Universal Insurance Holdings, Inc. Reports Record First Quarter 2016 Financial Results

Achieved Highest First Quarter Net Income and Diluted EPS in Company History

Fort Lauderdale, FL, May 2, 2016 – Universal Insurance Holdings, Inc. (NYSE: UVE) today reported record first quarter net income of $25.2 million, an increase of 13.0%, or $2.9 million, over the same quarter in 2015.  Diluted earnings per share (EPS) were $0.71 for the first quarter of 2016, an increase of 14.5%, or $0.09 per share, over the same quarter in 2015. 

“I am very pleased with our outstanding first quarter results, which we achieved
notwithstanding the most active severe weather experienced in the first quarter
in Florida in company history,” said Sean P. Downes, Universal’s Chairman and
Chief Executive Officer.  “Our record performance in the quarter
highlights the strength of our underwriting standards, our claims handling
ability and the high quality of our book of business. We continued to execute
well on our key strategic initiatives, including further progress on our
geographic expansion efforts as we wrote our first homeowners insurance policy
in Michigan and received certificates of authority from New York and New
Jersey.  We enter the second quarter with a robust financial position and
confidence in our underlying growth prospects and will continue to maintain our
focus on writing high quality, rate-adequate organic business to drive increasing
value for Universal shareholders.”

First-Quarter 2016 & Recent Highlights

•  Net earned premiums grew by $58.1 million, or 61.6%, to $152.4 million.
•  Total revenues increased by $60.6 million, or 58.4%, to $164.4 million.
•  Net income increased by $2.9 million, or 13.0%, to $25.2 million.
•  Diluted EPS grew by $0.09, or 14.5%, to $0.71 per share.
•  Paid dividends of $0.14 per share.
•  Received Certificates of Authority from New York and New Jersey.
•  Wrote our first policy in Michigan.
•  Launched beta test of Universal Direct®, a Direct-to-Consumer online platform for homeowners insurance and wrote our first policy on Universal Direct®.

First-Quarter 2016 Results

Net income for the first quarter of 2016 of $25.2 million reflects an improvement across all revenue measures. The increase in net earned premiums includes both organic growth in policies in force and lower reinsurance costs, including the elimination of quota share reinsurance arrangements effective June 2015.

Earned premiums, total revenues, net income and diluted EPS were higher than any other first quarter in the Company’s history.

Net income was offset by $8.5 million beyond originally projected pre-tax net losses and loss adjustment expenses attributable to first quarter weather events in Florida. These losses and loss adjustment expenses were incremental to amounts provided for in the underlying loss ratio based on historical experience for such events.

Losses and loss adjustment expenses as a percentage of net earned premiums increased 7.8 percentage points resulting in a net loss ratio of 43.4% for the first quarter, compared to 35.6% for the same period last year. The key driver of this increase was the severe weather events in the first quarter of 2016.

Stockholders’ equity reached an all-time high of $314.3 million as of March 31, 2016 compared to $293.1 million as of December 31, 2015.  Book value per common share also reached an all-time high of $9.03 as March 31, 2016 compared to $8.34 as of December 31, 2015.

Cash Dividends

On January 14, 2016, the Company announced that its Board of Directors had declared an increased cash dividend of $0.14 per share of common stock, up $0.02 from the $0.12 per share paid during the past four quarters, and that the Board expected to declare and pay a proposed regular quarterly dividend during fiscal year 2016 of $0.14 per share. Payment was made on March 2, 2016 to shareholders of record on February 18, 2016.

On April 13, 2016, the Company announced that its Board of Directors had declared a cash dividend of $0.14 per share of common stock to be paid on July 5, 2016 to shareholders of record on June 15, 2016. 

Conference Call

Members of the Universal management team will host a conference call on Tuesday, May 3, 2016 at 10:00 AM ET to discuss the first
quarter 2016 financial results.   Following prepared remarks, management will conduct a question and answer session.

The call will be accessible by dialing toll free at (888) 887-7180 or toll at (270) 823-1518 (using the Conference I.D.: 97089515).  A replay of the call can be accessed toll free at (855) 859-2056 or toll at (404) 537-3406 (using the Conference I.D.: 97089515).

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, Delaware, Indiana, Pennsylvania, Minnesota and Michigan.  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 Form 10-K for the year ended December 31, 2015.

 Investor Contact:

Andy Brimmer / Mahmoud Siddig 

Joele Frank, Wilkinson Brimmer Katcher

212-355-4449