EX-99.1 2 v104250_ex99-1.htm Unassociated Document
 

FOR IMMEDIATE RELEASE
CONTACT:
Peter J. Prygelski, CFO, 21st Century Holding Company
(954) 308-1252 or (954) 581-9993

21st CENTURY HOLDING COMPANY REPORTS
RECORD 4th QUARTER AND FULL YEAR EARNINGS

Lauderdale Lakes, Florida, February 19, 2008 - 21st Century Holding Company (Nasdaq: TCHC), today reported results for the quarter and year ended December 31, 2007 (see included tables).

For the three months ended December 31, 2007, the Company reported net income of $8,089,761, or $1.02 per share on 7,913,249 average shares outstanding, as compared to a net loss of $4,050,889, or $0.52 per share on 7,846,037 average shares outstanding in the same three-month period last year.

For the twelve months ended December 31, 2007, the Company reported net income of $21,279,797, or $2.69 per share on 7,922,542 average undiluted shares outstanding, as compared to net income of $13,896,267, or $1.84 per share on 7,537,550 average undiluted shares outstanding in the same twelve-month period last year. On a diluted share basis, the Company reported earnings of $2.65 per share, based on 8,030,205 average diluted shares outstanding, as compared to $1.72 per share, based on 8,085,722 average diluted shares outstanding for the twelve months ended December 31, 2006.

Net premiums earned increased $7.8 million or 45.4% to $24.9 million for the three months ended December 31, 2007 as compared to $17.1 million for the same three month period last year. Net premiums earned increased $9.9 million or 11.1% to $99.2 million for the twelve months ended December 31, 2007 as compared to $89.3 million for the same twelve month period last year.

Total revenues increased $7.8 million or 35.9% to $29.5 million for the three months ended December 31, 2007, as compared to $21.7 million for the same three-month period last year. Total revenues increased $15.2 million or 14.6% to $119.1 million for the twelve months ended December 31, 2007, as compared to $103.9 million for the same twelve month period last year.

Edward J. (Ted) Lawson, Chairman and CEO, said, “Our record results in 2007, which included a 35% increase in net income and a 46% increase in earnings per share, reflect the adaptability of our business model. This marks the Company’s third consecutive year of profitable growth. In addition, we end 2007 debt free and look forward to continued success in the future.”

The Company will hold an investor conference call at 4:30 PM (ET) today, February 19, 2008. Mr. Peter J. Prygelski, III, CFO, and Mr. Michael Braun, COO, will discuss the financial results and review the outlook for the Company. Messrs. Prygelski and Braun invite interested parties to participate in the conference call. Listeners can access the conference call by dialing toll free 888-460-6235, conference ID 34305759. Please call at least five minutes in advance to ensure that you are connected prior to the presentation. A replay of the conference call will be available for 7 days at 800-642-1687.

About the Company
The Company, through its subsidiaries, underwrites commercial general liability insurance, homeowners’ property and casualty insurance, flood insurance and personal automobile insurance in the State of Florida. The Company underwrites general liability coverage as an admitted carrier in the States of Louisiana, Texas and Alabama for more than 300 classes of business, including special events. The Company is approved to operate as a surplus lines/non-admitted carrier in the States of Georgia, Kentucky, Virginia, South Carolina, Missouri, Arkansas, Nevada, Maryland and California offering the same general liability products. The Company is licensed and has the facilities to market and underwrite other insurance carriers’ lines of business, as well as to process and adjust claims for third party insurance carriers. In addition to insurance services, the Company offers premium finance services to its insureds as well as insureds of certain third party insurance companies.

Safe harbor statements under the Private Securities Litigation Reform Act of 1995: Statements in this press release that are not historical fact are forward-looking statements that are subject to certain risks and uncertainties that could cause actual events and results to differ materially from those discussed herein. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “would,” “estimate,” or “continue” or the other negative variations thereof or comparable terminology are intended to identify forward-looking statements. The risks and uncertainties include, without limitation, uncertainties related to estimates, assumptions and projections generally; inflation and other changes in economic conditions (including changes in interest rates and financial markets); pricing competition and other initiatives by competitors; ability to obtain regulatory approval for applications to underwrite in an additional jurisdiction or for requested rate changes, and the timing thereof; legislative and regulatory developments; the outcome of litigation pending against the Company and any settlement thereof; risks related to the nature of the Company’s business; dependence on investment income and the composition of the Company’s investment portfolio; the adequacy of the Company’s liability for loss and loss adjustment expense; insurance agents; claims experience; limited experience in the insurance industry; ratings by industry services; catastrophe losses; reliance on key personnel; weather conditions (including the severity and frequency of storms, hurricanes, tornadoes and hail); changes in driving patterns and loss trends; acts of war and terrorist activities; court decisions and trends in litigation, and health care and auto repair costs; and other matters described from time to time by the Company in releases and publications, and in periodic reports and other documents filed with the United States Securities and Exchange Commission. In addition, investors should be aware that generally accepted accounting principles prescribe when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when a reserve is established for a major contingency. Reported results may therefore appear to be volatile in certain accounting periods.
#####


 
 
 

21st CENTURY HOLDING COMPANY
Consolidated Statements of Operations
(Unaudited)

   
Three Months Ended Dec 31,
  
Twelve Months Ended Dec 31,
  
Revenue:
  
2007
  
2006
  
2007
  
2006
  
Gross premiums written
  
$
23,875,468
  
$
41,633,645
  
$
133,591,334
  
$
152,664,893
  
Gross premiums ceded
    
1,994,459
    
(6,769,878
)
  
(44,550,721
)
  
(67,519,911
)
                           
Net premiums written
    
25,869,927
    
34,863,767
    
89,040,613
    
85,144,982
  
                           
(Decrease) Increase in prepaid reinsurance premiums
    
(12,755,101
)
  
