Global Indemnity plc Reports Fourth Quarter 2013 Financial Results

      Global Indemnity plc Reports Fourth Quarter 2013 Financial Results

  PR Newswire

  DUBLIN, Feb. 20, 2014

DUBLIN, Feb. 20, 2014 /PRNewswire/ --Global Indemnity plc (NASDAQ:GBLI) today
reported net income for the year ended December 31, 2013 of $61.7 million or
$2.45 per share. As of December 31st, book value per share was $34.65, an
increase of 7.8% compared to book value per share of $32.15 at December 31,
2012.

(Logo: http://photos.prnewswire.com/prnh/20100803/LT45156LOGO )

Selected Operating and Balance Sheet Data (Dollars in millions, except per
share data)

                     For the Twelve
                         Months                                 As of

                   Ended December 31,                        December 31,
                     2013      2012                        2013       2012
Gross Premiums                         Book value per
Written             $ 290.7   $ 244.1  share              $ 34.65   $ 32.15
Net Premiums                           Shareholders'
Written             $ 272.0   $ 219.5  equity             $ 873.3   $ 806.6
                                       Cash and invested
                                       assets            $ 1,567.4  $ 1,534.0
Net income           $ 61.7   $ 34.8
Net income per
share                $ 2.45   $ 1.30
Operating income     $ 40.5   $ 29.3
Operating income
per share            $ 1.61   $ 1.10

Various events occurred in 2013 and 2012 that the Company would consider
infrequent or non-routine. The table below reflects the Company's results
excluding these non-routine charges and (benefits).

                                      Net Income          Operating Income
                                 For the Twelve Months  For the Twelve Months

                                  Ended December 31,     Ended December 31,
(Dollars in millions, except per
share data)                        2013         2012      2013         2012
Net/Operating income                $ 61.7      $ 34.8     $ 40.5      $ 29.3
Prepayment charge on retirement
of debt                                2.9           -        2.9           -
Limited partnership
distributions                        (0.1)       (4.8)      (0.1)       (4.8)
Sale of subsidiary                   (5.2)           -      (5.2)           -
Impact of premium deficiency
adjustments                            1.2       (7.6)        1.2       (7.6)
Tax effect assuming applicable
statutory rates                        0.6         0.8        0.6         0.8
Adjusted net/operating income       $ 61.1      $ 23.2     $ 39.9      $ 17.7
Adjusted per share amounts          $ 2.43      $ 0.87     $ 1.58      $ 0.66

See the notes following the "Summary of Operating Income" table for
information regarding the presentation of income excluding non-routine events

Cynthia Y. Valko, Chief Executive Officer, commented: "We are pleased with
our final results for 2013. Global Indemnity's insurance and reinsurance
premium volume grew 19% compared to 2012 and our calendar year combined ratio
improved 8.2 points to 96%. Low catastrophes coupled with better pricing and
underwriting were factors in improved year over year results. Our operating
income results improved to $40.5 million for 2013 versus $29.3 million in
2012. Net income results were also enhanced by investment returns primarily
driven by strong performance of the common stock portfolio. Overall, book
value per share was $34.65, an increase of 7.8% compared to last year."

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 worldwide. Global Indemnity
plc's two primary segments are:

  *United States Based Insurance Operations
  *Bermuda Based Reinsurance Operations

For more information, visit theGlobal 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 21, 2014 at 8:30 a.m.
Eastern Time to discuss the fourth quarter 2013 results.

To participate in the teleconference, please telephone +1-877-260-8900 (U.S.
and Canada) or +1-612-332-7516 (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 319959 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 21, 2014 until 11:59 p.m.February 21, 2015. To listen
to the replay, please telephone +1-800-475-6701 (U.S. and Canada) or
+1-320-365-3844 (International) then enter 319959.

