Maiden Holdings, Ltd. Reports First Quarter 2013 Net Income Of $25.0 Million Or $0.34 Per Diluted Common Share And Operating Earnings(1) Of $21.1 Million Or $0.29 Per Diluted Common Share

First Quarter 2013 Highlights
  • Annualized operating return on common equity(1) of 9.8% compared to 9.9% in the first quarter of 2012
  • Net operating earnings (1) available to Maiden common shareholders of $21.1 million, or $0.29 per diluted common share compared with $19.4 million, or $0.27 per diluted common share in the first quarter of 2012
  • Combined ratio(10) of 97.5% compared to 97.9% in the first quarter of 2012
  • Net investment income increased 19.2% to $22.0 million compared to the first quarter of 2012
  • Net premiums written increased 16.6% to $689.1 million versus the same period last year
  • Book value per common share(4) of $12.10, up 1.2% versus year-end 2012

HAMILTON, Bermuda, May 8, 2013 (GLOBE NEWSWIRE) -- Maiden Holdings, Ltd. ("Maiden") (Nasdaq:MHLD) today reported first quarter 2013 net income available to Maiden common shareholders of $25.0 million, or $0.34 per diluted common share compared with $20.4 million or $0.28 per diluted common share in the first quarter of 2012. Net operating earnings (1) available to Maiden common shareholders for the first quarter of 2013 were $21.1 million, or $0.29 per diluted common share compared with $19.4 million, or $0.27 per diluted common share in the comparative quarter in 2012.

Commenting on the Company's earnings, Art Raschbaum, President and Chief Executive Officer of Maiden, said: "Strong first quarter results reflect the favorable impact of 2012 underwriting actions, continued strengthening of investment earnings and robust revenue growth, from the AmTrust segment in particular, driven by the continued improvement in the primary insurer pricing environment in the U.S. and select global markets. We remain focused on maintaining disciplined underwriting, reducing exposure to volatility, and delivering significant value to our regional and specialty insurer clients." 

Results for the three months ended March 31, 2013

Net income available to Maiden common shareholders was $25.0 million, or $0.34 per diluted common share in the first quarter of 2013, compared with $20.4 million or $0.28 per diluted common share in the first quarter of 2012. Net operating earnings (1) available to Maiden common shareholders for the first quarter of 2013 were $21.1 million, or $0.29 per diluted common share compared with $19.4 million, or $0.27 per diluted common share in the comparative quarter in 2012.

Net premiums written were up 16.6%, or $98.2 million to $689.1 million in the first quarter of 2013 compared to the same quarter in 2012. The majority of the growth was attributable to the AmTrust Quota Share Reinsurance segment, which increased $118.8 million, or 52.6% to $344.8 million in the first quarter of 2013. The increase in the AmTrust Quota Share Reinsurance segment resulted from the continued combination of strategic acquisitions, organic growth and rate strengthening at AmTrust.  Net premiums written from the ACAC Quota Share in the first quarter of 2013 were approximately the same as the same period in 2012 at $76.6 million. Maiden's Diversified Reinsurance segment experienced a 7.2% reduction in net premiums written in the first quarter of 2013 compared to the first quarter of 2012. The lower net premiums written in the Diversified Reinsurance segment resulted from increased retention of business by clients and the impact of underwriting decisions in 2012. 

Net premiums earned of $488.4 million increased 11.4%, or $49.9 million compared to the first quarter of 2012, reflecting growth of net premiums written during 2012.  Comparing the first quarter of 2013 to the same quarter in 2012, earned premiums increased 31.2% for the AmTrust Quota Share Reinsurance segment and were up 8.7% in the ACAC Quota Share segment. The Diversified Reinsurance segment had net premiums earned of $196.2 million in the first quarter of 2013, a decrease of 4.0% compared to the same quarter in 2012.

