0001193125-13-315230.txt : 20130801 0001193125-13-315230.hdr.sgml : 20130801 20130801165534 ACCESSION NUMBER: 0001193125-13-315230 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20130801 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20130801 DATE AS OF CHANGE: 20130801 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HCI Group, Inc. CENTRAL INDEX KEY: 0001400810 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 000000000 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-34126 FILM NUMBER: 131003300 BUSINESS ADDRESS: STREET 1: 5300 WEST CYPRESS STREET STREET 2: SUITE 100 CITY: TAMPA STATE: FL ZIP: 33607 BUSINESS PHONE: 813.405.3615 MAIL ADDRESS: STREET 1: 5300 WEST CYPRESS STREET STREET 2: SUITE 100 CITY: TAMPA STATE: FL ZIP: 33607 FORMER COMPANY: FORMER CONFORMED NAME: Homeowners Choice, Inc. DATE OF NAME CHANGE: 20070524 8-K 1 d578288d8k.htm FORM 8-K Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities and Exchange Act of 1934

Date of Report (or Date of Earliest Event Reported): August 1, 2013

 

 

HCI Group, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Florida   001-34126   20-5961396

(State or Other Jurisdiction of

Incorporation or Organization)

  

(Commission

File Number)

  

(I.R.S. Employer

Identification Number)

5300 West Cypress Street, Suite 100

Tampa, Florida 33607

(Address of Principal Executive Offices)

(813) 405-3600

(Telephone Number, Including Area Code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 2.02 Results of Operations and Financial Condition

On August 1, 2013, we released our earnings for the three and six months ended June 30, 2013. We plan to host an earnings conference call that same day at 4:30 p.m. Eastern time during which our chief executive officer and chief financial officer will discuss the results.

Date: Thursday, August 1, 2013

Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)

Listen-Only Number: 877-407-9210

International: 201-689-8049

Investors or analysts that wish to participate in the call should contact Les Holland at lholland@hcigroup.com or (813) 405-3281.

The conference call will be broadcast simultaneously and available for replay via the Investor Information section of the company’s website at www.hcigroup.com.

Please call the conference telephone number 5 to 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 Liolios Group at (949) 574-3860.

A replay of the call will be available after 8:00 p.m. Eastern time on the same day through August 9, 2013.

Toll-Free Replay Number: 877-660-6853

International Replay Number: 201-612-7415

Conference ID#: 418494

Our earnings release appears as Exhibit 99.1 to this form 8-K

 

Item 8.01 Other Events

Board Leadership

Our non-management/independent directors hold regularly scheduled executive sessions without management present. We have a procedure by which a director is chosen to preside at such sessions. That procedure is that at each executive session a presiding director is elected by majority vote of the directors present.

Communications with Board Members

We have established procedures by which interested parties (not just shareholders) may communicate with members of our Board of Directors. Any interested party wishing to communicate with the Board of Directors or a specified member of the Board may send written communications addressed to: Board of Directors, HCI Group, Inc., c/o Andrew L. Graham, Secretary of the Corporation, 5300 West Cypress Street, Suite 100, Tampa, Florida 33607. The

 

2

communication should include your name and your interest in HCI Group, Inc., including the class and number of shares you own (if any). Communications that are not commercial, pornographic, obscene, vulgar, profane, defamatory, abusive, harassing, threatening, malicious, false, frivolous or racially, ethically or religiously offensive will be promptly forwarded to the Board of Directors or the specified member of the Board to whom the communication is addressed

Corporate Governance Guidelines

Our Board of Directors has adopted written corporate governance guidelines. A current copy of the guidelines is available on our website www.hcigroup.com. Click “Investors” and then “Corporate Governance.”

 

Item 9.01 Exhibits.

Exhibit 99.1 Earnings Release

 

3

SIGNATURE

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, thereunto duly authorized.

Dated: August 1, 2013.

