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1347 Property Insurance Holdings, Inc. Reports Preliminary First Quarter 2020 Financial Information

1347 Property Insurance Holdings, Inc. (Nasdaq: PIH) (the "Companya??), which intends to operate as a diversified holding company of reinsurance and investment management businesses, today announced preliminary unaudited financial information for its first quarter ended March 31, 2020.


Operating Results


The Company expects to report a net loss attributable to common shareholders of $8.6 million for the quarter, or $1.43 per diluted share, which primarily results from non-cash losses associated with the change in fair value of the Companya??s investment in the common stock of FedNat Holding Company (Nasdaq: FNHC) ("FedNata??). Full results will be filed via Form 10-Q as soon as practicable.


As of March 31, 2020, key balance sheet items are expected to include:





Cash and cash equivalents of $27.7 million.






Equity securities, consisting of 1,773,102 shares of common stock of FedNat, with a cost basis of $25.5 million. As of March 31, 2020, the equity securities were valued at $20.4 million, compared with $29.5 million as of December 31, 2019, as the share price declined during the period. The Company expects to report an unrealized loss on investments of approximately $9.0 million for the period, and also expects to record a valuation allowance of approximately $1.0 million against the deferred tax asset generated from this unrealized loss.






Book value per share of approximately $6.07.





Also, on April 3, 2020, the Company made its initial quarterly payment of approximately $0.5 million under the Shared Services Agreement (the "Agreementa??) with an affiliate of Fundamental Global Investors, LLC ("FGMa??), the beneficial owner of approximately 45% of the Companya??s outstanding common stock. Pursuant to the Agreement, FGM will provide the Company with certain services related to the day-to-day management of the Company. In exchange for these services, the Company will pay FGM a fee of $0.5 million per quarter, plus reimbursement of certain expenses incurred by FGM in connection with the performance of the services. The Companya??s Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 6, 2020, provides additional details on the Shared Services Agreement.
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