Document



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):
November 2, 2016 (November 1, 2016)
 
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 November 2, 2016, Maiden Holdings, Ltd. (the “Company”) issued a press release announcing its results of operations for the fiscal quarter ended September 30, 2016. 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 November 1, 2016, the Company issued a press release announcing the following quarterly dividends:
 
 
Dividend per Share
 
Payable on:
 
Record date:
Common shares
 
$
0.15

 
January 17, 2017
 
January 3, 2017
Preference shares - Series A
 
$
0.515625

 
December 15, 2016
 
December 1, 2016
Preference shares - Series C
 
$
0.445313

 
December 15, 2016
 
December 1, 2016

 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)           Exhibit
 
Exhibit
 
 
No.
 
Description
 
 
 
99.1
 
Press Release of Maiden Holdings, Ltd., dated November 2, 2016
 
 
 
99.2
 
Press Release of Maiden Holdings, Ltd., dated November 1, 2016

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: November 2, 2016
MAIDEN HOLDINGS, LTD.
 
 
    
 
 
 
  By:
/s/ Lawrence F. Metz
 
 
Lawrence F. Metz
 
 
Executive Vice President, General Counsel and
Secretary






EXHIBIT INDEX
 
Exhibit
 
 
No.
 
Description
 
 
 
99.1
 
Press Release of Maiden Holdings, Ltd., dated November 2, 2016
 
 
 
99.2
 
Press Release of Maiden Holdings, Ltd., dated November 1, 2016






Exhibit 99.1

                                logo1a09.jpg
PRESS RELEASE

Maiden Holdings, Ltd. Announces Third Quarter 2016 Net Income Attributable to Common Shareholders of $31.8 Million or $0.40 Per Diluted Common Share and Operating Earnings(1) of $30.2 Million or $0.39 Per Diluted Common Share
 
Highlights for the quarter ended September 30, 2016
Net income attributable to Maiden common shareholders of $31.8 million, or $0.40 per diluted common share compared with net income attributable to Maiden common shareholders of $22.5 million, or $0.30 per diluted common share in the third quarter of 2015;
Annualized return on common equity of 11.6% compared to 9.8% in the third quarter of 2015;
Net operating earnings(1) of $30.2 million, or $0.39 per diluted common share compared with net operating earnings of $25.8 million, or $0.34 per diluted common share in the third quarter of 2015;
Annualized operating return on common equity(7) of 11.0% compared to 11.3% in the third quarter of 2015;
Gross premiums written increased 12.5% to $706.9 million compared to the third quarter of 2015;
Net premiums written increased 15.3% to $690.7 million compared to the third quarter of 2015;
Combined ratio(12) of 98.5% compared to 99.6% in the third quarter of 2015;
Net investment income was $35.7 million compared to $32.8 million in the third quarter of 2015;
Book value per common share(4) of $14.40 at September 30, 2016 increased 1.6% versus at June 31, 2016; and
In September, Maiden’s mandatory convertible preference shares converted into common shares, increasing common shares outstanding by 12,069,090.

Highlights for the nine months ended September 30, 2016
Net income attributable to Maiden common shareholders of $90.0 million or $1.15 per diluted common share compared with $75.4 million, or $0.99 per diluted common share in the first nine months of 2015;
Annualized return on common equity of 12.2% compared to 11.0% in the first three quarters of 2015;
Net operating earnings(1) of $87.0 million, or $1.11 per diluted common share compared with net operating earnings of $80.8 million, or $1.05 per diluted common share in the first nine months of 2015;
Annualized operating return on common equity(1) of 11.8% compared to 11.8% in the first three quarters of 2015;
Gross premiums written were $2.3 billion, an increase of 5.7% compared to the first nine months of 2015;
Net premiums written increased 5.3% to $2.1 billion in the first three quarters of 2016 compared to the same period last year;
Combined ratio(12) of 98.7% was lower than the 99.1% in the first nine months of 2015; and
Net investment income was $107.3 million, an increase of 11.5% compared to the first three quarters of 2015.


HAMILTON, Bermuda - Maiden Holdings, Ltd. (NASDAQ:  MHLD) (“Maiden” or “the Company”) today reported third quarter 2016 net income attributable to Maiden common shareholders of $31.8 million or $0.40 per diluted common share compared to net income attributable to Maiden common shareholders of $22.5 million or $0.30 per diluted common share in the third quarter of 2015. Net operating earnings(1) were $30.2 million, or $0.39 per diluted common share compared with net operating earnings of $25.8 million, or $0.34 per diluted common share in the third quarter of 2015.
 
