Federated National Holding Company (FNHC) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $12.12 million, or $ 0.89 a share in the quarter, against a net profit of $9.27 million, or $0.66 a share in the last year period.
Revenue during the quarter surged 39.33 percent to $88.57 million from $63.57 million in the previous year period. Net premium earned for the quarter jumped 40.40 percent or $21.70 million to $75.42 million.
Total expenses increase substantially
Benefits, losses and expenses for the quarter were at $104.59 million, or 138.67 percent of premium earned from $49.12 million or 91.44 percent of premium earned in the last year period. Operating loss for the quarter was $16.02 million, compared with an operating income of $14.44 million in the previous year period.
Net investment income was at $2.66 million for the quarter, up 28.62 percent or $0.59 million from year-ago period. The company has recorded a gain on investments of $0.98 million in the quarter compared with a loss of $0.13 million for the previous year period.
Mr. Michael H. Braun, the Company's chief executive officer and president, said, "The quarter's results were impacted by $21.4 million in losses, net of our reinsurance programs, related to Hurricane Matthew, which impacted Florida and South Carolina in the month of October. The $21.4 million impact is made up of an $18.45 million retention from the excess-of-loss property catastrophe reinsurance, $2.3 million related to the reversal of the profit sharing balance on the 10% Florida-only property quota share, which was previously recognized as income, since the inception of the reinsurance treaty, $0.4 million in losses from Monarch National Insurance Company and $0.25 million from 10% of the gross losses from South Carolina’s $2.3 million gross loss, which were not covered by excess-of-loss nor the 10% Florida-only property quota share agreement."
Liabilities outpace assets growth
Total assets increased 27.41 percent or $174.94 million to $813.13 million on Dec. 31, 2016. On the other hand, total liabilities were at $575.27 million as on Dec. 31, 2016, up 48.49 percent or $187.85 million from year-ago.
Return on assets was negative at 1.48 percent in the quarter against a positive 1.46 percent in the last year period. Return on equity was negative at 5.09 percent in the quarter against a positive 3.70 percent in the last year period.
Liability for future policy benefits, unpaid claims and claims adjustment expense was at $158.11 million as on Dec. 31, 2016, up 62.43 percent or $60.77 million from year-ago.
Shareholders equity stood at $237.86 million as on Dec. 31, 2016, down 5.15 percent or $12.90 million from year-ago.
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