Press Release
Nov 10, 2009 (GlobeNewswire via COMTEX News Network) --
Book Value of $9.45 Per Share Grew 9.8 Percent in the Quarter
Company Announces Agreement in Principal With American Capital
Acquisition Corporation, Inc.
Quarterly Highlights
* Net income of $15.0 million
* Net operating earnings(1) of $16.5 million
* Total revenue of $254.1 million included net earned premium of
$237.4 million
* Net written premium of $221.4 million rose 95.6 percent from
third quarter 2008
* Net investment income of $16.8 million increased 87 percent from
third quarter 2008
* Year-to-date net investment income of $46.2 million nearly
doubled from the same period a year ago
* Total investments and cash equivalents grew to over $1.7 billion
at quarter end with total investments of $1.5 billion
* Annualized return on equity of 9.4 percent and operating return
on equity of 10.3 percent
* Combined ratio of 96.3 percent compared to 94.4 percent a year
ago
* Book value per share of $9.45 increased 9.8 percent in the
quarter
* Shareholder's equity of $664.6 million up 30 percent since year
end
* Announced ACAC agreement expected to generate over $200 million
in annual revenue
HAMILTON, Bermuda, Nov. 10, 2009 (GLOBE NEWSWIRE) -- Maiden Holdings, Ltd. (Nasdaq:MHLD) today reported net income of $15.0 million or $0.21 per diluted share and net operating earnings (1) of $16.5 million or $0.23 per diluted share. Results included net written premium of $221.4 million.
(1) Please see additional information on this non-GAAP financial measure and reconciliation of this measure to GAAP.
The Company also announced that it has reached an agreement in principal with American Capital Acquisition Corporation ("ACAC") regarding a multi-year 25 percent quota share agreement that is expected to generate over $200 million in annual revenues. The contract will commence in connection with ACAC's proposed acquisition of GMAC's U.S. consumer property and casualty insurance business, which is expected to occur in the first quarter of 2010 and is subject to regulatory approval. GMAC's U.S. consumer property and casualty business generated over $1.0 billion in net written premium in 2008.
"We continue to make solid progress toward our goals, even in the face of the highly competitive landscape and challenging economic environment," said Art Raschbaum, President and CEO of Maiden Holdings, Ltd. "Our third quarter results reflect our strong commitment to driving significant value creation for our shareholders through our intense focus on disciplined underwriting and sound investing. Consistently delivering differentiated products and service to our clients in the regional and specialty markets has enabled us to maintain our pricing discipline while still continuing to expand our business and drive revenue gains. During the quarter, we grew our investment portfolio nearly 20 percent and improved investment income while maintaining our conservative stance."
"We are also very proud to announce the addition of another strong client as we partner with ACAC," continued Raschbaum. "Today's announcement and the recent extension of our agreement with AmTrust Financial Services, Inc. provide us with robust momentum as we look ahead to next year and beyond. We are confident in our ability to continue to leverage our platform and expand our existing base of long-term client relationships."
For the nine months ended September 30, 2009, the Company reported net income of $44.3 million and net operating earnings of $47.3 million compared to a net loss of $1.2 million and net operating earnings of $41.5 million for the nine months ended September 30, 2008. Net written premium for the nine months ended September 30, 2009 totaled $796.3 million compared with $386.9 million a year ago.
Shareholders' equity grew 9.8 percent during the quarter to $664.6 million with book value per share of $9.45 compared with $8.61 as of June 30, 2009.
Third Quarter 2009 Results:
Third quarter 2009 results reflected net written premium of $221.4 million which increased $108.2 million from $113.2 million a year ago. Net earned premium of $237.4 million rose $123.8 million, or 109 percent compared with $113 .6 million for the same period last year.
Net investment income totaled $16.8 million in the third quarter and reflected a $7.8 million, or 87.0 percent increase from $9.0 million in the third quarter of 2008.
Loss and loss adjustment expenses of $165.1 million rose $98.2 million from $66.9 million in the third quarter of 2008. Results reflected a loss ratio of 69.6 percent compared with 58.9 percent for the same period a year ago.
Commission and other acquisition expenses together with general and administrative expenses of $63.4 million increased $23.1 million from the third quarter of 2008 and reflected an improvement in the expense ratio to 26.7 percent from 35.5 percent. General and administrative expenses for the quarter totaled $8.1 million and reflected a general and administrative expense ratio of 3.4%.
