Net income for the quarter of
Fully diluted book value per share increased 0.5% in the quarter to
- Net income of
$6.5 million , or$0.19 per share, compared to a net loss of$40.3 million , or$1.11 per share, in the first quarter of 2020. - Combined ratio of 101.5%, compared to a combined ratio of 98.9% in the first quarter of 2020.
- Total investment income of
$18.7 million , compared to a net loss of$35.3 million in the first quarter of 2020. - An increase in fully diluted book value per share of
$0.07 , or 0.5%, to$13.49 .
Underwriting results
Gross written premiums in the first quarter of 2021 were
Net written premiums increased 55.8% to
Net premiums earned were
The Company incurred a net underwriting loss of
Investment results
The Company’s total investment income during the first quarter of 2021 was
Share repurchase plan
The Company’s share repurchase plan expires
Conference Call
Greenlight Re will hold a live conference call to discuss its financial results on
To participate in the
1-844-274-4096 | ||
International | 1-412-317-5608 |
Telephone participants may avoid any delays by pre-registering for the call using the following link to receive a special dial-in number and PIN.
Conference Call registration link: https://dpregister.com/sreg/10154500/e67980e728
The conference call can also be accessed via webcast at:
https://services.choruscall.com/mediaframe/webcast.html?webcastid=cY28YSYY
A telephone replay of the call will be available from
Non-GAAP Financial Measures
In presenting the Company’s results, management has included financial measures that are not calculated under standards or rules that comprise accounting principles generally accepted in
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the
About
Greenlight Re (www.greenlightre.com) provides multi-line property and casualty reinsurance though its licensed and regulated reinsurance entities in the
Contact:
Investor Relations:
(212) 836-9606
IR@greenlightre.ky
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(expressed in thousands of
Assets | |||||||||
Investments | |||||||||
Investment in related party investment fund | $ | 199,882 | $ | 166,735 | |||||
Other investments | 26,152 | 29,418 | |||||||
Total investments | 226,034 | 196,153 | |||||||
Cash and cash equivalents | 33,537 | 8,935 | |||||||
Restricted cash and cash equivalents | 697,689 | 745,371 | |||||||
Reinsurance balances receivable (net of allowance for expected credit losses) | 386,858 | 330,232 | |||||||
Loss and loss adjustment expenses recoverable (net of allowance for expected credit losses) | 15,009 | 16,851 | |||||||
Deferred acquisition costs | 58,591 | 51,014 | |||||||
Notes receivable | — | 6,101 | |||||||
Other assets | 4,394 | 2,993 | |||||||
Total assets | $ | 1,422,112 | $ | 1,357,650 | |||||
Liabilities and equity | |||||||||
Liabilities | |||||||||
Loss and loss adjustment expense reserves | $ | 512,843 | $ | 494,179 | |||||
Unearned premium reserves | 235,725 | 201,089 | |||||||
Reinsurance balances payable | 94,059 | 92,247 | |||||||
Funds withheld | 3,622 | 4,475 | |||||||
Other liabilities | 8,406 | 5,009 | |||||||
Convertible senior notes payable | 95,338 | 95,794 | |||||||
Total liabilities | 949,993 | 892,793 | |||||||
Shareholders' equity | |||||||||
Ordinary share capital (Class A: par value | $ | 3,485 | $ | 3,452 | |||||
Additional paid-in capital | 489,218 | 488,488 | |||||||
Retained earnings (deficit) | (20,584 | ) | (27,083 | ) | |||||
Total shareholders' equity | 472,119 | 464,857 | |||||||
Total liabilities and equity | $ | 1,422,112 | $ | 1,357,650 |
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS
(UNAUDITED)
(expressed in thousands of
Three months ended | |||||||||
2021 | 2020 | ||||||||
Underwriting revenue | |||||||||
Gross premiums written | $ | 169,935 | $ | 109,787 | |||||
Gross premiums ceded | 55 | (678 | ) | ||||||
Net premiums written | 169,990 | 109,109 | |||||||
Change in net unearned premium reserves | (34,594 | ) | 1,912 | ||||||
Net premiums earned | $ | 135,396 | $ | 111,021 | |||||
Underwriting related expenses | |||||||||
Net loss and loss adjustment expenses incurred | |||||||||
Current year | $ | 97,861 | $ | 71,525 | |||||
Prior year | (140 | ) | 4,172 | ||||||
Net loss and loss adjustment expenses incurred | 97,721 | 75,697 | |||||||
Acquisition costs | 33,381 | 31,739 | |||||||
Underwriting expenses | 3,337 | 2,936 | |||||||
Deposit accounting expense (income) | 2,947 | (607 | ) | ||||||
Underwriting income (loss) | $ | (1,990 | ) | $ | 1,256 | ||||
Income (loss) from investment in related party investment fund | $ | 4,024 | $ | (42,126 | ) | ||||
Net investment income (loss) | 14,650 | 6,837 | |||||||
Total investment income (loss) | $ | 18,674 | $ | (35,289 | ) | ||||
Net underwriting and investment income (loss) | $ | 16,684 | $ | (34,033 | ) | ||||
