UNITED
STATES
SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C.
20549
FORM 8-K
CURRENT
REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): March 3, 2010
MAIDEN
HOLDINGS, LTD.
(Exact
name of registrant as specified in its charter)
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Bermuda
(State
or other jurisdiction
of
incorporation)
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001-34042
(Commission
File
Number)
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98-0570192
(IRS
Employer
Identification
No.)
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131
Front Street, Hamilton HM12, Bermuda
(Address
of principal executive offices and zip code)
(441)
292-7090
(Registrant’s
telephone number, including area code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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|||
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o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02 Results
of Operations and Financial Condition.
On March
3, 2010, Maiden Holdings, Ltd. issued a press release announcing its results of
operations for the fourth quarter and fiscal year ended December 31,
2009. A copy of the press release is hereby furnished to the
Commission and incorporated by reference herein as Exhibit
99.1.
Item
9.01 Financial
Statements and Exhibits.
(d) Exhibits
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Exhibit
No.
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Description
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99.1
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Press
Release of Maiden Holdings, Ltd., dated March 3,
2010.
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SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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Date: March
3, 2010
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MAIDEN
HOLDINGS, LTD.
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By:
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/s/ Arturo M.
Raschbaum
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Arturo
M. Raschbaum
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President
and Chief Executive
Officer
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EXHIBIT
INDEX
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Exhibit
No.
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Description
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99.1
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Press
Release of Maiden Holdings, Ltd., dated March 3,
2010.
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March
3, 2010
Maiden
Holdings, Ltd. Reports Fourth Quarter Net Income of
$16.7
Million or 24 cents per share and Operating Earnings
of
$17.6 Million or 25 cents per share
Shareholders’
Equity of $676.5 Million Up 32.7% for the Year
Year-end
2009 Book Value of $9.62 per Share
Financial
Highlights
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·
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Net income of $16.7 million in
the quarter and $61.1million for
2009
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·
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Net operating
earnings(1) of $17.6 million in the
quarter and $64.9 million for
2009
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·
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Net written premium of $234.1
million in the quarter and $1.0 billion for
2009
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·
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Net investment income of $16.8
million up 30.3% from fourth quarter
2008
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·
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Total investable assets of $2.1
billion at year end with total investments of $1.7
billion
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·
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Income from operations totaled
$28.8 million in the quarter and $101.0 million for
2009
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·
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Annualized return on equity of
9.9% and operating(1) return on equity of
10.4%
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·
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Combined ratio of 95.5% for the
quarter compared to 97.2% a year
ago
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HAMILTON,
Bermuda, March 3, 2010 - Maiden Holdings, Ltd. (Nasdaq: MHLD) today
reported fourth quarter 2009 net income of $16.7 million or $0.24 per diluted
share and net operating earnings (1) of
$17.6 million or $0.25 per diluted share. For the full year 2009, net income
totaled $61.1 million or $0.87 per diluted share with net operating earnings of
$64.9 million or $0.93 per diluted share.
"I’m very
proud of how well the team came together this year to deliver for our clients
and shareholders,” said Art Raschbaum, President and CEO of Maiden Holdings,
Ltd. “Our fourth quarter and full year results reflect our intense effort as we
integrated two operating platforms while maintaining a strong, non-catastrophe,
client value proposition as well as our underwriting and pricing discipline even
in the face of challenging market conditions. The January renewal season
provided additional confirmation of the value of our business model as we
achieved our client retention target of 85% or better. These results, in
addition to our newly consummated relationship with American Capital Acquisition
Corporation, solidly position us in the face of competitive pressures and a
continued low yield environment.”
(more)
Page 2 of
7
Shareholders'
equity of $676.5 million grew 2.0% during the quarter and 32.7% from year end
2008. Book value per share of $9.62 compared with $8.70 at year end
2008.
Fourth
Quarter 2009 Results:
Net
written premium totaled $234.1 million compared with $340.5 million in the
fourth quarter of 2008. Net earned premium of $248.6 million increased $84.8
million compared with $163.8 million for the same period last year.
Net
investment income totaled $16.8 million; up $3.9 million from $12.9 million in
the fourth quarter of 2008.
Loss and
loss adjustment expenses of $146.1 million rose $30.8 million from $115.3
million in the fourth quarter of 2008. Results reflected a loss ratio of 58.8%
compared with 70.4% for the same period a year ago.
