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United Insurance (UIHC) Q4 Loss Widens, Revenues Beat
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United Insurance Holdings Corp. reported operating loss per share of 49 cents for the fourth quarter of 2016, wider than the Zacks Consensus Estimate loss of 43 cents. Loss per share compared unfavorably with 64 cents per share earned in the year-ago quarter.
Higher expenses offset the improvement in revenues and thus resulted in the underperformance.
Behind the Headlines
Operating revenues increased 32% year over year to $131 million on higher premiums earned, investment income and other income. Revenues beat the Zacks Consensus Estimate of $112 million.
Gross written premiums improved 15.6% year over year to $167 million driven by higher premiums written across Florida, Gulf, Northeast and Southeast region.
Investment income rose 16% year over year to $2.9 million.
United Insurance Holdings Corp. Price, Consensus and EPS Surprise
Operating expenses increased 97.1% year over year to $5.2 million due to increased costs related to the ongoing growth initiatives and higher assessment expense. Total operating expenses rose nearly 52% year over year to $50 million. The increase stemmed from higher loss and loss adjustment expenses, policy acquisition, interest expenses, general and administrative expense, and other operating expenses.
Loss ratio during the quarter deteriorated 3220 basis points year over year to 81.5%. Underlying combined ratio deteriorated 710 basis points to 90.2%.
2016 Highlights
United Insurance’s earnings per share came in at 28 cents per share on revenues of $487 million.
While top line improved 36%, the bottom line deteriorated 80% over 2015.
Financial Update
At the end of 2016, United Insurance had cash and cash equivalents of $150.7 million, up 78% from the 2015 end level. Total assets increased to $994.3 million from $740 million at year-end 2015, whereas shareholder equity rose to $241.3 million from $239.2 million at the end of 2015. Long-term debt totaled $54.2 million compared with $1.4 million at 2015 end.
Book value per share improved 0.4% to $11.15 at Dec 31, 2016, driven primarily by retained earnings.
Return on equity was 2.4% in 2016, down from 12.4% in 2015.
Dividend Update
The board of directors declared a fourth-quarter dividend of 6 cents per share. This represents a 20% hike from the dividend paid in prior-year quarter.
Performance of Other Property and Casualty Insurers
Among the other players from the same space that have reported their fourth-quarter earnings so far, the bottom line at Progressive Corp. (PGR - Free Report) , The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) have surpassed the Zacks Consensus Estimate.
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United Insurance (UIHC) Q4 Loss Widens, Revenues Beat
United Insurance Holdings Corp. reported operating loss per share of 49 cents for the fourth quarter of 2016, wider than the Zacks Consensus Estimate loss of 43 cents. Loss per share compared unfavorably with 64 cents per share earned in the year-ago quarter.
Higher expenses offset the improvement in revenues and thus resulted in the underperformance.
Behind the Headlines
Operating revenues increased 32% year over year to $131 million on higher premiums earned, investment income and other income. Revenues beat the Zacks Consensus Estimate of $112 million.
Gross written premiums improved 15.6% year over year to $167 million driven by higher premiums written across Florida, Gulf, Northeast and Southeast region.
Investment income rose 16% year over year to $2.9 million.
United Insurance Holdings Corp. Price, Consensus and EPS Surprise
United Insurance Holdings Corp. Price, Consensus and EPS Surprise | United Insurance Holdings Corp. Quote
Operating expenses increased 97.1% year over year to $5.2 million due to increased costs related to the ongoing growth initiatives and higher assessment expense. Total operating expenses rose nearly 52% year over year to $50 million. The increase stemmed from higher loss and loss adjustment expenses, policy acquisition, interest expenses, general and administrative expense, and other operating expenses.
Loss ratio during the quarter deteriorated 3220 basis points year over year to 81.5%. Underlying combined ratio deteriorated 710 basis points to 90.2%.
2016 Highlights
United Insurance’s earnings per share came in at 28 cents per share on revenues of $487 million.
While top line improved 36%, the bottom line deteriorated 80% over 2015.
Financial Update
At the end of 2016, United Insurance had cash and cash equivalents of $150.7 million, up 78% from the 2015 end level. Total assets increased to $994.3 million from $740 million at year-end 2015, whereas shareholder equity rose to $241.3 million from $239.2 million at the end of 2015. Long-term debt totaled $54.2 million compared with $1.4 million at 2015 end.
Book value per share improved 0.4% to $11.15 at Dec 31, 2016, driven primarily by retained earnings.
Return on equity was 2.4% in 2016, down from 12.4% in 2015.
Dividend Update
The board of directors declared a fourth-quarter dividend of 6 cents per share. This represents a 20% hike from the dividend paid in prior-year quarter.
Zacks Rank
United Insurance carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Performance of Other Property and Casualty Insurers
Among the other players from the same space that have reported their fourth-quarter earnings so far, the bottom line at Progressive Corp. (PGR - Free Report) , The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) have surpassed the Zacks Consensus Estimate.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>