Q4 2013 8K Press Release



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported):
February 19, 2014 (February 18, 2014)
 
MAIDEN HOLDINGS, LTD.
 (Exact name of registrant as specified in its charter)
 
Bermuda
(State or other jurisdiction
of incorporation)
 
001-34042
(Commission File
Number)
 
98-0570192
(IRS Employer
Identification No.)
 
131 Front Street, Hamilton HM12, Bermuda
 
(Address of principal executive offices and zip code)
 
(441) 298-4900
(Registrant's telephone number, including area code)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
 
 
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
 
 
 
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
 
 
 
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
 
 
 
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 








Item 2.02
Results of Operations and Financial Condition.


On February 19, 2014, Maiden Holdings, Ltd. (the “Company”) issued a press release announcing its results of operations for the fourth quarter and fiscal year ended December 31, 2013. A copy of the press release is furnished herewith as Exhibit 99.1 and incorporated herein by reference.
 
The information contained in this Item 2.02 and in the accompanying exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

Item 8.01
Other Events.
 
On February 18, 2014, the Company also issued a press release announcing the following quarterly dividends:

 
 
Dividend per Share
 
Payable on:
 
Record date:
Common shares
 
$
0.11

 
April 14, 2014
 
April 1, 2014
Preference shares - Series A
 
$
0.515625

 
March 17, 2014
 
March 1, 2014
Preference shares - Series B
 
$
0.9062500

 
March 17, 2014
 
March 1, 2014

 A copy of the press release is hereby filed with the Commission and incorporated by reference herein as Exhibit 99.2.

Item 9.01
Financial Statements and Exhibits.
 
(d)           Exhibits
 
Exhibit
 
 
No.
 
Description
 
 
 
99.1
 
Press Release of Maiden Holdings, Ltd., dated February 19, 2014
 
 
 
99.2
 
Press Release of Maiden Holdings, Ltd., dated February 18, 2014.






SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Date: February 19, 2014
MAIDEN HOLDINGS, LTD.
 
 
    
 
 
 
  By:
/s/ Lawrence F. Metz
 
 
Lawrence F. Metz
 
 
Senior Vice President, General Counsel and
Secretary

EXHIBIT INDEX
 
Exhibit
 
 
No.
 
Description
 
 
 
99.1
 
Press Release of Maiden Holdings, Ltd., dated February 19, 2014
 
 
 
99.2
 
Press Release of Maiden Holdings, Ltd., dated February 18, 2014.






Exhibit 99.1



Maiden Holdings, Ltd. Announces Record 2013 Annual Net Income Attributable to Common Shareholders of $87.9 Million and Return on Common Equity of 10.5% and Record 2013 Annual Net Operating Earnings(1) of $87.5 million and Operating Return on Common Equity(1) of 10.5%
 
Highlights for the quarter ended December 31, 2013
Annualized operating return on common equity(1) of 11.3% compared to (4.6)% in the fourth quarter of 2012, which was impacted by Superstorm Sandy;
Record net operating earnings (1) of $23.3 million, or $0.30 per diluted common share compared with a loss of $10.1 million, or $0.14 per diluted common share in the fourth quarter of 2012;
Net premiums written increased 0.7% to $445.9 million for the fourth quarter of 2013 versus the same period last year; excluding the divested property E&S business and National General Quota Share, the underlying growth rate was 21.6%;
Combined ratio(11) of 97.3% compared to 103.7% in the fourth quarter of 2012;
Net investment income was $25.4 million, an increase of 20.2% compared to the fourth quarter of 2012;
Book value per common share(4) of $11.14, down 1.8% versus September 30, 2013 reflecting unrealized bond value movements in the quarter;
In October, Maiden issued $165 million of 7.25% mandatory convertible preference shares to support the continuing growth of its reinsurance business; and
In November, Maiden issued $152.5 million of 7.75% senior notes due December 1, 2043 in order to pre-fund the repurchase of the Company’s previously outstanding 14% coupon trust preferred securities, which it completed on January 15, 2014.

Highlights for the year ended December 31, 2013
Annualized operating return on common equity(1) of 10.5% compared to 5.9% in 2012;
Record net operating earnings(1) of $87.5 million, or $1.18 per diluted common share compared with $48.5 million, or $0.66 per diluted common share in 2012;
Net premiums written increased 10.3% to $2.1 billion from $1.9 billion the same period last year; excluding the divested property E&S business and National General Quota Share, the underlying growth rate was 21.9%;
Combined ratio(11) of 97.5% compared to 99.5% in 2012;
Net investment income was $91.4 million, an increase of 12.5% compared to 2012; and
Total investments increased 20.8% in 2013 to $3.2 billion.