Net investment income of $22.0 million in the first quarter of 2013 increased 19.2% compared to the first quarter of 2012.  Total investments increased 19.6% to $2.6 billion versus March 31, 2012.  The average yield on the fixed income portfolio (excluding cash) is 3.32% with an average duration of 3.57 years.

Net loss and loss adjustment expenses of $334.9 million were up $47.0 million compared to the first quarter of 2012. The net loss and loss adjustment expense ratio (6) increased 2.8 percentage points to 67.8% versus the first quarter of 2012.

Commission and other acquisition expenses together with general and administrative expenses of $146.4 million was nearly the same as the year ago quarter, while the total expense ratio (9) improved to 29.7% in the first quarter of 2013 compared with 32.9% in the same quarter last year. General and administrative expenses for the first quarter of 2013 totaled $14.1 million compared with $13.8 million in the first quarter of 2012. The general and administrative expense ratio (8) improved to 2.9% compared to 3.1% in the first quarter of 2012. 

The combined ratio (10) for the first quarter of 2013 totaled 97.5% compared with 97.9% in the first quarter of 2012. 

Total assets increased 6.7% to $4.4 billion at March 31, 2013 compared to $4.1 billion at year-end 2012.   Shareholders' equity was $1.03 billion, an increase of 1.1% compared to December 31, 2012. Book value per common share was $12.10 at the end of the first quarter of 2013 or 1.2% higher than at December 31, 2012. 

During the first quarter of 2013, the Board of Directors declared a dividend of $0.09 per share.

(1)(4) Please see the Non-GAAP Financial Measures table for additional information on these non-GAAP financial measures and reconciliation of these measures to GAAP measures.

(6)(8)(9)(10) Net loss and loss adjustment expense ratio, general and administrative expense ratio, expense ratio and combined ratio are operating metrics. Please see the additional information on these measures under Segment information tables.

Conference Call

Maiden's CEO Art Raschbaum and CFO John Marshaleck will review the first quarter 2013 results tomorrow morning via teleconference and live audio webcast beginning at 8:30 a.m. ET.
To participate in the conference call, please access one of the following at least five minutes prior to the start time:U.S. Callers: 1.877.734.5373
Outside U.S. Callers: 1.973.200.3059
Passcode: 48256308
Webcast: http://www.maiden.bm/presentations_conferences

A replay of the conference call will be available beginning at 11:00 a.m. ET on May 9, 2013 through midnight on May 16, 2013. To listen to the replay, please dial toll free: 1.800.585.8367 (U.S. Callers) or toll: 1.404.537.3406 (callers outside the U.S.) and enter the Passcode: 48256308; or access http://www.maiden.bm/presentations_conferences

About Maiden Holdings, Ltd.

Maiden Holdings, Ltd. is a Bermuda-based holding company formed in 2007. Through its subsidiaries, which are each A- rated (excellent) by A.M. Best, the Company is focused on providing non-catastrophic, customized reinsurance products and services to small and mid-size insurance companies in the United States and Europe. As of March 31, 2013, Maiden had $4.4 billion in assets and shareholders' equity of $1.0 billion.

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 and unusual frequency of storm activity, 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, 2012 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.
Balance Sheet
(in thousands (000's), except per share data)
     
   March 31, 2013 December 31, 2012
  (Unaudited) (Audited)
Assets    
Fixed maturities, available-for-sale, at fair value (Amortized cost 2013: $2,497,242; 2012: $2,475,202)  $ 2,629,873  $ 2,618,697
Other investments, at fair value (Cost 2013: $2,987; 2012: $2,599)  3,220  2,901
Total investments  2,633,093  2,621,598
Cash and cash equivalents  103,789  81,543
Restricted cash and cash equivalents  127,316  132,327
Accrued investment income  21,180  21,007
Reinsurance balances receivable, net   726,392  522,614
Funds withheld  44,281  42,712
Prepaid reinsurance premiums  38,786  38,725
Reinsurance recoverable on unpaid losses  118,091  110,858
Loan to related party   167,975  167,975
Deferred commission and other acquisition expenses  312,254  270,669
Goodwill and intangible assets, net  93,448  94,393
Other assets  30,646  33,742
Total Assets  $ 4,417,251  $ 4,138,163
Liabilities and Equity    
Liabilities    
Reserve for loss and loss adjustment expenses  $ 1,779,050  $ 1,740,281
Unearned premiums   1,134,697  936,497
Accrued expenses and other liabilities  142,977  111,957
Senior notes  207,500  207,500
Junior subordinated debt  126,332  126,317
Total Liabilities  3,390,556  3,122,552
     
