DUBLIN, Ireland, Feb. 25, 2013 /PRNewswire/ -- Global Indemnity
plc (NASDAQ: GBLI) today reported net income for the year ended
December 31, 2012 of $34.8 million or $1.30 per share. As of December 31st, book value per share was
$32.15, an increase of 10.6% compared
to book value per share of $29.06 at
December 31, 2011.
(Logo:
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Selected Operating and Balance
Sheet Data (Dollars in millions, except per
share data)
|
|
|
|
|
For the
Twelve Months
Ended
December 31,
|
|
|
As
of
December
31,
|
|
|
2012
|
|
2011
|
|
|
2012
|
|
2011 (2)
|
|
|
|
|
|
|
Book Value per share
|
$ 32.15
|
|
$ 29.06
|
|
Gross Premiums
Written
|
$ 244.1
|
|
$ 307.9
|
|
Shareholders' equity
|
$ 806.6
|
|
$ 839.1
|
|
Net Premiums Written
|
$ 219.5
|
|
$ 280.6
|
|
Cash and invested
assets
|
$ 1,534.0
|
|
$ 1,647.7
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
(1)(2)
|
$ 34.8
|
|
$ (38.3)
|
|
|
|
|
|
|
Net income (loss) per
share (1)(2)
|
$ 1.30
|
|
$ (1.27)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
(1)(2)
|
$ 29.3
|
|
$ (53.1)
|
|
|
|
|
|
|
Operating income (loss) per
share (1)(2)
|
$ 1.10
|
|
$ (1.76)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(1)
|
Results include the impact of an
out-of-period adjustment which reduced net income and operating
income by $1.6 million, or $0.06 per diluted share.
|
|
(2)
|
Retrospective adoption of new
accounting guidance limiting acquisition costs that can be deferred
decreased shareholders' equity by $2.6 million or $0.09 per
share.
|
|
| |
Cynthia Y. Valko, Chief Executive
Officer, stated, "During 2012, in our domestic primary insurance
business, we continued executing upon our long-term strategy
focused on serving small business entrepreneurs as well as further
contracting in lines where we were not providing a differentiated
product. Also during 2012, we further expanded our
international business that is focused on providing catastrophe
reinsurance."
About Global Indemnity plc and its subsidiaries
Global Indemnity plc (NASDAQ: GBLI), through its several direct
and indirect wholly owned subsidiary insurance and reinsurance
companies, provides both admitted and non-admitted specialty
property and casualty insurance coverages in the United States, as well as reinsurance
throughout the world. Global Indemnity plc's two primary
divisions are:
- United States Based Insurance Operations
- Bermuda Based Reinsurance Operations
For more information, visit the Global Indemnity plc
website at http://www.globalindemnity.ie.
Teleconference and Webcast for Interested Parties
Cynthia Valko, Chief Executive
Officer of Global Indemnity plc, and Thomas
McGeehan, Chief Financial Officer of Global Indemnity plc,
will conduct a teleconference for interested parties on
February 26, 2013 at 8:30a.m. Eastern Time to discuss the fourth
quarter 2012 results.
The Company will release its earnings after the close of
business on February 25, 2013.
To participate in the teleconference, please telephone (800)
230-1074 (U.S. and Canada) or
(612) 288-0337 (International) and you will be greeted by an
operator. Please reference Global Indemnity plc Earnings
Release Call or the host Cynthia
Valko.
The teleconference is being webcast by AT&T and can be
accessed at the company's website at www.globalindemnity.ie.
Please access the site at least 15 minutes prior to the
teleconference to register, click on the Webcast link, enter
Conference ID number 283460 and click GO. Please download and
install any necessary software.
The teleconference will be available for replay beginning at
10:30 a.m. Eastern Time on
February 26, 2013 until 11:59 p.m. March 26,
2013. To listen to the replay, please telephone (800)
475-6701 (U.S. and Canada) or
(320) 365-3844 (International) then enter 283460.
Forward-Looking Information
Forward-looking statements contained in this press release are made
under the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995 and involve a number of risks and
uncertainties. We caution investors that our actual results
may be materially different from the estimates expressed in, or
implied, or projected by, the forward looking statements.
