Universal Insurance Holdings, Inc. Reports Record Fourth Quarter and Full-Year 2015 Financial Results

Achieved Highest Fourth Quarter and Full-Year Net Income and EPS in Company History

Feb 24, 2016, 16:47 ET from Universal Insurance Holdings, Inc.

FORT LAUDERDALE, Fla., Feb. 24, 2016 /PRNewswire/ -- Universal Insurance Holdings, Inc. (NYSE: UVE) today reported record fourth quarter net income in 2015 of $29.2 million, an increase of 39.0%, or $8.2 million, over the same period in 2014.  Diluted earnings per share (EPS) were $0.82 for the fourth quarter of 2015, an increase of 39.0%, or $0.23 per share, over the same quarter in 2014.  This compares to net income of $21.0 million, or $0.59 per diluted share, for the same period in 2014.

For the full year 2015, the Company reported record net income of $106.5 million, an increase of $33.5 million, or 45.9% compared to net income of $73.0 million for 2014.  For earnings per share on a diluted basis, the Company reported $2.97 per share in 2015, as compared to $2.08 per share for 2014.

"I am very pleased with our outstanding fourth quarter results, concluding a year in which we delivered the highest earned premiums, total revenues, net income and diluted EPS in Company history," said Sean P. Downes, Universal's Chairman, President and Chief Executive Officer.  "Our track record of delivering consistent, organically generated growth is a testament to the strength of our strategy and business model. We continued to maintain focus on writing high quality, rate-adequate business, investing in our vertically integrated business model, improving our claims handling and customer service and building strong relationships with our independent agency force.  We also continued to gain traction throughout 2015 on our geographic expansion efforts, concluding the year with a presence in 16 states.  As a result of our efforts, our total insured value in states outside of Florida reached 16% as of the end of 2015, and policy count outside of Florida increased by 49%. 

"Our record performance reflects the diligence and hard work of our employees and independent agents who form the cornerstone of our continued success. Looking ahead, we are better positioned now than at any other time in our history from an operational and financial standpoint, and we will continue to leverage our financial strength to return capital to our shareholders through dividends and share buybacks.  As we enter 2016, our entire team is aligned on our goal of driving profitable growth and increasing shareholder value." 

Fourth-Quarter 2015 & Recent Highlights

  • Net earned premiums grew by $55.2 million, or 57.8%, to $150.6 million.
  • Total revenues increased by $57.6 million, or 55.1%, to $162.1 million.
  • Net income increased by $8.2 million, or 39.0%, to $29.2 million.
  • Diluted EPS grew by $0.23, or 39.0%, to $0.82 per share.
  • Paid dividends of $0.27 per share.
  • Received Certificate of Authority from New Hampshire.

Fourth-Quarter 2015 Results

Net income for the fourth quarter of 2015 of $29.2 million reflects an improvement across multiple measures including an increase in direct premiums written, net premiums written, net earned premiums, net investment income, realized gains, commissions, policy fees, and income before taxes. The increase in net earned premiums reflects both growth in policies in force and lower reinsurance costs, including the elimination of quota share reinsurance effective June 2015. 

Stockholders' equity reached an all-time high of $293.1 million as of December 31, 2015 compared to $218.9 million pro-forma stockholders' equity as of December 31, 2014.

Full-Year 2015 Results

For the full year of 2015, the Company's net income increased by $33.5 million or 45.9%, compared to 2014. 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 2015 was $2.97, an increase of $0.89, or 42.8%, compared to 2014.

Share Repurchases

On November 18, 2015, the Company announced the completion of a $10 million share repurchase program with 363,100 shares repurchased at an average cost of $27.58 per share on the open market pursuant to the Board authorized share repurchase program announced on September 2, 2015.

On November 19, 2015, the Company announced that its Board of Directors authorized an additional share repurchase program under which the Company may repurchase up to $10 million of its outstanding shares of common stock through December 31, 2016. The Company has repurchased 185,000 shares of its common stock at an average cost of $19.24 per share, with $6.4 million remaining to be deployed. 

Cash Dividends

On November 5, 2015, the Company announced that its Board of Directors declared a cash dividend of $0.27 per share of common stock which was paid on December 10, 2015 to shareholders of record on December 1, 2015. The $0.27 per share dividend includes the expected $0.12 per share fourth quarter dividend, in line with the dividends for the first three quarters of 2015, and an additional special dividend of $0.15 per share.

On January 14, 2016, the Company announced that its Board of Directors had declared an increased cash dividend of $0.14 per share of common stock up $0.02 from the $0.12 per share paid the past four quarters. Payment will be made on March 2, 2016 to shareholders of record on February 18, 2016.  The Company also announced that it expects to declare and pay a proposed regular quarterly dividend during fiscal year 2016 of $0.14 per share of the Company's common stock.

Financial Results Presentation

The Company will make available an audio recording of a presentation discussing its fourth quarter 2015 financial results at approximately 5:00 pm Eastern on February 24, 2016. The presentation will be pre-recorded, and there will be no opportunity for live questions. The audio recording of this presentation will be available at www.universalinsuranceholdings.com until March 24, 2016.

