AmTrust Reports Strong Profit Growth For Third Quarter 2014

AmTrust Financial Services (AFSI), the parent company of Warrantech, announced strong earnings results for the third quarter of 2014.

For the third quarter 2014, operating earnings were $135.4 million, or $1.70 per diluted share, an increase of 107.8%, compared to $65.1 million, or $0.83 per diluted share, in the third quarter of 2013. Third quarter 2014 net income attributable to common stockholders grew to $156.6 million, or $1.97 per diluted share, an increase of 168.9% from $58.2 million, or $0.74 per diluted share, in the third quarter 2013. Third quarter 2014 annualized operating return on common equity increased to 34.2% from 21.1% in the third quarter 2013. Annualized return on common equity was 39.5% for the third quarter of 2014 and 18.9% for the third quarter of 2013.

During the first nine months of 2014, operating earnings were $339.9 million, or $4.28 per diluted share, an increase of 89.2% compared to $179.7 million, or $2.31 per diluted share, in the first nine months of 2013. During the first nine months of 2014, net income attributable to common stockholders grew to $362.7 million, or $4.57 per diluted share, an increase of 69.9% from $213.5 million, or $2.75 per diluted share, in the first nine months of 2013. Year to date 2014 annualized operating return on common equity increased to 30.1% from 19.8% year to date 2013. Year to date 2014 annualized return on common equity was 32.1% compared to 23.6% year to date 2013.

Third Quarter 2014 Financial Highlights

• Gross written premium of $1.52 billion, up 41.1%, and net earned premium of $914.4 million, up 49.0% from the third quarter 2013
• Operating diluted EPS of $1.70 compared to $0.83 in the third quarter 2013
• Annualized operating return on common equity of 34.2% and annualized return on common equity of 39.5%
• Service and fee income of $117.6 million, up 30.7% from the third quarter 2013
• Operating earnings of $135.4 million compared to $65.1 million from the third quarter 2013
• Net income attributable to common stockholders of $156.6 million compared to $58.2 million in the third quarter 2013
• Diluted EPS of $1.97 compared with $0.74 in the third quarter 2013
• Combined ratio of 91.3% compared to 0.74% in the third quarter 2013
• Service and fee income of $308.1 million, up 29.1% from YTD 2013
• AmTrust’s stockholders’ equity was $2.0 billion as of September 30, 2014

YTD 2014 Highlights

• Gross written premium of $4.63 billion, up 51.3%, and net earned premium of $2.62 billion, up 68.0% over YTD 2013
• Operating diluted EPS(1) of $4.28 compared to $2.31 in YTD 2013
• Annualized operating return on common equity(1) of 30.1% and annualized return on common equity of 32.1%
• Service and fee income of $308.1 million, up 29.1% from YTD 2013
• Operating earnings(1) of $339.9 million compared to $179.7 million from YTD 2013
• Net income attributable to common stockholders of $362.7 million compared to $213.5 million in YTD 2013
• Diluted EPS of $4.57 compared with $2.75 in YTD 2013
• Combined ratio of 90.7% compared to 90.8% in YTD 2013
• Book value per common share of $22.56, up from $17.74 at December 31, 2013
• AmTrust’s stockholders’ equity was $2.0 billion as of September 30, 2014

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