ICC Holdings, Inc. Reports 2024 First Quarter Results
ICC Holdings, Inc. reported its 2024 first quarter results, showing net earnings of $2,239,000, or $0.76 per share, a 14.0% increase in direct premiums written, and a 13.6% increase in net premiums earned. The Company ceded $3,370,000 to reinsurers, with net investment income up by 19.1%. Additionally, net unrealized gains on investments increased by $635,000, while losses and settlement expenses rose by 11.7%. Policy acquisition costs and other operating expenses increased by 20.7%, with total assets and equity also seeing positive growth.
Net earnings increased to $2,239,000, or $0.76 per share, from $1,579,000, or $0.54 per share, in the first quarter of 2023.
Direct premiums written increased by $2,921,000, or 14.0%, to $23,736,000 for the first quarter of 2024.
Net premiums earned increased by $2,421,000, or 13.6%, to $20,222,000 for the three months ended March 31, 2024.
Net investment income increased by $231,000, or 19.1%, to $1,440,000 for the first quarter of 2024.
Total assets increased by $5,416,000, or 2.6%, from $211,017,000 on December 31, 2023, to $216,433,000 on March 31, 2024.
Losses and settlement expenses increased by $1,289,000, or 11.7%, to $12,337,000 for the first quarter of 2024.
Policy acquisition costs and other operating expenses increased by $1,313,000, or 20.7%, to $7,663,000 for the first quarter of 2024.
The investment portfolio decreased by $112,000, or 0.1%, from $140,853,000 on December 31, 2023, to $140,741,000 on March 31, 2024.
Insights
The reported increase in net earnings from
Examining the combined ratio, an increase from
The growth in direct premiums written signals competitive strength and market expansion, but the increasing losses and settlement expenses highlight that risk management must keep pace with premium growth to maintain profitability.
ICC Holdings' focus on the food and beverage industry as a niche insurance market is an interesting competitive strategy. If the company can maintain its pricing discipline, as mentioned by the CEO, this could support sustainable growth. However, the increase in policy acquisition costs and other operating expenses by
The strategic alignment with investment partners and positioning in higher rate fixed maturity securities could potentially shield the company from interest rate volatility and support the net investment income, which has seen a
From a market perspective, ICC Holdings' entry into new markets and states could signal both an opportunity for growth and an increased risk profile. Investors typically like to see expansion as a sign of confidence and potential for larger market share, but it also entails the need for diligent underwriting to avoid unexpected losses.
The management's positive outlook for 2024 must be balanced against the backdrop of economic conditions affecting the insurance sector, including potential claims inflation or regulatory changes. The mention of maintaining conservative portfolio duration is reassuring, as it indicates a risk-averse approach to investment strategy, which is typically prudent for an insurance firm.
FIRST QUARTER ENDED MARCH 31, 2024 – FINANCIAL RESULTS
Net earnings totaled
Direct premiums written increased by
For the first quarter of 2024, the Company ceded to reinsurers
Net investment income increased by
Net unrealized gains on investments increased
Losses and settlement expenses increased by
Policy acquisition costs and other operating expenses increased by
Total assets increased by
Total equity increased by
FIRST QUARTER ENDED MARCH 31, 2024 – 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
"Our core insurance business remains strong as we start 2024. We have maintained pricing discipline and increased earned premiums by
"We have worked with our investment partners to realign our investments to maintain higher rate fixed maturity securities and take advantage of the continued improvement in the equity markets. In addition, we have increased cash and cash equivalents in order to purchase additional invested assets in the second quarter. The continued positive cash flow from operations has allowed the Company to position the portfolio duration conservatively and appropriately.
"We are pleased to see another unusually strong first quarter. We anticipate very healthy results this year as we enter new markets and states with our proven underwriting approach," 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 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 claims activity and the business operations of the Company and of our current and potential customers; 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; downturns and volatility in global economies and equity and credit markets, including as a result of inflation and supply chain disruptions and continued labor shortages; interest rates and changes in rates could adversely affect the Company's business and profitability; 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, 2023. No undue reliance should be placed on any forward-looking statements.
