Authorization

ICC Holdings, Inc. Reports 2018 Fourth Quarter and Year-End Results

ROCK ISLAND, Ill., Feb. 25, 2019 /PRNewswire/ -- ICC Holdings, Inc. (NASDAQ: ICCH) (theA Company), parent company of Illinois Casualty Company, a regional, multi-line property and casualty insurance company focusing exclusively on the food and beverage industry, today reported preliminary, unaudited results for the fourth quarter and twelve months ended December 31, 2018. FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2018 a?? FINANCIAL RESULTSNet earnings totaled $635,000, or $0.21 per share, for the fourth quarter of 2018, compared to $443,000 or $0.14 per share for the fourth quarter of 2017. For the twelve months ended December 31, 2018, the Company reported net earnings of $893,000, or $0.29 per share, compared to $708,000, or $0.22 per share, for the same period in 2017. Direct premiums written grew by $1,399,000, or 10.6%, to $14,543,000 for the fourth quarter of 2018 from $13,144,000 for the same period in 2017. For the twelve months ended December 31, 2018, direct premiums written grew by $7,455,000, or 13.9%, to $61,125,000 from $53,670,000 for the same period in 2017. Net premiums earned grew by 6.3% to $12,197,000 for the fourth quarter of 2018 from $11,473,000 for the same period in 2017. Net premiums earned grew by 6.6% to $47,117,000 for the twelve months ended December 31, 2018, from $44,213,000 for the same period in 2017.For the fourth quarter of 2018, the Company ceded to reinsurers $2,811,000 of earned premiums, compared to $1,956,000 of earned premiums for the fourth quarter of 2017. For the twelve months ended December 31, 2018, the Company ceded $10,759,000 of earned premiums to reinsurers compared to $7,948,000 of earned premiums for the same period in 2017. A Net realized investment losses net of other-than-temporary impairment losses were $127,000 for the fourth quarter of 2018 compared to gains of 622,000 for the same period in 2017, respectively. For the twelve months ended December 31, 2018, net realized investment gains net of other-than-temporary impairment losses, decreased by $48,000 to $960,000 from $1,008,000 for the same period in 2017. For the three and twelve months ended December 31, 2018, the decrease resulted from liquidating common stock holdings that no longer fit with our investment objectives and resulted in a realized loss during the fourth quarter of 2018. Net investment income decreased by $17,000, or 2.2%, to $766,000 for the fourth quarter of 2018, as compared to $783,000 for the same period in 2017. For the twelve months ended December 31, 2018, net investment income grew by $258,000, or 9.8%, to $2,890,000 from $2,632,000 for the same period in 2017. The growth in net investment income for the twelve months ended December 31, 2018, was primarily due to investing the IPO proceeds for the entire year in 2018 as compared to a partial year in 2017.Losses and settlement expenses decreased by $619,000, or 8.3%, to $6,864,000 for the fourth quarter of 2018, from $7,483,000 for the same period in 2017. Losses and settlement expenses increased by $2,252,000, or 7.8%, to $31,262,000 for the twelve months ended December 31, 2018, from $29,010,000 for the same period in 2017. Although the Company experienced increased weather-related loss activity, Businessowners Property results improved $2,208,000 for the twelve months ended December 31, 2018, compared to the same period in 2017. Losses and settlement expenses increased for the twelve months ended December 31, 2018, primarily due to weaker Businessowners Liability. Policy acquisition costs and other operating expenses increased by $617,000, or 13.7%, to $5,126,000 for the fourth quarter of 2018 from $4,509,000 for the same period in 2017. Policy acquisition costs and other operating expenses increased by $907,000, or 5.2%, to $18,215,000 for the twelve months ended December 31, 2018, from $17,308,000 for the same period in 2017. The primary drivers are an increase in direct commission expense associated with the increase in direct written premium coupled with an increase in self-funded employee medical expenses of $535,000 for the twelve months ended December 31, 2018, as compared to the same period in 2017. While total policy acquisition costs and other operating expenses were up for the twelve months ended December 31, 2018, the expense ratio is down for the same period as referenced below. Total assets decreased by 1.3% from $152,335,000 at DecemberA 31, 2017 to $150,283,000 at December 31, 2018. Our investment portfolio, which consists of fixed maturity securities, common stocks, preferred stocks, and property held for investment, decreased by 0.5% from $105,133,000 at DecemberA 31, 2017, to $104,565,000 at December 31, 2018.FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2018 a?? FINANCIAL RATIOSThe Company's losses and settlement expense ratio (defined as losses and settlement expenses divided by