ICC Holdings, Inc. Reports 2020 Fourth Quarter and Twelve Months Results
ICC Holdings, Inc. (NASDAQ: ICCH) reported unaudited financial results for Q4 and 2020. Net earnings for Q4 2020 reached $4.32 million ($1.43 per share), up from $3.58 million ($1.19 per share) in Q4 2019, aided by improved underwriting and a PPP loan forgiveness gain. However, 2020 net earnings declined to $3.53 million ($1.17 per share) from $4.29 million ($1.43 per share) in 2019. Direct premiums written rose 0.7% in Q4 but fell 6.4% for the year, reflecting COVID-19's impact. The book value per share increased by 9.7% to $22.08. Losses and settlement expenses rose 18.8% in Q4.
- Net earnings for Q4 2020 increased to $4.32 million from $3.58 million in Q4 2019.
- Book value per share grew by 9.7% to $22.08.
- Direct premiums written for Q4 increased by $108,000, or 0.7%.
- Net investment income rose by 9.6% in Q4 and 9.8% for the year.
- 2020 net earnings decreased to $3.53 million from $4.29 million in 2019.
- Direct premiums written fell by $4 million, or 6.4% for 2020.
- Net premiums earned decreased by 6.3% in Q4 and 6.0% for the year.
- Losses and settlement expenses increased by 18.8% in Q4.
ROCK ISLAND, Ill., March 3, 2021 /PRNewswire/ -- ICC Holdings, Inc. (NASDAQ: ICCH) (the 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, 2020.
FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2020 – FINANCIAL RESULTS
Net earnings totaled
Direct premiums written grew by
For the fourth quarter of 2020, the Company ceded to reinsurers
Net realized investment gains net of other-than-temporary impairment losses were
Net investment income increased by
Losses and settlement expenses increased by
Policy acquisition costs and other operating expenses decreased by
Total assets increased by
FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2020 – FINANCIAL RATIOS
The Company's losses and settlement expense ratio (defined as losses and settlement expenses divided by net premiums earned) was
The expense ratio (defined as the amortization of deferred policy acquisition costs and underwriting and administrative expenses divided by net premiums earned) was
The Company's GAAP combined ratio (defined as the sum of the losses and settlement expense ratio and the expense ratio) was
MANAGEMENT COMMENTARY
"The Company was tested by extraordinary events in calendar year 2020, including government-ordered business closures due to COVID-19, civil unrest, and a derecho windstorm. I am proud of the Company's resiliency. Understanding the uniquely difficult challenges faced by our food and beverage customers, multiple measures were implemented to adjust insureds' premiums. The goal of these efforts was to reduce cash flow burdens and properly recognize reduced risks given insureds' business closures or changing sales mixes.
"Unprecedented property catastrophe losses contributed to a slightly higher combined ratio than the prior year. In response, the Company reduced operational costs and improved its year-over-year expense ratio by
"Consistent with prior years, the Company has been focused on underwriting discipline and generating a high quality book of business. This is achieved through providing fair and adequate rates, while accepting proper levels of exposure. Our property and workers' compensation lines of business proved to be our most challenging lines this year. These challenges were offset with significant profitability in our liability lines, the investment portfolio's rebound and the SBA's forgiveness of our PPP loan in December 2020.
"Despite the year's challenges, the Company, again, produced positive earnings per share and a nearly
"The Company's human capital has been key to our continued success which was truly demonstrated in 2020. Our employees' seamless shift to the work-from-home environment coupled with minimal turnover kept the operational wheels turning. The Company's solid foundation and growth prospects are making space for positive movement in the year to come," stated Arron Sutherland, President and Chief Executive Officer.
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. 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 http://ir.iccholdingsinc.com.
FORWARD-LOOKING STATEMENTS
This 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; future responses to and effects of the COVID-19 pandemic, including their effects on our business operations and claims activity; new theories of liability; judicial, legislative, regulatory and other governmental developments, including, but not limited to, liability related to business interruption claims related to COVID-19; litigation tactics and developments; 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, 2019. No undue reliance should be placed on any forward-looking statements.