HAMILTON, Bermuda - Maiden Holdings, Ltd. (NASDAQ:  MHLD) (“Maiden” or “the Company”) today reported fourth quarter 2013 net operating earnings(1) of $23.3 million, or $0.30 per diluted common share compared with a loss of $10.1 million, or $0.14 per diluted common share in the fourth quarter of 2012. Net income attributable to Maiden common shareholders totaled $20.8 million, or $0.27 per diluted common share in the fourth quarter of 2013, compared to a net loss attributable to Maiden common shareholders of $10.3 million or $0.14 per share in the fourth quarter of 2012. 
 
Commenting on the Company's results, Art Raschbaum, Chief Executive Officer of Maiden, said: “The strong operating results in the fourth quarter and throughout 2013 reflect a focus on continued underwriting discipline, a significant level of organic growth despite the termination of the NGHC quota share, and steady growth in invested assets. We are gratified by the continued growth in new client relationships as well as the expansion of many existing client relationships, a testament to the Maiden team's strong client focus. Importantly, we believe that Maiden is well positioned for future growth and profitability after completing two strategic capital market transactions in the fourth quarter, as well as the repurchase of all of our outstanding 14% TRUPs in January 2014, which significantly decreases our forward cost of capital in 2014 and beyond. Continued growth in invested assets, a lower cost of capital, the Company's continued focus on operating efficiency and underwriting discipline, and a highly differentiated business model should enable us to further enhance operating performance in 2014 and beyond. The entire Maiden team looks forward to meeting the challenges of 2014 with an emphasis on continuing to provide outstanding support for our clients, while delivering value to our shareholders.”

Results for the quarter ended December 31, 2013
 
Net operating earnings(1) for the fourth quarter of 2013 were $23.3 million, or $0.30 per diluted common share compared with a loss of $10.1 million, or $0.14 per diluted common share in the comparative quarter in 2012. Net income attributable to Maiden





common shareholders was $20.8 million, or $0.27 per diluted common share in the fourth quarter of 2013, compared with a net loss of $10.3 million, or $0.14 per diluted common share in the fourth quarter of 2012.

In the fourth quarter of 2013, net premiums written totaled $445.9 million, an increase of 0.7% compared to the fourth quarter of 2012.  The Diversified Reinsurance segment’s net premiums written were up 24.8% to $173.6 million versus the fourth quarter of 2012. The growth in the Diversified segment’s premium was the result of organic growth of existing client accounts, as well as the addition of new client relationships. In the AmTrust Quota Share Reinsurance segment, net premiums written increased by 18.3% to $274.9 million compared to the fourth quarter of 2012 and was driven primarily by continued rate increases in lines of business such as worker’s compensation and new business growth. As of August 1, 2013, Maiden and National General Holdings Corporation (“NGHC”) mutually terminated their quota share reinsurance relationship. In the fourth quarter of 2012 Maiden wrote net premiums of $71.1 million in the NGHC Quota Share. Excluding the divested E&S property business and the terminated NGHC Quota Share, Maiden’s net premiums written in the fourth quarter of 2013 increased 21.6% compared to the fourth quarter of 2012.
 
Net premiums earned of $491.0 million increased 2.5%, or $11.9 million compared to the fourth quarter of 2012.  Earned premiums decreased 1.7% in the Diversified Reinsurance segment to $188.5 million compared to the fourth quarter of 2012 reflecting underwriting actions taken in 2013 and the sale of the Company's E&S property business. The AmTrust Quota Share Reinsurance segment earned premiums were up 22.8% to $263.8 million compared to the three months ended December 31, 2012. The NGHC Quota Share segment was $38.7 million in the fourth quarter of 2013, down 46.7% compared to the fourth quarter of 2012.
 
Net investment income of $25.4 million in the fourth quarter of 2013 increased 20.2% compared to the fourth quarter of 2012. Total investments of $3.2 billion increased $545.6 million or 20.8% versus December 31, 2012.  The average yield on the fixed income portfolio (excluding cash) is 3.48% with an average duration of 4.64 years.
 
Net loss and loss adjustment expenses of $329.8 million were down $35.1 million compared to the fourth quarter of 2012, which was negatively impacted by Superstorm Sandy.  The loss ratio(7) decreased by 8.8 percentage points to 66.8% versus the fourth quarter of 2012.
 
Commission and other acquisition expenses including general and administrative expenses increased $15.6 million to $151.0 million in the fourth quarter of 2013, compared to the year ago quarter, while the total expense ratio(10) rose to 30.5% in the fourth quarter of 2013 compared with 28.1% in the same quarter last year largely reflecting a change in business mix. General and administrative expenses for the fourth quarter of 2013 totaled $14.5 million compared with $11.2 million in the fourth quarter of 2012. The general and administrative expense ratio(9) increased to 2.9% in the fourth quarter of 2013 versus 2.4% in the fourth quarter of 2012 largely reflecting increased incentive plan funding driven by improved results.
 
The combined ratio(11) for the fourth quarter of 2013 totaled 97.3% compared with 103.7% in the fourth quarter of 2012.
  
