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 EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 30, 2013
HCC INSURANCE HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware |
|
001-13790 |
|
76-0336636 |
(State or other jurisdiction of |
|
(Commission File Number) |
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(I.R.S. Employer |
incorporation) |
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|
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Identification No.) |
13403 Northwest Freeway Houston, Texas 77040 |
(Address of principal executive offices, including zip code) |
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(713) 690-7300 |
(Registrants telephone number, including area code) |
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o 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 July 30, 2013, HCC Insurance Holdings, Inc. (the Company) announced its financial results for the second quarter of 2013. A copy of the press release announcing the Companys results is attached to this Current Report on Form 8-K (this Current Report) as Exhibit 99.1 and incorporated herein in its entirety by reference thereto.
Item 9.01. Financial Statements and Exhibits.
(d)
No. |
|
Exhibit |
99.1 |
|
Press Release dated July 30, 2013 |
In connection with the disclosure set forth in Item 2.02, the information in this Current Report, including the exhibits attached hereto, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of such section. The information in this Current Report, including the exhibits, shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any incorporation by reference language in any such filing. This Current Report will not be deemed an admission as to the materiality of any information in this Current Report that is required to be disclosed solely by Regulation FD.
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 hereunto duly authorized.
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HCC Insurance Holdings, Inc. | |
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| |
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By: |
/s/ Alexander M Ludlow |
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Alexander M Ludlow |
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Associate General Counsel & Assistant Secretary |
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DATED: July 30, 2013 |
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Exhibit 99.1
HCC INSURANCE HOLDINGS REPORTS STRONG
SECOND QUARTER AND RECORD EARNINGS PER SHARE
FOR THE FIRST SIX MONTHS OF 2013
Second Quarter 2013 Highlights:
· Net earnings of $88.2 million, or $0.87 per diluted share
· GAAP combined ratio of 85.3%
· Catastrophe losses of $21.4 million
· Annualized return on equity of 9.9%
· Annualized operating return on equity(a) of 10.3%
· Net investment income increased 4% to $55.7 million
HOUSTON (July 30, 2013) . . .
HCC Insurance Holdings, Inc. (NYSE: HCC) today released results for its second quarter ended June 30, 2013.
Net earnings were $88.2 million, or $0.87 per diluted share, for the second quarter of 2013, compared to $93.5 million, or $0.92 per diluted share, for the second quarter of 2012. Net earnings were $194.0 million for the first six months of 2013, or $1.92 per diluted share, compared to $176.1 million, or $1.71 per diluted share, for the same period of 2012.
The 2013 results included accident year pretax net catastrophe losses of $21.4 million and $26.6 million for the second quarter and first six months of 2013, respectively, which reduced net earnings by $0.14 and $0.17 per share for the respective periods. The 2012 results included catastrophe losses of $4.7 million and $12.3 million for the second quarter and first six months of 2012, respectively, which reduced net earnings by $0.03 and $0.08 per share for the respective periods.
The Companys combined ratio was 85.3% for the second quarter of 2013, compared to 85.2% for the second quarter of 2012. The combined ratio was 84.5% for the first six months of 2013, versus 85.3% for the same period of 2012. HCCs net paid loss ratio was 52.2% for the first half of 2013, compared to 54.9% for the same period of 2012.
We are very pleased to report record earnings per share for the first half of the year, driven by a combined ratio that was once again below 85%. Our businesses continue to generate strong, consistent returns, and we are finding good opportunities to grow our existing businesses, as well as to add teams focused on new lines, said Christopher J.B. Williams, HCCs Chief Executive Officer.
HCC had favorable loss development of $11.8 million in the second quarter and first six months of 2013, compared to no loss development in the same periods of 2012.
Gross written premium increased 2% to $809.4 million for the second quarter of 2013, compared to $791.6 million for the same quarter of 2012. Net written premium decreased 2% to $629.0 million for the second quarter of 2013, versus $642.1 million for the same quarter of 2012. Net earned premium decreased 1% to $561.4 million for the second quarter of 2013, compared to $565.3 million for the same quarter of 2012.
For the first six months of 2013, compared to the same period of 2012, gross written premium increased 4% to $1.5 billion; net written premium increased 1% to $1.2 billion; and net earned premium increased 1% to $1.1 billion.