Please see our periodic reports filed with the Securities and
Exchange Commission for a discussion of the risks and uncertainties
which may affect us and for a more detailed discussion of our
cautionary note regarding forward-looking statements.
Global Indemnity plc's Combined Ratio for the Twelve Months
Ended December 31, 2012
and 2011
The combined ratio is a key measure of insurance profitability.
The components comprising the combined ratio are as
follows:
|
Twelve
Months Ended
December
31,
|
|
|
2012 (1)
|
|
2011
|
|
Loss
Ratio:
|
|
|
|
|
Current
Accident Year
|
|
|
|
|
Excluding
Catastrophes
|
53.7
|
|
75.8
|
|
Catastrophes
|
10.4
|
|
16.6
|
|
Current Accident
Year
|
64.1
|
|
92.4
|
|
Changes to
Prior Accident Year
|
0.2
|
|
1.1
|
|
Loss Ratio –
Calendar Year
|
64.3
|
|
93.5
|
|
Expense
Ratio
|
39.9
|
|
40.8
|
|
Combined
Ratio
|
104.2
|
|
134.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(1)
|
Net premiums earned includes
$6.0 million related to reinsurance treaties written in 2009 and
2010 that became due as a result of additional losses incurred on
these treaties. The impact of these premiums are included in
the "Changes to Prior Accident Year" ratios.
|
|
| |
For the twelve months ended December
31st, the calendar year loss ratio improved by 29.2 points
to 64.3 in 2012 from 93.5 in 2011.
- Excluding catastrophes, the current accident year loss ratio
improved by 22.1 points to 53.7 in 2012 from 75.8 in 2011.
- Excluding catastrophes, the property loss ratio improved by 6.7
points from 43.7 in the fourth quarter of 2011 to 37.0 in the
fourth quarter of 2012. Including catastrophes, the property
loss ratio improved by 25.9 points to 55.8 in 2012 from 81.7 in
2011. Results for 2012 included $12
million related to Super Storm Sandy while 2011 included
Hurricane Irene and Tropical Storm Lee.
- The casualty loss ratio improved by 26.4 points to 74.3 in 2012
from 100.7 in 2011. The improvement is mainly attributable to
actions taken to increase profitability that were implemented in
the latter half of 2011.
- Current year results include a 0.2 point increase in the loss
ratio related to prior accident years. This increase was mainly
related to the Reinsurance Operations and resulted primarily from
unfavorable emergence in workers compensation and marine lines
partially offset by favorable emergence in property lines.
For the twelve months ended December
31st, the expense ratio decreased from 40.8 in 2011 to 39.9
in 2012.
- The expense ratio decreased primarily due to changes in the mix
of business in the Reinsurance Operations.
- Corporate expenses decreased $4.3
million mainly due to a decrease in outside legal and other
professional fees.
Global Indemnity plc's Three Months Ended December 31, 2012 and 2011 Gross and Net
Premiums Written Results by Business Unit
|
|
(Dollars in
thousands)
|
Three Months
Ended December 31,
|
|
|
Gross
Premiums Written
|
|
Net Premiums
Written
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
Insurance Operations
|
$ 50,380
|
|
$ 47,046
|
|
$ 45,342
|
|
$ 40,984
|
|
Reinsurance
Operations
|
11,334
|
|
5,137
|
|
11,334
|
|
5,137
|
|
Total
|
$ 61,714
|
|
$ 52,183
|
|
$ 56,676
|
|
$ 46,121
|
|
|
|
|
|
|
|
|
|
|
| |
Insurance Operations: For the three months ended
December 31, 2012, gross premiums
written increased 7.1%, and net premiums written increased 10.6%,
compared to the same period in 2011. This was primarily
driven by increases in the Company's small business, commercial
auto and property brokerage classes.
Reinsurance Operations: For the three months ended
December 30, 2012, gross and net
premiums written increased 120.6% compared to the same period in
2011. This increase is primarily due to a $6.0 million premium adjustment that became due
as a result of adverse loss development on two workers compensation
treaties that were written in 2009 and 2010.