Total assets increased 13.9% to $4.7 billion at December 31, 2013 compared to $4.1 billion at year-end 2012.   Shareholders' equity was $1.1 billion, up 10.7% compared to December 31, 2012. Book value per common share was $11.14 at the end of the fourth quarter of 2013 or 1.8% lower than at September 30, 2013.
  
During the fourth quarter of 2013, the Board of Directors declared dividends of $0.11 per common share, $0.515625 per Series A preference share and $0.745139 per Series B preference share.

Results for the year ended December 31, 2013
 
Net income attributable to Maiden common shareholders for the year ended December 31, 2013 was $87.9 million compared to net income of $46.5 million in 2012. Net operating earnings(1) for 2013 were $87.5 million, or $1.18 per diluted common share compared to $48.5 million or $0.66 per diluted common share in 2012.  Annualized operating return on common equity(1) for the year ended December 31, 2013 was 10.5% compared to 5.9% for 2012.
 
Net premiums written rose 10.3%, or $195.0 million to $2.1 billion in 2013 compared to 2012.  In 2013, net premiums written in the Diversified Reinsurance segment of $761.8 million were 0.5% lower than in 2012. Excluding the divested E&S property business, Diversified Reinsurance segment premium grew by 2.4% over 2012. Net premiums written for the AmTrust Quota Share Reinsurance segment were $1.2 billion, up 39.2% compared to 2012.  Net premiums written for the NGHC Quota Share were $164.6 million in 2013, which is 44.3% lower than the $295.6 million written in 2012. Excluding the divested E&S property business and the terminated NGHC Quota Share, Maiden’s net premiums written increased 21.9% in 2013 compared to 2012.
 





Net premiums earned in 2013 were $2.0 billion, an increase of 10.9% or $197.1 million compared to 2012.  Net premiums earned in the Diversified Reinsurance segment were down 4.2% to $762.1 million for 2013 compared to the same period in 2012. The AmTrust Quota Share Reinsurance segment net premiums earned of $988.9 million increased 35.9% in 2013 compared to 2012. The NGHC Quota Share segment net premiums earned totaled $249.9 million in 2013, down 11% compared to 2012.
 
Net investment income in 2013 was $91.4 million, up 12.5% compared to the same period in 2012. The year-over-year growth in net investment income resulted from an increase in total investments, which grew by 20.8% at the end of 2013 compared to the end of 2012.
 
Net loss and loss adjustment expenses for 2013 were $1.3 billion, up $87.3 million compared to the same period in 2012.  The loss ratio(7) decreased 2.5 percentage points to 67.0% versus 69.5% in 2012.
   
The combined ratio(11) for 2013 was 97.5%, which improved 2.0 percentage points compared to the combined ratio(11) for 2012 of 99.5%. These results include a general and administrative expense ratio(9) of 2.9% for 2013 and 2012.

(1)(4) Please see the Non-GAAP Financial Measures table for additional information on these non-GAAP financial measures and reconciliation of these measures to GAAP measures.
 
(7)(9)(10)(11) Loss ratio, general and administrative expense ratio, expense ratio and combined ratio are operating metrics. Please see the additional information on these measures under Segment information tables.

Conference Call
 
Maiden’s CEO Art Raschbaum and CFO John Marshaleck will review these results tomorrow morning via teleconference and live audio webcast beginning at 8:30 a.m. ET.

To participate in the conference call, please access one of the following at least five minutes prior to the start time:
U.S. Callers: 1.877.734.5373
Outside U.S. Callers: 1.973.200.3059
Passcode: 53223860
Webcast: http://www.maiden.bm/presentations_conferences

A replay of the conference call will be available beginning at 11:30 a.m. ET on February 20, 2014 through midnight on February 27, 2014. To listen to the replay, please dial toll free: 1.855.859.2056 (U.S. Callers) or toll: 1.404.537.3406 (callers outside the U.S.) and enter the Passcode: 53223860; or access http://www.maiden.bm/presentations_conferences

About Maiden Holdings, Ltd.
 
Maiden Holdings, Ltd. is a Bermuda-based holding company formed in 2007.  Through its subsidiaries, which are each A- rated (excellent) by A.M. Best, the Company is focused on providing non-catastrophic, customized reinsurance products and services





to small and mid-size insurance companies in the United States and Europe. As of December 31, 2013, Maiden had $4.7 billion in assets and shareholders' equity of $1.1 billion.
 
The Maiden Holdings, Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5006    

Forward Looking Statements
 
This release contains "forward-looking statements" which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that actual developments will be those anticipated by the Company. Actual results may differ materially from those projected as a result of significant risks and uncertainties, including non-receipt of the expected payments, changes in interest rates, effect of the performance of financial markets on investment income and fair values of investments, developments of claims and the effect on loss reserves, accuracy in projecting loss reserves, the impact of competition and pricing environments, changes in the demand for the Company's products, the effect of general economic conditions and unusual frequency of storm activity, adverse state and federal legislation, regulations and regulatory investigations into industry practices, developments relating to existing agreements, heightened competition, changes in pricing environments, and changes in asset valuations. Additional information about these risks and uncertainties, as well as others that may cause actual results to differ materially from those projected is contained in Item 1A. Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2012 as updated in periodic filings with the SEC. The Company undertakes no obligation to publicly update any forward-looking statements, except as may be required by law.
 


