Attached files
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| 8-K - CURRENT REPORT - OXBRIDGE RE HOLDINGS Ltd | oxbr_8k.htm |
Exhibit 99.1
Company
Contact:
Oxbridge
Re Holdings Limited
Jay
Madhu, CEO
345-749-7570
jmadhu@oxbridgere.com
Media
contact:
Suzie
Boland
RFB
Communications Group
813-786-1019
sboland@rfbcommunications.com
Oxbridge
Re Holdings Reports Fourth Quarter and Full Year 2016
Results
GRAND CAYMAN, Cayman Islands (March 13, 2017) --
Oxbridge Re Holdings Limited (OXBR),
a provider of reinsurance solutions primarily to property and
casualty insurers in the Gulf Coast region of the United States,
reported financial results for the fourth quarter and 12 months
ended Dec. 31, 2016. Despite the company reporting a net loss
of $(0.39) per basic and diluted common share for the fourth
quarter of 2016 due to Hurricane Matthew, the company was
profitable for the year, and reported net income of $2.6 million or
$0.43 per basic and diluted common share.
Fourth Quarter 2016 Results
Net
loss totaled $2.3 million or $(0.39) per basic and diluted common
share compared with net income of $0.4 million or $0.06 per basic
and diluted common share in the fourth quarter of 2015. The
decrease in earnings was primarily due to net underwriting losses
related to Hurricane Matthew experience during 2016.
Net
premiums earned increased to $11.4 million compared with $1.8
million in the fourth quarter of 2015. The increase in net premiums
earned was a result of the derecognition of approximately $9.6
million of loss experience refund reserve during the fourth quarter
of 2016 as the company experienced losses under one of its
retrospectively rated contracts.
Net
investment income totaled $123,000 coupled with $298,000 of net
realized investment gains. This compares with $75,000 of net
investment income offset by $998,000 of net realized investment
losses for the fourth quarter of 2015.
Total
expenses, including losses and loss adjustment expenses, policy
acquisition costs and underwriting expenses, and general and
administrative expenses, were $14.2 million compared with $496,000
in the fourth quarter of 2015. The increase was primarily as a
result of losses from Hurricane Matthew during Q4 2016 compared
with no weather-related losses during Q4 2015, offset by lower
policy acquisition costs and general and administrative
expenses.
During
the fourth quarter of 2016 the company repurchased 65,464 common
shares under the $2.0 million share repurchase plan approved by the
board of directors in May 2016. These shares were repurchased at an
average price of $5.25 per share, bringing the total repurchases to
date to approximately $742,000.
Dividends
paid per share were $0.12 for the fourth quarter of 2016, unchanged
from the fourth quarter of 2015.
At Dec.
31, 2016, cash and cash equivalents, and restricted cash and cash
equivalents, totaled $35.7 million compared with $39.0 million at
Dec. 31, 2015.
Fourth Quarter 2016 Financial Ratios
Loss
ratio, which measures underwriting profitability, is the ratio of
losses and loss adjustment expenses incurred to net premiums
earned. The loss ratio was 120.4% for the fourth quarter of 2016
compared with 0.0% for the fourth quarter of 2015. The increase was
wholly due to the financial impact of Hurricane Matthew occurring
during the quarter that affected the company’s book of
business.
Acquisition
cost ratio, which measures operational efficiency, compares policy
acquisition costs and other underwriting expenses with net premiums
earned. The acquisition cost ratio was 0.7% for the fourth quarter
of 2016 compared with 4.7% for the same year-ago period. The
decrease was due to the lower weighted-average acquisition costs on
reinsurance contracts in force as well as the impact of an
adjustment to net premiums earned due to the derecognition of loss
experience refund payable mentioned above.
Expense
ratio, which measures operating performance, compares policy
acquisition costs, other underwriting expenses and general and
administrative expenses with net premiums earned. The expense ratio
totaled 3.6% during the fourth quarter of 2016 compared with 27.7%
for the fourth quarter of 2015. The decrease is primarily due to
the increase in net premiums earned as a result of the
derecognition of loss experience refund payable coupled with lower
policy acquisition costs.
Combined
ratio, which is used to measure underwriting performance, is the
sum of the loss ratio and the expense ratio. If the combined ratio
is at or above 100%, underwriting is not profitable. The combined
ratio totaled 124.0% for the fourth quarter of 2016 and 27.7% for
the fourth quarter of 2015.
Twelve Months Ended December 31, 2016 Financial
Results
Net
income totaled $2.6 million or $0.43 per basic and diluted common
share compared with $4.6 million or $0.76 per basic and diluted
common share in 2015. The decrease was primarily due to net
underwriting losses related to Hurricane Matthew and other
weather-related events experienced during 2016.
