DUBLIN, Ireland, Aug. 04, 2016 (GLOBE NEWSWIRE) -- Global Indemnity plc (NASDAQ:GBLI) today reported net income for the six months ended June 30, 2016 of $2.0 million or $0.11 per share and operating income of $9.1 million or $0.52 per share. As of June 30^th, book value per share was $43.91, an increase of 2.2% compared to book value per share of $42.98 at December 31, 2015.

Selected Operating and Balance Sheet Data (Dollars in millions, except per share data)

		For the Six Months Ended June 30,									As of  June 30,					As of December 31,
			2016				2015				2016					2015
Gross Premiums Written		$	295.7			$	309.4			Book value per share	$	43.91				$	42.98
Net Premiums Written		$	242.2			$	272.1			Shareholders’ equity	$	770.7				$	749.9
										Cash and invested assets(2)	$	1,533.0				$	1,516.3
Net income		$	2.0			$	17.9
Net income per share		$	0.11			$	0.70			(2) Including receivable/(payable) for securities sold/(purchased)
Operating income		$	9.1			$	15.7
Operating income per share		$	0.52			$	0.61
Combined ratio analysis:
Loss ratio			59.7				58.2
Expense ratio (1)			42.0				38.7
Combined ratio			101.7				96.9
(1) The expense ratio in 2016 was approximately 1.5 points higher in 2016 primarily due to purchasing additional catastrophe reinsurance, while the 2015 ratio benefitted approximately 1.7 points from a purchase accounting adjustment. Excluding these factors, the expense ratio was consistent year-over-year.

About Global Indemnity plc and its subsidiaries

Global Indemnity plc (NASDAQ:GBLI), through its several direct and indirect wholly owned subsidiary insurance and reinsurance companies, provides both admitted and non-admitted specialty property and casualty insurance coverages and individual policyholder coverages in the United States, as well as reinsurance worldwide.  Global Indemnity plc’s three primary segments are:

• United States Based Commercial Lines Operations
   
• United States Based Personal Lines Operations
   
• Bermuda Based Reinsurance Operations

For more information, visit the Global Indemnity plc website at http://www.globalindemnity.ie.

Forward-Looking Information
The forward-looking statements contained in this press release¹ do not address a number of risks and uncertainties.  Investors are cautioned that Global Indemnity’s actual results may be materially different from the estimates expressed in, or implied, or projected by, the forward looking statements. Factors that could cause actual results to differ materially from those contemplated in the forward-looking statements include, but are not limited to, the risk that there may be difficulties in the continued integration of American Reliable business, which could result in a failure to realize the potential benefits of the acquisition, and the risk that American Reliable’ s or Global Indemnity’s prospective insurance premiums, investment yield, or net earnings are less than anticipated (including as a result of unexpected events, competition, costs, charges or outlays whether as a consequence of the transaction or otherwise).  The foregoing review of factors that could cause actual financial or operating performance to differ materially from expectations is not exhaustive. Please see Global Indemnity’s filings with the Securities and Exchange Commission for a discussion of additional risks and uncertainties which could impact the company and for a more detailed explication regarding forward-looking statements.  

¹ Disseminated pursuant to the "safe harbor" provisions of Section 21E of the Security Exchange Act of 1934.

Global Indemnity plc’s Combined Ratio for the Six Months Ended June 30, 2016

The combined ratio is a key measure of insurance profitability.  The components comprising the combined ratio, by reportable business segment, for the six months ended June 30, 2016 are as follows:

		Commercial Lines		Personal Lines		Reinsurance Operations
Loss Ratio		57.3		65.0		39.4
Expense Ratio		41.2		43.4		37.7
Combined Ratio		98.5		108.4		77.1

Loss Ratio:

Commercial Lines Operations:

The calendar year loss ratio for the Company’s Commercial Lines was 57.3% for 2016 compared with 59.4% for 2015, an improvement of 2.1 points. The improvement was primarily due to lower than expected claims severity experienced across multiple prior accident years, primarily in liability lines. The current accident year loss ratio increased 5.2 points from 65.0% in 2015 to 70.2% in 2016 primarily due to catastrophes.  

Personal Lines Operations:

The 2016 loss ratio was 65.0%, compared to 62.7% for the comparable period of 2015, primarily due to an increase in catastrophe losses. There were no adjustments to prior accident years for 2016 or 2015.

Reinsurance Operations:

The loss ratio for the Company’s Reinsurance Operations was 39.4% for 2016 compared with 31.8% for 2015. The current accident year loss ratio increased 11.2 points from 43.3% for the six months ended June 30, 2015 to 54.5% for the six months ended June 30, 2016, primarily due to catastrophic events in the second quarter of 2016. The improvement in the loss ratio related to prior years was driven by less than anticipated case incurred emergence on property catastrophe treaties.

