Re Capital reports 1994 earnings.STAMFORD Stamford, town, England Stamford, town (1991 pop. 18,127), in the Parts of Kesteven, Lincolnshire, E central England, on the Welland River. It is a market town. Products include diesel engines, electrical equipment, bricks, and tiles. , Conn.--(BUSINESS WIRE)--Feb. 8, 1995--Re Capital Corp. (the "Company")("RCAP RCAP Restricted Canada Air Pilot RCAP Regulatory Capital RCAP Rate Control Proactive Protocol RCAP Realtime Channel Administration Protocol "-NASDAQ) announced today that its net income for the year ended Dec. 31, 1994 decreased 1.6% to $7,907,000 from $8,037,000 for the full year 1993. Primary and fully diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the year were $1.14 and $.95, respectively, as compared with $1.18 and $1.06, respectively, for the year ended Dec. 31, 1993. Net income for the quarter ended Dec. 31, 1994 was $879,000 or $.13 per share on a primary basis compared with $1,857,000 or $.26 per share for the comparable period of 1993. Fully diluted earnings per share for the three months ended Dec. 31, 1994 and 1993 were $.13 and $.22, respectively. As previously announced on Jan. 12, 1995, Zurich 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. Centre Holdings Inc. ("ZRC ZRC Zonal Research Center ") and the company entered into a definitive agreement for the acquisition of Re Capital Corp. by ZRC. Under the terms of the agreement, holders of Re Capital's common stock will receive cash consideration of $18.50 per share, and ZRC will assume all obligations under Re Capital's existing 5-1/2% Convertible Debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. that are not converted into common stock prior to the closing. The transaction, expected to be completed in the first half of 1995, is conditioned upon the receipt of regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approvals and the approval of Re Capital's shareholders. John Deere Insurance Group Inc., owner of 43.8% of the company's outstanding shares of common stock, has agreed to vote that stock in favor of upon the side of; favorable to; for the advantage of. See also: favor the acquisition. Expenses associated with this pending transaction reduced net income for the three and twelve months ended Dec. 31, 1994 by $786,000 and $1,134,000, respectively, or $.11 and $.16 per share on a primary basis, and $.07 and $.10 per share on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis. For the three and twelve month periods ended Dec. 31, 1994, the company's operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. per share, excluding the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. transaction expenses and after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. realized investment gains, was $.24 and $1.30, respectively, on a primary basis ($.21 and $1.05 on a fully diluted basis). For the corresponding periods of 1993, operating results, excluding after-tax realized investment gains, were $.26 and $1.11 on a primary basis and $.22 and $1.01 on a fully diluted basis, respectively. The company's 1994 fourth quarter and full year results were adversely impacted by the strengthening of certain casualty loss reserves involving the 1993 and 1994 underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. years. This strengthening was confined con·fine v. con·fined, con·fin·ing, con·fines v.tr. 1. To keep within bounds; restrict: Please confine your remarks to the issues at hand. See Synonyms at limit. to a limited number of treaties and reduced net income by $.14 and $.09 per share on a primary and fully diluted basis, respectively. Net premiums written for the year ended Dec. 31, 1994 were $132,421,000, an increase of 14.3% from $115,814,000 recorded in 1993. This increase resulted from a combination of new business written and increased participations on existing treaties. Net premiums written for the three months ended Dec. 31, 1994 were $29,680,000 compared with $29,659,000 in the fourth quarter of 1993. The statutory combined ratios for the quarter and twelve months ended Dec. 31, 1994 were 109.7% and 104.4%, respectively, compared with 109.7% and 106.9% for the comparable periods of 1993. Net investment income, exclusive of net realized gains Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. , was $21,696,000 for the year ended Dec. 31, 1994, an increase of 14.6% from the $18,934,000 recorded for the year ended Dec. 31, 1993. This increase resulted principally from an increase in invested assets as a result of the Company's convertible debenture offering which closed in July July: see month. 