net premiums earned) was 56.3% and 66.3% in the fourth quarter and twelve months ended December 31, 2018, respectively, compared with 65.2% and 65.6% in the same periods of 2017.The expense ratio (defined as the amortization of deferred policy acquisition costs and underwriting and administrative expenses divided by net premiums earned) was 42.0% and 38.7% in the fourth quarter and twelve months ended December 31, 2018, respectively, compared to 39.3% and 39.1% in the same periods of 2017.The Company's GAAP combined ratio (defined as the sum of the losses and settlement expense ratio and the expense ratio) was 98.3% and 105.0% in the fourth quarter and twelve months ended December 31, 2018, respectively, compared to 104.5% and 104.8% in the same periods of 2017.MANAGEMENT COMMENTARY"I am pleased to report improved results for this past quarter.A  As stated above, we had a quarterly combined ratio below 100 for the first time since the first quarter of 2017.A The Company experienced improved loss experience due to improved Workers' Compensation results and continued stability in the Liquor Liability line of business.A  Partially offsetting these results were continuing challenges in the Businessowners line of business.A The Company recognized improved patterns in the closing of claims, whereby reserves are reaching ultimate faster.A This reduced the amount of additional reserve needed for incurred but not reported claims at the end of 2018.A We recognize the need to further strengthen the adequacy of rates in the Businessowners line and streamline operations for expense savings. These efforts will continue into 2019.A The Company experienced loss activity related to the polar vortex in the Midwest during the first quarter of 2019, negatively impacting property results. I am excited about the future of ICCH and the quality book of business that we continue to build," stated Arron Sutherland, President and Chief Executive Officer.EARNINGS CONFERENCE CALLThe Company will hold a conference call on March 15, 2019, at 10:30 a.m. CT to discuss results for the fourth quarter and twelve months ended December 31, 2018.Teleconference:Dial-in information for the call is 1-866-595-5224 (toll-free) or 1-636-812-6497, passcode 4856807.ABOUT ICC HOLDINGS, INC.ICC Holdings, Inc. is a vertically integrated company created to facilitate the growth, expansion and diversification of its subsidiaries in order to maximize value to its stakeholders.A  The group of companies consolidated under ICC Holdings, Inc. engages in diverse, yet complementary business activities, including property and casualty insurance, real estate, and information technology. The Company's common shares trade on the NASDAQ Capital Market under the ticker symbol "ICCH". For more information about ICC Holdings, visit https://ir.iccholdingsinc.com. FORWARD-LOOKING STATEMENTSThis press release, and oral statements made regarding the subjects of this release, contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, or the Reform Act, which may include, but are not limited to, statements regarding the Company's, plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts, including statements identified by words such as "believe," "plan," "seek," "expect," "intend," "estimate," "anticipate," "will," and similar expressions. All statements addressing operating performance, events, or developments that the Company expects or anticipates will occur in the future, including statements relating to revenue and profit growth, product and segment expansion, regulatory approval in connection with expansion, and market share, as well as statements expressing optimism or pessimism about future operating results, are forward-looking statements within the meaning of the Reform Act. The forward-looking statements are based on management's current views and assumptions regarding future events and operating performance, and are inherently subject to significant business, economic, and competitive uncertainties and contingencies and changes in circumstances, many of which are beyond the Company's control. The statements in this press release are made as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company does not undertake any obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.Although the Company does not make forward-looking statements unless it believes it has a reasonable basis for doing so, the Company cannot guarantee their accuracy. The foregoing factors, among others, could cause actual results to differ materially from those described in these forward-looking statements. For a list of other factors which could affect the Company's results, see the Company's filings with the Securities and Exchange Commission, "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations," including "Forward-Looking Information," set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2017. No undue reliance should be placed on any forward-looking statements.