Equity    
Preference Shares - Series A  150,000  150,000
Common shares  734  733
Additional paid-in capital  576,517  575,869
Accumulated other comprehensive income   133,098  141,130
Retained earnings  169,774  151,308
Treasury stock, at cost  (3,801)  (3,801)
Total Maiden Shareholders' Equity  1,026,322  1,015,239
Noncontrolling interest in subsidiaries  373  372
Total Equity  1,026,695  1,015,611
Total Liabilities and Equity  $ 4,417,251  $ 4,138,163
     
     
Book value per common share (4)  $ 12.10  $ 11.96
     
Common shares outstanding 72,440,857 72,343,947
 
Maiden Holdings, Ltd.
Income Statement
(in thousands (000's), except per share data)
(Unaudited)
     
     
  For the Three Months Ended March 31, 2013 For the Three Months Ended March 31, 2012
Revenues:    
Gross premiums written  $ 714,720  $ 613,212
     
Net premiums written  $ 689,059  $ 590,833
Change in unearned premiums  (200,617)  (152,337)
Net premiums earned  488,442  438,496
Other insurance revenue  5,215  4,754
Net investment income  21,979  18,437
Net realized and unrealized gains on investment   3,283  1,365
Total revenues  518,919  463,052
Expenses:    
Net loss and loss adjustment expenses   334,895  287,917
Commission and other acquisition expenses   132,330  132,258
General and administrative expenses  14,095  13,831
Total expenses  481,320  434,006
     
Income from operations (2)  37,599  29,046
     
Other expenses    
Amortization of intangible assets  (945)  (1,090)
Foreign exchange gains  1,547  979
Interest and amortization expenses  (9,570)  (7,678)
Total other expenses  (8,968)  (7,789)
     
Income before income taxes  28,631  21,257
Income taxes:    
Current tax expense  573  638
Deferred tax (benefit) expense  (49)  241
Income tax expense  524  879
     
Net income   28,107  20,378
Less: income attributable to noncontrolling interest  (27)  (1)
Net income attributable to Maiden   28,080  20,377
Dividends on preference shares  (3,094)  -- 
Net income attributable to Maiden common shareholders  $ 24,986  $ 20,377
Net operating earnings attributable to Maiden common shareholders (1)  $ 21,052  $ 19,364
     
Basic earnings per common share attributable to Maiden shareholders  $ 0.35  $ 0.28
Diluted earnings per common share attributable to Maiden shareholders  $ 0.34  $ 0.28
Basic operating earnings per common share attributable to Maiden shareholders   $ 0.29  $ 0.27
Diluted operating earnings per common share attributable to Maiden shareholders  $ 0.29  $ 0.27
     
Dividends declared per common share  $ 0.09  $ 0.08
     
Weighted average number of basic shares outstanding   72,417,358  72,226,329
Weighted average number of diluted shares outstanding   73,440,372  73,056,423
     
Net loss and loss adjustment expense ratio (6) 67.8% 65.0%
Commission and other acquisition expense ratio (7) 26.8% 29.8%
General and administrative expense ratio (8) 2.9% 3.1%
Expense ratio (9) 29.7% 32.9%
Combined ratio (10) 97.5% 97.9%
Annualized return on common equity 11.6% 10.4%
Annualized operating return on common equity 9.8% 9.9%
 