Net
premiums earned totaled $18.1 million compared with $6.8 million in
2015. The increase in net premiums earned was a result of the
derecognition of approximately $11.3 million of loss experience
refund payable during 2016 as the company experienced losses under
one of its retrospectively rated contracts. Such derecognition is recorded in the change in
loss experience refund payable, a component of net premiums
earned.
Net
investment income totaled $450,000 coupled with $554,000 of net
realized investment gains. This compares with $337,000 of net
investment income offset by $325,000 of net realized investment
losses and $399,000 of other-than-temporary impairment losses for
2015.
Total
expenses, including losses and loss adjustment expenses, policy
acquisition costs and underwriting expenses, and general and
administrative expenses, were $16.5 million compared with $1.8
million in 2015. The increase a result
of weather-related losses during 2016 compared with no
weather-related losses during 2015, offset by lower policy
acquisition costs and general and administrative
expenses.
Dividends
paid per share were $0.48 for 2016, unchanged from
2015.
Twelve Months Ended December 31, 2016 Financial Ratios
The
loss ratio was 81.8% compared with no losses and a loss ratio of
0.0% during 2015. The increase was wholly due to weather-related
events during 2016 that affected the company’s book of
business.
The
acquisition cost ratio was 1.6% compared with 5.1% for the 2015.
The decrease was due to the lower weighted-average acquisition
costs on reinsurance contracts in force during 2016 compared with
2015, as well as the impact of an adjustment to net premiums earned
due to the derecognition of loss experience refund payable
mentioned above.
The
expense ratio was 9.4% compared with 26.3% for 2015. The decrease
is primarily due to the increase in net premiums earned as a result
of the derecognition of loss experience refund payable coupled with
lower policy acquisition costs.
The
combined ratio was 91.3% compared with 26.3% for the year-ago
period.
Subsequent Events
Subsequent
to the quarter end, the company declared its regular quarterly cash
dividend in the amount of $0.12. The dividend will be paid on March
30, 2017 to shareholders of record on the close of business March
17, 2017.
Management Commentary
“Our diversified book of business produced $2.6 million of
profit, despite paying out on losses for the year,” said
Oxbridge Re Holdings President and CEO Jay Madhu. “We believe
our positive results for the year were a reflection of our
conservative approach and stringent underwriting
process."
“We
remain committed to our shareholders through the distribution of
dividends and the repurchase of common shares.”
“Looking
forward, our strong capital position allows us to patiently
evaluate the marketplace and seek opportunities to expand and
diversify our business of writing fully collateralized reinsurance
contracts.”
Conference Call
Management
will host a conference call later today to discuss these financial
results, followed by a question and answer session. President and
CEO Jay Madhu, and CFO Wrendon Timothy will host the call starting
at 4:30 p.m. Eastern time.
The
live presentation can be accessed by dialing the number below or by
clicking the webcast link available on the Investor Information
section of the company's website at www.oxbridgere.com.
Date:
Monday, March 13, 2017
Time:
4:30 p.m. Eastern time
Listen-only
toll-free number: 877-407-0782
Listen-only
international number: 201-689-8567
Please
call the conference telephone number 10 minutes before the start
time. An operator will register your name and organization. If you
have any difficulty connecting with the conference call, please
contact Issuer Direct at 919-481-4000 or operations@issuerdirect.com.
A
replay of the call will be available by telephone after 8 p.m.
Eastern time on the same day of the call and via the Investor
Information section of Oxbridge's website at www.oxbridgere.com
until April 13, 2017.
Toll-free
replay number: 877-481-4010
International
replay number: 919-882-2331
Conference
ID: 10257
About Oxbridge Re Holdings Limited
Oxbridge
(www.oxbridgere.com)
is a Cayman Islands exempted company that was organized in April
2013 to provide reinsurance business solutions primarily to
property and casualty insurers in the Gulf Coast region of the
United States. Through Oxbridge's licensed reinsurance subsidiary,
Oxbridge Reinsurance Limited, it writes fully collateralized
policies to cover property losses from specified catastrophes.
Oxbridge specializes in underwriting medium frequency, high
severity risks, where it believes sufficient data exists to analyze
effectively the risk/return profile of reinsurance contracts. The
company's ordinary shares and warrants trade on the NASDAQ Capital
Market under the symbols "OXBR" and
"OXBRW,"
respectively, and the company's common stock is included in the
Russell Microcap Index.
Forward-Looking Statements
This
press release may contain forward-looking statements made pursuant
to the Private Securities Litigation Reform Act of 1995. Words such
as "anticipate," "estimate," "expect," "intend," "plan," "project"
and other similar words and expressions are intended to signify
forward-looking statements. Forward-looking statements are not
guarantees of future results and conditions but rather are subject
to various risks and uncertainties. Some of these risks and
uncertainties are identified in the Company's filings with the SEC.
