Universal Insurance Holdings, Inc. Reports First Quarter 2007 Financial Results

 Company Reports Earnings of $.30 Per Share Compared to $.09 Per Share for Prior Year First Quarter

 

FORT LAUDERDALE, Fla., May 15, 2007 -- Universal Insurance Holdings, Inc. today reported net income of $12,374,829 or $.30 per share on a fully diluted basis on revenues of $44,569,042 for the three months ended March 31, 2007 compared to net income of $3,312,594 or $.09 per share on a fully diluted basis on revenues of $5,629,275 for the three months ended March 31, 2006. The Company is currently servicing approximately 310,000 homeowners' insurance policies.
 
Commenting on the Company's financial results, Bradley I. Meier, President and Chief Executive Officer said: "Although the Florida marketplace has become more competitive in recent months, the Company has successfully combined both growth and profitability by writing rate adequate business." Mr. Meier added, "Based on the strength of both the Company's balance sheet and its infrastructure, we believe the Company is well-positioned in the Florida marketplace."
 
About Universal Insurance Holdings, Inc.
 
Universal Insurance Holdings, Inc. is a vertically integrated insurance company. Readers should refer generally to reports filed by the Company with the Securities and Exchange Commission (SEC), and specifically to the Company's Form 10-KSB for the year ended December 31, 2006 for a discussion of the risk factors that could affect its operations. Such factors include, without limitation, exposure to catastrophic losses; reliance on the Company's reinsurance program; underwriting performance on catastrophe and non-catastrophe risks; the ability to maintain relationships with customers, employees or suppliers; and competition and its effect on pricing, spending, third-party relationships and revenues. Additional factors that may affect future results are contained in the Company's filings with the SEC, which are available on the SEC's web site at http://www.sec.gov. The Company disclaims any obligation to update and revise statements contained in this press release based on new information or otherwise.
 
Cautionary Language Concerning Forward-Looking Statements.
 
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate" and "project," and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such statements may include, but not be limited to, projections of revenues, income or loss, expenses, plans, 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 in forward-looking statements.
 
         UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                             (Unaudited)

                                         Three Months   Three Months
                                             Ended           Ended
                                        March 31, 2007  March 31, 2006
                                        --------------- --------------

PREMIUMS EARNED AND OTHER REVENUES:
  Direct premiums written                 $130,989,353    $36,844,517
  Ceded premiums written                   (94,076,043)   (31,982,560)
                                        --------------- --------------
  Net premiums written                      36,913,310      4,861,957
  Decrease (increase) in unearned
   premiums                                  2,524,953       (576,371)
                                        --------------- --------------
  Premiums earned, net                      39,438,263      4,285,586
  Net investment income                      2,726,221        383,967
  Commission revenue                         2,352,856        920,892
  Other revenue                                 51,702         38,830
                                        --------------- --------------
       Total premiums earned and other
        revenues                            44,569,042      5,629,275
                                        --------------- --------------

OPERATING COSTS AND EXPENSES
  Losses and loss adjustment expenses,
   net                                      11,454,252        919,123
  General and administrative expenses       10,926,557        (80,184)
                                        --------------- --------------
       Total operating costs and
        expenses                            22,380,809        838,939
                                        --------------- --------------

INCOME BEFORE INCOME TAXES                  22,188,233      4,790,336

  Income taxes, current                      9,374,434      1,278,865
  Income taxes, deferred                       438,970        198,877
                                        --------------- --------------
       Income taxes, net                     9,813,404      1,477,742
                                        --------------- --------------

NET INCOME                                 $12,374,829     $3,312,594
                                        =============== ==============

INCOME PER COMMON SHARE:
  Basic                                          $0.35          $0.10
                                        =============== ==============

WEIGHTED AVERAGE COMMON SHARES
 OUTSTANDING - BASIC                        34,999,000     33,470,000
                                        =============== ==============

INCOME PER COMMON SHARE
  Diluted                                        $0.30          $0.09
                                        =============== ==============

WEIGHTED AVERAGE COMMON SHARES
 OUTSTANDING - DILUTED                      41,103,000     35,455,000
                                        =============== ==============

CASH DIVIDEND DECLARED PER COMMON
 SHARE                                           $0.07          $0.04
                                        =============== ==============


         UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED BALANCE SHEET
                            March 31, 2007
                             (Unaudited)

                                ASSETS

Cash and cash equivalents                                $272,344,012
Real estate, net                                            3,236,841
Reinsurance recoverables                                  263,647,056
Premiums and other receivables, net                        20,009,914
Deferred policy acquisition costs, net                      2,378,326
Property and equipment, net                                   564,064
Deferred income taxes                                       8,232,786
Other assets                                                   16,749
                                                         -------------
Total assets                                             $570,429,748
                                                         =============


                 LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Unpaid losses and loss adjustment expenses                $51,927,770
Unearned premiums                                         260,822,071
Accounts payable                                            2,337,892
Reinsurance payable                                       155,296,394
Federal and state income taxes payable                      8,807,850
Dividends payable                                           4,579,352
Other accrued expenses                                     13,005,933
Other liabilities                                           8,076,078
Loans payable                                               7,516,931
Long-term debt                                             25,057,286
                                                         -------------
Total liabilities                                         537,427,557
                                                         -------------

STOCKHOLDERS' EQUITY:
Cumulative convertible preferred stock, $.01 par value,
 1,000,000 shares authorized, 138,640 shares issued and
 outstanding, minimum liquidation preference of
 $1,419,700                                                     1,387
Common stock, $.01 par value, 50,000,000 shares
 authorized, 38,307,103 shares issued and 35,198,458
 shares outstanding                                           383,072
Common stock in treasury, at cost - 208,645 shares           (101,820)
Common stock held in trust, at cost - 2,900,000 shares     (2,349,000)
Additional paid-in capital                                 19,774,709
Retained earnings                                          15,293,843
                                                         -------------
Total stockholders' equity                                 33,002,191
                                                         -------------
Total liabilities and stockholders' equity               $570,429,748                                                         =============


SOURCE: Universal Insurance Holdings, Inc.
Universal Insurance Holdings, Inc., Fort Lauderdale Bradley I. Meier, President, 954-958-1200