Investment income increased to $55.7 million for the second quarter of 2013, compared to $53.3 million for the same period of 2012. Investment income increased to $111.4 million for the first six months of 2013, compared to $110.3 million for the same period of 2012. As of June 30, 2013, HCCs fixed maturity securities portfolio had an average rating of AA, with a duration of 5.5 years and an average long-term tax equivalent yield of 4.5%.
HCC generated operating cash flow of $176.3 million in the first six months of 2013, compared to $293.3 million in the same period of 2012. Operating cash flow is cash flow from operating activities excluding surety collateral outflows of $74.3 million and $21.2 million in the first six months of 2013 and 2012, respectively, as well as a payment of $27.5 million in 2012 to commute a large contract in Exited Lines. The Companys liquidity position remains strong with $256.1 million of cash and short-term investments and $253.6 million of available capacity under its $600.0 million revolving loan facility at June 30, 2013.
As of June 30, 2013, total assets were $10.2 billion, shareholders equity was $3.5 billion and the Companys debt to total capital ratio was 15.4%.
For further information about HCCs 2013 second quarter results, see the supplemental financial schedules that are accessible on HCCs website at http://www.hcc.com, as well as directly in the Investor Relations section of HCCs website at http://ir.hcc.com.
(Note: If clicking on the above links does not open in a new web page, please cut and paste the above URLs into your browsers address bar.)
HCC will hold an open conference call beginning at 8:00 a.m. Central Daylight Time on Wednesday, July 31. To participate, the number for domestic calls is (800) 374-0290 and the number for international calls is (706) 634-0161. There will also be a live webcast available on a listen-only basis that can be accessed through the HCC website at http://www.hcc.com. The webcast replay will be archived in the Investor Relations section of the HCC website through Friday, November 1, 2013.
Headquartered in Houston, Texas, HCC Insurance Holdings, Inc. is a leading specialty insurer with offices in the United States, the United Kingdom, Spain and Ireland. HCCs major
domestic and international insurance companies have financial strength ratings of AA (Very Strong) from Standard & Poors Corporation, A+ (Superior) from A.M. Best Company, Inc., AA (Very Strong) from Fitch Ratings, and A1 (Good Security) from Moodys Investors Service, Inc.
For more information about HCC, please visit http://www.hcc.com.
a) Non-GAAP Financial Measure
Annualized operating return on equity is a non-GAAP financial measure under Regulation G and is calculated as net earnings excluding after-tax net realized investment gain/loss, other-than-temporary impairment credit losses, and foreign currency benefit/expense (collectively, operating earnings) divided by average shareholders equity excluding accumulated other comprehensive income. To annualize a quarterly rate, the result is multiplied by four. See the supplemental financial schedules for a reconciliation of this non-GAAP financial measure to corresponding GAAP amounts. Management believes annualized operating return on equity is a useful measure for understanding the Companys profitability relative to shareholders equity before consideration of investment-related gains/losses and foreign currency benefit/expense, both of which management excludes when evaluating operating results internally.
Contact: |
Doug Busker, Director of Investor Relations |
|
HCC Insurance Holdings, Inc. |
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Telephone: (713) 996-1192 |
Forward-looking statements contained in this press release are made under safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. The types of risks and uncertainties which may affect the Company are set forth in its periodic reports filed with the Securities and Exchange Commission.