CONTACT:
 
Noah Fields, Vice President, Investor Relations
Maiden Holdings, Ltd.
Phone: 441.298.4927
E-mail: nfields@maiden.bm







Maiden Holdings, Ltd.
Balance Sheet
(in thousands of U.S. dollars (000's), except per share data)
 
 
 
 
 
 
 
December 31, 2013
 
December 31, 2012
ASSETS
 
 
 
 
Investments:
 
 
 
 
Fixed maturities, available-for-sale, at fair value (Amortized cost 2013: $3,127,792; 2012: $2,475,202)
 
$
3,162,067

 
$
2,618,697

Other investments, at fair value (Cost 2013: $4,522; 2012: $2,599)
 
5,092

 
2,901

Total investments
 
3,167,159

 
2,621,598

Cash and cash equivalents
 
139,833

 
81,543

Restricted cash and cash equivalents
 
77,360

 
132,327

Accrued investment income
 
25,238

 
21,007

Reinsurance balances receivable, net
 
560,145

 
522,614

Prepaid reinsurance premiums
 
39,186

 
38,725

Reinsurance recoverable on unpaid losses
 
84,036

 
110,858

Loan to related party
 
167,975

 
167,975

Deferred commission and other acquisition costs
 
304,908

 
270,669

Goodwill and intangible assets, net
 
90,613

 
94,393

Other assets
 
56,926

 
76,454

Total assets
 
$
4,713,379

 
$
4,138,163

LIABILITIES
 
 
 
 
Reserve for loss and loss adjustment expenses
 
$
1,957,835

 
$
1,740,281

Unearned premiums
 
1,034,754

 
936,497

Accrued expenses and other liabilities
 
110,114

 
111,957

Senior notes
 
360,000

 
207,500

Junior subordinated debt
 
126,381

 
126,317

Total liabilities
 
3,589,084

 
3,122,552

Commitments and Contingencies
 
 
 
 
EQUITY
 
 
 
 
Preference shares
 
315,000

 
150,000

Common shares
 
736

 
733

Additional paid-in capital
 
574,522

 
575,869

Accumulated other comprehensive income
 
25,784

 
141,130

Retained earnings
 
211,602

 
151,308

Treasury shares, at cost
 
(3,801
)
 
(3,801
)
Total Maiden shareholders’ equity
 
1,123,843

 
1,015,239

Noncontrolling interest in subsidiaries
 
452

 
372

Total equity
 
1,124,295

 
1,015,611

Total liabilities and equity
 
$
4,713,379

 
$
4,138,163

 
 
 
 
 
Book value per common share (4)
 
$
11.14

 
$
11.96

 
 
 
 
 
Common shares outstanding
 
72,633,561

 
72,343,947








Maiden Holdings, Ltd.
Income Statement
(in thousands of U.S. dollars (000's), except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
For the Three Months
Ended December 31,

For the Year
Ended December 31,
 
 
2013
 
2012

2013
 
2012
Revenues:
 
 
 
 
 
 
 
 
Gross premiums written
 
$
462,067

 
$
464,037

 
$
2,204,159

 
$
2,000,992

 
 
 
 
 
 
 
 
 
Net premiums written
 
$
445,875

 
$
442,645

 
$
2,096,301

 
$
1,901,285

Change in unearned premiums
 
45,171

 
36,550

 
(95,414
)
 
(97,505
)
Net premiums earned
 
491,046

 
479,195

 
2,000,887

 
1,803,780

Other insurance revenue
 
2,966

 
3,240

 
14,232

 
12,890

Net investment income
 
25,375

 
21,116

 
91,352

 
81,188

Net realized (losses) gains on investment
 
(122
)
 
1,071

 
3,585

 
1,907

Total revenues
 
519,265

 
504,622

 
2,110,056

 
1,899,765

Expenses:
 
 
 
 
 
 
 
 
Net loss and loss adjustment expenses
 
329,759

 
364,850

 
1,349,630

 
1,262,348

Commission and other acquisition expenses
 
136,482

 
124,187

 
556,578

 
492,031

General and administrative expenses
 
14,498

 
11,187

 
58,661

 
53,804

Total expenses
 
480,739

 
500,224

 
1,964,869

 
1,808,183

 
 
 
 
 
 
 
 
 
Income from operations (2)
 
38,526

 
4,398

 
145,187

 
91,582

 
 
 
 
 
 
 
 
 
Other expenses
 
 
 
 
 
 
 