Expense ratio:

For the six months ended June 30, the total expense ratio increased from 38.7% in 2015 to 42.0% in 2016. 1.7% of the increase is due to acquisition accounting adjustments related to the purchase of American Reliable Insurance Company in 2015.  The remainder of the increase in the 2016 expense ratio was primarily due to a reduction in earned premium as a result of the Company reducing catastrophe exposure and purchasing additional reinsurance.

Global Indemnity plc’s Gross and Net Premiums Written Results by Segment

	Six Months Ended June 30,
	Gross Premiums Written								Net Premiums Written
		2016				2015				2016				2015
Commercial Lines Operations	$	107,121			$	108,826			$	96,010			$	100,322
Personal Lines Operations		163,421				162,215				121,043				133,483
Reinsurance Operations		25,143				38,343				25,129				38,304
Total	$	295,685			$	309,384			$	242,182			$	272,109

Gross premiums written and net premiums written decreased 4.4% and 11.0%, respectively, compared to the same period in 2015.

Commercial Lines Operations: For the six months ended June 30, 2016, gross premiums written and net premiums written decreased 1.6% and 4.3%, respectively, compared to the same period in 2015. The reduction in net premiums written was primarily due to purchasing additional reinsurance to reduce catastrophe exposure.

Personal Lines Operations:  For the six months ended June 30, 2016, gross premiums written increased 0.7% and net premiums written decreased 9.3% compared to the same period in 2015. The reduction in net premiums written is due to purchasing additional reinsurance to reduce catastrophe exposure.

Reinsurance Operations: For the six months ended June 30, 2016, gross premiums written and net premiums written both decreased 34.4% compared to the same period in 2015. This decrease is mainly due to a treaty being non-renewed in 2016 in an effort to reduce catastrophe exposure.  In addition, the property catastrophe reinsurance marketplace continues to be very competitive due to excess capital.

Note: Tables Follow

Global Indemnity plc
Consolidated Statements of Operations
(Unaudited)
(Dollars and shares in thousands, except per share data)
	For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2016				2015				2016				2015
Gross premiums written	$	154,319			$	166,515			$	295,685			$	309,384
Net premiums written	$	125,310			$	146,005			$	242,182			$	272,109
Net premiums earned	$	117,804			$	128,877			$	239,440			$	256,214
Net investment income		6,562				9,141				16,308				17,382
Net realized investment gains (losses)		(3,492	)			6,532				(10,985	)			3,562
Other income		795				577				1,751				1,129
Total revenues		121,669				145,127				246,514				278,287
Net losses and loss adjustment expenses		78,111				79,560				142,895				149,179
Acquisition costs and other underwriting expenses		48,542				50,926				100,632				99,184
Corporate and other operating expenses		4,255				4,334				8,058				15,874
Interest expense		2,229				535				4,444				1,040
Income (loss) before income taxes		(11,468	)			9,772				(9,515	)			13,010
Income tax benefit		(6,303	)			(1,345	)			(11,475	)			(4,901	)
Net income (loss)	$	(5,165	)		$	11,117			$	1,960			$	17,911
Weighted average shares outstanding–basic		17,244				25,455				17,234				25,447
Weighted average shares outstanding–diluted (1)		17,244				25,681				17,485				25,660
Net income (loss) per share – basic	$	(0.30	)		$	0.44			$	0.11			$	0.70
Net income (loss) per share – diluted	$	(0.30	)		$	0.43			$	0.11			$	0.70
Combined ratio analysis (2):
Loss ratio		66.3				61.7				59.7				58.2
Expense ratio		41.2				39.5				42.0				38.7
Combined ratio		107.5				101.2				101.7				96.9

	(1	)	For the quarter ended June 30, 2016, diluted loss per share is the same as basic loss per share since there was a net loss for the period.
	(2	)	The loss ratio, expense ratio and combined ratio are GAAP financial measures that are generally viewed in the insurance industry as indicators of underwriting profitability.  The loss ratio is the ratio of net losses and loss adjustment expenses to net premiums earned.  The expense ratio is the ratio of acquisition costs and other underwriting expenses to net premiums earned.  The combined ratio is the sum of the loss and expense ratios.