Global Indemnity plc's Twelve Months Ended
December 31, 2012 and 2011
Gross and Net Premiums Written Results by Business Unit
|
|
(Dollars in
thousands)
|
Twelve
Months Ended December 31,
|
|
|
Gross
Premiums Written
|
|
Net Premiums
Written
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
Insurance Operations
|
$ 201,790
|
|
$ 229,148
|
|
$ 177,832
|
|
$ 202,317
|
|
Reinsurance
Operations
|
42,263
|
|
78,755
|
|
41,715
|
|
78,253
|
|
Total
|
$ 244,053
|
|
$ 307,903
|
|
$ 219,547
|
|
$ 280,570
|
|
|
|
|
|
|
|
|
|
|
| |
Insurance Operations: For the twelve months ended
December 31, 2012, gross premiums
written decreased 11.9%, and net premiums written decreased 12.1%,
compared to the same period in 2011. In the second half of
2011 the Company began exiting certain unprofitable classes of
business which contributed to the decrease. This was
partially offset by increases in the Company's small business,
property brokerage and commercial auto classes.
Reinsurance Operations: For the twelve months ended
December 31, 2012, gross premiums
written decreased 46.3%, and net premiums written decreased 46.7%,
compared to the same period in 2011. The decrease was
primarily due to the cancellation of several unprofitable treaties
during 2012.
Note: Tables Follow
GLOBAL
INDEMNITY PLC
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Dollars and
shares in thousands, except per share data)
|
|
|
|
|
For the
Three Months
Ended
December 31,
|
|
For the
Twelve Months
Ended
December 31,
|
|
|
(Unaudited)
2012 (1)
|
|
2011
|
|
(Unaudited)
2012 (1)
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
Gross premiums
written
|
$ 61,714
|
|
$ 52,183
|
|
$ 244,053
|
|
$ 307,903
|
|
|
|
|
|
|
|
|
|
|
Net premiums written
|
$ 56,676
|
|
$ 46,121
|
|
$ 219,547
|
|
$ 280,570
|
|
|
|
|
|
|
|
|
|
|
Net premiums earned
|
$ 61,204
|
|
$ 66,740
|
|
$ 238,862
|
|
$ 297,854
|
|
Net investment income
|
10,292
|
|
11,888
|
|
47,557
|
|
53,112
|
|
Net realized investment gains
(losses)
|
(158)
|
|
(198)
|
|
6,755
|
|
21,473
|
|
Other income (loss)
|
133
|
|
42
|
|
(158)
|
|
12,581
|
|
Total
revenues
|
71,471
|
|
78,472
|
|
293,016
|
|
385,020
|
|
|
|
|
|
|
|
|
|
|
Net losses and loss adjustment
expenses
|
40,054
|
|
72,355
|
|
153,628
|
|
278,684
|
|
Acquisition costs and other
underwriting expenses
|
25,253
|
|
28,681
|
|
95,403
|
|
121,491
|
|
Corporate and other operating
expenses
|
2,828
|
|
3,104
|
|
9,691
|
|
13,973
|
|
Interest expense
|
1,180
|
|
1,456
|
|
5,393
|
|
6,476
|
|
Income (loss)
before income taxes
|
2,156
|
|
(27,124)
|
|
28,901
|
|
(35,604)
|
|
Income tax expense
(benefit)
|
(2,222)
|
|
(3,614)
|
|
(5,856)
|
|
2,787
|
|
Net income (loss) before equity
in net income of partnership
|
4,378
|
|
(23,510)
|
|
34,757
|
|
(38,391)
|
|
Equity in net income of
partnership, net of tax
|
-
|
|
-
|
|
-
|
|
53
|
|
Net income
(loss)
|
$ 4,378
|
|
$ (23,510)
|
|
$ 34,757
|
|
$ (38,338)
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding–basic
|
25,113
|
|
29,995
|
|
26,723
|
|
30,246
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding–diluted
|
25,141
|
|
29,995
|
|
26,749
|
|
30,246
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share –
basic
|
$
0.17
|
|
$
(0.78)
|
|
$
1.30
|
|
$
(1.27)
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share –
diluted
|
$
0.17
|
|
$
(0.78)
|
|
$
1.30
|
|
$
(1.27)
|
|
|
|
|
|
|
|
|
|
|
Combined ratio
analysis: (2)
|
|
|
|
|
|
|
|
|
Loss ratio
|
65.4
|
|
108.4
|
|
64.3
|
|
93.5
|
|
Expense ratio
|
41.3
|
|
43.0
|
|
39.9
|
|
40.8
|
|
Combined ratio
|
106.7
|
|
151.4
|
|
104.2
|
|
134.3
|
|
|
|
|
|
|
|
|
|
| |
(1)
|
Results for the quarter and year
to date 2012 include the impact of an out-of-period adjustment
which reduced net income by $1.6 million, or $0.06 per diluted
share.
