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Maiden Holdings (MHLD) Q1 Earnings Miss, Revenues Grow Y/Y
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Maiden Holdings, Ltd. (MHLD - Free Report) reported first-quarter 2017 earnings per share of 26 cents, which missed the Zacks Consensus Estimate of 38 cents. Earnings declined 30% year over year.
Though revenues improved, escalating expenses limited the top-line growth.
Behind the Headlines
Gross premiums written increased 6.9% year over year to $923.4 million on higher premiums written in Diversified Reinsurance and AmTrust Reinsurance segment.
Net investment income grew nearly 16.1% to $42.2 million.
Total revenue of $756.7 million climbed 15% year over year on higher net premiums earned and net investment income.
Total expense escalated 17.3% year over year to $720 million as net loss and loss adjustment expenses, commission and other acquisition costs, and general & administrative expenses increased in the quarter.
Maiden Holdings’ underwriting income of $1.3 million plummeted 92% year over year. Combined ratio deteriorated 200 basis points (bps) year over year to 100.9%.
Maiden Holdings, Ltd. Price, Consensus and EPS Surprise
Diversified Reinsurance: Net premiums earned increased 17.2% to $201.8 million.
Underwriting income of $0.3 million compared favorably with a loss of $5.1 million incurred in the year-ago quarter. Combined ratio improved 300 bps to 99.9%.
AmTrust Reinsurance: Net premiums earned increased 14.4% to $507.6 million.
Underwriting income was $1.1 million compared with $20.9 million in the year-ago quarter. Combined ratio deteriorated 450 bps year over year to 99.8%.
Other: Underwriting loss of $0.3 million was narrower than a loss of $2.8 million in the year-ago quarter.
Financial Update
Maiden Holdings exited the quarter with total investment of $4.732 billion as against $4.737 billion at year-end 2016. Cash and cash equivalents as of Mar 31, 2017 were $193.2 million, about $43.7 million higher than the 2016-end level.
The company’s senior notes totaled $351.5 million compared with $351.4 million at year-end 2016.
Shareholders’ equity of $1.4 billion at the end of the quarter was up 0.7% from the 2016-end level.
As of Mar 31, 2017, diluted book value per share was $12.19, up 0.6% from the 2016-end level.
Operating return on equity was 8.7% in the quarter as against 11.9% in the year-ago quarter.
Zacks Rank
Maiden Holdings presently carries a Zacks Rank #5 (Strong Sell).
Among the other players that have reported first-quarter earnings so far, Chubb Limited (CB - Free Report) beat the Zacks Consensus Estimate but RLI Corp. (RLI - Free Report) and The Progressive Corporation (PGR - Free Report) missed expectations.
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Maiden Holdings (MHLD) Q1 Earnings Miss, Revenues Grow Y/Y
Maiden Holdings, Ltd. (MHLD - Free Report) reported first-quarter 2017 earnings per share of 26 cents, which missed the Zacks Consensus Estimate of 38 cents. Earnings declined 30% year over year.
Though revenues improved, escalating expenses limited the top-line growth.
Behind the Headlines
Gross premiums written increased 6.9% year over year to $923.4 million on higher premiums written in Diversified Reinsurance and AmTrust Reinsurance segment.
Net investment income grew nearly 16.1% to $42.2 million.
Total revenue of $756.7 million climbed 15% year over year on higher net premiums earned and net investment income.
Total expense escalated 17.3% year over year to $720 million as net loss and loss adjustment expenses, commission and other acquisition costs, and general & administrative expenses increased in the quarter.
Maiden Holdings’ underwriting income of $1.3 million plummeted 92% year over year. Combined ratio deteriorated 200 basis points (bps) year over year to 100.9%.
Maiden Holdings, Ltd. Price, Consensus and EPS Surprise
Maiden Holdings, Ltd. Price, Consensus and EPS Surprise | Maiden Holdings, Ltd. Quote
Segment Result
Diversified Reinsurance: Net premiums earned increased 17.2% to $201.8 million.
Underwriting income of $0.3 million compared favorably with a loss of $5.1 million incurred in the year-ago quarter. Combined ratio improved 300 bps to 99.9%.
AmTrust Reinsurance: Net premiums earned increased 14.4% to $507.6 million.
Underwriting income was $1.1 million compared with $20.9 million in the year-ago quarter. Combined ratio deteriorated 450 bps year over year to 99.8%.
Other: Underwriting loss of $0.3 million was narrower than a loss of $2.8 million in the year-ago quarter.
Financial Update
Maiden Holdings exited the quarter with total investment of $4.732 billion as against $4.737 billion at year-end 2016. Cash and cash equivalents as of Mar 31, 2017 were $193.2 million, about $43.7 million higher than the 2016-end level.
The company’s senior notes totaled $351.5 million compared with $351.4 million at year-end 2016.
Shareholders’ equity of $1.4 billion at the end of the quarter was up 0.7% from the 2016-end level.
As of Mar 31, 2017, diluted book value per share was $12.19, up 0.6% from the 2016-end level.
Operating return on equity was 8.7% in the quarter as against 11.9% in the year-ago quarter.
Zacks Rank
Maiden Holdings presently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other P&C Insurers
Among the other players that have reported first-quarter earnings so far, Chubb Limited (CB - Free Report) beat the Zacks Consensus Estimate but RLI Corp. (RLI - Free Report) and The Progressive Corporation (PGR - Free Report) missed expectations.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.
Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>