The Company posted a combined ratio of 96.3 percent for the quarter compared with 94.4 percent in the third quarter of 2008.
Year-to-date income from operations of $72.2 million represented the highest level in the Company's history and was driven by the acquisition of GMAC RE and other ongoing business development.
Other Matters
Shareholders' equity as of September 30, 2009 totaled $664.6 million up from $509.8 million at December 31, 2008. During the third quarter, the Board of Directors declared a dividend of $0.06 per share. Book value per share as of September 30, 2009 was $9.45.
Conference Call
CEO Art Raschbaum and CFO John Marshaleck will review third quarter results today via teleconference and live audio webcast beginning at 3:00 p.m. AT (2:00 p.m. ET).
To participate please access one of the following no later than 2:55 p.m. AT (1:55 p.m. ET):
1.800.949.2175 for U.S. callers
1.913.312.1409 for callers outside the U.S.
Webcast: http://ir.maiden.bm
A replay of the conference call will be available beginning at 6:00 p.m. Atlantic Time (5:00 p.m. ET) on Tuesday, November 10, 2009 through November 17, 2009. To listen to the replay please dial toll free: 1.888.203.1112 (U.S. callers) or toll 1.719.457.0820 (callers outside the U.S.) and enter the Passcode: 7475096; or access http://ir.maiden.bm/.
About Maiden Holdings, Ltd.
Maiden Holdings, Ltd. is a Bermuda holding company formed in 2007 to offer customized reinsurance products and services to regional and specialty insurance companies in the United States and Europe.
The Maiden Holdings, Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5006
Forward Looking Statements
This release contains "forward-looking statements" which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that actual developments will be those anticipated by the Company. Actual results may differ materially from those projected as a result of significant risks and uncertainties, including non-receipt of the expected payments, changes in interest rates, effect of the performance of financial markets on investment income and fair values of investments, developments of claims and the effect on loss reserves, accuracy in projecting loss reserves, the impact of competition and pricing environments, changes in the demand for the Company's products, the effect of general economic conditions, adverse state and federal legislation, regulations and regulatory investigations into industry practices, developments relating to existing agreements, heightened competition, changes in pricing environments, and changes in asset valuations. Additional information about these risks and uncertainties, as well as others that may cause actual results to differ materially from those projected is contained in Item 1A. Risk Factors in the Company's Annual Statement on Form 10-K for the year ended December 31, 2008. The Company undertakes no obligation to publicly update any forward-looking statements, except as may be required by law.
Maiden Holdings, Ltd.
Income Statement
(in thousands (000's), except per share data)
(Unaudited)
For the For the For the For the
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2009 2008 2009 2008
Revenues:
Premium income:
Net premiums written $ 221,400 $ 113,187 $ 796,304 $ 386,870
Change in unearned
premiums 15,950 408 (125,021) (130,631)
---------- ---------- ---------- ----------
Net earned premium 237,350 113,595 671,283 256,239
Net investment income 16,778 8,974 46,150 24,346
Net realized
investment gains
(losses) (66) (42,538) (462) (42,375)
---------- ---------- ---------- ----------
Total revenues 254,062 80,031 716,971 238,210
---------- ---------- ---------- ----------
Expenses:
Loss and loss
adjustment expenses 165,123 66,915 462,468 148,362
Commission and other
acquisition expenses 55,313 38,299 159,608 85,057
General and
administrative
expenses 8,059 1,974 22,726 5,636
---------- ---------- ---------- ----------
Total expenses 228,495 107,188 644,802 239,055
Income from operations 25,567 (27,157) 72,169 (845)
Other income(expense)
Amortization of
intangible assets (1,676) -- (4,915) --
Foreign exchange and
other gain (loss) 210 (359) 2,401 (364)
Trust preferred
interest (9,114) -- (25,316) --
---------- ---------- ---------- ----------
(10,580) (359) (27,830) (364)
Net income $ 14,987 $ (27,516) $ 44,339 $ (1,209)
========== ========== ========== ==========
Operating earnings (1) $ 16,519 $ 15,381 $ 47,315 $ 41,530
========== ========== ========== ==========
Basic earnings per
common share $ 0.21 $ (0.46) $ 0.64 $ (0.02)
========== ========== ========== ==========
Diluted earnings per
common share $ 0.21 $ (0.46) $ 0.63 $ (0.02)
========== ========== ========== ==========
Basic operating
earnings per common
share $ 0.24 $ 0.26 $ 0.68 $ 0.70
========== ========== ========== ==========
Diluted operating
earnings per common
share $ 0.23 $ 0.26 $ 0.68 $ 0.70
========== ========== ========== ==========
Dividends declared per
common share $ 0.06 $ 0.05 $ 0.18 $ 0.15
========== ========== ========== ==========
Weighted average
number of basic
shares outstanding 70,287,664 59,550,000 69,430,521 59,550,000
Weighted average
number of diluted
shares outstanding 70,852,895 59,550,000 69,846,714 59,550,000
Combined ratio 96.3% 94.4% 96.1% 93.3%
Annualized return on
equity 9.4% (21.3%) 10.1% (0.3%)
Annualized return on
equity on operating
earnings 10.3% 12.0% 10.8% 10.9%
Maiden Holdings, Ltd.