 

HCI GROUP, INC.
BY:  

/s/ Richard R. Allen

Name:   Richard R. Allen
Title:   Chief Financial Officer

A signed original of this Form 8-K has been provided to HCI Group, Inc. and will be retained by HCI Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

 

4

EX-99.1 2 d578288dex991.htm EARNINGS RELEASE Earnings Release

Exhibit 99.1

 

LOGO

HCI Group Reports Second Quarter and Six-Month 2013 Results

Tampa, Fla. – August 1, 2013 – HCI Group, Inc. (NYSE:HCI) reported results today for the three and six months ended June 30, 2013.

Second Quarter 2013 - Financial Results

Income available to common stockholders in the second quarter of 2013 totaled $16.2 million or $1.40 diluted earnings per common share, an improvement from $7.2 million or $0.74 diluted earnings per common share in the second quarter of 2012.

Gross premiums earned in the second quarter of 2013 increased 52.4% to $82.0 million from $53.8 million in the same period in 2012. The increase was primarily due to policies assumed from Citizens Property Insurance Corporation in November 2012.

Net premiums earned (defined as gross premiums earned less premiums ceded to reinsurance companies) in the second quarter of 2013 increased 54.7% to $57.3 million from $37.1 million in the same period in 2012. Premiums ceded in the second quarter of 2013 were 30.0% of the company’s gross premiums earned, compared with 31.1% during the same period in 2012.

Net investment income in the second quarter of 2013 was $295,000 compared with $302,000 in the same period in 2012.

Losses and loss adjustment expenses during the second quarter of 2013 were $17.4 million compared with $16.2 million in the same period in 2012.

Policy acquisition and other underwriting expenses in the second quarter of 2013 were $7.3 million compared with $6.2 million in the comparable period in 2012. The increase was primarily attributable to commissions and premium taxes related to the increase in policy renewals. Other operating expenses, which include a variety of general and administrative expenses, totaled $7.4 million in the second quarter of 2013 compared with $4.4 million in the second quarter of 2012. The change was primarily due to increases in compensation and related expenses.

Interest expense from the company’s senior notes issued in January 2013 totaled $846,000 in the second quarter of 2013.

Second Quarter 2013 - Financial Ratios

The company’s loss ratio applicable to the second quarter of 2013 (defined as losses and loss adjustment expenses related to net premiums earned) was 30.4% compared with 43.7% in the second quarter of 2012. The loss ratio was positively impacted by a significant increase in premiums earned during Q2 2013 as compared to Q2 2012.

The expense ratio applicable to the second quarter of 2013 (defined as underwriting expenses, interest and other operating expenses related to net premiums earned) was 27.0% compared with 28.7% in the same year-ago period.

Exhibit 99.1

 

LOGO

 

Expressed as a total of all expenses related to net premiums earned, the combined loss and expense ratio to net premiums earned was 57.4% in the second quarter of 2013 compared with 72.4% in the same year-ago period.

Six Months Ended June 30, 2013 - Financial Results

Income available to common stockholders for the six months ended June 30, 2013 totaled $36.6 million or $3.20 diluted earnings per common share, compared with $14.0 million or $1.60 diluted earnings per common share for the six months ended June 30, 2012.

Gross premiums earned for the six months ended June 30, 2013 increased 51.7% to $164.5 million from $108.5 million in the same year-ago period. The increase was primarily due to policies assumed from Citizens Property Insurance Corporation in November 2012.

Net premiums earned for the six months ended June 30, 2013 increased 52.1% to $117.9 million from $77.5 million in the same period in 2012. Premiums ceded for the six months ended June 30, 2013 were 28.3% of the company’s gross premiums earned, compared with 28.6% during the same period in 2012.

Net investment income for the six months ended June 30, 2013 and 2012 was $434,000 and $824,000, respectively.

Losses and loss adjustment expenses for the six months ended June 30, 2013 and 2012 were $33.3 million and $35.4 million, respectively.

