Maiden Beats Earnings Est, Lags Revs - Analyst Blog
Maiden Holdings Ltd.
) reported second quarter 2013 operating earnings of 28 cents per
share that exceeded the Zacks Consensus Estimate of 26 cents per
share by 7.7%. Earnings also exceeded the year-ago earnings of 27
cents per share.
Including net realized losses on investment and amortization of intangible assets, Maiden reported net income of 27 cents per share during the reported quarter, up 35% from 20 cents reported in the year-ago quarter.
Improved underwriting performance and absence of any adverse impact from catastrophe events during the quarter mainly led to the upside. Additionally, favorable North American pricing environment led to robust growth in the AmTrust segment which also contributed to the improvement.
Quarterly Operational Update
Total revenue of Maiden during the second quarter increased 17.6% year over year to $536.7 million. Higher premiums and increased investment income shored up the revenues. However, revenues lagged the Zacks Consensus Estimate of $541 million.
Net premiums written during the quarter increased 20.9% to $497.9 million mainly led by growth in the AmTrust Quota Share Reinsurance segment. Growth in the AmTrust Quota Share Reinsurance segment was driven by acquisition activities and by internal premium increases, especially in the workers' compensation line. However, this was partially tempered by a 6.3% decline in net premiums written in the Diversified Reinsurance segment.
Net investment income of Maiden in the second quarter of 2013 was $20.7 million, up 3.3% year over year. Going forward, higher interest rates are expected to push up net investment income of the company further.
Total expenses during the quarter increased 17.1% year over year to $503.7 million reflecting higher loss and loss adjustment expenses, commissions and other acquisition expenses.
Combined ratio for the second quarter of 2013 improved 30 basis points year over year to 97.6% owing to absence of any adverse impact from catastrophe losses during the quarter.
On Aug 7, 2013, Maiden declared a quarterly dividend of 9 cents per share which will be paid on Oct 15, 2013 to shareholders of record at Oct 1, 2013.
Additionally, Maiden declared a cash dividend of 52 cents per preferred share of the company. The dividend will be paid on Sept 16, 2013 to shareholders of record as of Sept 1, 2013.
As of Jun 30, 2013, Markel had cash and cash equivalents of $2.8 billion compared to $2.7 billion as of Mar 31, 2013.
As of Jun 30, 2013, Maiden had assets worth $4.40 billion, down from $4.42 billion as of Mar 31, 2013.
Shareholders' equity as of Jun 30, 2013 was $956.8 million, compared to $1 billion as of Mar 31, 2013. Return on equity (ROE) of Maiden for the first half of the year stood at 10%, compared to 9.9% for the first half of 2012. Book value as of Jun 30, 2013 was $11.12 per share compared to $12.10 as of Mar 31, 2013.
Performance of Other Insurers
On Jul 23, 2013, ACE Limited ( ACE ) reported second quarter 2013 operating net income of $2.29 per share, up 19.3% from the Zacks Consensus Estimate of $1.92. Results improved 5.5% from $2.17 earned in the year-ago quarter.
On Jul 25, 2013, Chubb Corporation ( CB ) reported second-quarter operating earnings of $1.77 per share, significantly ahead of the Zacks Consensus Estimate of $1.38 per share. Earnings also increased 29% year over year.
On Aug 2, 2013, Berkshire Hathaway Inc. ( BRK.A ) ( BRK.B ) reported second quarter 2013 operating earnings of $1.53 per share, surpassing the Zack Consensus estimate of $1.45 per share. Earnings also compared favorably with $1.50 per share reported in the year-ago quarter.
Maiden carries a Zacks Rank #3 (Hold).
ACE LIMITED (ACE): Free Stock Analysis Report
BERKSHIRE HTH-A (BRK.A): Free Stock Analysis Report
BERKSHIRE HTH-B (BRK.B): Free Stock Analysis Report
CHUBB CORP (CB): Free Stock Analysis Report
MAIDEN HOLDINGS (MHLD): Free Stock Analysis Report
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