* * * * *
HCC Insurance Holdings, Inc. and Subsidiaries
Financial Highlights
(Unaudited, in thousands except per share data)
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Six months ended |
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Three months ended |
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June 30, |
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June 30, |
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2013 |
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2012 |
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2013 |
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2012 |
| ||||
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| ||||
Gross written premium |
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$ |
1,529,648 |
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$ |
1,474,242 |
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$ |
809,443 |
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$ |
791,553 |
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| ||||
Net written premium |
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1,208,218 |
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1,200,492 |
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629,034 |
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642,088 |
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|
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|
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Net earned premium |
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1,122,542 |
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1,112,472 |
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561,356 |
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565,331 |
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|
|
|
|
|
|
|
|
| ||||
Net investment income |
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111,433 |
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110,300 |
|
55,668 |
|
53,290 |
| ||||
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|
|
|
|
|
|
|
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| ||||
Total revenue |
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1,263,797 |
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1,241,811 |
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629,431 |
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632,288 |
| ||||
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|
|
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| ||||
Net earnings |
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194,012 |
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176,077 |
|
88,162 |
|
93,493 |
| ||||
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|
|
|
|
|
|
|
|
| ||||
Operating earnings* |
|
179,558 |
|
170,818 |
|
86,419 |
|
86,548 |
| ||||
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|
|
|
|
|
|
|
|
| ||||
Earnings per share (diluted) |
|
$ |
1.92 |
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$ |
1.71 |
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$ |
0.87 |
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$ |
0.92 |
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|
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|
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|
|
|
|
| ||||
Weighted-average shares outstanding (millions) |
|
99.2 |
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101.0 |
|
99.1 |
|
99.9 |
| ||||
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|
|
|
|
|
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|
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| ||||
Net loss ratio |
|
59.9 |
% |
59.8 |
% |
60.5 |
% |
59.6 |
% | ||||
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|
|
|
|
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Combined ratio |