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,
2013 and 2012

The combined ratio is a key measure of insurance profitability. The
components comprising the combined ratio are as follows:

                                Twelve Months Ended December 31,
                                   2013              2012 (1)
Loss Ratio:
Current Accident Year
 Excluding Catastrophes              47.7                 53.7
 Catastrophes                         8.9                 10.4
 Current Accident Year               56.6                 64.1
Changes to Prior Accident Year        (3.1)                  0.2
Loss Ratio – Calendar Year             53.5                 64.3
Expense Ratio                          42.5                 39.9
Combined Ratio                         96.0                104.2

(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 is included
in the "Changes to Prior Accident Year" ratios.

For the twelve months ended December 31st, the calendar year loss ratio
decreased by 10.8 points to 53.5 in 2013 from 64.3 in 2012.

For the twelve months ended December 31, 2013, the current accident year loss
ratio improved to 56.6 compared to 64.1 for the same period in 2012. Total
calendar year results in 2013 include a 3.1 point reduction in the loss ratio
related to prior accident years, which was primarily driven by lower than
expected severity in property lines. The property accident year loss ratio
decreased 11.9 points to 43.9 in 2013 from 55.8 in 2012. 2012's results
included $12 million related to Super Storm Sandy. The casualty loss ratio,
excluding premium deficiency charges, increased 6.9 points from 74.0 to 80.9
in 2013, primarily due to poor performance in commercial auto lines. Other
casualty lines in 2013 performed comparably to 2012.

For the twelve months ended December 31st, the expense ratio increased from
39.9 in 2012 to 42.5 in 2013.

The expense ratio for the twelve months ended December 31, 2013 and 2012 was
42.0 and 41.4, respectively excluding premium deficiency charges. The increase
is primarily due to an increase in profit commissions as a result of better
than expected performance within Reinsurance Operations.

Global Indemnity plc's Gross and Net Premiums Written Results by Segment

(Dollars in thousands)       Three Months Ended December 31,
                       Gross Premiums Written  Net Premiums Written
                          2013        2012       2013       2012
Insurance Operations     $ 59,659    $ 50,380  $ 54,695  $ 45,342
Reinsurance Operations      3,095      11,334      3,435     11,334
Total                    $ 62,754    $ 61,714   $ 58,130   $ 56,676

                              Twelve Months Ended December 31,
                       Gross Premiums Written   Net Premiums Written
                          2013        2012        2013        2012
Insurance Operations    $ 232,373   $ 201,790  $ 213,705  $ 177,832
Reinsurance Operations     58,350      42,263      58,279      41,715
Total                   $ 290,723   $ 244,053   $ 271,984   $ 219,547

Insurance Operations: For the twelve months ended December 31, 2013, gross
premiums written and net premiums written increased 15.2% and 20.2%,
respectively, compared to the same period in 2012. Gross written premiums
increased as a result of growth in small business binding authority lines as
well as growth in the property brokerage, programs and other lines. Growth
was driven by new business, pricing increases, and increased agent
relationships. Net written premiums increased as a result of an increase in
gross premiums written and a reduction of ceded premiums written as a result
of an increase in retention in property excess of loss and property
catastrophe. For the three months ended December 31, 2013, gross premiums
written and net premiums written increased 18.4% and 20.6%, respectively,
compared to the same period in 2012 for the same reasons as noted above.

Reinsurance Operations:  For the twelve months ended December 31, 2013, gross
premiums written and net premiums written increased 38.1% and 39.7%,
respectively, compared to the same periods in 2012. These increases were
primarily due to several new treaties written during 2013. For the three
months ended December 31, 2013, gross premiums written and net premiums
written decreased 72.7% and 69.7%, respectively, compared to the same periods
in 2012. 2012 included a premium increase of $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.