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, Indiana, Pennsylvania and Minnesota.  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 Form 10-K for the year ended December 31, 2015.

 

 

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands, except per share data)

December 31,

December 31,

ASSETS

2015

2014

Cash and cash equivalents

$          197,014

$       115,397

Restricted cash and cash equivalents

2,635

2,635

Fixed maturities, at fair value

416,083

353,949

Equity securities, at fair value

42,214

19,642

Short-term investments, at fair value

25,021

49,990

Investment real estate, net

6,117

Prepaid reinsurance premiums

114,673

190,505

Reinsurance recoverable

22,853

55,187

Reinsurance receivable, net

353

7,468

Premiums receivable, net

50,980

50,987

Other receivables

4,626

2,763

Property and equipment, net

27,065

17,254

Deferred policy acquisition costs, net

60,019

25,660

Income taxes recoverable

5,420

5,675

Deferred income tax asset, net

13,912

11,850

Other assets

4,563

2,812

          Total assets

$          993,548

$       911,774

LIABILITIES, CONTINGENTLY REDEEMABLE COMMON STOCK AND STOCKHOLDERS' EQUITY

LIABILITIES:

Unpaid losses and loss adjustment expenses

$            98,840

$       134,353

Unearned premiums

442,366

395,748

Advance premium

24,813

17,919

Accounts payable

378

4,121

Book overdraft

5,924

Reinsurance payable, net

73,585

66,066

Income taxes payable

1,799

Other liabilities and accrued expenses

36,424

36,318

Long-term debt

24,050

30,610

          Total liabilities

700,456

692,858

Contingently redeemable common stock

19,000

Issued shares - 0 and 1,000

Outstanding shares - 0 and 1,000

STOCKHOLDERS' EQUITY:

Cumulative convertible preferred stock, $.01 par value

Authorized shares - 1,000

Issued shares - 10 and 12

Outstanding shares - 10 and 12

Minimum liquidation preference - $9.99 and $8.49 per share

Common stock, $.01 par value

455

448

Authorized shares - 55,000

Issued shares - 45,525 and 43,769

Outstanding shares - 35,110 and 34,102

Treasury shares, at cost - 10,415 and 9,667

(80,802)

(62,153)

Additional paid-in capital

70,789

40,987

Accumulated other comprehensive income (loss), net of taxes

(4,006)

(1,835)

Retained earnings

306,656

222,469

          Total stockholders' equity

293,092

199,916

          Total liabilities, contingently redeemable           common stock and stockholders' equity

$          993,548

$       911,774

 

 

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(in thousands, except per share data)

Three Months Ended

December 31,

2015

2014

PREMIUMS EARNED AND OTHER REVENUES

Direct premiums written

$           199,261

$        182,216

Ceded premiums written

(71,381)

(98,106)

Net premiums written

127,880

84,110

Change in net unearned premium

22,718

11,310

Premiums earned, net

150,598

95,420

Net investment income (expense)

1,779

801

Net realized gains (losses) on investments

768

274

Commission revenue

4,113

3,323

Policy fees

3,436

3,155

Other revenue

1,406

1,509

Total premiums earned and other revenues

162,100

104,482

OPERATING COSTS AND EXPENSES

Losses and loss adjustment expenses

60,591

34,590

General and administrative expenses

53,629

32,966

Total operating costs and expenses

114,220

67,556

INCOME BEFORE INCOME TAXES

47,880

36,926

Income tax expense

18,728

15,954

NET INCOME

$             29,152

$          20,972

Basic earnings per common share

$                 0.84

$              0.63

Weighted average common shares outstanding - Basic

34,567

33,457

Fully diluted earnings per common share

$                 0.82

$              0.59

Weighted average common shares outstanding - Diluted

35,747

35,271

Cash dividend declared per common share

$                 0.27

$              0.25

 

 

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(in thousands, except per share data)

Year Ended

December 31,

2015

2014

PREMIUMS EARNED AND OTHER REVENUES

Direct premiums written

$         883,409

$      789,577

Ceded premiums written

(256,961)

(399,730)

Net premiums written

626,448

389,847

Change in net unearned premium

(122,449)

(62,970)

Premiums earned, net

503,999

326,877

Net investment income (expense)

5,155

2,375

Net realized gains (losses) on investments

1,060

5,627

Commission revenue

14,870

14,205

Policy fees

15,440

13,982

Other revenue

6,020

6,210

Total premiums earned and other revenues

546,544

369,276

OPERATING COSTS AND EXPENSES

Losses and loss adjustment expenses

187,739

123,275

General and administrative expenses

183,782

118,397

Total operating costs and expenses

371,521

241,672

INCOME BEFORE INCOME TAXES

175,023

127,604

Income tax expense

68,539

54,616

NET INCOME

$         106,484

$           72,988

Basic earnings per common share

$               3.06

$               2.17

Weighted average common shares outstanding - Basic

34,799

33,569

Fully diluted earnings per common share

$               2.97

$               2.08

Weighted average common shares outstanding - Diluted

35,884

35,150

Cash dividend declared per common share

$               0.63

$               0.55

 

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

SOURCE Universal Insurance Holdings, Inc.



RELATED LINKS

http://www.universalinsuranceholdings.com