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Universal Insurance Holdings, Inc. Reports Record First Quarter 2016 Financial Results

FORT LAUDERDALE, Fla., May 2, 2016 /PRNewswire/ -- Universal Insurance Holdings, Inc. UVE, -1.71% today reported record first quarter net income of $25.2 million, an increase of 13.0%, or $2.9 million, over the same quarter in 2015. Diluted earnings per share (EPS) were $0.71 for the first quarter of 2016, an increase of 14.5%, or $0.09 per share, over the same quarter in 2015.

"I am very pleased with our outstanding first quarter results, which we achieved notwithstanding the most active severe weather experienced in the first quarter in Florida in company history," said Sean P. Downes, Universal's Chairman and Chief Executive Officer. "Our record performance in the quarter highlights the strength of our underwriting standards, our claims handling ability and the high quality of our book of business. We continued to execute well on our key strategic initiatives, including further progress on our geographic expansion efforts as we wrote our first homeowners insurance policy in Michigan and received certificates of authority from New York and New Jersey. We enter the second quarter with a robust financial position and confidence in our underlying growth prospects and will continue to maintain our focus on writing high quality, rate-adequate organic business to drive increasing value for Universal shareholders."

First-Quarter 2016 & Recent Highlights

  • Net earned premiums grew by $58.1 million, or 61.6%, to $152.4 million.
  • Total revenues increased by $60.6 million, or 58.4%, to $164.4 million.
  • Net income increased by $2.9 million, or 13.0%, to $25.2 million.
  • Diluted EPS grew by $0.09, or 14.5%, to $0.71 per share.
  • Paid dividends of $0.14 per share.
  • Received Certificates of Authority from New York and New Jersey.
  • Wrote our first policy in Michigan.
  • Launched beta test of Universal Direct®, a Direct-to-Consumer online platform for homeowners insurance and wrote our first policy on Universal Direct®.

First-Quarter 2016 Results

Net income for the first quarter of 2016 of $25.2 million reflects an improvement across all revenue measures. The increase in net earned premiums includes both organic growth in policies in force and lower reinsurance costs, including the elimination of quota share reinsurance arrangements effective June 2015.

Earned premiums, total revenues, net income and diluted EPS were higher than any other first quarter in the Company's history.

Net income was offset by $8.5 million beyond originally projected pre-tax net losses and loss adjustment expenses attributable to first quarter weather events in Florida. These losses and loss adjustment expenses were incremental to amounts provided for in the underlying loss ratio based on historical experience for such events.

Losses and loss adjustment expenses as a percentage of net earned premiums increased 7.8 percentage points resulting in a net loss ratio of 43.4% for the first quarter, compared to 35.6% for the same period last year. The key driver of this increase was the severe weather events in the first quarter of 2016.

Stockholders' equity reached an all-time high of $314.3 million as of March 31, 2016 compared to $293.1 million as of December 31, 2015. Book value per common share also reached an all-time high of $9.03 as March 31, 2016 compared to $8.34 as of December 31, 2015.

Cash Dividends

On January 14, 2016, the Company announced that its Board of Directors had declared an increased...