Note: Tables Follow

                            Global Indemnity plc
                    Consolidated Statements of Operations
          (Dollars and shares in thousands, except per share data)
                           For the Three Months Ended  For the Twelve Months
                                  December 31,           Ended December 31,
                            (Unaudited)                (Unaudited)
                               2013         2012 (5)      2013      2012 (5)
Gross premiums written          $ 62,754     $ 61,714    $ 290,723  $ 244,053
Net premiums written            $ 58,130     $ 56,676    $ 271,984  $ 219,547
Net premiums earned             $ 69,586     $ 61,204    $ 248,722  $ 238,862
Net investment income              8,924       10,292       37,209     47,557
Net realized investment
gains (losses)                    17,208        (158)       27,412      6,755
Other income (loss)                5,307          133        5,791      (158)
 Total revenues              101,025       71,471      319,134    293,016
Net losses and loss
adjustment expenses               30,796       40,054      132,991    153,628
Acquisition costs and
other underwriting
expenses                          28,674       25,253      105,651     95,403
Corporate and other
operating expenses                 4,170        2,828       11,614      9,691
Interest expense                     230        1,180        6,169      5,393
 Income before income
taxes                             37,155        2,156       62,709     28,901
Income tax expense
(benefit)                          3,442      (2,222)        1,019    (5,856)
 Net income                 $ 33,713        4,378     $ 61,690     34,757
Weighted average shares
outstanding–basic                 25,094       25,113       25,073     26,723
Weighted average shares
outstanding–diluted               25,218       25,141       25,174     26,749
Net income per share –
basic                            $ 1.34      $ 0.17      $ 2.46    $ 1.30
Net income per share –
diluted                          $ 1.34      $ 0.17      $ 2.45    $ 1.30
Combined ratio analysis:
(1)
Loss ratio (2)                      44.3         65.4         53.5       64.3
Expense ratio (3)                   41.2         41.3         42.5       39.9
Combined ratio (4)                  85.5        106.7         96.0      104.2

(1) 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.

(2) Excluding the impact of the 2011 premium deficiency charges, the loss
ratio was 65.5% and 66.0% for the three months and twelve months ended
December 31, 2012, respectively.

(3) Excluding the impact of 2011 and 2013 premium deficiency charges, the
expense ratio was 41.2% and 40.6% for the three months ended December 31, 2013
and 2012, respectively. Excluding the impact of 2011 and 2013 premium
deficiency charges, the expense ratio was 42.0% and 41.4% for the twelve
months ended December 31, 2013 and 2012, respectively.

(4) Excluding the impact of the 2011 and 2013 premium deficiency charges,
the combined ratio was 85.5 and 106.1 for the three months ended December 31,
2013 and 2012, respectively. Excluding the impact of the 2011 and 2013
premium deficiency charges, the combined ratio was 95.5% and 107.4% for the
twelve months ended December 31, 2013 and 2012, respectively.

(5) 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.

                            GLOBAL INDEMNITY PLC
                         CONSOLIDATED BALANCE SHEETS
                           (Dollars in thousands)
                                                   ( Unaudited)
                                                   December 31,  December 31,
ASSETS                                                 2013          2012
Fixed Maturities:
         Available for sale securities, at fair
         value

         (amortized cost: 2013 - $1,187,685 and
         2012 - $1,187,094)                        $ 1,204,364   $ 1,229,322
Equity securities:
         Available for sale, at fair value

         (cost: 2013 - $191,425 and 2012 -
         $167,179)                                      254,070       197,075
Other invested assets:
         Available for sale securities, at fair
         value