ICC Holdings, Inc. and Subsidiaries



Condensed Consolidated Balance Sheets
















































As of













December 31,








DecemberA 31,













2018








2017













(Unaudited)


















Assets

































Investments and cash:

































Available for sale securities, at fair value

































Fixed maturity securities (amortized cost - $89,252,906 at








$



88,981,159








$



89,605,073



12/31/2018 and $87,773,047 at 12/31/2017)

































Common stocksA? (cost - $13,572,713 at













11,843,223













8,534,109



12/31/2018 and $7,631,180 at 12/31/2017)

































Preferred stocks (cost - $0 at













a??













3,867,429



12/31/2018 and $3,783,311 at 12/31/2017)

































Other invested assets













154,200













a??



Property held for investment, at cost, net of accumulated depreciation of













3,586,273













3,126,566



$222,825 at 12/31/2018 and $127,161 at 12/31/2017

































Cash and cash equivalents













4,644,784













6,876,519



Total investments and cash













109,209,639













112,009,696



Accrued investment income













648,321













687,453



Premiums and reinsurance balances receivable, net of allowances for













21,404,344













19,013,262



uncollectible amounts of $50,000 at 12/31/2018 and 12/31/2017

































Ceded unearned premiums













796,065













274,972



Reinsurance balances recoverable on unpaid losses and settlement expenses,













6,735,964













10,029,834



net of allowances for uncollectible amounts of $0 at 12/31/2018 and 12/31/2017

































Current federal income taxes













847,271













573,147



Net deferred federal income taxes













1,021,398













349,258



Federal income taxes













1,868,669













922,405



Deferred policy acquisition costs, net













5,247,188













4,592,415



Property and equipment, at cost, net of accumulated depreciation of













3,332,810













3,503,904



$5,099,090 at 12/31/2018 and $4,896,041 at 12/31/2017

































Other assets













1,040,193













1,301,420



Total assets








$



150,283,193








$



152,335,361



Liabilities and Equity

































Liabilities:

































Unpaid losses and settlement expenses








$



51,447,440








$



51,074,126



Unearned premiums













29,972,623













26,555,582



Reinsurance balances payable













993,004













327,483



Corporate debt













3,484,606













4,339,208



Accrued expenses













4,536,218













4,274,002



Other liabilities













1,256,003













1,663,415



Total liabilities













91,689,894













88,233,816



Equity:

































Common stock2













35,000













35,000



Treasury stock, at cost3













(2,999,995)













a??



Additional paid-in capital













32,505,423













32,333,290



Accumulated other comprehensive (loss) earnings, net of tax













(1,580,976)













2,227,069



Retained earnings













33,680,702













32,787,406



Less: Unearned Employee Stock Ownership Plan shares at cost4













(3,046,855)













(3,281,220)



Total equity













58,593,299













64,101,545



Total liabilities and equity








$



150,283,193








$



152,335,361













1



At December 31, 2018, common stock securities consist primarily of individual common stocks. At December 31, 2017, common stock consisted of exchange trade funds (ETF) made up primarily of Dividends Select and the S&P 500.500



2



Par value $0.01; authorized: 2018 - 10,000,000 shares and 2017 a?? 10,000,000 shares; issued: 2018 - 3,500,000 and 2017 a?? 3,500,000 shares; outstanding: 2018 - 2,992,734 and 2017 a?? 3,171,878 shares.