Balance Sheet
(in thousands (000's), except per share data)
(unaudited)
(Unaudited)
30-Sep-09 31-Dec-08
Assets
Fixed maturities, available-for-sale, at fair
value (amortized cost $1,506,704;
$1,163,926) $1,541,704 $1,119,955
Other investments, at fair value (cost $5,707;
$5,818) 5,529 5,291
---------- ----------
Total investments 1,547,233 1,125,246
Cash and cash equivalents 94,582 131,897
Restricted cash and cash equivalents 218,595 409,277
Accrued investment income 11,078 10,293
Reinsurance balances receivable, net 236,643 71,895
Loan to related party 167,975 167,975
Deferred commission and other acquisition
costs 171,120 104,470
Other assets 15,527 2,617
Intangible assets 52,959 55,147
Goodwill 49,747 49,747
---------- ----------
Total Assets $2,565,459 $2,128,564
========== ==========
Liabilities and Shareholders' Equity
Liabilities
Loss and loss adjustment expense reserves $ 967,425 $ 895,608
Unearned premiums 570,875 444,479
Accrued expenses and other liabilities 42,191 46,072
Securities sold under agreements to
repurchase, at contract value 105,307 232,646
Trust preferred securities 215,110 --
---------- ----------
Total Liabilities 1,900,908 1,618,805
---------- ----------
Shareholders' Equity:
Common shares 713 596
Additional paid-in capital 575,891 530,519
Treasury stock (3,801) (3,801)
Accumulated other comprehensive loss 33,117 (44,499)
Retained earnings 58,631 26,944
---------- ----------
Total Shareholders' Equity 664,551 509,759
---------- ----------
Total Liabilities and Shareholders' Equity $2,565,459 $2,128,564
========== ==========
Book value per share $ 9.45 $ 8.70
Common shares outstanding 70,287,664 58,587,664
Maiden Holdings, Ltd.
Non - GAAP Financial Measure
(in thousands (000's), except per share data)
(Unaudited)
For the For the For the For the
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2009 2008 2009 2008
Reconciliation of net
income to net
operating earnings:
Net income $ 14,987 $ (27,516) $ 44,339 $ (1,209)
Add (subtract)
Net realized
investment losses 66 42,538 462 42,375
Foreign exchange and
other (gain) loss (210) 359 (2,401) 364
Amortization of
intangibles 1,676 -- 4,915 --
---------- ---------- ---------- ----------
Operating earnings (1) $ 16,519 $ 15,381 $ 47,315 $ 41,530
========== ========== ========== ==========
Operating earnings per
common share:
Basic earnings per
share $ 0.24 $ 0.26 $ 0.68 $ 0.70
Diluted earnings per
share $ 0.23 $ 0.26 $ 0.68 $ 0.70
(1) Net operating earnings is a non-GAAP financial measure defined by
the Company as net income excluding realized investment gains and
losses, foreign exchange and other gains and losses and amortization
of intangible assets and should not be considered as an alternative to
net income. The Company's management believes that net operating
earnings is a useful indicator of trends in the Company's underlying
operations. The Company's measure of net operating earnings may not be
comparable to similarly titled measures used by other companies.
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Maiden Holdings, Ltd.
CONTACT: Maiden Holdings, Ltd. Hilly Gross Ellen Taylor 441.292.7090 irelations@maiden.bm
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