HCC REPORTS RESULTS FOR FIRST
QUARTER 2007
HOUSTON (May 8, 2007) . . .
HCC Insurance Holdings, Inc. (NYSE symbol: HCC) today announced record
earnings for the first quarter of 2007.
Net earnings increased significantly for the first quarter of 2007 rising
22% to $96.7 million from $79.1 million for the first quarter of 2006.
During the same period, net earnings per diluted share grew 22% to $0.83 per
share from $0.68 per share.
Book value per share increased to $19.03 at March 31, 2007, up 4% since
December 31, 2006. The Company’s annualized return on average equity as of
March 31, 2007 was 18.5%.
Frank J. Bramanti, Chief Executive Officer, said, “The Company continues to
deliver record results despite the softening insurance marketplace. We are
off to a great start for 2007 and our results are on track with our
expectations for full year 2007.”
Total revenue grew 28% during the first quarter of 2007 to $597.2 million
from $466.3 million in the first quarter of 2006. This increase is primarily
due to the growth in our insurance company subsidiaries’ earned premium from
acquisitions as well as organic growth and increases in overall investment
income. We expect revenue to continue to increase throughout 2007.
During the first three months of 2007, our insurance company subsidiaries’
gross written premium increased 18% to $599.1 million and net earned premium
increased 31% to $497.6 million, both compared to the first quarter of 2006.
Premiums grew as expected due to the acquisition of the Health Products
Division of Allianz Life Insurance Company and strong growth in credit and
surety. The GAAP combined ratio improved for the first three months of 2007
to 84.0% compared to 85.5% in the corresponding period of 2006.
Mr. Bramanti added, “Our margins remain at acceptable levels and we continue
to see opportunities to expand our operations through acquisitions. We
expect to expand the HCC footprint to provide growth for 2008 and beyond.”
During the first quarter of 2007, fee and commission income was flat at
$32.1 million compared to $31.7 million during the same period in 2006. We
continue to focus our acquisition activities in this area.
Net investment income increased 35% in the first quarter of 2007 to $49.5
million from $36.6 million in the first quarter of 2006 as a result of
excellent cash flow from operations, including $100 million of cash
collected from a commutation consummated in the fourth quarter of 2006, and
an increase in short-term interest rates.
As of March 31, 2007, total investments increased to $4.2 billion, total
assets exceeded $7.6 billion, shareholders’ equity was over $2.1 billion and
the Company’s debt to total capital ratio was 12.3%. See
attached tables.
HCC will hold an open conference call beginning at 8:00 a.m. Central Time on
Wednesday, May 9. To participate, the number for domestic calls is (800)
374-0290 and the number for international calls is (706) 634-1303. In
addition, there will be a live
webcast available on a listen-only basis that can be accessed
through the HCC website at www.hcc.com. A replay of the webcast will be
available on the website until Friday, June 8, 2007.
Headquartered in Houston, Texas, HCC is a leading international specialty
insurance group with offices across the United States and in Bermuda, Spain,
Ireland and the United Kingdom. HCC has assets exceeding $7.6 billion,
shareholders’ equity of over $2.1 billion and is rated AA (Very Strong) by
Standard & Poor’s and A+ (Superior) by A.M. Best Company.
For more information, visit our website at
www.hcc.com.
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Contact:
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L. Byron Way, Vice President
HCC Insurance Holdings, Inc.
Telephone: (713) 690-7300
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Forward-looking statements contained in this press
release are made under “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995 and involve a number of
risks and uncertainties. The types of risks and uncertainties which
may affect the Company are set forth in its periodic reports filed
with the Securities and Exchange Commission. |
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