3



2018 a?? 196,721 shares and 2017 a?? 0 shares



4



2018 a??304,685 shares and 2017 a?? 328,122 shares



ICC Holdings, Inc. and Subsidiaries



Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited)
















































For the Three-Months Ended













December 31,













2018








2017



Net premiums earned








$



12,197,256








$



11,472,959



Net investment income













766,207













783,077



Net realized investment (losses) gains













(111,236)













621,632



Other-than-temporary impairment losses













(16,178)













a??



Other income













66,427













127,480



Consolidated revenues













12,902,476













13,005,148



Losses and settlement expenses













6,864,453













7,482,790



Policy acquisition costs and other operating expenses













5,125,902













4,508,621



Interest expense on debt













32,542













51,030



General corporate expenses













147,127













103,449



Total expenses













12,170,024













12,145,890



Earnings before income taxes













732,452













859,258



Income tax (benefit) expense:

































Current













(238,145)













379,844



Deferred













336,023













36,701



Total income tax expense













97,878













416,545



Net earnings








$



634,574








$



442,713






































Other comprehensive (loss), net of tax













(1,418,631)













(188,174)



Comprehensive (loss) earnings








$



(784,057)








$



254,539






































Earnings per share:

































Basic:

































Basic net loss per share








$



0.21








$



0.14



Diluted:

































Diluted net loss per share








$



0.21








$



0.14






































Weighted average number of common shares outstanding:

































Basic













2,994,775













3,167,344



Diluted













2,995,947













3,167,344



ICC Holdings, Inc. and Subsidiaries



Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited)
















































For the Twelve-Months Ended













December 31,













2018








2017



Net premiums earned








$



47,116,961








$



44,213,271



Net investment income













2,890,266













2,632,498



Net realized investment gains













975,993













1,064,577



Other-than-temporary impairment losses













(16,178)













(57,316)



Other income













196,649













325,127



Consolidated revenues













51,163,691













48,178,157



Losses and settlement expenses













31,262,462













29,009,833



Policy acquisition costs and other operating expenses













18,214,983













17,307,700



Interest expense on debt













140,877













225,379



General corporate expenses













545,986













555,109



Total expenses













50,164,308













47,098,021



Earnings before income taxes













999,383













1,080,136



Income tax (benefit) expense:

































Current













(234,037)













197,200



Deferred













340,124













175,085



Total income tax expense













106,087













372,285



Net earnings








$



893,296








$



707,851






































Earnings per share:

































Basic:

































Basic net earnings per share








$



0.29








$



0.22



Diluted:

































Diluted net earnings per share








$



0.29








$



0.22






































Weighted average number of common shares outstanding:

































Basic













3,119,968













3,158,163



Diluted













3,121,140













3,158,163






































Other comprehensive earnings, net of tax

































Unrealized gains and losses on investments:

































Unrealized holding (losses) gains arising during the period,

































net of income tax (benefit) of $(810,701) in 2018

































and income tax expense of $706,378 in 2017








$



(3,049,791)








$



1,371,206



Reclassification adjustment for (gains) included in net

































income, net of income tax expense of $201,561 in 2018

































and expense of $342,469 in 2017













(758,254)













(664,792)



Total other comprehensive earnings













(3,808,045)













706,414



Comprehensive earnings








$



(2,914,749)








$



1,414,265



Contact Info:



Arron K. Sutherland, President and CEOA 








ICC Holdings, Inc.








(309) 732-0105








arrons@ilcasco.com








225 20th Street, Rock Island, ILA  61201

ICC Holdings, Inc. Reports 2018 Fourth Quarter and Year-End Results
View original content:https://www.prnewswire.com/news-releases/icc-holdings-inc-reports-2018-fourth-quarter-and-year-end-results-300801693.htmlSOURCE ICC Holdings, Inc.
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