GLOBAL INDEMNITY PLC
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
ASSETS				(Unaudited) June 30, 2016				December 31, 2015
Fixed Maturities:
	Available for sale securities, at fair value (amortized cost: 2016 - $1,292,785 and 2015 - $1,308,333)			$	1,306,955			$	1,306,149
Equity securities:
	Available for sale, at fair value (cost: 2016 - $101,867 and 2015 - $100,157)				119,008				110,315
Other invested assets					35,798				32,592
		Total investments			1,461,761				1,449,056
Cash and cash equivalents					70,647				67,037
Premiums receivable, net					90,275				89,245
Reinsurance receivables, net					115,365				115,594
Funds held by ceding insurers					19,927				16,037
Federal income taxes receivable					4,840				4,828
Deferred federal income taxes					41,028				34,687
Deferred acquisition costs					56,051				56,517
Intangible assets					23,342				23,607
Goodwill					6,521				6,521
Prepaid reinsurance premiums					49,763				44,363
Receivable for securities sold					561				172
Other assets					66,013				49,630
		Total assets		$	2,006,094			$	1,957,294
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Unpaid losses and loss adjustment expenses				$	683,850			$	680,047
Unearned premiums					294,426				286,285
Ceded balances payable					12,386				4,589
Contingent commissions					9,498				11,069
Debt					174,211				172,034
Other liabilities					60,974				53,344
		Total liabilities			1,235,345				1,207,368
Shareholders’ equity:
Ordinary shares, $0.0001 par value, 900,000,000 ordinary shares authorized; A ordinary shares issued: 16,559,872 and 16,424,546 respectively; A ordinary shares outstanding: 13,420,978 and 13,313,751, respectively; B ordinary  shares issued and outstanding: 4,133,366 and 4,133,366, respectively					3				3
Additional paid-in capital					531,542				529,872
Accumulated other comprehensive income, net of taxes					22,076				4,078
Retained earnings					320,376				318,416
A ordinary shares in treasury, at cost: 3,138,894 and 3,110,795 shares, respectively					(103,248	)			(102,443	)
		Total shareholders’ equity			770,749				749,926
		Total liabilities and shareholders’ equity		$	2,006,094			$	1,957,294

GLOBAL INDEMNITY PLC
SELECTED INVESTMENT DATA
(Dollars in millions)
		Market Value as of
		(Unaudited) June 30, 2016				December 31, 2015
Fixed maturities		$	1,307.0			$	1,306.1
Cash and cash equivalents			70.6				67.0
Total bonds and cash and cash equivalents			1,377.6				1,373.1
Equities and other invested assets			154.8				143.0
Total cash and invested assets, gross			1,532.4				1,516.1
Receivable/(payable) for securities sold (purchased)			0.6				0.2
Total cash and invested assets, net		$	1,533.0			$	1,516.3

		(Unaudited) Three Months Ended June 30, 2016 (a)				(Unaudited) Six Months Ended June 30, 2016 (a)
Net investment income		$	6.6			$	16.3
Net realized investment losses			(3.5	)			(11.0	)
Net change in unrealized investment gains			11.5				23.3
Net realized and unrealized investment returns			8.0				12.3
Total investment return		$	14.6			$	28.6
Average total cash and invested assets		$	1,519.6			$	1,524.6
Total investment return % annualized			3.8	%			3.8	%

(a)	Amounts in this table are shown on a pre-tax basis.
(b)	Simple average of beginning and end of period, net of payable/receivable for securities.

GLOBAL INDEMNITY PLC
SUMMARY OF OPERATING INCOME (LOSS)
(Unaudited)
(Dollars and shares in thousands, except per share data)
	For the Three Months Ended June 30,								For the Six Months Ended June 30,
		2016				2015				2016				2015
Operating income (loss)	$	(2,915	)		$	6,913			$	9,076			$	15,731
Adjustments:
Net realized investment gains (losses), net of tax		(2,250	)			4,204				(7,116	)			2,180
Net income (loss)	$	(5,165	)		$	11,117			$	1,960			$	17,911
Weighted average shares outstanding –  basic		17,244				25,455				17,234				25,447
Weighted average shares outstanding –  diluted (1)		17,244				25,681				17,485				25,660
Operating income (loss) per share – basic	$	(0.17	)		$	0.27			$	0.53			$	0.62
Operating income (loss) per share – diluted	$	(0.17	)		$	0.27			$	0.52			$	0.61

Note Regarding Operating Income

Operating income, a non-GAAP financial measure, is equal to net income excluding after-tax net realized investment gains (losses). Operating income is not a substitute for net income determined in accordance with GAAP, and investors should not place undue reliance on this measure.

	(1	)	For the quarter ended June 30, 2016, diluted loss per share is the same as basic loss per share since there was a net loss for the period.

Contact:         

Media
Stephen Ries
Senior Corporate Counsel
(610) 668-3270           
sries@global-indemnity.com