EX-99.1 7 v132005_ex99-1.htm
 
Maiden Holdings, Ltd. Reports Third Quarter Operating Earnings of $15 Million and a Net Loss of $27.5 Million
 
HAMILTON, Bermuda, Nov 11, 2008 (GlobeNewswire via COMTEX News Network) -- Maiden Holdings, Ltd. (NASDAQ: MHLD), today reported quarterly operating earnings of $15.02 million for the third quarter ended September 30, 2008. Operating earnings is a non-GAAP financial measure defined by the Company as net income, excluding realized investment gains and losses. Operating earnings per basic share for the third quarter was $0.25. Net written premium for the quarter was $113.2 million. During the third quarter of 2008, the Company incurred a realized loss of $42.5 million on its investment portfolio. The realized loss related primarily to fixed income investments in Lehman Brothers and Washington Mutual. As a result of the realized investment loss, the Company had a net loss of $27.5 million or $0.46 for the third quarter 2008.
 
Third Quarter and Nine Months 2008 Highlights:
 
*
Net written premium for third quarter 2008 was $113.2 million
*
Net written premium for nine months ended September 30, 2008 was $386.9 million
*
Operating earnings of $15.02 million for the quarter ended September 30, 2008
*
Operating earnings for nine months ended September 30, 2008 was $41.2 million
*
Annualized return on equity on operating earnings for the third quarter was 11.7%
*
The combined ratio for the third quarter was 94.7%
*
The combined ratio for nine months ended September 30, 2008 was 93.4%
*
Book value per share was $8.03 as of September 30, 2008
 
Third Quarter and Nine Months 2008 Results:
 
Revenue:
 
Net written premium for the third quarter was $113.2 million and net earned premium was $113.6 million. Net investment income was $9 million, operating earnings for the third quarter was $15.02 million. For the nine months ended September 30, 2008, net written premium was $386.9 million and net earned premium was $256.2 million. Net investment income for the nine months was $24.3 million and operating earnings was $41.2 million. The Company recorded a net loss of $27.5 million for the third quarter and for the nine months ended September 30, 2008 had a net loss of $1.2 million inclusive of the fixed income investment losses.
 
Expenses:
 
The Company's loss ratio for the third quarter 2008 was 58.9%. The Company's expense ratio for the third quarter 2008 was 35.8%. The Company's loss ratio for nine months ended September 30, 2008 was 57.9% and the expense ratio was 35.5%.
 
Other Matters:
 
Shareholders' equity as of September 30, 2008 was $478.5 million compared to $537.3 million as of December 31, 2007. During the third quarter the Company announced a dividend of $0.05. Book value per share as of September 30, 2008 was $8.03.
 
During the fourth quarter 2008, a hedge fund in which the Company had an investment commenced liquidation. The Company received a distribution of 962,336 shares of its Common Stock in lieu of a distribution of other assets, representing a distribution of 90% of its holdings in the fund. The shares were valued at $3.95 per share for purposes of this liquidation distribution. The Company will receive the remaining 10% of its holdings in the fund upon the completion of the fund's liquidation. Book value per share with the inclusion of this transaction would be $8.17.
 
Conference Call:
 
On Wednesday, November 12, at 3:00 p.m. Atlantic Time (2:00 p.m. ET), the Company will hold a conference call regarding its third quarter earnings and recent acquisition of GMAC RE that can be accessed as follows:
 
Toll Dial-in (International Callers): 719.325.4793
Toll-free Dial-in: 877.719.9810
Webcast: http://ir.maiden.bm
 
In order to participate in the conference call, you must register at http://ir.maiden.bm. At the time of the call slides will be available for reference at http://ir.maiden.bm.
 
A replay of the conference call will be available starting at 6:00 p.m. Atlantic Time on Wednesday, November 12th, 2008 through Wednesday, November 19th, 2008 by dialing toll 719.457.0820 or toll-free 888.203.1112. The passcode for the replay is 5576448. Replay of the webcast will also be available at http://ir.maiden.bm.
 
About Maiden Holdings, Ltd.
 
Maiden Holdings, Ltd. is a Bermuda holding company formed in 2007 to offer customized reinsurance products and services, through Maiden Insurance Company, Ltd., its wholly owned Bermuda reinsurance subsidiary, to small and mid-size insurance companies in the United States and Europe.
 
The Maiden Holdings, Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5006 
 
Forward Looking Statement
 
This release contains "forward-looking statements" which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that actual developments will be those anticipated by the Company. Actual results may differ materially from those projected as a result of significant risks and uncertainties, including non-receipt of the expected payments, changes in interest rates, effect of the performance of financial markets on investment income and fair values of investments, developments of claims and the effect on loss reserves, accuracy in projecting loss reserves, the impact of competition and pricing environments, changes in the demand for the Company's products, the effect of general economic conditions, adverse state and federal legislation, regulations and regulatory investigations into industry practices, developments relating to existing agreements, heightened competition, changes in pricing environments, and changes in asset valuations. The Company undertakes no obligation to publicly update any forward-looking statements.
 