Commission
and other acquisition expenses together with general and administrative expenses
of $91.2 million increased $47.2 million from the year ago quarter and reflected
a total expense ratio of 36.7% compared with 26.8%. General and administrative
expenses for the quarter totaled $9.4 million and reflected a general and
administrative expense ratio of 3.8% compared to 5.7% in the fourth quarter of
2008.
Maiden
posted a combined ratio of 95.5% for the quarter compared with 97.2% in the
fourth quarter of 2008.
Income
from operations totaled $28.8 million in the fourth quarter and increased $6.5
million, or 29.4%, from $22.3 million in the fourth quarter of
2008.
During
the fourth quarter of 2009, the Board of Directors declared a dividend of $0.065
per share.
Full
Year 2009 Results
Net
written premium totaled $1.0 billion compared with $727.4 million in 2008. Net
earned premium of $919.9 million rose $499.8 million compared with $420.1
million in 2008.
Net
investment income totaled $63.0 million; up $25.7 million, or 69.1%, from $37.2
million in 2008.
Loss and
loss adjustment expenses of $608.6 million rose $344.9 million from $263.7
million in 2008. Results reflected a loss ratio of 66.2% compared with 62.8% for
full year 2008.
(more)
Page 3 of
7
Commission
and other acquisition expenses together with general and administrative expenses
of $273.6 million increased $138.9 million from the year ago and reflected an
expense ratio of 29.7% compared with 32.1% in 2008. General and administrative
expenses totaled $32.1 million compared with $15.0 million in 2008 and reflected
a stable general and administrative expense ratio of 3.5% for both
years.
Income
from operations totaled $101.0 million in 2009, up from $21.4 million in 2008.
Results reflected a full year 2009 combined ratio of 95.9% compared with 94.8%
in 2008.
Other
Matters
Total
assets of $2.6 billion at year end 2009 compared with $2.1 billion for year end
2008. Total assets included total investments of $1.7 billion in 2009, up from
$1.1 billion in 2008. Total investable assets, which includes total
investments, cash, restricted cash, cash equivalents and the loan to a related
party, increased to $2.1 billion from $1.8 billion at year end 2008.
Shareholders' equity as of year end 2009 totaled $676.5 million up from $509.8
million at year end 2008.
(1)Please
see the Non-GAAP Financial Measures table for additional information on these
non-GAAP financial measures and reconciliation of this measure to GAAP
measures.
Conference
Call
Maiden
Holdings, Ltd. CEO Art Raschbaum and CFO John Marshaleck will review these
results tomorrow morning via teleconference and live audio webcast beginning at
10:00 a.m. AT (9:00 a.m. ET).
To
participate please access one of the following no later than 9:55 a.m. AT (8:55
a.m. ET):
1.877.734.5373
for U.S. callers
1.973.200.3059
for callers outside the U.S.
Webcast:
http://ir.maiden.bm
A replay
of the conference call will be available beginning at 1:00 p.m. Atlantic Time
(12:00 p.m. ET) on Thursday, March 4, 2010 through March 11, 2010. To listen to
the replay please dial toll free: 1.800.642.1687 (U.S. callers) or toll
1.706.645.9291 (callers outside the U.S.) and enter the Passcode: 58311669; or
access http://ir.maiden.bm/.
(more)
Page 4 of
7
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.
You may
access the Maiden Holdings, Ltd. Logo via 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 Report
on Form 10-K for the year ended December 31, 2008 as updated in periodic filings
with the SEC. The Company undertakes no obligation to publicly update any
forward-looking statements, except as may be required by law.
Maiden
Holdings, Ltd.