(12,602,067
)
  
(11,251,117
)
  
20,193,320
  
Decrease (Increase) in unearned premiums
    
11,741,312
    
(5,168,931
)
  
21,434,625
    
(15,990,048
)
Net change in prepaid reinsurance premiums and
unearned premiums
    
(1,013,789
)
  
(17,770,998
)
  
10,183,508
    
4,203,272
  
                           
Net premiums earned
    
24,856,138
    
17,092,769
    
99,224,121
    
89,348,254
  
Commission income
    
291,866
    
54,987
    
7,213,752
    
673,258
  
Finance revenue
    
81,925
    
218,738
    
544,893
    
1,686,062
  
Managing general agent fees
    
434,329
    
641,710
    
2,034,503
    
2,624,817
  
Net investment income
    
1,949,147
    
1,551,798
    
7,977,801
    
5,932,683
  
Net realized investment gains
    
1,330,451
    
320,238
    
(158,776
)
  
1,062,862
  
Other income
    
539,101
    
1,807,082
    
2,295,836
    
2,586,616
  
                           
Total revenue
    
29,482,957
    
21,687,322
    
119,132,130
    
103,914,552
  
                           
Expenses:
                          
Loss and loss adjustment expenses
    
9,008,716
    
17,216,951
    
47,618,922
    
44,399,908
  
Operating and underwriting expenses
    
1,734,648
    
4,767,588
    
12,683,627
    
13,160,073
  
Salaries and wages
    
1,666,624
    
1,701,472
    
6,731,533
    
7,010,937
  
Interest expense
    
(260
)
  
110,341
    
172,817
    
655,796
  
Policy acquisition costs, net of amortization
    
4,524,145
    
4,351,401
    
19,419,915
    
17,395,177
  
                           
Total expenses
    
16,933,873
    
28,147,753
    
86,626,814
    
82,621,891
  
                           
Income before provision for income tax expense
    
12,549,084
    
(6,460,431
)
  
32,505,316
    
21,292,661
  
Provision for income tax expense
    
4,459,323
    
(2,409,542
)
  
11,225,519
    
7,396,394
  
Net income
  
$
8,089,761
 
$
(4,050,889
)
$
21,279,797
 
$
13,896,267
  
Basic net income per share
  
$
1.02
 
$
(0.52
)
$
2.69
 
$
1.84
  
Fully diluted net income per share
  
$
1.01
 
$
(0.52
)
$
2.65
 
$
1.72
  
                           
Weighted average number of common shares outstanding
    
7,913,249
   
7,846,037
   
7,922,542
   
7,537,550
  
                           
Weighted average number of common shares outstanding (assuming dilution)
    
7,988,203
   
7,846,037
   
8,030,205
   
8,085,722
  
                           
Dividends paid per share
  
$
0.18
 
$
0.12
 
$
0.72
 
$
0.48
  
 
 
 
 

21st CENTURY HOLDING COMPANY
Other Selected Data
(Unaudited)

Balance Sheet
   
Period Ending
  
   
12/31/07
  
12/31/06
  
Total Cash & Investments
  
$
158,748,019
  
$
142,750,333
  
Total Assets
  
$
219,360,763
  
$
207,897,195
  
Unpaid Loss and Loss Adjustment Expense
  
$
59,684,790
  
$
39,615,478
  
Total Liabilities
  
$
137,138,585
  
$
141,703,777
  
Total Shareholders’ Equity
  
$
82,222,178
  
$
66,193,418
  
Common Stock Outstanding
    
7,871,234
    
7,896,919
  
Book Value Per Share
  
$
10.45
  
$
8.38
  


Premium Breakout

   
3 Months Ending
  
12 Months Ending
  
Line of Business
  
12/31/07
  
12/31/06
  
12/31/07
  
12/31/06
  
   
(Dollars in thousands)
  
Homeowners’
  
$
17,031
  
$
33,523
  
$
99,502
  
$
114,388
  
General Liability
    
6,620
    
7,463
    
32,222
    
32,213
  
Automobile
    
225
    
648
    
1,867
    
6,064
  
                           
Gross Written Premiums
  
$
23,875
  
$
41,634
  
$
133,591
  
$
152,665
  


Commercial General Liability
Written Premium by State

   
3 Months Ending
  
12 Months Ending
  
State
  
12/31/07
  
12/31/06
  
12/31/07
  
12/31/06
  
   
(Dollars in thousands)
  
Alabama
  
$
26
  
$
--
  
$
26
  
$
--
  
California
    
23
    
--
    
23
    
--
  
Florida
    
4,124
    
4,796
    
21,192
    
22,965
  
Georgia
    
223
    
575
    
1,023
    
1,805
  
Kentucky
    
3
    
9
    
8
    
9
  
Louisiana
    
1,548
    
1,509
    
5,595
    
5,743
  
South Carolina
    
48
    
77
    
182
    
77
  
Texas
    
611
    
487
    
4,127
    
1,604
  
Virginia
    
14
    
10
    
46
    
10
  
                           
Gross Written Premiums
  
$
6,620
  
$
7,463
  
$
32,222
  
$
32,213
  
 
 
Loss Ratios
                  
   
3 Months Ending
  
12 Months Ending
  
Line of Business
  
12/31/07
  
12/31/06
  
12/31/07
  
12/31/06
  
Homeowners’
    
21.6
%
  
103.9
%
  
37.4
%
  
46.7
%
General Liability
    
69.3
%
  
92.9
%
  
58.9
%
  
38.2
%
Automobile
    
(3.2
%)
  
117.7
%
  
140.0
%
  
84.4
%
All Lines
    
36.2
%
  
100.7
%
  
48.0
%
  
49.7
%