Michigan
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38-2626206
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(State or other jurisdiction of incorporation)
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(I.R.S. Employer Identification Number)
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26255 American Drive
Southfield, Michigan
(Address of Principal
Executive Offices)
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48034
(Zip Code)
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.02.
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RESULTS OF OPERATIONS AND FINANCIAL CONDITION
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ITEM 9.01.
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FINANCIAL STATEMENTS AND EXHIBITS
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a.
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None.
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b.
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None.
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c.
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None.
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d.
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The following document is furnished as an Exhibit to this Current Report on Form 8-K pursuant to Item 601 of Regulation S-K:
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99.1
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Earnings Press Release for the second quarter and six months ended June 30, 2011, issued August 1, 2011.
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Dated: August 4, 2011
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MEADOWBROOK INSURANCE GROUP, INC.
(Registrant)
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By: |
/s/ Karen M. Spaun
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Karen M. Spaun, Chief Financial Officer |
Exhibit No.
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Document Description
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Earnings Press Release for the second quarter and six months ended June 30, 2011, issued August 1, 2011.
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CONTACT:
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Karen M. Spaun
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John P. Shallcross
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SVP & Chief Financial Officer
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Director of Investor Relations & Capital Strategies
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(248) 204-8178
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(248) 204-8066
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·
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Net operating income of $8.5 million, or $0.16 per diluted share
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o
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Results include higher than normal after-tax storm losses of $4.1 million, or $0.08 per diluted share, as previously announced
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·
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Accident quarter combined ratio of 100.8%
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o
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Higher than normal storm activity added 3.5 percentage points, as previously announced
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·
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Gross written premium increased 12% to $212.7 million
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·
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Book value per share increased 5.4% to $10.84 as compared to December 31, 2010
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·
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Board of Directors declared quarterly dividend of $0.04 per share
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PR-0611 |
PRESS RELEASE
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PAGE 2 |
PRESS RELEASE
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PAGE 3 |
JUNE 30,
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DECEMBER 31,
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|||||||
(In Thousands, Except Per Share Data)
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2011
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2010
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||||||
BALANCE SHEET DATA
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||||||||
ASSETS
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||||||||
Cash and invested assets
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$ | 1,404,779 | $ | 1,345,257 | ||||
Premium and agents balances
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195,500 | 169,865 | ||||||
Reinsurance recoverable
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305,967 | 294,196 | ||||||
Deferred policy acquisition costs
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84,833 | 78,755 | ||||||
Prepaid reinsurance premiums
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28,500 | 28,208 | ||||||
Goodwill
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118,842 | 118,842 | ||||||
Other assets
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142,585 | 142,518 | ||||||
Total Assets
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$ | 2,281,006 | $ | 2,177,641 | ||||
LIABILITIES
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||||||||
Loss and loss adjustment expense reserves
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$ | 1,125,216 | $ | 1,065,056 | ||||
Unearned premium reserves
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379,842 | 352,585 | ||||||
Debt
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31,250 | 37,750 | ||||||
Debentures
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80,930 | 80,930 | ||||||
Other liabilities
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90,732 | 94,219 | ||||||
Total Liabilities
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1,707,970 | 1,630,540 | ||||||
STOCKHOLDERS' EQUITY
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||||||||
Common stockholders' equity
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573,036 | 547,101 | ||||||
Total Liabilities & Stockholders' Equity
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$ | 2,281,006 | $ | 2,177,641 | ||||
Book value per common share
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$ | 10.84 | $ | 10.28 | ||||
Book value per common share excluding unrealized gain/loss, net of deferred taxes
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$ | 9.99 | $ | 9.61 |
(In Thousands, Except
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FOR THE THREE MONTHS | FOR THE SIX MONTHS | ||||||||||||||
Share & Per Share Data)
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ENDED JUNE 30, | ENDED JUNE 30, | ||||||||||||||
SUMMARY DATA
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2011
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2010
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2011
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2010
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||||||||||||