ICC Holdings, Inc. and Subsidiaries | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
As of | ||||||||
March 31, | December 31, | |||||||
2024 | 2023 | |||||||
(Unaudited) | ||||||||
Assets: | ||||||||
Investments and cash: | ||||||||
Fixed maturity securities (amortized cost of | $ | 109,168,285 | $ | 110,955,697 | ||||
Common stocks at fair value | 13,369,954 | 12,191,621 | ||||||
Preferred stocks at fair value | 3,046,812 | 2,896,296 | ||||||
Other invested assets, net of allowances for credit losses of | 9,040,528 | 8,898,409 | ||||||
Property held for investment, at cost, net of accumulated depreciation of | 6,115,025 | 5,910,864 | ||||||
Cash and cash equivalents | 7,026,999 | 1,478,135 | ||||||
Total investments and cash | 147,767,603 | 142,331,022 | ||||||
Accrued investment income | 962,242 | 915,156 | ||||||
Premiums and reinsurance balances receivable, net of allowances for credit losses of | 36,450,702 | 37,220,433 | ||||||
Ceded unearned premiums | 724,172 | 755,099 | ||||||
Reinsurance balances recoverable on unpaid losses and settlement expenses, net of | 13,738,899 | 12,736,579 | ||||||
Federal income taxes | 2,386,403 | 2,775,366 | ||||||
Deferred policy acquisition costs, net | 8,643,538 | 8,552,459 | ||||||
Property and equipment, at cost, net of accumulated depreciation of | 3,363,731 | 3,325,322 | ||||||
Other Assets, net of allowances for credit losses of | 2,395,727 | 2,405,577 | ||||||
Total assets | $ | 216,433,017 | $ | 211,017,013 | ||||
Liabilities: | ||||||||
Unpaid losses and settlement expenses | $ | 77,650,986 | $ | 71,919,585 | ||||
Unearned premiums | 47,450,348 | 47,259,637 | ||||||
Reinsurance balances payable | 663,886 | 1,132,301 | ||||||
Corporate debt | 15,000,000 | 15,000,000 | ||||||
Accrued expenses | 5,783,483 | 7,442,617 | ||||||
Other liabilities | 1,198,903 | 1,259,324 | ||||||
Total liabilities | 147,747,606 | 144,013,464 | ||||||
Equity: | ||||||||
Common stock1 | 35,000 | 35,000 | ||||||
Treasury stock, at cost2 | (5,776,979) | (5,710,324) | ||||||
Additional paid-in capital | 33,421,997 | 33,330,846 | ||||||
Accumulated other comprehensive (loss), net of tax | (7,261,448) | (6,621,336) | ||||||
Retained earnings | 50,083,573 | 47,844,368 | ||||||
Less: Unearned Employee Stock Ownership Plan shares at cost3 | (1,816,732) | (1,875,005) | ||||||
Total equity | 68,685,411 | 67,003,549 | ||||||
Total liabilities and equity | $ | 216,433,017 | $ | 211,017,013 | ||||
1 Par value | ||||||||
ICC Holdings, Inc. and Subsidiaries | ||||||||
Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) | ||||||||
For the Three-Months Ended | ||||||||
March 31, | ||||||||
2024 | 2023 | |||||||
Net premiums earned | $ | 20,222,366 | $ | 17,801,297 | ||||
Net investment income | 1,440,202 | 1,209,415 | ||||||
Net realized investment gains (losses) | 150,686 | (75,565) | ||||||
Net unrealized gains on investments | 1,273,890 | 639,418 | ||||||
Other (loss) income | (5,037) | 45,836 | ||||||
Consolidated revenues | 23,082,107 | 19,620,401 | ||||||
Losses and settlement expenses | 12,336,928 | 11,047,681 | ||||||
Policy acquisition costs and other operating expenses | 7,663,099 | 6,349,581 | ||||||
Interest expense on debt | 45,904 | 45,400 | ||||||
General corporate expenses | 200,770 | 193,674 | ||||||
Total expenses | 20,246,701 | 17,636,336 | ||||||
Earnings before income taxes | 2,835,406 | 1,984,065 | ||||||
Total income tax expense | 596,201 | 405,520 | ||||||
Net earnings | $ | 2,239,205 | $ | 1,578,545 | ||||
Other comprehensive (loss) earnings, net of tax | (640,112) | 1,596,353 | ||||||
Comprehensive earnings | $ | 1,599,093 | $ | 3,174,898 | ||||
Earnings per share: | ||||||||
Basic: | ||||||||
Basic net earnings per share | $ | 0.76 | $ | 0.54 | ||||
Diluted: | ||||||||
Diluted net earnings per share | $ | 0.75 | $ | 0.53 | ||||
Weighted average number of common shares outstanding: | ||||||||
Basic | 2,953,441 | 2,942,659 | ||||||
Diluted | 2,969,446 | 2,956,273 | ||||||
Contact Info: Arron K. Sutherland, President and CEO |
Illinois Casualty Company |
(309) 732-0105 |
arrons@ilcasco.com |
225 20th Street, |
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SOURCE ICC Holdings, Inc.
FAQ
What were ICC Holdings, Inc.'s net earnings for the first quarter of 2024?
ICC Holdings, Inc. reported net earnings of $2,239,000 for the first quarter of 2024.
How much did direct premiums written increase by in the first quarter of 2024?
Direct premiums written increased by $2,921,000, or 14.0%, in the first quarter of 2024.
What was the total assets increase from December 31, 2023, to March 31, 2024?
Total assets increased by $5,416,000, or 2.6%, from $211,017,000 to $216,433,000.