Ellen
Taylor
Hilly
Gross
441.292.7090
irelations@maiden.bm
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For
the Three Months Ended December 31, 2009
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For
the Three Months Ended December 31, 2008
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For
the Year Ended December 31, 2009
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For
the Year Ended December 31, 2008
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|||||||||||||
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||||||||||||||||
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Revenues:
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||||||||||||||||
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Gross
premiums written
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$ | 247,333 | $ | 340,525 | $ | 1,048,676 | $ | 727,395 | ||||||||
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Net
premiums written
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$ | 234,070 | $ | 340,525 | $ | 1,030,374 | $ | 727,395 | ||||||||
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Decrease
(increase) in unearned premiums
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14,566 | (176,681 | ) | (110,455 | ) | (307,313 | ) | |||||||||
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Net
earned premium
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248,636 | 163,844 | 919,919 | 420,082 | ||||||||||||
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Net
investment income
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16,807 | 12,894 | 62,957 | 37,240 | ||||||||||||
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Net
realized investment gains (losses)
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732 | 4,819 | 270 | (37,555 | ) | |||||||||||
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Total
revenues
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266,175 | 181,557 | 983,146 | 419,767 | ||||||||||||
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Expenses:
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||||||||||||||||
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Net
loss and loss adjustment expenses
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146,145 | 115,322 | 608,613 | 263,682 | ||||||||||||
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Commission
and other acquisition expenses
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81,821 | 34,644 | 241,429 | 119,703 | ||||||||||||
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General
and administrative expenses
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9,409 | 9,337 | 32,135 | 14,973 | ||||||||||||
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Total
expenses
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237,375 | 159,303 | 882,177 | 398,358 | ||||||||||||
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Income
from operations
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28,800 | 22,254 | 100,969 | 21,409 | ||||||||||||
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Other
income(expense)
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||||||||||||||||
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Amortization
of intangible assets
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(1,675 | ) | (1,253 | ) | (6,590 | ) | (1,253 | ) | ||||||||
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Foreign
exchange and other gain (loss)
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53 | (998 | ) | 2,454 | (1,362 | ) | ||||||||||
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Subordinated
obligation interest expense
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(9,115 | ) | - | (34,431 | ) | - | ||||||||||
| (10,737 | ) | (2,251 | ) | (38,567 | ) | (2,615 | ) | |||||||||
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Income
before income taxes
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18,063 | 20,003 | 62,402 | 18,794 | ||||||||||||
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Income
taxes:
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||||||||||||||||
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Current
tax expense
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- | - | - | - | ||||||||||||
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Deferred
tax expense
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1,344 | - | 1,344 | - | ||||||||||||
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Income
tax expense
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1,344 | - | 1,344 | - | ||||||||||||
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Net
income
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$ | 16,719 | $ | 20,003 | $ | 61,058 | $ | 18,794 | ||||||||
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Operating
earnings (1)
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$ | 17,609 | $ | 19,071 | $ | 64,924 | $ | 60,600 | ||||||||
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Basic
earnings per common share
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$ | 0.24 | $ | 0.34 | $ | 0.88 | $ | 0.32 | ||||||||
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Diluted
earnings per common share
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$ | 0.24 | $ | 0.34 | $ | 0.87 | $ | 0.32 | ||||||||
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Basic
operating earnings per common share
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$ | 0.25 | $ | 0.32 | $ | 0.93 | $ | 1.02 | ||||||||
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Diluted
operating earnings per common share
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$ | 0.25 | $ | 0.32 | $ | 0.93 | $ | 1.02 | ||||||||
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Dividends
declared per common share
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$ | 0.06 | $ | 0.06 | $ | 0.25 | $ | 0.21 | ||||||||
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Weighted
average number of basic shares outstanding
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70,288,602 | 58,734,106 | 69,646,804 | 59,344,912 | ||||||||||||
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Weighted
average number of diluted shares outstanding
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70,791,229 | 58,734,106 | 70,060,197 | 59,344,912 | ||||||||||||
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Net
Loss and loss adjustment expense ratio
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58.8 | % | 70.4 | % | 66.2 | % | 62.8 | % | ||||||||
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Commission
and other acquisition expense ratio
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32.9 | % | 21.1 | % | 26.2 | % | 28.5 | % | ||||||||
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General and
administrative expense ratio
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3.8 | % | 5.7 | % | 3.5 | % | 3.5 | % | ||||||||
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Combined
ratio
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95.5 | % | 97.2 | % | 95.9 | % | 94.8 | % | ||||||||
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Annualized
return on equity
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9.9 | % | 16.1 | % | 10.3 | % | 3.6 | % | ||||||||