 
Interest and amortization expenses
 
(10,786
)
 
(9,569
)
 
(39,497
)
 
(36,384
)
Amortization of intangible assets
 
(945
)
 
(1,091
)
 
(3,780
)
 
(4,362
)
Foreign exchange and other gains
 
236

 
320

 
2,809

 
1,638

Total other expenses
 
(11,495
)
 
(10,340
)
 
(40,468
)
 
(39,108
)
 
 
 
 
 
 
 
 
 
Income (loss) before income taxes
 
27,031

 
(5,942
)
 
104,719

 
52,474

Income taxes:
 
 
 
 
 
 
 
 
Current tax expense
 
217

 
140

 
873

 
1,020

Deferred tax expense
 
429

 
575

 
990

 
1,193

Income tax expense
 
646

 
715

 
1,863

 
2,213

Net income (loss)
 
26,385

 
(6,657
)
 
102,856

 
50,261

Less: income attributable to noncontrolling interest
 
(26
)
 
(26
)
 
(121
)
 
(107
)
Net income (loss) attributable to Maiden
 
26,359

 
(6,683
)
 
102,735

 
50,154

Dividends on preference shares
 
(5,553
)
 
(3,644
)
 
(14,834
)
 
(3,644
)
Net income (loss) attributable to Maiden common shareholders
 
$
20,806


$
(10,327
)

$
87,901


$
46,510

Net operating earnings (loss) attributable to Maiden common shareholders (1)
 
$
23,281

 
$
(10,052
)
 
$
87,492

 
$
48,520

 
 
 
 
 
 
 
 
 
Basic earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.29

 
$
(0.14
)
 
$
1.21

 
$
0.64

Diluted earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.27

 
$
(0.14
)
 
$
1.18

 
$
0.64

Basic operating earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.32

 
$
(0.14
)
 
$
1.21

 
$
0.67

Diluted operating earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.30

 
$
(0.14
)
 
$
1.18

 
$
0.66

 
 
 
 
 
 
 
 
 
Dividends declared per common share
 
$
0.11

 
$
0.09

 
$
0.38

 
$
0.33

 
 
 
 
 
 
 
 
 





Weighted average number of common shares - basic
 
72,615,033

 
72,296,708

 
72,510,361

 
72,263,022

Adjusted weighted average number of common shares and assumed conversions - diluted
 
84,521,981

 
73,154,424

 
76,417,839

 
73,105,531

 
 
 
 
 
 
 
 
 
Net loss and loss adjustment expense ratio (7)
 
66.8
%
 
75.6
 %
 
67.0
%
 
69.5
%
Commission and other acquisition expense ratio (8)
 
27.6
%
 
25.7
 %
 
27.6
%
 
27.1
%
General and administrative expense ratio (9)
 
2.9
%
 
2.4
 %
 
2.9
%
 
2.9
%
Expense ratio (10)
 
30.5
%
 
28.1
 %
 
30.5
%
 
30.0
%
Combined ratio (11)
 
97.3
%
 
103.7
 %
 
97.5
%
 
99.5
%
Annualized return on common equity
 
10.1
%
 
(4.7
)%
 
10.5
%
 
5.7
%
Annualized operating return on common equity
 
11.3
%
 
(4.6
)%
 
10.5
%
 
5.9
%







Maiden Holdings, Ltd.
Non - GAAP Financial Measure
(in thousands of U.S. dollars (000's), except per share data)
(Unaudited)
 
 
For the Three Months
Ended December 31,
 
For the Year
Ended December 31,
 
 
2013
 
2012
 
2013
 
2012
Reconciliation of net income (loss) attributable to Maiden common shareholders to net operating earnings:
 
 
 
 
 
 
 
 
Net income (loss) attributable to Maiden common shareholders
 
$
20,806

 
$
(10,327
)
 
$
87,901

 
$
46,510

Add (subtract)
 
 
 
 
 
 
 
 
Net realized losses (gains) on investment
 
122

 
(1,071
)
 
(3,585
)
 
(1,907
)
Foreign exchange and other gains
 
(236
)
 
(320
)
 
(2,809
)
 
(1,638
)
Amortization of intangible assets
 
945

 
1,091

 
3,780

 
4,362

Interest expense incurred related to 7.75% senior notes prior to actual redemption of the junior subordinated debt
 
1,215

 

 
1,215

 

Non-cash deferred tax expense
 
429

 
575

 
990

 
1,193

Net operating earnings (loss) attributable to Maiden common shareholders (1)
 
$
23,281

 
$
(10,052
)
 
$
87,492


$
48,520

 
 
 
 
 
 
 
 
 
Operating earnings (loss) per common share attributable to Maiden shareholders:
 
 
 
 
 
 
 
 
Basic earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.32

 
$
(0.14
)
 
$
1.21

 
$
0.67

Diluted earnings (loss) per common share attributable to Maiden shareholders (6)
 