Contact Info:
Arron K. Sutherland, President and CEO
Illinois Casualty Company
(309) 732-0105
arrons@ilcasco.com
225 20th Street, Rock Island, IL 61201
ICC Holdings, Inc. and Subsidiaries | ||||
Condensed Consolidated Balance Sheets | ||||
As of | ||||
December 31, | December 31, | |||
2020 | 2019 | |||
(Unaudited) | ||||
Assets | ||||
Investments and cash: | ||||
Fixed maturity securities (cost or amortized cost - | $ 105,740,566 | $ 92,087,572 | ||
Common stocks at fair value | 14,724,814 | 14,448,773 | ||
Preferred stocks at fair value | 1,683,892 | — | ||
Other invested assets | 1,772,867 | 877,900 | ||
Property held for investment, at cost, net of accumulated depreciation of | 5,399,826 | 4,353,713 | ||
Cash and cash equivalents | 6,598,842 | 6,626,585 | ||
Total investments and cash | 135,920,807 | 118,394,543 | ||
Accrued investment income | 660,793 | 646,504 | ||
Premiums and reinsurance balances receivable, net of allowances for uncollectible amounts of | 23,506,171 | 22,368,526 | ||
Ceded unearned premiums | 860,905 | 822,818 | ||
Reinsurance balances recoverable on unpaid losses and settlement expenses, net of allowances for uncollectible amounts of | 13,019,865 | 11,036,170 | ||
Income taxes - current | 372,986 | 192,559 | ||
Deferred policy acquisition costs, net | 5,429,620 | 5,269,256 | ||
Property and equipment, at cost, net of accumulated depreciation of | 2,860,331 | 3,033,348 | ||
Other assets | 1,307,794 | 1,239,794 | ||
Total assets | $ 183,939,272 | $ 163,003,518 | ||
Liabilities and Equity | ||||
Liabilities: | ||||
Unpaid losses and settlement expenses | $ 61,575,666 | $ 56,838,307 | ||
Unearned premiums | 29,788,834 | 30,392,817 | ||
Reinsurance balances payable | 371,195 | 374,998 | ||
Corporate debt | 13,465,574 | 3,475,088 | ||
Accrued expenses | 3,472,511 | 4,216,988 | ||
Income taxes - deferred | 1,231,271 | 39,213 | ||
Other liabilities | 1,290,532 | 1,324,273 | ||
Total liabilities | 111,195,583 | 96,661,684 | ||
Equity: | ||||
Common stock1 | 35,000 | 35,000 | ||
Treasury stock, at cost2 | (3,153,838) | (3,146,576) | ||
Additional paid-in capital | 32,780,436 | 32,703,209 | ||
Accumulated other comprehensive earnings, net of tax | 5,520,091 | 2,953,936 | ||
Retained earnings | 40,140,115 | 36,608,750 | ||
Less: Unearned Employee Stock Ownership Plan shares at cost3 | (2,578,115) | (2,812,485) | ||
Total equity | 72,743,689 | 66,341,834 | ||
Total liabilities and equity | $ 183,939,272 | $ 163,003,518 |
1 | Par value |
2 | 2020 – 208,875 shares and 2019 – 203,811 shares |
3 | 2020 – 257,811 shares and 2019 – 281,248 shares |
ICC Holdings, Inc. and Subsidiaries | ||||
Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) | ||||
For the Three-Months Ended | ||||
December 31, | ||||
2020 | 2019 | |||
Net premiums earned | $ 12,767,500 | $ 13,621,884 | ||
Net investment income | 852,802 | 778,188 | ||
Net realized investment gains | 156,997 | 459,642 | ||
Net unrealized gains on equity securities | 2,165,222 | 634,389 | ||
Gain on extinguishment of debt | 1,641,299 | — | ||
Other (loss) | (313,958) | (9,459) | ||
Consolidated revenues | 17,269,862 | 15,484,644 | ||
Losses and settlement expenses | 6,648,369 | 5,597,468 | ||
Policy acquisition costs and other operating expenses | 4,787,721 | 5,478,019 | ||
Interest expense on debt | 56,946 | 32,437 | ||
General corporate expenses | 170,147 | 134,879 | ||
Total expenses | 11,663,183 | 11,242,803 | ||
Earnings before income taxes | 5,606,679 | 4,241,841 | ||
Income tax expense (benefit): | ||||
Current | 354,162 | 806,106 | ||
Deferred | 933,811 | (141,687) | ||
Total income tax expense | 1,287,973 | 664,419 | ||
Net earnings | $ 4,318,706 | $ 3,577,422 | ||
Other comprehensive earnings (loss), net of tax | 311,434 | (254,618) | ||
Comprehensive earnings | $ 4,630,140 | $ 3,322,804 | ||
Earnings per share: | ||||
Basic: | ||||
Basic net earnings per share | $ 1.43 | $ 1.19 | ||
Diluted: | ||||
Diluted net earnings per share | $ 1.42 | $ 1.19 | ||
Weighted average number of common shares outstanding: | ||||
Basic | 3,028,868 | 3,011,034 | ||
Diluted | 3,042,863 | 3,015,038 |
ICC Holdings, Inc. and Subsidiaries | ||||
Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) | ||||
For the Twelve-Months Ended | ||||
December 31, | ||||
2020 | 2019 | |||
Net premiums earned | $ 49,689,202 | $ 52,841,766 | ||
Net investment income | 3,497,702 | 3,185,153 | ||
Net realized investment (losses) gains | (245,323) | 1,200,765 | ||
Net unrealized gains on equity securities | 2,167,417 | 2,350,513 | ||
Gain on extinguishment of debt | 1,641,299 | — | ||
Other (loss) | (231,024) | (53,297) | ||
Consolidated revenues | 56,519,273 | 59,524,900 | ||
Losses and settlement expenses | 32,561,988 | 33,714,837 | ||
Policy acquisition costs and other operating expenses | 18,529,446 | 20,020,005 | ||
Interest expense on debt | 207,719 | 128,790 | ||
General corporate expenses | 641,763 | 579,708 | ||
Total expenses | 51,940,916 | 54,443,340 | ||
Earnings before income taxes | 4,578,357 | 5,081,560 | ||
Income tax expense: | ||||
Current | 537,078 | 568,893 | ||
Deferred | 509,915 | 218,322 | ||
Total income tax expense | 1,046,993 | 787,215 | ||
Net earnings | $ 3,531,364 | $ 4,294,345 | ||
Earnings per share: | ||||
Basic: | ||||
Basic net earnings per share | $ 1.17 | $ 1.43 | ||
Diluted: | ||||
Diluted net earnings per share | $ 1.16 | $ 1.42 | ||
Weighted average number of common shares outstanding: | ||||
Basic | 3,027,903 | 3,008,564 | ||
Diluted | 3,041,898 | 3,013,867 | ||
Net earnings | $ 3,531,364 | $ 4,294,345 | ||
Other comprehensive earnings, net of tax | ||||
Unrealized gains and losses on investments: | ||||
Unrealized holding gains arising during the period, net of income tax expense of | 3,019,434 | 3,393,585 | ||
Reclassification adjustment for (gains) included in net income, net of income tax expense of | (453,279) | (224,970) | ||
Total other comprehensive earnings | 2,566,155 | 3,168,615 | ||
Comprehensive earnings | $ 6,097,519 | $ 7,462,960 |
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SOURCE ICC Holdings, Inc.
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