|
84.5 |
% |
85.3 |
% |
85.3 |
% |
85.2 |
% | ||||
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Paid loss ratio |
|
52.2 |
% |
54.9 |
% |
51.1 |
% |
47.0 |
% |
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June 30, |
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December 31, |
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|
2013 |
|
2012 |
| ||
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|
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|
| ||
Total investments |
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$ |
6,659,291 |
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$ |
6,950,398 |
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|
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|
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| ||
Total assets |
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10,153,494 |
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10,267,807 |
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| ||
Shareholders equity |
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3,505,383 |
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3,542,612 |
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Debt to total capital ratio |
|
15.4 |
% |
14.2 |
% | ||
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Book value per share |
|
$ |
35.00 |
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$ |
35.10 |
|
* Non-GAAP financial measure under Regulation G. See calculation on S - 9. Management believes operating earnings is a useful measure for understanding the Companys profitability before consideration of investment-related gains/losses and foreign currency benefit/expense, both of which management excludes when evaluating operating results internally.
HCC Insurance Holdings, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited, in thousands)
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June 30, |
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December 31, |
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2013 |
|
2012 |
| ||
ASSETS |
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Investments: |
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Fixed maturity securities available for sale, at fair value |
|
$ |
6,094,640 |
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$ |
6,281,781 |
|
Equity securities available for sale, at fair value |
|
347,840 |
|
284,639 |
| ||
Short-term investments |
|
216,793 |
|
363,053 |
| ||
Other investments |
|
18 |
|
20,925 |
| ||
Total investments |
|
6,659,291 |
|
6,950,398 |
| ||
Cash |
|
39,353 |
|
71,390 |
| ||
Restricted cash and securities |
|
115,031 |
|
101,480 |
| ||
Premium, claims and other receivables |
|
648,438 |
|
549,725 |
| ||
Reinsurance recoverables |
|
1,086,435 |
|
1,071,222 |
| ||
Ceded unearned premium |
|
291,939 |
|
256,988 |
| ||
Ceded life and annuity benefits |
|
57,841 |
|
58,641 |
| ||
Deferred policy acquisition costs |
|
202,322 |
|
191,960 |
| ||
Goodwill |
|
885,999 |
|
885,860 |
| ||
Other assets |
|
166,845 |
|
130,143 |
| ||
|
|
|
|
|
| ||
Total assets |
|
$ |
10,153,494 |
|
$ |
10,267,807 |
|
|
|
|
|
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| ||
LIABILITIES |
|
|
|
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| ||
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|
|
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Loss and loss adjustment expense payable |
|
$ |
3,814,684 |
|
$ |
3,767,850 |
|
Life and annuity policy benefits |
|
57,841 |
|
58,641 |
| ||
Reinsurance, premium and claims payable |
|
337,666 |
|
294,621 |
| ||
Unearned premium |
|
1,189,520 |
|
1,069,956 |
| ||
Deferred ceding commissions |
|
82,119 |
|
74,609 |
| ||
Notes payable |
|
639,021 |
|
583,944 |
| ||
Accounts payable and accrued liabilities |
|
527,260 |
|
875,574 |
| ||
|
|
|
|
|
