CapMAC Holdings reports record 1995 earnings; first regular quarterly cash dividend declared.NEW YORK--(BUSINESS WIRE)--Jan. 31, 1996--CapMAC Holdings Inc. (NYSE NYSE See: New York Stock Exchange :KAP) today reported record net income for full-year 1995 of $23.5 million, up 38% from $17.1 million in full-year 1994. Full-year 1995 primary net earnings per share of $1.73 represent a 41% increase over full-year 1994 primary net earnings per share of $1.23. Net income for the fourth quarter of 1995 was $7.2 million, compared to $9.2 million for the prior-year quarter, due to a combination of lower advisory fee income received in the quarter and an increased level of general operating, staff and benefit-related expenses. Full-year 1995 operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before per share were $1.66, an increase of 34% from $1.25 in full-year 1994. Operating earnings exclude the impact of realized capital gains and losses, net of taxes. Book value per share at Dec. 31, 1995 was $17.86, up 16% from $15.38 at Dec. 31, 1994. Adjusted book value at Dec. 31, 1995 was $22.91, an increase of 17% from adjusted book value of $19.50 at Dec. 31, 1994. Adjusted book value, which provides additional information concerning the value of the company, is calculated by adding to book value the estimated present value of future scheduled revenues or PFR (consisting of net premiums earned and ceding cede tr.v. ced·ed, ced·ing, cedes 1. To surrender possession of, especially by treaty. See Synonyms at relinquish. 2. commissions), reduced by the deferred acquisition costs, net of related taxes. John B. Caouette, chairman and chief executive officer, said, "I am pleased to report that 1995 was an outstanding year for CapMAC Holdings. We met our challenging financial goals, we laid the groundwork for continued strong growth and we successfully completed an initial public offering. By focusing sharply on structured asset-backed securities Asset-backed security A security that is collateralized by loans, leases, receivables, or installment contracts on personal property, not real estate. asset-backed security A debt security collateralized by specific assets. , we have succeeded in building an increasingly valuable franchise." Full-year 1995 net premiums earned of $29.2 million represents a 27% increase over full-year 1994 net premiums earned of $23.1 million. Net premiums earned for the fourth quarter of 1995 rose 14% to $7.5 million from $6.6 million in the prior-year quarter. Full-year 1995 net investment income (excluding capital gains and losses) totaled $12.8 million, an increase of 25% from $10.3 million in full-year 1994. Net investment income for the fourth quarter of 1995 was $3.6 million, up 25% from $2.9 million in the fourth quarter of 1994. At Dec. 31, 1995 the fair value of the company's investments totaled $329.8 million, including investment in affiliates of $32 million. The $329.8 million represents a 63% increase over the year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 1994 figure of $202.6 million. The 1995 year-end investment portfolio also includes proceeds from the initial public offering, investments in the company by Orix ORIX Corporation (オリックス株式会社 USA Corp. and Centre Reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. Limited and cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses . The structured asset-backed transactions guaranteed by Capital Markets Assurance Corp. (CapMAC), CapMAC Holdings' triple-A rated insurance subsidiary, include securities backed by corporate and consumer assets. CapMAC has long been an innovator in the credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing of new asset classes, becoming in 1995, for example, the first company to provide credit enhancement for insurance company guaranteed investment contracts Guaranteed investment contract (GIC) A pure investment product in which a life company agrees, for a single premium, to pay at a maturity date the principal amount of a predetermined annual crediting (interest) rate over the life of the investment. (GICs). CapMAC was also the first company to guarantee obligations backed by delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. tax receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed , and the first to guarantee trade receivables and tax-exempt bonds Tax-exempt bond A bond usually issued by municipal, county, or state governments whose interest payments are not subject to federal and, in some cases, state and local income tax. tax-exempt bond See municipal bond. backed by hospital receivables in the public market, among others. In addition, CapMAC provides credit enhancement for more familiar asset classes, such as automobile loans, credit card receivables and home equity loans. CapMAC is also the leading financial guarantee provider of credit-enhanced asset-backed commercial paper. Significant Fourth Quarter Activities -- Initial Public Offering Completed. On