Policy acquisition and other underwriting expenses for the six months ended June 30, 2013 were $13.3 million compared with
$13.1 million for the six months ended June 30, 2012. Other operating expenses totaled $13.5 million for the six months ended June 30, 2013 compared with $8.7 million for the six months ended June 30, 2012.

Interest expense from the company’s senior notes issued in January 2013 totaled $1.5 million for the six months ended June 30, 2013.

Six Months Ended June 30, 2013 - Financial Ratios

The company’s loss ratio applicable to the six months ended June 30, 2013 was 28.2% compared with 45.6% in the six months ended June 30, 2012.

The expense ratio applicable to the six months ended June 30, 2013 was 24.0% compared with 28.1% in the same period in 2012.

Expressed as a total of all expenses related to net premiums earned, the combined loss and expense ratio to net premiums earned was 52.2% in the six months ended June 30, 2013 compared with 73.7% in the same period in 2012.

 

Exhibit 99.1

 

LOGO

 

Management Commentary

“Our second quarter results reflect continued strength in our core business. We remain diligently focused on our strict underwriting standards and on strategically growing and diversifying our business,” said Paresh Patel, HCI Group’s chairman and chief executive officer.

Conference Call

HCI Group will hold a conference call later today (August 1, 2013) to discuss these financial results. Chairman and chief executive officer, Paresh Patel, and chief financial officer, Richard Allen, will host the call starting at 4:30 p.m. Eastern time. A question and answer session will follow management’s presentation.

Listen-Only Number: 877-407-9210

International: 201-689-8049

Investors or analysts that wish to participate in the Q&A portion of the call should contact Les Holland at lholland@hcigroup.com or (813) 405-3281.

The conference call will be broadcast simultaneously and will be available for replay via the investor section of the company’s website at www.hcigroup.com.

Please call the conference telephone number 5 to 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 Liolios Group at (949) 574-3860.

A replay of the call will be available after 8:00 p.m. Eastern time on the same day through August 9, 2013.

Toll-Free Replay Number: 877-660-6853

International Replay Number: 201-612-7415

Conference ID#: 418494

About HCI Group, Inc.

HCI Group, Inc. owns subsidiaries engaged in diverse, yet complementary business activities, including homeowners’ insurance, reinsurance, real estate and information technology services. The company’s largest subsidiary, Homeowners Choice Property & Casualty Insurance Company, Inc., is a leading provider of property and casualty insurance in the state of Florida.

The company’s common shares trade on the New York Stock Exchange under the ticker symbol “HCI” and are included in the Russell 2000 Index. Its 8% Senior Notes trade on the New York Stock Exchange under the ticker symbol “HCJ.” Its 7% Series A, cumulative redeemable preferred shares trade on the NASDAQ Capital Market under the ticker symbol “HCIIP.” For more information about HCI Group, visit www.hcigroup.com.

 

Exhibit 99.1

 

LOGO

 

Forward-Looking Statements

This news 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,” ”confident,” “prospects” and “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 Securities and Exchange Commission. Should any risks or uncertainties develop into actual events, these developments could have material adverse effects on the company’s business, financial condition and results of operations. HCI Group, Inc. disclaims all obligations to update any forward-looking statements.

Company Contact:

Les Holland, Investor Relations

HCI Group, Inc.

Tel (813) 405-3281

lholland@hcigroup.com

Investor Relations Contact:

Matt Glover or Michael Koehler

Liolios Group, Inc.

Tel (949) 574-3860

hci@liolios.com

 

Exhibit 99.1

 

LOGO

 

HCI GROUP, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(Amounts in thousands, except share amounts)

 

     At June 30,
2013		      At December 31,
2012		  
     (Unaudited)         
Assets      

Fixed-maturity securities, available-for-sale, at fair value

    $ 40,119         35,953   

Equity securities, available-for-sale, at fair value

      10,335         8,876   

Other investments

      16,014         16,087   
  

 

 

     

 

 

  