Corporate expenses | $ | 4,204 | $ | 3,858 | |||||
Other (income) expense, net | 703 | 394 | |||||||
Interest expense | 1,544 | 1,561 | |||||||
Income tax expense (benefit) | 3,734 | 424 | |||||||
Net income (loss) | $ | 6,499 | $ | (40,270 | ) | ||||
Earnings (loss) per share | |||||||||
Basic | $ | 0.19 | $ | (1.11 | ) | ||||
Diluted | $ | 0.19 | $ | (1.11 | ) | ||||
Underwriting ratios | |||||||||
Loss ratio - current year | 72.3 | % | 64.4 | % | |||||
Loss ratio - prior year | (0.1 | ) | % | 3.8 | % | ||||
Loss ratio | 72.2 | % | 68.2 | % | |||||
Acquisition cost ratio | 24.7 | % | 28.6 | % | |||||
Composite ratio | 96.9 | % | 96.8 | % | |||||
Underwriting expense ratio | 4.6 | % | 2.1 | % | |||||
Combined ratio | 101.5 | % | 98.9 | % |
The following tables present the Company’s underwriting ratios by line of business:
Three months ended | Three months ended | ||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||
Property | Casualty | Other | Total | Property | Casualty | Other | Total | ||||||||||||||||
Loss ratio | 80.4 | % | 73.7 | % | 65.0 | % | 72.2 | % | 64.0 | % | 72.7 | % | 60.7 | % | 68.2 | % | |||||||
Acquisition cost ratio | 19.8 | % | 25.0 | % | 25.7 | % | 24.7 | % | 19.5 | % | 27.1 | % | 36.2 | % | 28.6 | % | |||||||
Composite ratio | 100.2 | % | 98.7 | % | 90.7 | % | 96.9 | % | 83.5 | % | 99.8 | % | 96.9 | % | 96.8 | % | |||||||
Underwriting expense ratio | 4.6 | % | 2.1 | % | |||||||||||||||||||
Combined ratio | 101.5 | % | 98.9 | % |
NON-GAAP MEASURES AND RECONCILIATION
Adjusted combined ratio
“Combined ratio” is a commonly used measure in the property and casualty insurance industry and is calculated using
In calculating the adjusted combined ratio, we exclude underwriting losses attributable to (i) prior accident-year reserve development, (ii) catastrophe losses, and (iii) certain significant, infrequent loss events.
Prior accident-year reserve development, which can be favorable or unfavorable, represents changes in our estimates of losses and loss adjustment expenses associated with loss events that occurred in prior years. We believe a discussion of current accident-year performance, which excludes prior accident-year reserve development, is helpful since it provides more insight into current underwriting performance.
By their nature, catastrophe losses and other significant, infrequent loss events are not representative of the type of loss activity that we would expect to occur in every period.
We believe an adjusted combined ratio that excludes the effects of these items aids in understanding the underlying trends and variability in our underwriting results that these items may obscure.
The following table reconciles the combined ratio to the adjusted combined ratio:
Three months ended | ||||||
2021 | 2020 | |||||
Combined ratio | 101.5 | % | 98.9 | % | ||
Impact on combined ratio of selected items: | ||||||
Prior-year development | (0.2 | ) | % | 3.5 | % | |
Catastrophes | 3.4 | % | — | % | ||
Other adjustments 1 | 2.2 | % | — | % | ||
Adjusted combined ratio | 96.1 | % | 95.4 | % |
1 In the periods presented, “Other adjustments” represents interest income and expense on deposit-accounted contracts due to changes in the associated estimated ultimate cash flows.
Net Underwriting Income (Loss)
One way that we evaluate the Company’s underwriting performance is through the measurement of net underwriting income (loss). We do not use premiums written as a measure of performance. Net underwriting income (loss) is a performance measure used by management to measure the fundamentals underlying the Company’s underwriting operations. We believe that the use of net underwriting income (loss) enables investors and other users of the Company’s financial information to analyze our performance in a manner similar to how management analyzes performance. Management also believes that this measure follows industry practice and allows the users of financial information to compare the Company’s performance with those of our industry peer group.
Net underwriting income (loss) is considered a non-GAAP financial measure because it excludes items used to calculate net income before taxes under
The reconciliations of net underwriting income (loss) to income (loss) before income taxes (the most directly comparable
Three months ended | |||||||||
2021 | 2020 | ||||||||
($ in thousands) | |||||||||
Income (loss) before income tax | $ | 10,233 | $ | (39,846 | ) | ||||
Add (subtract): | |||||||||
Total investment (income) loss | (18,674 | ) | 35,289 | ||||||
Other non-underwriting (income) expense | 703 | 394 | |||||||
Corporate expenses | 4,204 | 3,858 | |||||||
Interest expense | 1,544 | 1,561 | |||||||
Net underwriting income (loss) | $ | (1,990 | ) | $ | 1,256 |
Source:
2021 GlobeNewswire, Inc., source