Dec. 19, 1995, CapMAC Holdings sold 3.71 million shares of common stock to the public at an offering price of $20. Approximately $50 million from the net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of the initial public offering and the private placement with Centre Reinsurance Limited (Centre Re), a wholly owned indirect subsidiary of The Zurich Insurance Co., were contributed to CapMAC in order to support planned growth. The balance was retained by CapMAC Holdings for general corporate purposes. -- Centre Re Investment in CapMAC Holdings. In conjunction with the initial public offering, CapMAC Holdings sold 500,000 shares of common stock to Centre Re. This investment reflects the intent of CapMAC Holdings and Centre Re to establish a strategic alliance to jointly pursue the development of new financial products and new applications of their existing financial products. -- ASIA Asia (ā`zhə), the world's largest continent, 17,139,000 sq mi (44,390,000 sq km), with about 3.3 billion people, nearly three fifths of the world's total population. Ltd. Established. CapMAC Asia Ltd., an affiliate of CapMAC Holdings, became the lead investor in Asian Securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. & Infrastructure Assurance (Pte) Ltd. (ASIA Ltd.), Asia's first monoline financial guarantee company. In addition, CapMAC Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Inc., a subsidiary of CapMAC Holdings, entered into a technical assistance agreement to become the technical advisor to ASIA Ltd. ASIA Ltd. has subscribed capital subscribed capital n → capital m suscrito of $150 million provided by a diverse group of notable international financial and investment institutions. ASIA Ltd. will originate o·rig·i·nate v. 1. To bring into being; create. 2. To come into being; start. , structure and credit enhance infrastructure revenue bonds and asset-backed securities in both regional and international capital markets for Asian borrowers. Rated double-A by Duff & Phelps Credit Rating Co. and single-A by Standard & Poor's Rating Services, ASIA Ltd. will guarantee transactions in Asian countries Noun 1. Asian country - any one of the nations occupying the Asian continent Asian nation country, land, state - the territory occupied by a nation; "he returned to the land of his birth"; "he visited several European countries" such as China, Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. , India, Indonesia, South Korea, Malaysia, the Philippines, Singapore, Taiwan and Thailand. Debt securities guaranteed by ASIA Ltd. will carry the claims paying ability ratings of ASIA Ltd. Board of Directors Declares First Regular Quarterly Cash Dividend CapMAC Holdings' Board of Directors today declared the first regular quarterly cash dividend of $0.02 per share on the common stock. The dividend will be payable on Feb. 28, 1996 to shareholders of record as of Feb. 14, 1996. CapMAC Holdings Inc., through its subsidiaries, provides financial guarantee insurance, principally of asset-backed obligations; advisory and structuring services in connection with asset-backed financings; and access to funding for its customers through third-party owned and managed securitization funding vehicles. -0-
CapMAC Holdings Inc. and Subsidiaries
Annual Financial Highlights
Fourth Quarter Year Ended December 31,
($ in thousands
except per share data) 1995 1994 1995 1994
Summary of Operations Gross Premiums Written $11,509 10,586 57,476 44,662 Net Premiums Earned 7,527 6,601 29,242 23,103 Advisory Fees 4,082 8,106 15,470 10,723 Net Investment Income 3,615 2,899 12,843 10,316 Total Revenues 18,795 17,375 62,632 44,551 Total Expenses 7,745 3,141 27,968 19,693 Net Income $ 7,175 $ 9,220 $ 23,528 $ 17,066 Primary Earnings per share $ 0.49 $ 0.66 $ 1.73 $ 1.23
December 31
1995 1994
Balance Sheets
Investments $329,758 202,637
Total Assets 391,273 244,404
Unearned Premiums 45,767 25,905
Senior Notes 15,000 15,000
Stockholders' Equity 276,519 180,661
-0-
CapMAC Holdings Inc. and Subsidiaries
Components of Adjusted Book Value per Share
December 31,
1995 1994
GAAP Book Value $17.86 $15.38 After-tax value of: Present value of future revenues (PFR) (including premiums earned and ceding commissions), net of deferred acquisition costs 5.05 4.12 Adjusted Book Value $22.91 $19.50
CapMAC Holdings Inc. and Subsidiaries
Selected Statutory Data
(Dollars in thousands, except ratios)
December 31,
1995 1994
Qualified statutory capital $239,927 $170,477 Unearned Premiums 34,260 20,769 Net reserve for losses and loss adjustment expenses 0 0 Policyholders' capital and reserves $274,187 $191,246 Net par outstanding $15,137,582 $10,838,338 Policyholders' leverage ratio (1) 63:1 64:1 (1) Policyholders' leverage ratio is net par outstanding divided by qualified statutory capital. CONTACT: Capital Markets Assurance Corp., New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Mary Vermylen, 212/891-6719 |
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