$
0.30

 
$
(0.14
)
 
$
1.18

 
$
0.66

 
 
 
 
 
 
 
 
 
Reconciliation of net income (loss) attributable to Maiden to income from operations:
 
 
 
 
 
 
 
 
Net income (loss) attributable to Maiden
 
$
26,359

 
$
(6,683
)
 
$
102,735

 
$
50,154

Add (subtract)
 
 
 
 
 
 
 
 
Foreign exchange and other gains
 
(236
)
 
(320
)
 
(2,809
)

(1,638
)
Amortization of intangible assets
 
945

 
1,091

 
3,780


4,362

Interest and amortization expenses
 
10,786

 
9,569

 
39,497

 
36,384

Income tax expense
 
646

 
715

 
1,863

 
2,213

Income attributable to noncontrolling interest
 
26

 
26

 
121

 
107

Income from operations (2)
 
$
38,526

 
$
4,398

 
$
145,187

 
$
91,582

 
 
 
 
 
 
 
 
 
 
 
December 31, 2013
 
December 31, 2012
 
 
 
 
Investable assets:
 
 
 
 
 
 
 
 
Total investments
 
$
3,167,159

 
$
2,621,598

 
 
 
 
Cash and cash equivalents
 
139,833

 
81,543

 
 
 
 
Restricted cash and cash equivalents
 
77,360

 
132,327

 
 
 
 
Funds withheld (3)
 

 
26,494

 
 
 
 
Loan to related party
 
167,975

 
167,975

 
 
 
 
Total investable assets (3)
 
$
3,552,327

 
$
3,029,937

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2013
 
December 31, 2012
 
 
 
 
Capital:
 
 
 
 
 
 
 
 
Senior notes
 
$
360,000

 
$
207,500

 
 
 
 
Junior subordinated debt
 
126,381

 
126,317

 
 
 
 
Total Maiden shareholders' equity
 
1,123,843

 
1,015,239

 
 
 
 
Total capital (5)
 
$
1,610,224

 
$
1,349,056

 
 
 
 

(1) Net operating earnings is a non-GAAP financial measure defined by the Company as net income attributable to Maiden common shareholders excluding realized and unrealized investment gains and losses, foreign exchange and other gains and losses, amortization of intangible assets, interest expense incurred related to 7.75% senior notes prior to actual redemption of the junior subordinated debt and non-cash deferred tax charge and should not be considered as an alternative to net income. The Company's management believes that net operating earnings is a useful indicator of trends in the Company's underlying operations. The Company's measure of net operating earnings may not be comparable to similarly titled measures used by other companies.
 
 
 
 
 
 
 
 
(2) Income from Operations is a non-GAAP financial measure defined by the Company as net income attributable to Maiden excluding foreign exchange and other gains and losses, amortization of intangible assets, interest and amortization expenses, income tax expense and income or loss attributable to noncontrolling interest and should not be considered as an alternative to net income. The Company’s management believes that income from operations is a useful measure of the Company’s underlying earnings fundamentals based on its underwriting and investment income before financing costs. This income from operations enables readers of this information to more clearly understand the essential operating results of the Company. The Company’s measure of income from operations may not be comparable to similarly titled measures used by other companies.
 
 
 
 
 
 
 
 
(3) Investable assets is the total of the Company's investments, cash and cash equivalents, loan to a related party and the portion of the funds withheld balance that comprises fixed maturity securities and cash and cash equivalents.
 
 
 
 
 
 
 
 
(4) Calculated by dividing total Maiden shareholders' equity less the preference shares by total common shares outstanding.
 
 
 
 
 
 
 
 
(5) Capital is the total of the Company's senior notes, junior subordinated debt and shareholders' equity.
 
 
 
 
 
 
 
 
(6) During a period of loss, the basic weighted average common shares outstanding is used in the denominator of the diluted loss per common share computation as the effect of including potential dilutive shares would be anti-dilutive.








Maiden Holdings, Ltd.
Supplemental Financial Data - Segment Information
(in thousands of U.S. dollars (000's))
(Unaudited)

For the Three Months Ended December 31, 2013
 
Diversified Reinsurance
 
AmTrust Quota Share Reinsurance
 
NGHC
Quota Share
 
Total
Net premiums written
 
$
173,609

 
$
274,932

 
$
(2,666
)
 
$
445,875

Net premiums earned
 
$
188,512

 
$
263,800

 
$
38,734

 
$
491,046

Other insurance revenue
 
2,966

 

 

 
2,966

Net loss and loss adjustment expenses
 
(129,861
)
 
(173,779
)
 
(26,119
)
 
(329,759
)
Commission and other acquisition expenses
 
(45,911
)
 
(78,360
)
 
(12,211
)
 
(136,482
)
General and administrative expenses
 
(10,692
)
 
(494
)
 
(177
)
 