Maiden Holdings, Ltd.
Non - GAAP Financial Measure
(in thousands (000's), except per share data)
(Unaudited)
     
     
  For the Three Months Ended March 31, 2013 For the Three Months Ended March 31, 2012
Reconciliation of net income attributable to Maiden common shareholders to net operating earnings:    
Net income attributable to Maiden common shareholders  $ 24,986  $ 20,377
Add (subtract)    
Net realized and unrealized gains on investment   (3,283)  (1,365)
Foreign exchange gains  (1,547)  (979)
Amortization of intangible assets  945  1,090
Non-cash deferred tax (benefit) expense  (49)  241
Net operating earnings attributable to Maiden common shareholders (1)  $ 21,052  $ 19,364
     
Operating earnings per common share attributable to Maiden shareholders:    
     
Basic earnings per common share attributable to Maiden shareholders   $ 0.29  $ 0.27
Diluted earnings per common share attributable to Maiden shareholders  $ 0.29  $ 0.27
     
Reconciliation of net income attributable to Maiden to income from operations:    
Net income attributable to Maiden   $ 28,080  $ 20,377
Add (subtract)    
Foreign exchange gains  (1,547)  (979)
Amortization of intangible assets  945  1,090
Interest and amortization expenses  9,570  7,678
Income tax expense   524  879
Income attributable to noncontrolling interest  27  1
Income from operations (2)  $ 37,599  $ 29,046
     
  March 31, 2013 December 31, 2012
Investable assets:    
Total investments  $ 2,633,093  $ 2,621,598
Cash and cash equivalents  103,789  81,543
Restricted cash and cash equivalents  127,316  132,327
Funds withheld (3)  25,108  26,494
Loan to related party  167,975  167,975
Total investable assets (3)  $ 3,057,281  $ 3,029,937
     
  March 31, 2013 December 31, 2012
Capital:    
Senior notes  $ 207,500  $ 207,500
Junior subordinated debt  126,332  126,317
Total Maiden shareholders' equity  1,026,322  1,015,239
Total capital (5)  $ 1,360,154  $ 1,349,056

(1) Net operating earnings is a non-GAAP financial measure defined by the Company as net income attributable to Maiden common shareholders excluding realized and unrealized investment gains and losses, foreign exchange gains and losses, amortization of intangible assets and non-cash deferred tax charge 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.

(2) Income from Operations is a non-GAAP financial measure defined by the Company as net income attributable to Maiden excluding foreign exchange  gains and losses, amortization of intangible assets, interest and amortization expenses, income tax expense and income or loss attributable to noncontrolling interest and should not be considered as an alternative to net income.  The Company's management believes that income from operations is a useful measure of the Company's underlying earnings fundamentals based on its underwriting and investment income before financing costs. This income from operations enables readers of this information to more clearly understand the essential operating results of the Company. The Company's measure of income from operations may not be comparable to similarly titled measures used by other companies.

(3) Investable assets is the total of the Company's investments, cash and cash equivalents, loan to a related party and the portion of the funds withheld balance that comprises fixed maturity securities and cash and cash equivalents.

(4) Calculated by dividing total Maiden shareholders' equity less the preference shares - series A by total common shares outstanding.

(5) Capital is the total of the Company's senior notes, junior subordinated debt and Maiden shareholders' equity.
Maiden Holdings, Ltd.
Supplemental Financial Data - Segment Information
(in thousands (000's))
(Unaudited)
         
         
         
         
For the Three Months Ended March 31, 2013 Diversified Reinsurance AmTrust Quota Share Reinsurance ACAC Quota Share Total
Net premiums written  $ 267,610  $ 344,818  $ 76,631  $ 689,059
Net premiums earned  $ 196,249  $ 220,288  $ 71,905  $ 488,442
Other insurance revenue 5,215  --   --  5,215
Net loss and loss adjustment expenses  (140,763)  (145,645)  (48,487)  (334,895)
Commissions and other acquisition expenses  (44,782)  (65,132)  (22,416)  (132,330)
General and administrative expenses  (10,798)  (489)  (174)  (11,461)
Underwriting income  $ 5,121  $ 9,022  $ 828  $ 14,971
         