| ||
Total liabilities |
|
6,648,111 |
|
6,725,195 |
| ||
|
|
|
|
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| ||
SHAREHOLDERS EQUITY |
|
|
|
|
| ||
|
|
|
|
|
| ||
Common stock |
|
125,350 |
|
125,114 |
| ||
Additional paid-in capital |
|
1,063,949 |
|
1,052,253 |
| ||
Retained earnings |
|
2,917,086 |
|
2,756,166 |
| ||
Accumulated other comprehensive income |
|
126,119 |
|
295,271 |
| ||
Treasury stock |
|
(727,121 |
) |
(686,192 |
) | ||
|
|
|
|
|
| ||
Total shareholders equity |
|
3,505,383 |
|
3,542,612 |
| ||
|
|
|
|
|
| ||
Total liabilities and shareholders equity |
|
$ |
10,153,494 |
|
$ |
10,267,807 |
|
Consolidated Statements of Earnings
(Unaudited, in thousands except per share data)
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|
Six months ended |
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Three months ended |
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|
June 30, |
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June 30, |
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|
2013 |
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2012 |
|
2013 |
|
2012 |
| ||||
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REVENUE |
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|
|
|
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| ||||
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|
|
|
|
|
|
|
| ||||
Net earned premium |
|
$ |
1,122,542 |
|
$ |
1,112,472 |
|
$ |
561,356 |
|
$ |
565,331 |
|
Net investment income |
|
111,433 |
|
110,300 |
|
55,668 |
|
53,290 |
| ||||
Other operating income |
|
16,629 |
|
12,389 |
|
7,784 |
|
7,188 |
| ||||
Net realized investment gain |
|
13,193 |
|
7,047 |
|
4,623 |
|
6,876 |
| ||||
Other-than-temporary impairment credit losses |
|
|
|
(397 |
) |
|
|
(397 |
) | ||||
|
|
|
|
|
|
|
|
|
| ||||
Total revenue |
|
1,263,797 |
|
1,241,811 |
|
629,431 |
|
632,288 |
| ||||
|
|
|
|
|
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| ||||
EXPENSE |
|
|
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|
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|
| ||||
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|
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Loss and loss adjustment expense, net |
|
672,171 |
|
665,753 |
|
339,474 |
|
336,825 |
| ||||
Policy acquisition costs, net |
|
137,745 |
|
143,934 |
|
70,796 |
|
74,490 |
| ||||
Other operating expense |
|
164,572 |
|
167,706 |
|
87,719 |
|
80,424 |
| ||||
Interest expense |
|
13,082 |
|
13,139 |
|
6,611 |
|
6,230 |
| ||||
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|
|
|
|
|
|
|
|
| ||||
Total expense |
|
987,570 |
|
990,532 |
|
504,600 |
|
497,969 |
| ||||
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|
|
|
|
|
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| ||||
Earnings before income tax expense |
|
276,227 |
|
251,279 |
|
124,831 |
|
134,319 |
| ||||
Income tax expense |
|
82,215 |
|
75,202 |
|
36,669 |
|
40,826 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net earnings |
|
$ |
194,012 |
|
$ |
176,077 |
|
$ |
88,162 |
|
$ |
93,493 |
|
|
|
|
|
|
|
|
|
|
| ||||
Basic earnings per share data: |
|
|
|
|
|
|
|
|
| ||||
Net earnings per share |
|
$ |
1.93 |
|
$ |
1.71 |
|
$ |
0.88 |
|
$ |
0.92 |
|
|
|
|
|
|
|
|
|
|
| ||||
Weighted-average shares outstanding (millions) |
|
99.0 |
|
100.8 |
|
98.9 |
|
99.6 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Diluted earnings per share data: |
|
|
|
|
|
|
|
|
| ||||
Net earnings per share |
|
$ |
1.92 |
|
$ |
1.71 |
|
$ |
0.87 |
|
$ |
0.92 |
|
|
|
|
|
|
|
|
|
|
| ||||
Weighted-average shares outstanding (millions) |
|
99.2 |
|
101.0 |
|
99.1 |
|
99.9 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Cash dividends declared, per share |
|
$ |
0.330 |
|
$ |
0.310 |
|
$ |
0.165 |
|
$ |
0.155 |
|
HCC Insurance Holdings, Inc. and Subsidiaries
Gross Written Premium