The occurrence of any of these risks and uncertainties could have a
material adverse effect on the Company's business, financial
condition and results of operations. Any forward-looking statements
made in this press release speak only as of the date of this press
release and, except as required by law, the Company undertakes no
obligation to update any forward-looking statement contained in
this press release, even if the Company's expectations or any
related events, conditions or circumstances change.
-Tables to follow-
OXBRIDGE
RE HOLDINGS LIMITED AND SUBSIDIARY
Consolidated
Balance Sheets
(expressed
in thousands of U.S. Dollars, except per share and share
amounts)
|
|
At December 31,
|
|
|
|
2016
|
2015
|
|
Assets
|
|
|
|
Investments:
|
|
|
|
Fixed-maturity
securities, available for sale, at fair value (amortized cost:
$6,060 and $3,080, respectively)
|
$6,051
|
3,096
|
|
Equity
securities, available for sale, at fair value (cost: $5,343 and
$7,742, respectively)
|
4,941
|
6,252
|
|
Total
investments
|
10,992
|
9,348
|
|
Cash
and cash equivalents
|
12,242
|
8,584
|
|
Restricted
cash and cash equivalents
|
23,440
|
30,368
|
|
Accrued
interest and dividend receivable
|
48
|
25
|
|
Premiums
receivable
|
4,038
|
4,117
|
|
Deferred
policy acquisition costs
|
88
|
90
|
|
Prepayment
and other receivables
|
98
|
91
|
|
Property
and equipment, net
|
54
|
64
|
|
Total
assets
|
$51,000
|
52,687
|
|
|
|
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
Liabilities:
|
|
|
|
Reserve
for losses and loss adjustment expenses
|
$8,702
|
-
|
|
Loss
experience refund payable
|
1,470
|
9,913
|
|
Unearned
premiums reserve
|
3,461
|
5,571
|
|
Accounts
payable and other liabilities
|
204
|
176
|
|
Total
liabilities
|
13,837
|
15,660
|
|
|
|
|
|
Shareholders’
equity:
|
|
|
|
Ordinary
share capital, (par value $0.001, 50,000,000 shares authorized;
5,916,149 and 6,060,000 shares issued and outstanding)
|
6
|
6
|
|
Additional
paid-in capital
|
33,034
|
33,657
|
|
Retained
earnings
|
4,534
|
4,838
|
|
Accumulated
other comprehensive loss
|
(411)
|
(1,474)
|
|
Total
shareholders’ equity
|
37,163
|
37,027
|
|
Total
liabilities and shareholders’ equity
|
$51,000
|
52,687
|
OXBRIDGE RE HOLDINGS LIMITED AND SUBSIDIARY
Consolidated
Statements of Income
(expressed in thousands of U.S. Dollars, except per share
amounts)
|
|
Three Months Ended
|
Year Ended
|
||
|
|
December 31,
|
December 31,
|
||
|
|
2016
|
2015
|
|
2015
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
Assumed
premiums
|
$-
|
-
|
$15,065
|
14,888
|
|
Change
in loss experience refund payable
|
5,348
|
(2,090)
|
883
|
(8,294)
|
|
Change
in unearned premiums reserve
|
6,065
|
3,881
|
2,110
|
173
|
|
|
|
|
|
|
|
Net
premiums earned
|
11,413
|
1,791
|
18,058
|
6,767
|
|
Net
realized investment gains (losses)
|
298
|
(998)
|
554
|
(325)
|
|
Net
investment income
|
123
|
75
|
450
|
337
|
|
Other-than-temporary
impairment losses
|
-
|
-
|
-
|
(399)
|
|
|
|
|
|
|
|
Total
revenue
|
11,834
|
868
|
19,062
|
6,380
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
Losses
and loss adjustment expenses
|
13,745
|
-
|
14,775
|
-
|
|
Policy
acquisition costs and underwriting expenses
|
75
|
85
|
286
|
344
|
|
General
and administrative expenses
|
333
|
411
|
1,420
|
1,435
|
|
|
|
|
|
|
|
Total
expenses
|
14,153
|
496
|
16,481
|
1,779
|
|
|
|
|
|
|
|
Net
income
|
(2,319)
|
372
|
2,581
|
4,601
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
|
|
|
|
|
|
Basic
and Diluted
|
$(0.39)
|
0.06
|
0.43
|
0.76
|
|
Diluted
|
(0.39)
|
0.06
|
0.43
|
0.76
|
|
|
|
|
|
|
|
Dividends paid per share
|
$0.12
|
0.12
|
0.48
|
0.48
|