Total investments

      66,468         60,916   

Cash and cash equivalents

      296,812         230,214   

Accrued interest and dividends receivable

      410         375   

Premiums and reinsurance receivable

      28,305         10,642   

Prepaid reinsurance premiums

      31,236         9,112   

Deferred policy acquisition costs

      18,608         10,032   

Property and equipment, net

      13,008         10,853   

Deferred income taxes

      —           3,848   

Other assets

      6,934         2,296   
  

 

 

     

 

 

  

Total assets

    $ 461,781         338,288   
  

 

 

     

 

 

  
Liabilities and Stockholders’ Equity      

Losses and loss adjustment expenses

    $ 44,749         41,168   

Unearned premiums

      191,446         154,249   

Advance premiums

      11,273         4,029   

Assumed reinsurance balances payable

      1,466         1,377   

Accrued expenses

      7,725         3,041   

Dividends payable

      34         42   

Income taxes payable

      124         8,813   

Deferred income taxes

      1,529         —     

Long-term debt

      40,250         —     

Other liabilities

      9,600         4,316   
  

 

 

     

 

 

  

Total liabilities

      308,196         217,035   
  

 

 

     

 

 

  

Stockholders’ equity:

      

7% Series A cumulative convertible preferred stock (liquidation preference $10.00 per share), no par value, 1,500,000 shares authorized, 191,750 and 241,182 shares issued and outstanding in 2013 and 2012

      —           —     

Preferred stock (no par value 18,500,000 shares authorized, no shares issued or outstanding)

      —           —     

Common stock, (no par value, 40,000,000 shares authorized, 11,434,216 and 10,877,537 shares issued and outstanding in 2013 and 2012)

      —           —     

Additional paid-in capital

      65,394         63,875   

Retained income

      87,294         55,758   

Accumulated other comprehensive income

      897         1,620   
  

 

 

     

 

 

  

Total stockholders’ equity

      153,585         121,253   
  

 

 

     

 

 

  

Total liabilities and stockholders’ equity

    $ 461,781         338,288   
  

 

 

     

 

 

  

 

Exhibit 99.1

 

LOGO

 

HCI GROUP, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(Unaudited)

(Amounts in thousands, except per share amounts)

 

     Three Months Ended
June 30,		     S ix Months Ended
June 30,		  
     2013     2012     2013     2012  

Revenue

         

Gross premiums earned

    $ 81,952        53,772      $ 164,499        108,470   

Premiums ceded

      (24,617 )      (16,702 )      (46,613 )      (30,969 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net premiums earned

      57,335        37,070        117,886        77,501   

Net investment income

      295        302        434        824   

Policy fee income

      1,426        1,028        2,198        1,543   

Net realized investment (losses) gains

      (8 )      9        12        30   

Gain on bargain purchase

      —          179        —          179   

Other

      285        267        614        430   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total revenue

      59,333        38,855        121,144        80,507   
  

 

 

    

 

 

    

 

 

    

 

 

  

Expenses

         

Losses and loss adjustment expenses

      17,414        16,197        33,286        35,365   

Policy acquisition and other underwriting expenses

      7,308        6,243        13,276        13,079   

Interest expense

      846        —          1,532        —     

Other operating expenses

      7,358        4,406        13,473        8,673   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total expenses

      32,926        26,846        61,567        57,117   
  

 

 

    

 

 

    

 

 

    

 

 

  

Income before income taxes

      26,407        12,009        59,577        23,390   

Income taxes

      10,172        4,747        22,955        9,160   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income

    $ 16,235        7,262      $ 36,622        14,230   

Preferred stock dividends

      (32 )      (63 )      (66 )      (244 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Income available to common stockholders

    $ 16,203        7,199      $ 36,556        13,986   
  

 

 

    

 

 

    

 

 

    

 

 

  

Basic earnings per common share

    $ 1.44        0.85      $ 3.31        1.89   
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted earnings per common share

    $ 1.40        0.74      $ 3.20        1.60   
  

 

 

    

 

 

    

 

 

    

 

 

  

Dividends per common share

    $ 0.23        0.20      $ 0.45        0.35   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

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