(Unaudited, in thousands)
|
|
Six months ended June 30, |
|
Three months ended June 30, |
| ||||||||||||
|
|
2013 |
|
2012 |
|
Change |
|
2013 |
|
2012 |
|
Change |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Property & Casualty |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Aviation |
|
$ |
75,182 |
|
$ |
82,870 |
|
(9 |
)% |
$ |
38,184 |
|
$ |
45,780 |
|
(17 |
)% |
E&O |
|
28,328 |
|
31,493 |
|
(10 |
) |
13,254 |
|
14,602 |
|
(9 |
) | ||||
Public Risk |
|
37,105 |
|
43,245 |
|
(14 |
) |
15,664 |
|
23,461 |
|
(33 |
) | ||||
Other |
|
217,773 |
|
161,005 |
|
35 |
|
116,149 |
|
81,623 |
|
42 |
| ||||
|
|
358,388 |
|
318,613 |
|
12 |
|
183,251 |
|
165,466 |
|
11 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Professional Liability |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. D&O |
|
186,845 |
|
186,184 |
|
|
|
111,606 |
|
111,188 |
|
|
| ||||
International D&O |
|
59,548 |
|
59,566 |
|
|
|
30,768 |
|
33,317 |
|
(8 |
) | ||||
|
|
246,393 |
|
245,750 |
|
|
|
142,374 |
|
144,505 |
|
(1 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Accident & Health |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Medical Stop-loss |
|
405,039 |
|
387,974 |
|
4 |
|
202,231 |
|
194,741 |
|
4 |
| ||||
Other |
|
25,431 |
|
24,901 |
|
2 |
|
12,678 |
|
12,807 |
|
(1 |
) | ||||
|
|
430,470 |
|
412,875 |
|
4 |
|
214,909 |
|
207,548 |
|
4 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Surety & Credit |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Surety |
|
80,327 |
|
80,762 |
|
(1 |
) |
42,631 |
|
40,836 |
|
4 |
| ||||
Credit |
|
31,111 |
|
29,940 |
|
4 |
|
16,558 |
|
15,373 |
|
8 |
| ||||
|
|
111,438 |
|
110,702 |
|
1 |
|
59,189 |
|
56,209 |
|
5 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
International |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Energy |
|
111,859 |
|
110,714 |
|
1 |
|
85,314 |
|
90,119 |
|
(5 |
) | ||||
Property Treaty |
|
113,995 |
|
113,855 |
|
|
|
41,650 |
|
44,517 |
|
(6 |
) | ||||
Liability |
|
40,210 |
|
40,242 |
|
|
|
22,077 |
|
20,982 |
|
5 |
| ||||
Surety & Credit |
|
46,196 |
|
43,451 |
|
6 |
|
25,030 |
|
22,493 |
|
11 |
| ||||
Other |
|
60,933 |
|
56,649 |
|
8 |
|
31,315 |
|
29,124 |
|
8 |
| ||||
|
|
373,193 |
|
364,911 |
|
2 |
|
205,386 |
|
207,235 |
|
(1 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Exited Lines |
|
9,766 |
|
21,391 |
|
(54 |
) |
4,334 |
|
10,590 |
|
(59 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Totals |
|
$ |
1,529,648 |
|
$ |
1,474,242 |
|
4 |
% |
$ |
809,443 |
|
$ |
791,553 |
|
2 |
% |
HCC Insurance Holdings, Inc. and Subsidiaries
Net Written Premium
(Unaudited, in thousands)
|
|
Six months ended June 30, |
|
Three months ended June 30, |
| ||||||||||||
|
|
2013 |
|
2012 |
|
Change |
|
2013 |
|
2012 |
|
Change |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Property & Casualty |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Aviation |
|
$ |
60,134 |
|
$ |
63,405 |
|
(5 |
)% |
$ |
31,520 |
|
$ |
35,898 |
|
(12 |
)% |
E&O |
|
24,691 |
|
30,235 |
|
(18 |
) |
12,153 |
|
13,730 |
|
(11 |
) | ||||
Public Risk |
|
29,880 |
|
35,567 |
|
(16 |
) |
14,109 |
|
19,973 |
|
(29 |
) | ||||
Other |
|
94,164 |
|
68,687 |
|
37 |
|
47,205 |
|
35,965 |
|
31 |
| ||||
|
|
208,869 |
|
197,894 |
|
6 |
|
104,987 |
|
105,566 |
|
(1 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Professional Liability |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. D&O |
|
129,578 |
|
136,826 |
|
(5 |
) |
77,879 |
|
81,121 |
|
(4 |
) | ||||
International D&O |
|
34,183 |
|
34,311 |
|
|
|
18,256 |
|
19,103 |
|
(4 |
) | ||||
|
|
163,761 |
|
171,137 |
|
(4 |
) |
96,135 |
|
100,224 |
|
(4 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Accident & Health |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Medical Stop-loss |
|
404,604 |
|
387,673 |
|
4 |
|
202,010 |
|
194,586 |
|
4 |
| ||||
Other |
|
25,264 |
|