(11,363
)
Underwriting income
 
$
5,014

 
$
11,167

 
$
227

 
16,408

Reconciliation to net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
 
Net investment income and realized losses on investment
 
 
 
 
 
 
 
25,253

Amortization of intangible assets
 
 
 
 
 
 
 
(945
)
Foreign exchange and other gains
 
 
 
 
 
 
 
236

Interest and amortization expenses
 
 
 
 
 
 
 
(10,786
)
Other general and administrative expenses
 
 
 
 
 
 
 
(3,135
)
Income tax expense
 
 
 
 
 
 
 
(646
)
Income attributable to noncontrolling interest
 
 
 
 
 
 
 
(26
)
Dividends on preference shares
 
 
 
 
 
 
 
(5,553
)
Net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
$
20,806

 
 
 
 
 
 
 
 
 
Net loss and loss adjustment expense ratio (7)
 
67.8
%
 
65.9
%
 
67.4
%
 
66.8
%
Commission and other acquisition expense ratio (8)
 
24.0
%
 
29.7
%
 
31.5
%
 
27.6
%
General and administrative expense ratio (9)
 
5.6
%
 
0.2
%
 
0.5
%
 
2.9
%
Combined ratio (11)
 
97.4
%
 
95.8
%
 
99.4
%
 
97.3
%







For the Three Months Ended December 31, 2012
 
Diversified Reinsurance
 
AmTrust Quota Share Reinsurance
 
NGHC
Quota Share
 
Total
Net premiums written
 
$
139,073

 
$
232,444

 
$
71,128

 
$
442,645

Net premiums earned
 
$
191,728

 
$
214,793

 
$
72,674

 
$
479,195

Other insurance revenue
 
3,240

 

 

 
3,240

Net loss and loss adjustment expenses
 
(171,533
)
 
(144,080
)
 
(49,237
)
 
(364,850
)
Commission and other acquisition expenses
 
(43,314
)
 
(58,262
)
 
(22,611
)
 
(124,187
)
General and administrative expenses
 
(9,102
)
 
(505
)
 
(171
)
 
(9,778
)
Underwriting (loss) income
 
$
(28,981
)
 
$
11,946

 
$
655

 
(16,380
)
Reconciliation to net loss attributable to Maiden common shareholders
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
22,187

Amortization of intangible assets
 
 
 
 
 
 
 
(1,091
)
Foreign exchange gains
 
 
 
 
 
 
 
320

Interest and amortization expenses
 
 
 
 
 
 
 
(9,569
)
Other general and administrative expenses
 
 
 
 
 
 
 
(1,409
)
Income tax expense
 
 
 
 
 
 
 
(715
)
Income attributable to noncontrolling interest
 
 
 
 
 
 
 
(26
)
Dividends on preference shares
 
 
 
 
 
 
 
(3,644
)
Net loss attributable to Maiden common shareholders
 
 
 
 
 
 
 
$
(10,327
)
 
 
 
 
 
 
 
 
 
Net loss and loss adjustment expense ratio (7)
 
88.0
%
 
67.1
%
 
67.8
%
 
75.6
%
Commission and other acquisition expense ratio (8)
 
22.2
%
 
27.1
%
 
31.1
%
 
25.7
%
General and administrative expense ratio (9)
 
4.7
%
 
0.2
%
 
0.2
%
 
2.4
%
Combined ratio (11)
 
114.9
%
 
94.4
%
 
99.1
%
 
103.7
%






Maiden Holdings, Ltd.
Supplemental Financial Data - Segment Information
(in thousands of U.S. dollars (000's))
(Unaudited)

For the Year Ended December 31, 2013
 
Diversified Reinsurance
 
AmTrust Quota Share Reinsurance
 
NGHC
Quota Share
 
Total
Net premiums written
 
$
761,773

 
$
1,169,961

 
$
164,567

 
$
2,096,301

Net premiums earned
 
$
762,063

 
$
988,900

 
$
249,924

 
$
2,000,887

Other insurance revenue
 
14,232

 

 

 
14,232

Net loss and loss adjustment expenses
 
(528,541
)
 
(652,561
)
 
(168,528
)
 
(1,349,630
)
Commission and other acquisition expenses
 
(186,788
)
 
(291,559
)
 
(78,231
)
 
(556,578
)
General and administrative expenses
 
(42,331
)
 
(1,992
)
 
(707
)
 
(45,030
)
Underwriting income
 
$
18,635

 
$
42,788

 
$
2,458

 
63,881

Reconciliation to net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
94,937

Amortization of intangible assets
 
 
 
 
 
 
 
(3,780
)
Foreign exchange and other gains
 
 
 
 
 
 
 
2,809

Interest and amortization expenses
 
 
 
 
 
 
 
(39,497
)
Other general and administrative expenses
 
 
 
 
 
 
 
(13,631
)
Income tax expense
 
 
 
 
 
 
 
(1,863
)
Income attributable to noncontrolling interest
 
 
 
 
 
 
 