|
|
(2)
|
The loss ratio, expense ratio
and combined ratio are non-GAAP financial measures that are
generally viewed in the insurance industry as indicators of
underwriting profitability. The loss ratio is the ratio of
net losses and loss adjustment expenses to net premiums earned.
The expense ratio is the ratio of acquisition costs and other
underwriting expenses to net premiums earned. The combined
ratio is the sum of the loss and expense ratios.
|
|
| |
GLOBAL
INDEMNITY PLC
CONSOLIDATED
BALANCE SHEETS
(Dollars in
thousands)
|
|
|
|
ASSETS
|
|
(Unaudited)
December 31,
2012
|
|
December
31,
2011 (1)
|
|
Fixed Maturities:
|
|
|
|
|
|
|
Available for sale securities,
at fair value
(amortized cost: 2012 -
$1,187,094 and 2011 - $1,258,533)
|
|
$ 1,229,322
|
|
$ 1,296,885
|
|
Equity securities:
|
|
|
|
|
|
|
Available for sale, at fair
value
(cost: 2012 - $167,179 and 2011
- $155,390)
|
|
197,075
|
|
168,361
|
|
Other invested
assets:
|
|
|
|
|
|
|
Available for sale securities,
at fair value
(cost: 2012 - $3,049 and 2011 -
$4,150)
|
|
3,132
|
|
6,617
|
|
|
Total
investments
|
|
1,429,529
|
|
1,471,863
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
104,460
|
|
175,860
|
|
Premiums receivable,
net
|
|
45,162
|
|
47,844
|
|
Reinsurance
receivables
|
|
241,827
|
|
287,986
|
|
Deferred federal income
taxes
|
|
10,824
|
|
14,642
|
|
Deferred acquisition
costs
|
|
18,265
|
|
21,564
|
|
Intangible assets
|
|
18,343
|
|
18,704
|
|
Goodwill
|
|
4,820
|
|
4,820
|
|
Prepaid reinsurance
premiums
|
|
5,945
|
|
6,555
|
|
Receivable for securities
sold
|
|
-
|
|
1,484
|
|
Federal income taxes
receivable
|
|
6,844
|
|
2,223
|
|
Other assets
|
|
17,684
|
|
19,371
|
|
|
Total assets
|
|
$ 1,903,703
|
|
$ 2,072,916
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
Unpaid losses and loss
adjustment expenses
|
|
$
879,114
|
|
$
971,377
|
|
Unearned premiums
|
|
94,114
|
|
114,041
|
|
Ceded balances
payable
|
|
4,201
|
|
8,887
|
|
Contingent
commissions
|
|
9,911
|
|
7,473
|
|
Payable for securities
purchased
|
|
2,634
|
|
-
|
|
Notes and debentures
payable
|
|
84,929
|
|
103,000
|
|
Other liabilities
|
|
22,182
|
|
29,075
|
|
|
Total liabilities
|
|
1,097,085
|
|
1,233,853
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
Ordinary shares, $0.0001
par value, 900,000,000 ordinary shares authorized; A ordinary
shares issued: 16,087,939 and 21,429,683 respectively; A ordinary
shares outstanding: 13,030,938 and 16,810,678, respectively; B
ordinary shares issued and outstanding: 12,061,370 and
12,061,370, respectively
|
|
3
|
|
3
|
|
Additional paid-in
capital
|
|
512,304
|
|
621,917
|
|
Accumulated other comprehensive
income, net of taxes
|
|
53,350
|
|
40,174
|
|
Retained earnings
|
|
342,171
|
|
307,413
|
|
A ordinary shares in
treasury, at cost: 3,057,001 and 4,619,005 shares,
respectively
|
|
(101,210)
|
|
(130,444)
|
|
|
Total shareholders'
equity
|
|
806,618
|
|
839,063
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$ 1,903,703
|
|
$ 2,072,916
|
|
|
|
|
|
|
|
| |
(1)
|
Retrospective adoption of new
accounting guidance limiting acquisition costs that can be deferred
decreased deferred acquisition costs by $4.0 million and
shareholders' equity by $2.6 million.
