-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UkKq628+Fuy8oD1TqbBGRqqE9yKwOmsGEa135mJ4IiA5rDPh1Ejqm5nkKMqsSVDq VpNFADDj5mq5HfX2cwjwtw== 0000899140-01-000055.txt : 20010207 0000899140-01-000055.hdr.sgml : 20010207 ACCESSION NUMBER: 0000899140-01-000055 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010205 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010206 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BERKLEY W R CORP CENTRAL INDEX KEY: 0000011544 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 221867895 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-07849 FILM NUMBER: 1526447 BUSINESS ADDRESS: STREET 1: 165 MASON ST STREET 2: P O BOX 2518 CITY: GREENWICH STATE: CT ZIP: 06836-2518 BUSINESS PHONE: 2036293000 MAIL ADDRESS: STREET 1: 165 MASON ST STREET 2: PO BOX 2518 CITY: GREENWICH STATE: CT ZIP: 06836-2518 8-K 1 0001.txt CURRENT REPORT ON FORM 8-K As filed with the Securities and Exchange Commission on February 6, 2001 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): February 5, 2001 W. R. BERKLEY CORPORATION ----------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-7849 22-1867895 - --------------- ---------------- ------------------- (State or other (Commission File (IRS Employer jurisdiction of Number) Identification No.) incorporation) 165 Mason Street, P.O. Box 2518, Greenwich, CT 06836-2518 ---------------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (203) 629-3000 -------------- Not Applicable (Former name or former address, if changed since last report) Item 5. Other Events Reference is made to the press release of W. R. Berkley Corporation (the "Company") relating to the announcement of the Company's results of operations for the fourth quarter and full year 2000. The press release was issued on February 5, 2001. A copy of the press release is attached to this Form 8-K as Exhibit 99.1 and is incorporated herein by reference. Item 7. Financial Statements and Exhibits (a) Financial statements of businesses acquired: None. (b) Pro forma financial information: None. (c) Exhibits: 99.1 Press Release dated February 5, 2001 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. W. R. BERKLEY CORPORATION By: /s/ Eugene G. Ballard ------------------------------ Name: Eugene G. Ballard Title: Senior Vice President, Chief Financial Officer and Treasurer Date: February 6, 2001 EXHIBIT INDEX Exhibit: - -------- 99.1 Press Release dated February 5, 2001 EX-99.1 2 0002.txt PRESS RELEASE EXHIBIT 99.1 W. R. Berkley Corporation 165 Mason Street, P.O. Box 2518 Greenwich, Connecticut 06836-2518 (203) 629-3000 NEWS RELEASE FOR IMMEDIATE RELEASE CONTACT: Eugene G. Ballard Senior Vice President- Chief Financial Officer and Treasurer 203-629-3000 W. R. BERKLEY CORPORATION ANNOUNCES RESULTS OF OPERATIONS FOR THE FOURTH QUARTER AND FULL YEAR Greenwich, CT, February 5, 2001 -- W.R. Berkley Corporation (NASDAQ: BKLY) today reported revenues for the fourth quarter ended December 31, 2000 increased 14 percent to $480 million from $422 million for the same period in 1999. Revenues for the year increased six percent to $1,781 million from $1,674 million in 1999. Operating income for the fourth quarter was $14 million, or 53 cents per diluted share, compared with an operating loss of $38 million, or $1.50 per diluted share, for the fourth quarter of 1999. Operating income for the year was $32 million, or $1.23 per diluted share, compared with an operating loss of $23 million, or 91 cents per diluted share, for 1999. In the 1999 fourth quarter, the Company established additional loss reserves for the regional insurance group of approximately $55 million (before tax). There was no comparable reserve adjustment in 2000. Net income for the fourth quarter was $18 million, or 68 cents per diluted share, compared with a net loss of $41 million, or $1.59 per diluted share, for the 1999 period. Net income for the year was W.R. Berkley Corporation 2 - -------------------------------------------------------------------------------- $36 million, or $1.39 per diluted share, compared with a net loss of $37 million, or $1.43 per diluted share, for 1999. Net income includes realized investment gains and losses, restructuring charges, extraordinary items and changes in accounting principles, which are not part of operating income. Commenting on the Company's results, William R. Berkley, chairman and chief executive officer, said: "We are very pleased with our fourth quarter results and believe they reflect a clear sign of the improving environment and the actions we have taken to date. Our annualized return approached double digits in the fourth quarter, while for the year our reserves increased at a greater rate than the increase in our premium volume. We continue to implement further substantial price increases, in addition to those previously put in place. "Book value increased by approximately 15 percent for the year. We anticipate improved returns for 2001 and are enthusiastic about prospects for 2002. We expect