on equity securities

 

 

(0.04

)

 

 

(0.12

)

 

 

 

(0.02

)

 

 

0.12

 

 

 

Net realized (gains)/losses on investments

 

 

(0.02

)

 

 

(0.01

)

 

 

 

(0.03

)

 

 

(0.01

)

 

 

Total Pre-Tax Adjustments

 

 

(0.06

)

 

 

(0.13

)

 

 

 

(0.05

)

 

 

0.11

 

 

 

Income Tax on Above Adjustments

 

 

0.01

 

 

 

0.03

 

 

 

 

0.01

 

 

 

(0.02

)

 

 

Total Adjustments

 

 

(0.05

)

 

 

(0.10

)

 

 

 

(0.04

)

 

 

0.09

 

 

 

Non-GAAP Adjusted EPS

 

$

0.65

 

 

$

0.52

 

 

 

$

1.50

 

 

$

1.32

 

 

 

$ 2.75 - 3.00

 

 

 

 

 

 

 

 

 

 

 

 

 

8 Includes extraordinary reinstatement premiums not covered by reinstatement premium protection and related commissions. 

 

Investor Relations Contact: Rob Luther, 954-958-1200 ext. 6750 VP, Corporate Development, Strategy & IR rluther@universalproperty.com

Media Relations Contact: Andy Brimmer / Mahmoud Siddig, 212-355-4449 Joele Frank, Wilkinson Brimmer Katcher

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