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Annualized
return on equity on operating earnings
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10.4 | % | 13.5 | % | 10.9 | % | 11.1 | % | ||||||||
Balance
Sheet
(in
thousands (000's), except per share data)
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31-Dec-09
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31-Dec-08
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|||||||
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Assets
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||||||||
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Fixed
maturities, available-for-sale, at fair value (amortized cost
$1,623,382; $1,163,926)
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$ | 1,661,692 | $ | 1,119,955 | ||||
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Other
investments, at fair value (cost $5,684; $5,818)
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5,549 | 5,291 | ||||||
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Total
investments
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1,667,241 | 1,125,246 | ||||||
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Cash
and cash equivalents
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107,396 | 131,897 | ||||||
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Restricted
cash and cash equivalents
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144,944 | 409,277 | ||||||
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Accrued
investment income
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11,405 | 10,293 | ||||||
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Reinsurance
balances receivable, net
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208,495 | 71,895 | ||||||
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Prepaid
reinsurance
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28,752 | - | ||||||
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Losses
recoverable - unpaid losses
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11,984 | - | ||||||
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Loan
to related party
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167,975 | 167,975 | ||||||
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Deferred
commission and other acquisition costs
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172,983 | 104,470 | ||||||
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Other
assets
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11,818 | 2,617 | ||||||
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Intangible
assets
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51,284 | 55,147 | ||||||
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Goodwill
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52,617 | 49,747 | ||||||
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Total
Assets
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$ | 2,636,894 | $ | 2,128,564 | ||||
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Liabilities
and Shareholders’ Equity
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||||||||
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Liabilities
|
||||||||
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Loss
and loss adjustment expense reserves
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$ | 1,006,320 | $ | 897,656 | ||||
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Unearned
premiums
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583,478 | 444,479 | ||||||
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Accrued
expenses and other liabilities
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60,044 | 44,024 | ||||||
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Securities
sold under agreements to repurchase, at contract value
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95,401 | 232,646 | ||||||
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Subordinated
obligation to capital trust - related party
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215,125 | - | ||||||
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Total
Liabilities
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1,960,368 | 1,618,805 | ||||||
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Shareholders’
Equity:
|
||||||||
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Common
shares
|
713 | 596 | ||||||
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Additional
paid-in capital
|
576,086 | 530,519 | ||||||
|
Treasury
stock
|
(3,801 | ) | (3,801 | ) | ||||
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Accumulated
other comprehensive income (loss)
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32,747 | (44,499 | ) | |||||
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Retained
earnings
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70,781 | 26,944 | ||||||
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Total
Shareholders’ Equity
|
676,526 | 509,759 | ||||||
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Total
Liabilities and Shareholders’ Equity
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$ | 2,636,894 | $ | 2,128,564 | ||||
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Book
value per share
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$ | 9.62 | $ | 8.70 | ||||
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Common
shares outstanding
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70,291,289 | 58,587,664 | ||||||
Maiden
Holdings, Ltd.
Non
- - GAAP Financial Measure
(in
thousands (000's), except per share data)
(Unaudited)
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For
the Three Months Ended December 31, 2009
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For
the Three Months Ended December 31, 2008
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For
the Year Ended December 31, 2009
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For
the Year Ended December 31, 2008
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|||||||||||||
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Reconciliation
of net income to net operating earnings:
|
||||||||||||||||
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Net
income
|
$ | 16,719 | $ | 20,003 | $ | 61,058 | $ | 18,794 | ||||||||
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Add
(subtract)
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||||||||||||||||
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Net
realized investment (gains) losses
|
(732 | ) | (4,819 | ) | (270 | ) | 37,555 | |||||||||
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Foreign
exchange and other (gains) losses
|
(53 | ) | 998 | (2,454 | ) | 1,362 | ||||||||||
|
Amortization
of intangibles
|
1,675 | 1,253 | 6,590 | 1,253 | ||||||||||||
|
Non-recurring
general and administrative expenses relating to acquisition of GMAC
Re
|
1,636 | 1,636 | ||||||||||||||
|
Operating
earnings (1)
|
$ | 17,609 | $ | 19,071 | $ | 64,924 | $ | 60,600 | ||||||||
|
Operating
earnings per common share:
|
||||||||||||||||
|
Basic earnings
per share
|
$ | 0.25 | $ | 0.32 | $ | 0.93 | $ | 1.02 | ||||||||
|
Diluted
earnings per share
|
$ | 0.25 | $ | 0.32 | $ | 0.93 | $ | 1.02 | ||||||||
(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, non-recurring general and admin expenses 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.