that pricing will continue to tighten in commercial lines for the next several years." W.R. Berkley Corporation will webcast its fourth quarter earnings call on Tuesday, February 6, 2001 at 10:00am eastern time through the Investor Broadcasting Network Vcall website. Those who want to hear the conference call should go to www.vcall.com fifteen minutes prior to the start of the call to register, download and install any necessary audio software. W.R. Berkley Corporation 3 - -------------------------------------------------------------------------------- W.R. Berkley Corporation is a holding company which, through its subsidiaries, operates in broad segments of the property casualty insurance business. The operating units are grouped for management purposes into five segments according to market served: Regional Property Casualty Insurance, Reinsurance, Specialty Insurance, Alternative Markets and International. This is a "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein, including those related to the Company's performance for the year 2001 and beyond, are based upon the Company's historical performance and on current plans, estimates and expectations. They are subject to various risks and uncertainties, including but not limited to, the cyclical nature of the property casualty industry, the long-term and potentially volatile nature of the reinsurance business, the impact of competition, product demand and pricing, claims development and the process of estimating reserves, the level of the Company's retention, catastrophe and storm losses, legislative and regulatory developments, changes in the ratings assigned to the Company by rating agencies, investment results, availability of reinsurance and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. These risks could cause the Company's actual results for the year 2001 and beyond to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. (See accompanying financial tables) W.R. Berkley Corporation 4 - --------------------------------------------------------------------------------
For the Three Months For Year Ended Ended December 31, December 31, -------------------- -------------------- 2000 1999 2000 1999 ---- ---- ---- ---- (Amounts in thousands except per share data) Revenues: Net premiums written $ 394,318 $ 342,067 $1,506,244 $1,427,719 Change in unearned premiums 5,013 20,425 (15,230) (13,335) ------- ------- --------- --------- Premiums earned 399,331 362,492 1,491,014 1,414,384 Net investment income 57,423 45,051 210,448 190,316 Management fees and commissions 16,514 16,997 68,049 72,344 Realized gains (losses) on investments 6,479 (3,660) 8,364 (6,064) Other income 326 1,002 3,412 2,688 ------- -------- -------- --------- Total revenues 480,073 421,882 1,781,287 1,673,668 Operating costs and expenses: Losses and loss expenses 290,815 320,910 1,094,411 1,085,826 Other operating costs and expenses 152,173 156,634 596,579 604,784 Interest expense 11,642 12,733 47,596 50,801 Restructuring charge -- -- 1,850 11,505 ------- -------- --------- --------- Income (loss) before income taxes And minority interest 25,443 (68,395) 40,851 (79,248) Federal income tax (expense) benefit (6,536) 27,998 (2,451) 45,766 ------- -------- --------- --------- Income (loss) before minority Interest 18,907 (40,397) 38,400 (33,482) Minority interest (743) (391) (2,162) (566) -------- -------- --------- --------- Net income (loss) before preferred Dividends 18,164 (40,788) 36,238 (34,048) Preferred dividends -- -- -- (497) ------- ------- --------- --------- Net income (loss) attributable to Common stockholders before change In accounting and extraordinary Loss 18,164 (40,788) 36,238 (34,545) Cumulative effect of change in Accounting principle (net of taxes) -- -- -- (3,250) Extraordinary gain on early Extinguishment of long-term debt (net of taxes) -- -- -- 735 ------- ------- --------- --------- Net income (loss) attributable to Common stockholders $ 18,164 $(40,788) $ 36,238 $ (37,060) ======= ======= ========= ======== Earnings (loss) per share: Basic $ 0.71 $ (1.59) $ 1.41 $ (1.44) ======= ======== ========= ======== Diluted $ 0.68 $ (1.59) $ 1.39 $ (1.43) ======= ======== ========= ======== Average shares outstanding: Basic 25,536 25,616 25,632 25,823 ======== ======== ========= ======== Diluted 26,539 25,689 25,991 25,927 ======== ======== ========= ========
W.R. Berkley Corporation 5 - -------------------------------------------------------------------------------- ADDENDUM #1 TO PRESS RELEASE DATED February 5, 2001 Operating Statistics by Insurance Industry Segment -------------------------------------------------- (Amounts in thousands) ----------------------