24,698 |
|
2 |
|
12,590 |
|
12,687 |
|
(1 |
) | ||||
|
|
429,868 |
|
412,371 |
|
4 |
|
214,600 |
|
207,273 |
|
4 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Surety & Credit |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Surety |
|
72,146 |
|
73,385 |
|
(2 |
) |
38,456 |
|
37,251 |
|
3 |
| ||||
Credit |
|
25,982 |
|
22,711 |
|
14 |
|
14,168 |
|
14,141 |
|
|
| ||||
|
|
98,128 |
|
96,096 |
|
2 |
|
52,624 |
|
51,392 |
|
2 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
International |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Energy |
|
71,120 |
|
81,013 |
|
(12 |
) |
56,451 |
|
68,189 |
|
(17 |
) | ||||
Property Treaty |
|
101,266 |
|
99,819 |
|
1 |
|
35,099 |
|
37,517 |
|
(6 |
) | ||||
Liability |
|
37,577 |
|
37,316 |
|
1 |
|
21,007 |
|
19,424 |
|
8 |
| ||||
Surety & Credit |
|
40,290 |
|
39,813 |
|
1 |
|
21,641 |
|
20,786 |
|
4 |
| ||||
Other |
|
47,573 |
|
43,662 |
|
9 |
|
22,156 |
|
21,137 |
|
5 |
| ||||
|
|
297,826 |
|
301,623 |
|
(1 |
) |
156,354 |
|
167,053 |
|
(6 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Exited Lines |
|
9,766 |
|
21,371 |
|
(54 |
) |
4,334 |
|
10,580 |
|
(59 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Totals |
|
$ |
1,208,218 |
|
$ |
1,200,492 |
|
1 |
% |
$ |
629,034 |
|
$ |
642,088 |
|
(2 |
)% |
HCC Insurance Holdings, Inc. and Subsidiaries
Net Earned Premium
(Unaudited, in thousands)
|
|
Six months ended June 30, |
|
Three months ended June 30, |
| ||||||||||||
|
|
2013 |
|
2012 |
|
Change |
|
2013 |
|
2012 |
|
Change |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Property & Casualty |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Aviation |
|
$ |
56,286 |
|
$ |
58,220 |
|
(3 |
)% |
$ |
28,429 |
|
$ |
29,397 |
|
(3 |
)% |
E&O |
|
26,433 |
|
31,979 |
|
(17 |
) |
13,235 |
|
15,602 |
|
(15 |
) | ||||
Public Risk |
|
32,755 |
|
31,792 |
|
3 |
|
16,395 |
|
16,574 |
|
(1 |
) | ||||
Other |
|
69,489 |
|
55,861 |
|
24 |
|
33,373 |
|
27,261 |
|
22 |
| ||||
|
|
184,963 |
|
177,852 |
|
4 |
|
91,432 |
|
88,834 |
|
3 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Professional Liability |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. D&O |
|
153,721 |
|
170,667 |
|
(10 |
) |
77,016 |
|
84,413 |
|
(9 |
) | ||||
International D&O |
|
31,502 |
|
30,238 |
|
4 |
|
15,428 |
|
15,054 |
|
2 |
| ||||
|
|
185,223 |
|
200,905 |
|
(8 |
) |
92,444 |
|
99,467 |
|
(7 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Accident & Health |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Medical Stop-loss |
|
404,604 |
|
387,673 |
|
4 |
|
202,010 |
|
194,586 |
|
4 |
| ||||
Other |
|
30,343 |
|
27,355 |
|
11 |
|
15,812 |
|
13,561 |
|
17 |
| ||||
|
|
434,947 |
|
415,028 |
|
5 |
|
217,822 |
|
208,147 |
|
5 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
U.S. Surety & Credit |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Surety |
|
72,725 |
|
79,608 |
|
(9 |
) |
37,118 |
|
39,688 |
|
(6 |
) | ||||
Credit |
|
24,506 |
|
21,236 |
|
15 |
|
12,936 |
|
13,427 |
|
(4 |
) | ||||
|
|
97,231 |
|
100,844 |
|
(4 |
) |
50,054 |
|
53,115 |
|
(6 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
International |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Energy |
|
43,457 |
|
40,889 |
|
6 |
|
22,418 |
|
25,795 |
|
(13 |
) | ||||
Property Treaty |
|
58,498 |
|
49,007 |
|
19 |
|
29,743 |
|
26,918 |
|
10 |
| ||||
Liability |
|
35,583 |
|
39,131 |
|
(9 |
) |
18,408 |
|
19,649 |
|
(6 |
) | ||||
Surety & Credit |
|
36,066 |
|
34,945 |
|
3 |
|
17,853 |
|
17,184 |
|
4 |
| ||||
Other |
|
36,808 |
|
32,500 |
|
13 |
|
16,848 |
|
15,642 |
|
8 |
| ||||
|
|
210,412 |
|
196,472 |
|
7 |
|
105,270 |
|
105,188 |
|
|
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Exited Lines |
|
9,766 |
|
21,371 |
|
(54 |
) |
4,334 |
|
10,580 |
|
(59 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||
Totals |
|
$ |
1,122,542 |
|
$ |
1,112,472 |
|
1 |
% |