(121
)
Dividends on preference shares
 
 
 
 
 
 
 
(14,834
)
Net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
$
87,901

 
 
 
 
 
 
 
 
 
Net loss and loss adjustment expense ratio (7)
 
68.1
%
 
66.0
%
 
67.4
%
 
67.0
%
Commission and other acquisition expense ratio (8)
 
24.1
%
 
29.5
%
 
31.3
%
 
27.6
%
General and administrative expense ratio (9)
 
5.4
%
 
0.2
%
 
0.3
%
 
2.9
%
Combined ratio (11)
 
97.6
%
 
95.7
%
 
99.0
%
 
97.5
%







For the Year Ended December 31, 2012
 
Diversified Reinsurance
 
AmTrust Quota Share Reinsurance
 
NGHC
Quota Share
 
Total
Net premiums written
 
$
765,293

 
$
840,346

 
$
295,646

 
$
1,901,285

Net premiums earned
 
$
795,341

 
$
727,781

 
$
280,658

 
$
1,803,780

Other insurance revenue
 
12,890

 

 

 
12,890

Net loss and loss adjustment expenses
 
(583,970
)
 
(494,633
)
 
(183,745
)
 
(1,262,348
)
Commission and other acquisition expenses
 
(203,209
)
 
(200,546
)
 
(88,276
)
 
(492,031
)
General and administrative expenses
 
(40,951
)
 
(1,949
)
 
(737
)
 
(43,637
)
Underwriting (loss) income
 
$
(19,899
)
 
$
30,653

 
$
7,900

 
18,654

Reconciliation to net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
83,095

Amortization of intangible assets
 
 
 
 
 
 
 
(4,362
)
Foreign exchange gains
 
 
 
 
 
 
 
1,638

Interest and amortization expenses
 
 
 
 
 
 
 
(36,384
)
Other general and administrative expenses
 
 
 
 
 
 
 
(10,167
)
Income tax expense
 
 
 
 
 
 
 
(2,213
)
Income attributable to noncontrolling interest
 
 
 
 
 
 
 
(107
)
Dividends on preference shares
 
 
 
 
 
 
 
(3,644
)
Net income attributable to Maiden common shareholders
 
 
 
 
 
 
 
$
46,510

 
 
 
 
 
 
 
 
 
Net loss and loss adjustment expense ratio (7)
 
72.3
%
 
68.0
%
 
65.5
%
 
69.5
%
Commission and other acquisition expense ratio (8)
 
25.1
%
 
27.6
%
 
31.5
%
 
27.1
%
General and administrative expense ratio (9)
 
5.1
%
 
0.2
%
 
0.2
%
 
2.9
%
Combined ratio (11)
 
102.5
%
 
95.8
%
 
97.2
%
 
99.5
%

(7) Calculated by dividing net loss and loss adjustment expenses by the sum of net premiums earned and other insurance revenue.
(8) Calculated by dividing commission and other acquisition expenses by the sum of net premiums earned and other insurance revenue.
(9) Calculated by dividing commission and other acquisition expenses by the sum of net premiums earned and other insurance revenue
(10) Calculated by adding together the commission and other acquisition expense ratio and the general and administrative expense ratio.
(11) Calculated by adding together the net loss and loss adjustment expense ratio, the commission and other acquisition expense ratio and the general and administrative expense ratio.





















Exhibit 99.2

                            


PRESS RELEASE

Maiden Holdings Announces Dividends on Common Shares and Preference Shares
HAMILTON, Bermuda, February 18, 2014 -- Maiden Holdings, Ltd. (NASDAQ: MHLD) today announced that its Board of Directors approved a quarterly cash dividend of $0.11 per share of common stock. The dividend will be payable on April 14, 2014 to shareholders of record as of April 1, 2014.
Maiden’s Board of Directors also approved a cash dividend on its Series A 8.25% Non-Cumulative Preference Shares of $0.515625 per Preference Share. The dividend will be payable on March 17, 2014 to shareholders of record as of March 1, 2014.
Additionally, Maiden’s Board of Directors approved a cash dividend on its Series B 7.25% Mandatory Convertible Preference Shares of $0.90625 per Preference Share. The dividend will be payable on March 17, 2014 to shareholders of record as of March 1, 2014.

About Maiden Holdings, Ltd.
Maiden Holdings, Ltd. is a Bermuda-based holding company formed in 2007.  Through its subsidiaries, which are each A- rated (excellent) by A.M. Best, the Company is focused on providing non-catastrophic, customized reinsurance products and services to small and mid-size insurance companies in the United States and Europe. As of September 30, 2013, Maiden had $4.4 billion in assets and shareholders' equity of $973.5 million.
The Maiden Holdings, Ltd. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5006
 
CONTACT:
Noah Fields, Vice President, Investor Relations
Maiden Holdings, Ltd.
Phone: 441.298.4927
E-mail: nfields@maiden.bm