         (cost: 2013 - $3,065 and 2012 - $3,049)          3,489         3,132
          Total investments                      1,461,923     1,429,529
Cash and cash equivalents                               105,492       104,460
Premiums receivable, net                                 49,888        37,752
Reinsurance receivables, net                            197,887       241,827
Funds held by ceding reinsurers                          18,662         7,410
Federal income taxes receivable                               -         6,844
Deferred federal income taxes                             4,206        10,824
Deferred acquisition costs                               22,177        18,265
Intangible assets                                        17,990        18,343
Goodwill                                                  4,820         4,820
Prepaid reinsurance premiums                              5,199         5,945
Receivable for securities sold                              723             -
Other assets                                             22,812        17,684
          Total assets                         $ 1,911,779   $ 1,903,703
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Unpaid losses and loss adjustment expenses            $ 779,466     $ 879,114
Unearned premiums                                       116,629        94,114
Federal income taxes payable                              1,595             -
Ceded balances payable                                    5,177         4,201
Contingent commissions                                   12,677         9,911
Payable for securities purchased                              -         2,634
Margin borrowing facility                               100,000             -
Notes and debentures payable                                  -        84,929
Other liabilities                                        22,955        22,182
          Total liabilities                      1,038,499     1,097,085
Shareholders' equity:
Ordinary shares, $0.0001 par value, 900,000,000
ordinary shares authorized; A ordinary shares
issued: 16,200,406 and 16,087,939 respectively; A
ordinary shares outstanding: 13,141,035 and
13,030,938, respectively; B ordinary shares
issued and outstanding: 12,061,370 and
12,061,370, respectively                                      3             3
Additional paid-in capital                              516,653       512,304
Accumulated other comprehensive income, net of
taxes                                                    54,028        53,350
Retained earnings                                       403,861       342,171
A ordinary shares in treasury, at cost: 3,059,371
and 3,057,001 shares, respectively                    (101,265)     (101,210)
          Total shareholders' equity               873,280       806,618
          Total liabilities and
         shareholders' equity                       $ 1,911,779   $ 1,903,703

                            GLOBAL INDEMNITY PLC
                          SELECTED INVESTMENT DATA
                            (Dollars in millions)
                                                  Market Value as of
                                            (Unaudited)

                                         December 31, 2013  December 31, 2012
Fixed Maturities                                 $ 1,204.4          $ 1,229.3
Cash and cash equivalents                            105.5              104.5
Total bonds and cash and cash
equivalents                                        1,309.9            1,333.8
Equities and other invested assets                   257.5              200.2
Total cash and invested assets, gross              1,567.4            1,534.0
Receivable / (payable) for securities                  0.7              (2.6)
Total cash and invested assets, net             $ 1,568.1          $ 1,531.4

                                                    (Unaudited)

                                                Twelve Months Ended

                                               December 31, 2013 (a)
Net investment income                                       $  37.2
Net realized investment gains                                   27.4
Net unrealized investment gain                                   7.3
Net realized and unrealized investment returns                  34.7
 Total investment return                                 $  71.9
 Average total cash and invested assets (b)              $ 1,549.7
 Total investment return %                                    4.6%

(a) Amounts in this table are shown on a pre-tax basis.

(b) 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)
                                  For the Three Months  For the Twelve Months

                                   Ended December 31,    Ended December 31,
                                    2013      2012 (2)    2013      2012 (1)
Operating income                   $ 19,132    $ 4,453   $ 40,453    $ 29,309
Adjustments:
Net realized investment gains,
net of tax                           11,223       (75)     17,879       5,448
Gain on disposition of
subsidiary, net of tax                3,358          -      3,358           -
Total after-tax adjustments          14,581       (75)     21,237       5,448
Net income                         $ 33,713    $ 4,378   $ 61,690    $ 34,757
Weighted average shares
outstanding –basic                  25,094     25,113     25,073      26,723
Weighted average shares
outstanding –diluted                25,218     25,141     25,174      26,749
Operating income per share –
basic                               $ 0.76    $ 0.18    $ 1.61     $ 1.10
Operating income per share –
diluted                             $ 0.76    $ 0.18    $ 1.61     $ 1.10

(1) 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.

Note Regarding Operating Income

Operating income, a non-GAAP financial measure, is equal to net income
excluding after-tax net realized investment gains (losses) and after-tax gain
on disposition of subsidiary. Operating income is not a substitute for net
income determined in accordance with GAAP, and investors should not place
undue reliance on this measure.

Note Regarding Presentation of Income Excluding Non-Routine Events

The presentation of income excluding non-routine events, including adjusted
net income, adjusted operating income and adjusted per share amounts metrics,
is a non-GAAP financial measure. These metrics were presented to show
comparable results between periods without the impact of non-routine events.
It is not a substitute for net income determined in accordance with GAAP, and
investors should not place undue reliance on this measure.

Contact: Media Linda HohnAssociate General Counsel +1-610-660-6862
lhohn@global-indemnity.com 

Website: http://www.globalindemnity.ie
 
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