|
|
| |
GLOBAL
INDEMNITY PLC
SELECTED
INVESTMENT DATA
(Dollars in
millions)
|
|
|
|
|
Market Value
as of
|
|
|
(Unaudited)
December 31,
2012
|
|
December 31,
2011
|
|
|
|
|
|
|
Fixed
Maturities
|
$ 1,229.3
|
|
$ 1,296.9
|
|
Cash and cash
equivalents
|
104.5
|
|
175.8
|
|
Total bonds and cash and
cash equivalents
|
1,333.8
|
|
1,472.7
|
|
Equities and other invested
assets
|
200.2
|
|
175.0
|
|
Total cash and invested
assets, gross
|
1,534.0
|
|
1,647.7
|
|
Receivable / (payable) for
securities
|
(2.6)
|
|
1.5
|
|
Total cash and invested
assets, net
|
$ 1,531.4
|
|
$ 1,649.2
|
|
|
|
|
|
| |
|
(Unaudited)
Twelve
Months Ended
December 31,
2012 (a)
|
|
|
|
|
Net investment income
(b)
|
$
47.5
|
|
|
|
|
Net realized investment
gains
|
6.8
|
|
Net unrealized investment
gain
|
18.4
|
|
Net realized and unrealized
investment returns
|
25.2
|
|
|
|
|
Total investment
return
|
$
72.7
|
|
|
|
|
Average total cash and
invested assets (c)
|
$ 1,590.3
|
|
|
|
|
Total investment return
%
|
4.6%
|
|
| |
(a)
|
Amounts in this table are shown
on a pre-tax basis.
|
|
(b)
|
Includes $4.8 million of
partnership distributions.
|
|
(c)
|
Simple average of beginning and
end of period, net of payable/receivable for
securities.
|
|
| |
GLOBAL
INDEMNITY PLC
SUMMARY OF
OPERATING INCOME
(Unaudited)
(Dollars and
shares in thousands, except per share data)
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For the
Three Months
Ended
December 31,
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For the
Twelve Months
Ended
December 31,
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2012 (1)
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2011
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2012 (1)
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2011
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Operating income
(loss)
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$ 4,453
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$ (22,761)
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$ 29,309
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$ (53,149)
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Adjustments:
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Net realized investment gains
(losses), net of tax
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(75)
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(749)
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5,448
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14,811
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Total after-tax
adjustments
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(75)
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(749)
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5,448
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14,811
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Net income (loss)
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$
4,378
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$ (23,510)
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$ 34,757
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$ (38,338)
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Weighted average shares
outstanding – basic
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25,113
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29,995
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26,723
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30,246
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Weighted average shares
outstanding – diluted
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25,141
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29,995
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26,749
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30,246
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Operating income (loss) per
share – basic
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$
0.18
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$
(0.76)
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$
1.10
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$
(1.76)
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Operating income (loss) per
share – diluted
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$
0.18
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$
(0.76)
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$
1.10
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$
(1.76)
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(1)
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Results for the quarter and year
to date 2012 include the impact of an out of period adjustment
which reduced net income and operating income by $1.6 million, or
$0.06 per diluted share.
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Note Regarding Operating Income
Operating income, a non-GAAP financial measure, is equal to net
income excluding after-tax net realized investment gains (losses).
Operating income is not a substitute for net income determined in
accordance with GAAP, and investors should not place undue reliance
on this measure.
Contact:
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Media
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Linda Hohn
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Associate General
Counsel
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(610) 660-6862
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lhohn@global-indemnity.com
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SOURCE Global Indemnity plc