1993. Exclusive of investment income allocable al·lo·ca·ble adj. Capable of being allocated. Adj. 1. allocable - capable of being distributed allocatable, apportionable distributive - serving to distribute or allot or disperse to the proceeds of this offering, the company's net investment income for the year ended Dec. 31, 1994 increased by 5.8% over the comparable 1993 amount. For the fourth quarter of 1994, net investment income totalled $5,647,000, an increase of 10% from the same period in 1993. 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 aggregated $26,824,000 for the year ended Dec. 31, 1994, as compared with $22,978,000 for the year ended Dec. 31, 1993. The company's shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. and Re Capital Reinsurance Corp.'s statutory surplus at Dec. 31, 1994 amounted to $121,207,000 and $166,596,000, respectively, compared with $130,773,000 and $155,530,000 at Dec. 31, 1993. The company's shareholders' equity per share decreased to $17.19 at Dec. 31, 1994 from $18.56 at Dec. 31, 1993. Effective Dec. 31, 1993, the company adopted Statement of Financial Accounting Standard No. 115, "Accounting for Certain Investments in Debt and Equity Securities." In connection therewith there·with adv. 1. With that, this, or it. 2. In addition to that. 3. Archaic Immediately thereafter. Adv. 1. , the company recorded a $10,461,000 ($1.48 per share) increase in shareholders' equity for the unrealized appreciation on its fixed income portfolio, net of tax. During 1994, the market value of the company's fixed income portfolio decreased by $15,564,000, net of tax, or $2.21 per share. -0-
Re Capital Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
(Dollars in thousands)
Dec. 31, Dec. 31,
1994 1993
ASSETS
Investments:
Fixed maturities available for sale,
at market value (amortized cost
1994 - $344,428 and 1993 - $318,868) $336,696 $334,719
Short-term 5,137 8,676
Total Investments 341,833 343,395
Cash 1,061 692
Accrued investment income 6,612 6,280
Premiums receivable 64,261 57,227
Reinsurance balances recoverable 14,829 12,557
Other assets 37,636 38,466
Total Assets $466,232 $458,617
LIABILITIES
Claims and claim expenses $210,397 $200,638
Unearned premiums 52,221 46,487
Convertible debentures 69,000 69,000
Other liabilities 13,407 11,719
Total Liabilities 345,025 327,844
SHAREHOLDERS' EQUITY
Preferred stock, $.10 par value,
authorized:
1,000,000 shares, none issued
Common stock, $.10 par value, authorized:
50,000,000 shares, issued: 9,540,174
shares (1994) and 9,536,159 shares (1993) 954 954
Additional paid-in capital 93,242 93,194
Unrealized (depreciation) appreciation
on fixed maturities available for sale,
net of tax (5,103) 10,461
Retained earnings 61,541 55,890
Unearned compensation - restricted
common stock (1,333) (1,632)
Treasury stock, at cost; 2,490,284 shares (28,094) (28,094)
Total Shareholders' Equity 121,207 130,773
Total Liabilities and
Shareholders' Equity $466,232 $458,617
Re Capital Corporation and Subsidiaries Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statements of Income (In thousands except per share data) Three months Twelve months ended Dec. 31, ended Dec. 31, 1994 1993 1994 1993 Revenues Premiums earned $33,069 $27,318 $129,398 $112,681 Net investment income 5,647 5,134 21,696 18,934 Net realized investment gains -- -- 39 694 Total 38,716 32,452 151,133 132,309 Expenses Claims and claim expenses 25,285 21,192 94,795 84,137 Other operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. 12,019 9,156 44,441 38,017 Interest expense 949 937 3,795 2,348 Total 38,253 31,285 143,031 124,502 Income before Federal income tax 463 1,167 8,102 7,807 Federal income tax (benefit) expense (416) (690) 195 (230) Net income $ 879 $1,857 $7,907 $8,037 Per Share Data Primary earnings per share: Weighted average shares outstanding 6,953 7,138 6,959 6,834 Primary earnings per share $ .13 $ .26 $1.14 $1.18 Fully diluted earnings per share: Weighted average shares outstanding 10,968 11,153 10,974 8,792 Fully diluted earnings per share $ .13 $ .22 $ .95 $1.06
Re Capital Corporation and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
Twelve months ended Dec. 31,
1994 1993
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities $ 26,824 $ 22,978 INVESTING ACTIVITIES Purchases of fixed maturities (50,158) (105,280) Maturities or calls of fixed maturities 22,446 16,622 Sales of fixed maturities -- 11,380 Net sales of short-term investments 3,539 2,657 Net additions to property and equipment (102) (364)
Net Cash Used in Investing Activities (24,275) (74,985)
FINANCING ACTIVITIES Cash dividends to shareholders (2,184) (1,811) Net proceeds from issuance of convertible debentures -- 67,282 Short-term debt repayments, net -- (14,850) Other, net 4 76
Net Cash (Used in) Provided by
Financing Activities (2,180) 50,697
Increase (Decrease) in Cash 369 (1,310)
Cash at Beginning of Year 692 2,002
Cash at End of Year $ 1,061 $ 692
CONTACT: Re Capital Corp. James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. E. Roberts, 203/977-6100 |
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