For the Three Months For the Year Ended Ended December 31, December 31, -------------------- -------------------- 2000 1999 2000 1999 ---- ---- ---- ---- Regional Insurance: Net premiums written $ 155,945 $ 157,500 $ 640,843 $ 649,849 Total revenues 183,212 182,149 718,489 702,129 Pre-tax operating income (loss) (1) 1,949 (62,879) (2,031) (89,431) Loss ratio 74.5% 108.2% 75.1% 84.7% Expense ratio 32.0% 36.6% 33.5% 36.1% Policyholders' dividend ratio 1.2% .4% .8% .7% Combined ratio (2) 107.7% 145.2% 109.4% 121.5% Reinsurance: Net premiums written $76,035 $ 77,224 $ 276,640 $ 309,181 Total revenues 96,767 84,720 349,164 341,940 Pre-tax operating income (1) 9,489 1,530 28,987 17,116 Loss ratio 74.1% 77.5% 73.2% 76.0% Expense ratio 30.3% 34.8% 32.5% 33.2% Combined ratio (2) 104.4% 112.3% 105.7% 109.2% Specialty Insurance: Net premiums written $77,595 $60,474 $ 285,525 $ 260,380 Total revenues 86,788 74,761 324,859 309,068 Pre-tax operating income (1) 13,302 6,046 30,993 42,677 Loss ratio 69.2% 63.1% 73.1% 66.0% Expense ratio 28.1% 35.5% 32.0% 32.9% Policyholders' dividend ratio .1% .1% .1% .2% Combined ratio (2) 97.4% 98.7% 105.2% 99.1% Alternative Markets: Net premiums written $48,319 $21,061 $ 184,255 $122,137 Total revenues 78,597 53,966 269,025 222,276 Pre-tax operating income (1) 7,986 5,940 31,221 30,133 Loss ratio 69.8% 72.1% 71.2% 67.4% Expense ratio 37.8% 46.6% 36.2% 37.3% Combined ratio (2) 107.6% 118.7% 107.4% 104.7% International (3): Net premiums written $36,424 $ 25,808 $ 118,981 $86,172 Total revenues 33,915 25,322 118,234 93,878 Pre-tax operating income (1) 3,083 1,947 6,591 4,200 Loss ratio 61.1% 52.6% 60.5% 53.3% Expense ratio 32.1% 42.3% 36.6% 46.4% Combined ratio (2) 93.2% 94.9% 97.1% 99.7% Combined: Net premiums written $394,318 $342,067 $ 1,506,244 $1,427,719 Total revenues 479,279 420,918 1,779,771 1,669,291 Pre-tax operating income (loss)(1) 35,809 (47,416) 95,761 4,695 Loss ratio 72.1% 88.2% 73.1% 76.5% Expense ratio 31.6% 36.9% 33.5% 35.4% Policyholders' dividend ratio .5% .2% .4% .3% Combined ratio (2) 104.2% 125.3% 107.0% 112.2% (1) Pre-tax operating income (loss) represents earnings before the effects of realized investment gains and losses, restructuring charges, extraordinary items and changes in accounting principles. (2) Ratios are based on statutory accounting practices. (3) International includes life insurance premiums of $33.2 million and $24.5 million for the years ended December 31, 2000 and 1999, respectively. Life insurance results are not included in the statutory ratios.
W.R. Berkley Corporation 6 - -------------------------------------------------------------------------------- ADDENDUM #2 TO PRESS RELEASE DATED February 5, 2001 Supplementary Information ------------------------- (Amounts in thousands except per share data) --------------------------------------------
For the Three Months For Year Ended Ended December 31, December 31, -------------------- -------------------- 2000 1999 2000 1999 ---- ---- ---- ---- After-tax earnings amounts: - -------------------------- Operating income (loss)(1) $ 13,953 $ (38,409) $ 32,005 $ (23,309) Restructuring charge (net of minority interest) -- -- (1,203) (7,294) Extraordinary gain -- -- -- 735 Cumulative effect of change in Accounting principle -- -- -- (3,250) Realized investment gains (losses) 4,211 (2,379) 5,436 (3,942) ------- -------- --------- -------- Net income (loss) $ 18,164 $ (40,788) $ 36,238 $ (37,060) ======= ======== ========= ======== After-tax diluted earnings per share: - ------------------------------------ Operating income (loss)(1) $ 0.53 $ (1.50) $ 1.23 $ (.91) Restructuring charge (net of minority interest) -- -- (0.05) (.28) Extraordinary gain -- -- -- .03 Cumulative effect of change in Accounting principle -- -- -- (.12) Realized investment gains (losses) 0.15 (.09) 0.21 (.15) ------- ------- --------- -------- Net income (loss) $ 0.68 $ (1.59) $ 1.39 $ (1.43) ======= ======= ========= ======== Cash flow (used in) from operations before increases in trading account securities $ (3,095) $ 27,571 $ 76,334 $ 82,047 ======= ======= ========= ======== December 31, December 31, 2000 1999 ------------- ------------ Balance sheet information: - ------------------------- Total investments (2) $ 3,111,602 $2,975,929 Total assets 5,022,070 4,784,791 Reserves for losses and loss expenses 2,533,917 2,361,238 Long-term debt 370,158 394,792 Capital Trust Securities 198,169 198,126 Common stockholders' equity 680,896 591,778 Common shares outstanding 25,656 25,617 Common stockholders' equity per share (3) 26.54 23.10 (1) Operating income includes after-tax catastrophe losses of $3.6 million, or 13 cents per diluted share, for the fourth quarter of 2000 compared with $3.5 million, or 14 cents per diluted share, for the fourth quarter of 1999 and $31.9 million, or $1.23 per diluted share, for 2000 compared with $39.1 million, or $1.50 per diluted share, for 1999. (2) Investments include trading account receivable from broker and clearing organizations and trading securities sold but not yet purchased. (3) The calculation of common stockholders' equity per share includes after-tax unrealized investment gains of $19.4 million as of December 31,2000 and unrealized investment losses of $44.5 million as of December 31, 1999.
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