Universal Insurance Holdings, Inc. Reports Third Quarter 2014 Financial Results
Fort Lauderdale, FL, October 30, 2014 – Universal Insurance Holdings, Inc. (NYSE: UVE) (or the “Company”) today reported net income of $21.3 million, or $0.61 per diluted share, an increase of $6.9 million, for the third quarter of 2014, compared to net income of $14.4 million, or $0.40 per diluted share, for the same period in 2013.
“Our record third quarter results highlight the successful execution of our strategy to grow our business, increase profitability and deliver value to our shareholders,” said Sean P. Downes, the Company’s Chairman, President and Chief Executive Officer. “Consistent with our strategy, we continued to maintain disciplined underwriting standards along with a focus on writing high quality, rate adequate, organically grown business. From a growth perspective, earlier this year we decided to reduce our quota share reinsurance which resulted in us retaining a greater portion of our business. In addition, this quarter we have seen an increase in policy count in each and every state in which we are currently writing business. We also continue to diversify our portfolio via geographic expansion and have recently been approved to write business in the state of Indiana. We believe the underlying organic growth drivers of our business remain strong and expect to build on our strong momentum in the fourth quarter.”
Third-Quarter 2014 & Recent Highlights
Third-Quarter 2014 Results
Net income for the third quarter of 2014 of $21.3 million reflects an improvement across multiple measures including an increase in net earned premiums, policy fees and income generated from the Company’s investment portfolio, partially offset by a decrease in commission revenue and increases in operating expenses. Earned premiums, total revenues, net income and diluted EPS are all higher than any other quarter in the Company’s history.
Diluted EPS of $0.61 benefitted from lower outstanding shares as a result of the cumulative share repurchases made by the Company.
At September 30, 2014, stockholders’ equity was $189.1 million compared to $175.6 million at December 31, 2013 reflecting year-to-date net income of $52.0 million, share repurchases of $29.7 million and dividend payments of $10.4 million.
First Nine-Month Results
For the first nine months of 2014, the Company’s net income increased by $8.6 million, or 19.9 percent, compared to the same period of 2013. Diluted earnings per share for the first nine months of 2014 increased by $0.35, or 31 percent, compared to the same period of 2013.
Net premiums earned increased by $30.3 million to $231.5 million for the first nine months of 2014 compared to the same period of 2013.
During the third quarter of 2014, the Company repurchased 719,937 shares of its common stock at an average purchase price of $13.16 per share. As announced on September 25, 2014, the Company completed its $10 million share repurchase program announced on June 17, 2014, having repurchased a total of 758,361 shares of common stock in the open market at an average price of $13.15 per share.
The Company noted that the completion of its share repurchase program underscores its confident outlook, solid financial position and commitment to effectively deploying capital when it sees clear value. The Board of Directors and management team expect to continue to consider ways to enhance shareholder value, both through strategic growth initiatives and capital returns to shareholders.
On August 26, 2014, the Company announced that its board of directors declared a cash dividend of $0.10 per share of common stock which was paid on October 1, 2014, to shareholders of record on September 23, 2014.
Financial Results Presentation
The Company will make available an audio recording of a presentation discussing its second quarter 2014 financial results on Thursday, October 30, 2014, at approximately 5:00 p.m. Eastern. The presentation will be pre-recorded and there will be no opportunity for live questions. The audio recording will be available at www.universalinsuranceholdings.com until December 1, 2014.
About Universal Insurance Holdings, Inc.
Universal Insurance Holdings, Inc., with its wholly-owned subsidiaries, is a vertically integrated insurance holding company performing all aspects of insurance underwriting, distribution and claims. Universal Property & Casualty Insurance Company (UPCIC), a wholly-owned subsidiary of the Company, is one of the leading writers of homeowners insurance in Florida and is now fully licensed and has commenced its operations in North Carolina, South Carolina, Hawaii, Georgia, Massachusetts, Maryland and Delaware. American Platinum Property and Casualty Insurance Company, also a wholly-owned subsidiary, currently writes homeowners multi-peril insurance on Florida homes valued in excess of $1 million, which are limits and coverages currently not targeted through its affiliate UPCIC. For additional information on the Company, please visit our investor relations website at www.universalinsuranceholdings.com.
Forward-Looking Statements and Risk Factors
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such statements may include commentary on plans, products and lines of business, marketing arrangements, reinsurance programs and other business developments 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 and the Company undertakes no obligation to correct or update any forward-looking statements. For further information regarding risk factors that could affect the Company’s operations and future results, refer to the Company’s reports filed with the Securities and Exchange Commission, including the Form 10-K for the year ended December 31, 2013 and the Form 10-Q for the quarter ended September 30, 2014.