Reconciliation to net income attributable to Maiden common shareholders        
Net investment income and realized gains on investment        25,262
Amortization of intangible assets        (945)
Foreign exchange gains        1,547
Interest and amortization expenses        (9,570)
Other general and administrative expenses        (2,634)
Income tax expense        (524)
Income attributable to noncontrolling interest        (27)
Dividends on preference shares        (3,094)
Net income attributable to Maiden common shareholders        $ 24,986
         
Net loss and loss adjustment expense ratio (6) 69.9% 66.1% 67.4% 67.8%
Commission and other acquisition expense ratio (7) 22.2% 29.6% 31.2% 26.8%
General and administrative expense ratio (8) 5.4% 0.2% 0.2% 2.9%
Combined ratio (10) 97.5% 95.9% 98.8% 97.5%
         
         
         
         
For the Three Months Ended March 31, 2012 Diversified Reinsurance AmTrust Quota Share Reinsurance ACAC Quota Share Total
Net premiums written  $ 288,296  $ 226,015  $ 76,522  $ 590,833
Net premiums earned  $ 204,463  $ 167,879  $ 66,154  $ 438,496
Other insurance revenue 4,754  --   --   4,754
Net loss and loss adjustment expenses  (132,392)  (112,856)  (42,669)  (287,917)
Commissions and other acquisition expenses  (64,149)  (47,169)  (20,940)  (132,258)
General and administrative expenses  (10,448)  (379)  (173)  (11,000)
Underwriting income  $ 2,228  $ 7,475  $ 2,372  $ 12,075
         
Reconciliation to net income attributable to Maiden common shareholders        
Net investment income and realized and unrealized gains on investment        19,802
Amortization of intangible assets        (1,090)
Foreign exchange gains        979
Interest and amortization expenses        (7,678)
Other general and administrative expenses        (2,831)
Income tax expense        (879)
Income attributable to noncontrolling interest        (1)
Net income attributable to Maiden common shareholders        $ 20,377
         
Net loss and loss adjustment expense ratio (6) 63.3% 67.2% 64.5% 65.0%
Commission and other acquisition expense ratio (7) 30.7% 28.1% 31.7% 29.8%
General and administrative expense ratio (8) 4.9% 0.2% 0.2% 3.1%
Combined ratio (10) 98.9% 95.5% 96.4% 97.9%

(6) Calculated by dividing net loss and loss adjustment expenses by the sum of net premiums earned and other insurance revenue.

(7) Calculated by dividing commission and other acquisition expenses by the sum of net premiums earned and other insurance revenue.

(8) Calculated by dividing general and administrative expenses by the sum of net premiums earned and other insurance revenue.

(9) Calculated by adding together the commission and other acquisition expense ratio and general and administrative expense ratio.

(10) Calculated by adding together the net loss and loss adjustment expense ratio and expense ratio.  
CONTACT: Noah Fields, Vice President, Investor Relations         Maiden Holdings, Ltd.         Phone: 441.298.4927         E-mail: nfields@maiden.bm

company logo

More from Press Releases

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

NFL Pushes for Regulation Following Supreme Court's Sports Gambling Ruling

21st Century Fox Scoops Up Local News Stations

21st Century Fox Scoops Up Local News Stations

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Walmart CEO: 'We Are Transforming Globally' With Flipkart

Three-Part FREE Webinar Series

Three-Part FREE Webinar Series

March 24 Full-Day Course Offering: Professional Approach to Trading SPX

March 24 Full-Day Course Offering: Professional Approach to Trading SPX