Gross written premiums
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$ | 212,672 | $ | 189,821 | $ | 437,618 | $ | 396,994 | ||||||||
Net written premiums
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185,777 | 161,275 | 379,093 | 340,051 | ||||||||||||
REVENUES
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||||||||||||||||
Net earned premiums
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$ | 181,470 | $ | 162,760 | $ | 352,128 | $ | 314,201 | ||||||||
Net commissions and fees
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7,897 | 7,135 | 16,335 | 17,003 | ||||||||||||
Net investment income
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13,765 | 13,454 | 27,337 | 26,483 | ||||||||||||
Net realized gains
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1,094 | 292 | 1,906 | 158 | ||||||||||||
Total Revenues
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204,226 | 183,641 | 397,706 | 357,845 | ||||||||||||
EXPENSES
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||||||||||||||||
Net losses and loss adjustment expenses
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121,403 | 99,212 | 226,665 | 186,692 | ||||||||||||
Policy acquisition and other underwriting expenses
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62,450 | 57,370 | 119,888 | 109,249 | ||||||||||||
General selling and administrative expenses
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5,631 | 5,321 | 11,875 | 11,227 | ||||||||||||
General corporate expenses
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(719 | ) | 1,269 | 636 | 3,246 | |||||||||||
Amortization expense
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1,206 | 1,121 | 2,438 | 2,522 | ||||||||||||
Interest expense
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2,082 | 2,411 | 4,254 | 4,854 | ||||||||||||
Total Expenses
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192,053 | 166,704 | 365,756 | 317,790 | ||||||||||||
INCOME BEFORE INCOME TAXES AND EQUITY EARNINGS OF AFFILIATES AND UNCONSOLIDATED SUBSIDIARIES
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12,173 | 16,937 | 31,950 | 40,055 | ||||||||||||
Income tax expense
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2,408 | 4,738 | 8,119 | 12,396 | ||||||||||||
Equity earnings of affiliates, net of tax
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173 | 644 | 1,246 | 1,166 | ||||||||||||
Equity earnings of unconsolidated subsidiaries, net of tax
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1 | 18 | (22 | ) | 470 | |||||||||||
NET INCOME
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$ | 9,939 | $ | 12,861 | $ | 25,055 | $ | 29,295 | ||||||||
Less: Net realized gains (losses), net of tax
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1,399 | 239 | 2,031 | (148 | ) | |||||||||||
NET OPERATING INCOME (1)
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$ | 8,540 | $ | 12,622 | $ | 23,024 | $ | 29,443 | ||||||||
Diluted earnings per common share
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||||||||||||||||
Net income
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$ | 0.19 | $ | 0.24 | $ | 0.47 | $ | 0.53 | ||||||||
Net operating income
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$ | 0.16 | $ | 0.23 | $ | 0.43 | $ | 0.54 | ||||||||
Diluted weighted average common shares outstanding
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53,248,573 | 54,268,668 | 53,323,802 | 54,887,561 | ||||||||||||
GAAP ratios:
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||||||||||||||||
Loss & LAE ratio
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66.9 | % | 61.0 | % | 64.4 | % | 59.4 | % | ||||||||
Other underwriting expense ratio
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34.4 | % | 35.2 | % | 34.0 | % | 34.8 | % | ||||||||
GAAP combined ratio
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101.3 | % | 96.2 | % | 98.4 | % | 94.2 | % |
(In Thousands)
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FOR THE THREE MONTHS
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FOR THE SIX MONTHS
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||||||||||||||
ENDED JUNE 30,
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ENDED JUNE 30,
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|||||||||||||||
2011
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2010
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2011
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2010
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|||||||||||||
Net earned premium
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$ | 181,470 | $ | 162,760 | $ | 352,128 | $ | 314,201 | ||||||||
Net losses & loss adjustment expenses (1)
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121,403 | 99,212 | 226,665 | 186,692 | ||||||||||||
Policy acquisition and other underwriting expenses
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62,450 | 57,370 | 119,888 | 109,249 | ||||||||||||
Profit (loss) from net earned premium
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(2,383 | ) | 6,178 | 5,575 | 18,260 | |||||||||||
Net investment income
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13,765 | 13,454 | 27,337 | 26,483 | ||||||||||||
Profit from insurance operations
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11,382 | 19,632 | 32,912 | 44,743 | ||||||||||||
Net commissions and fees
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$ | 7,897 | $ | 7,135 | $ | 16,335 | $ | 17,003 | ||||||||
General selling & administrative expenses
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5,631 | 5,321 | 11,875 | 11,227 | ||||||||||||
Profit from net commissions & fees
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2,266 | 1,814 | 4,460 | 5,776 | ||||||||||||
General corporate expense
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$ | (719 | ) | $ | 1,269 | $ | 636 | $ | 3,246 | |||||||
Amortization expense
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1,206 | 1,121 | 2,438 | 2,522 | ||||||||||||
Interest expense
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2,082 | 2,411 | 4,254 | 4,854 | ||||||||||||
Other expenses
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2,569 | 4,801 | 7,328 | 10,622 | ||||||||||||
Profit from insurance operations
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$ | 11,382 | 19,632 | $ | 32,912 | $ | 44,743 | |||||||||
Profit from net commissions & fees
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2,266 | 1,814 | 4,460 | 5,776 | ||||||||||||
Other expenses
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(2,569 | ) | (4,801 | ) | (7,328 | ) | (10,622 | ) | ||||||||
Net capital gains
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1,094 | 292 | 1,906 | 158 | ||||||||||||
Pretax income
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$ | 12,173 | $ | 16,937 | $ | 31,950 | $ | 40,055 | ||||||||
Key ratios:
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||||||||||||||||
GAAP combined ratio
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101.3 | % | 96.2 | % | 98.4 | % | 94.2 | % | ||||||||
Accident year combined ratio (2)
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100.8 | % | 100.3 | % | 99.0 | % | 99.5 | % |
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