Maiden Holdings, Ltd.
Income Statement
(in thousands (000's), except per share data)
(Unaudited)

 
 
For the
 
 For the
 
 For the
 
 Period from
 
 
 
 Three Months
 
  Three Months
 
  Nine Months
  
 May 31 2007
  
   
Ended
  
 Ended
  
 Ended
  
 (inception)
  
   
Sept 30,
 
 Sept 30,
 
 Sept 30,
 
 to Sept 30,
 
 
 
2008
 
 2007
 
 2008
 
 2007
  
Revenues:
                     
Premium income:
                     
Net premiums written
  
$
113,187
  
$
190,801
  
$
386,870
  
$
190,801
  
Change in unearned premiums
    
408
    
(127,835
)
  
(130,631
)
  
(127,835
)
Net earned premium
    
113,595
    
62,966
    
256,239
    
62,966
  
Net investment income
    
8,974
    
7,503
    
24,346
    
7,562
  
Net realized investment gains (losses)
    
(42,538
)
  
87
    
(42,375
)
  
87
  
  Total revenues
    
80,031
    
70,556
    
238,210
    
70,615
  
Expenses:
                          
Loss and loss adjustment expenses
    
66,915
    
37,667
    
148,362
    
37,667
  
Commission and other acquisition expenses
    
38,299
    
20,307
    
85,057
    
20,307
  
Salaries and benefits
    
673
    
211
    
1,820
    
211
  
Foreign exchange loss
    
359
    
1
    
364
    
1
  
Other operating expenses
    
1,301
    
1,030
    
3,816
    
1,166
  
    Total expenses
    
107,547
    
59,216
    
239,419
    
59,352
  
                           
Net income
  
$
(27,516
)
$
11,340
  
$
(1,209
)
$
11,263
  
 
                          
Operating earnings (1)
  
$
15,022
  
$
11,253
  
$
41,166
  
$
11,176
  
 
                          
Basic and diluted earnings per common share
  
$
(0.46
)
$
0.20
  
$
(0.02
)
$
0.25
  
 
                          
Basic and diluted operating earnings per common share
  
$
0.25
  
$
0.19
  
$
0.69
  
$
0.25
  
 
                          
Dividends declared per common share
  
$
0.05
  
$
0.025
  
$
0.15
  
$
0.025
  
 
Weighted average number of basic
                  
  and diluted shares outstanding
    
59,550,000
    
57,716,859
    
59,550,000
    
44,184,968
  
                           
Combined ratio
    
94.7
%
  
94.0
%
  
93.4
%
  
94.3
%
Annualized return on equity
                          
  on operating earnings
    
11.7
%
  
15.4
%
  
10.8
%
  
136.0
%
 

Maiden Holdings, Ltd.
Balance Sheet
(in thousands (000's), except per share data)

       
 (Unaudited)
 
  
 
 
 
 
 
 30-Sep-08
 
 31-Dec-07
  
Assets
  
 
            
Fixed maturities, available-for-sale, at
  
 
            
  fair value (amortized cost $749,797; $488,765)
    
 
$
687,186
  
$
474,789
  
Other investments, at fair value
                    
  (cost $10,315; $15,176)
          
10,071
    
15,656
  
    Total investments
          
697,257
    
490,445
  
Cash and cash equivalents
          
82,443
    
35,729
  
Accrued investment income
          
5,423
    
3,204
  
Reinsurance balances receivable, net
          
98,779
    
27,990
  
Loan to related party
          
167,975
    
113,542
  
Prepaid expenses and other assets
          
420
    
454
  
Deferred commission and other acquisition costs
          
88,615
    
44,215
  
Furniture and equipment, net
          
63
    
29
  
Total Assets
        
$
1,140,975
  
$
715,608
  
                     
Liabilities and Shareholders' Equity
                    
Liabilities
                    
Loss and loss adjustment expense reserves
        
$
123,621
  
$
38,508
  
Unearned premiums
          
267,799
    
137,166
  
Accrued expenses and other liabilities
          
4,670
    
2,589
  
Due to broker
          
5,656
    
--
  
Securities sold under agreements to
                    
  repurchase, at contract value
          
260,775
    
--
  
    Total Liabilities
          
662,521
    
178,263
  
                     
Shareholders' Equity:
                    
Common shares
          
596
    
596
  
Additional paid-in capital
          
530,258
    
529,647
  
Accumulated other comprehensive loss
          
(62,856
)
  
(13,496
)
Retained earnings
          
10,456
    
20,598
  
    Total Shareholders' Equity
          
478,454
    
537,345
  
 
                    
    Total Liabilities and Shareholders' Equity
        
$
1,140,975
  
$
715,608
  
                     
Book value per share
        
$
8.03
  
$
9.02
  
                     
Common shares outstanding
          
59,550,000
    
59,550,000
  
 
 
Maiden Holdings, Ltd.
Income Statement
(in thousands (000's), except per share data)
(Unaudited)

   
For the
  
For the
  
For the
  
Period from
  
   
Three Months
  
 Three Months
  
Nine Months
  
May 31 2007
  
   
Ended
  
Ended
  
Ended
  
(inception)
  
   
Sept 30,
  
Sept 30,
  
Sept 30,
  
to Sept 30,
  
   
2008
  
2007
  
2008
  
2007
  
                   
Reconciliation of net
                   
  income to operating earnings:
                    
                   
Net income
  
$
(27,516
)
$
11,340
  
$
(1,209
)
$
11,263
  
Less: Net realized gains (losses) net of taxes
    
(42,538
)
  
87
    
(42,375
)
  
87
  
 
                          
Operating earnings (1)
  
$
15,022
  
$
11,253
  
$
41,166
  
$
11,176
  
 
                          
Operating earnings per common share:
                          
 
                          
Basic and diluted earnings per share
  
$
0.25
  
$
0.19
  
$
0.69
  
$
0.25
  

(1)  
Net operating income is a non-GAAP financial measure defined by the Company as net income excluding realized investment gains and losses, which provides a useful indicator of trends in the Company's underlying operations.
 
This news release was distributed by GlobeNewswire, www.globenewswire.com 
 
SOURCE: Maiden Holdings, Ltd.
 
Maiden Holdings, Ltd.
Devora M. Goldenberg
441.292.7090
irelations@maiden.bm
 
(C) Copyright 2008 GlobeNewswire, Inc. All rights reserved.
 
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