$ |
561,356 |
|
$ |
565,331 |
|
(1 |
)% |
HCC Insurance Holdings, Inc. and Subsidiaries
Net Investment Income and Unrealized Gain
(Unaudited, in thousands)
|
|
Six months ended |
|
Three months ended |
| ||||||||
|
|
June 30, |
|
June 30, |
| ||||||||
|
|
2013 |
|
2012 |
|
2013 |
|
2012 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Sources of net investment income: |
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Fixed maturity securities |
|
|
|
|
|
|
|
|
| ||||
Taxable |
|
$ |
51,022 |
|
$ |
58,218 |
|
$ |
25,062 |
|
$ |
27,103 |
|
Exempt from U.S. income taxes |
|
56,075 |
|
52,872 |
|
28,186 |
|
26,260 |
| ||||
Total fixed maturity securities |
|
107,097 |
|
111,090 |
|
53,248 |
|
53,363 |
| ||||
Equity securities |
|
7,808 |
|
993 |
|
4,228 |
|
993 |
| ||||
Short-term investments |
|
80 |
|
102 |
|
68 |
|
40 |
| ||||
Other |
|
319 |
|
868 |
|
366 |
|
401 |
| ||||
Total investment income |
|
115,304 |
|
113,053 |
|
57,910 |
|
54,797 |
| ||||
Investment expense |
|
(3,871 |
) |
(2,753 |
) |
(2,242 |
) |
(1,507 |
) | ||||
|
|
|
|
|
|
|
|
|
| ||||
Net investment income |
|
$ |
111,433 |
|
$ |
110,300 |
|
$ |
55,668 |
|
$ |
53,290 |
|
|
|
|
|
|
|
|
|
|
| ||||
Unrealized gain on available for sale securities: |
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Increase (decrease) in unrealized gain for period, before tax |
|
$ |
(260,622 |
) |
$ |
54,654 |
|
$ |
(221,657 |
) |
$ |
33,185 |
|
|
|
|
|
|
|
|
|
|
| ||||
Unrealized gain at: |
|
|
|
|
|
|
|
|
| ||||
|
|
|
|
|
|
|
|
|
| ||||
June 30, 2013 |
|
$ |
176,073 |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
| ||||
March 31, 2013 |
|
$ |
397,730 |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
| ||||
December 31, 2012 |
|
$ |
436,695 |
|
|
|
|
|
|
|
HCC Insurance Holdings, Inc. and Subsidiaries
Net Loss Ratios
(Unaudited, in thousands)
|
|
Six months ended |
|
Six months ended |
| ||||||
|
|
June 30, 2013 |
|
June 30, 2012 |
| ||||||
|
|
Net earned |
|
Loss |
|
Net earned |
|
Loss |
| ||
|
|
premium |
|
ratio |
|
premium |
|
ratio |
| ||
U.S. Property & Casualty |
|
|
|
|
|
|
|
|
| ||
Aviation |
|
$ |
56,286 |
|
63.0 |
% |
$ |
58,220 |
|
55.8 |
% |
E&O |
|
26,433 |
|
61.1 |
|
31,979 |
|
60.8 |
| ||
Public Risk |
|
32,755 |
|
76.7 |
|
31,792 |
|
77.8 |
| ||
Other |
|
69,489 |
|
44.1 |
|
55,861 |
|
43.4 |
| ||
|
|
184,963 |
|
58.1 |
|
177,852 |
|
56.7 |
| ||
|
|
|
|
|
|
|
|
|
| ||
Professional Liability |
|
|
|
|
|
|
|
|
| ||
U.S. D&O |
|
153,721 |
|
62.8 |
|
170,667 |
|
69.7 |
| ||
International D&O |
|
31,502 |
|
48.6 |
|
30,238 |
|
51.0 |
| ||
|
|
185,223 |
|
60.4 |
|
200,905 |
|
66.9 |
| ||
|
|
|
|
|
|
|
|
|
| ||
Accident & Health |
|
|
|
|
|
|
|
|
| ||
Medical Stop-loss |
|
404,604 |
|
75.2 |
|
387,673 |
|
75.5 |
| ||
Other |
|
30,343 |
|
53.9 |
|
27,355 |
|
52.3 |
| ||
|
|
434,947 |
|
73.7 |
|
415,028 |
|
74.0 |
| ||
|
|
|
|
|
|
|
|
|
| ||
U.S. Surety & Credit |
|
|
|
|
|
|
|
|
| ||
Surety |
|
72,725 |
|
19.8 |
|
79,608 |
|
24.8 |
| ||
Credit |
|
24,506 |
|
18.1 |
|
21,236 |
|
33.0 |
| ||
|
|
97,231 |
|
19.4 |
|
100,844 |
|
26.5 |
| ||
|
|
|
|
|
|
|
|
|
| ||
International |
|
|
|
|
|
|
|
|
| ||
Energy |
|
43,457 |
|
45.4 |
|
40,889 |
|
41.6 |
| ||
Property Treaty |
|
58,498 |
|
51.1 |
|
49,007 |
|
17.7 |
| ||
Liability |
|
35,583 |
|
49.4 |
|
39,131 |
|
49.5 |
| ||
Surety & Credit |
|
36,066 |
|
63.0 |
|
34,945 |
|
58.2 |
| ||
Other |
|
36,808 |
|
40.6 |
|
32,500 |
|
43.7 |
| ||
|
|
210,412 |
|
49.9 |
|
196,472 |
|
40.5 |
| ||
|
|
|
|
|
|
|
|
|
| ||
Exited Lines |
|
9,766 |
|
88.3 |
|
21,371 |
|
80.7 |
| ||
|
|
|
|
|
|
|
|
|
| ||
Totals |
|
$ |
1,122,542 |
|
59.9 |
% |
$ |
1,112,472 |
|
59.8 |
% |
HCC Insurance Holdings, Inc. and Subsidiaries
Reconciliation of Non-GAAP Financial Measures to GAAP
(Unaudited, in thousands)
* Net of tax, calculated using 35% statutory tax rate.
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