Commenting on the Company's results, Art Raschbaum, Chief Executive Officer of Maiden, said: “Maiden continued to deliver strong results with a year-over-year improvement in our combined ratio, double digit operating return on common equity, increased investment income, continued growth in book value and disciplined growth from virtually all business activities, despite an increasingly challenging operating environment with intensifying competition, as well as growing loss cost volatility. Maiden’s growth during the quarter emanated from existing client relationships and new business. Our recent rating upgrade from AM Best to A stable, will further strengthen Maiden's unique value proposition to our clients and prospects.”








Results for the quarter ended September 30, 2016
Maiden reported third quarter 2016 net income attributable to common shareholders of $31.8 million or $0.40 per diluted common share compared with $22.5 million or $0.30 per diluted common share in the third quarter of 2015. Net operating earnings(1) were $30.2 million, or $0.39 per diluted common share in the third quarter of 2016 compared with $25.8 million, or $0.34 per diluted common share in the third quarter of 2015.

In the third quarter of 2016, gross premiums written increased 12.5% to $706.9 million from $628.5 million in the third quarter of 2015. The Diversified Reinsurance segment’s gross premiums written totaled $186.8 million, an increase of 7.1% versus the third quarter of 2015, with growth from existing customers and new accounts developed over the course of the year. In the AmTrust Reinsurance segment, gross premiums written were $520.1 million, an increase of 14.5% compared to $454.2 million in the third quarter of 2015.

Net premiums written totaled $690.7 million in the third quarter of 2016, an increase of 15.3% compared to the third quarter of 2015. 

Net premiums earned of $698.3 million increased 6.0% compared to the third quarter of 2015.  In the Diversified Reinsurance segment, net premiums earned decreased 9.4% to $175.1 million compared to the third quarter of 2015. The AmTrust Reinsurance segment net premiums earned were $523.1 million, up 12.4% compared to the third quarter of 2015.

Net loss and loss adjustment expenses of $466.8 million were up 5.1% compared to the third quarter of 2015.  

The loss ratio(8) of 66.6% was lower than the 67.2% reported in the third quarter of 2015.
 
Commission and other acquisition expenses, increased 4.6% to $206.7 million in the third quarter of 2016, compared to the same quarter a year ago. The expense ratio(11) decreased to 31.9% for the third quarter of 2016 compared with 32.4% in the same quarter last year, due to changes in the mix of quota share and excess of loss business. General and administrative expenses for the third quarter of 2016 totaled $17.0 million, a 3.0% increase compared with $16.5 million in the third quarter of 2015. The general and administrative expense ratio(10) was 2.4% in the third quarter of 2016, compared to 2.5% in the third quarter of 2015.
 
The combined ratio(12) for the third quarter of 2016 totaled 98.5% compared with 99.6% in the third quarter of 2015. The Diversified Reinsurance segment combined ratio was 102.2% in the third quarter of 2016, an improvement from 103.6% in the third quarter of 2015, as net adverse development from commercial auto business continued to impact results. The AmTrust Reinsurance segment combined ratio was 95.9% in the third quarter of 2016 compared to 95.4% in the third quarter of 2015.

Net investment income of $35.7 million in the third quarter of 2016 increased 8.6% compared to the third quarter of 2015. As of September 30, 2016, the average yield on the fixed income portfolio (excluding cash) is 3.20% with an average duration of 4.49 years. Cash and cash equivalents were $434.0 million at September 30, 2016 or $101.5 million higher than at year-end 2015.
  
Total assets increased 13.4% to $6.5 billion at September 30, 2016 compared to $5.7 billion at year-end 2015.   Shareholders' equity was $1.6 billion, up 15.4% compared to December 31, 2015. Book value per common share was $14.40 at September 30, 2016 or 22.3% higher than at December 31, 2015.
  
During the third quarter of 2016, the Board of Directors declared dividends of $0.14 per common share, $0.515625 per Series A preference share, $0.90625 per Series B preference share and $0.445313 per Series C preference share.

Results for the nine months ended September 30, 2016
Net income attributable to Maiden common shareholders was $90.0 million or $1.15 per diluted common share in the first nine months of 2016 compared to net income attributable to Maiden common shareholders of $75.4 million or $0.99 per diluted common share in the first three quarters of 2015. Net operating earnings(1) for the first nine months of 2016 were $87.0 million, or $1.11 per diluted common share compared with $80.8 million, or $1.05 per diluted common share in the first three quarters of 2015.

In the first nine months of 2016, gross premiums written totaled $2.3 billion, an increase of 5.7% compared to the first nine months of 2015.  Gross premiums written in the Diversified Reinsurance segment totaled $667.4 million, an increase of 5.7% versus the first three quarters of 2015. In the AmTrust Reinsurance segment, gross premiums written increased by 5.7% to $1.6 billion compared to the first three quarters of 2015.

In the first three quarters of 2016, net premiums written totaled $2.1 billion, an increase of 5.3% compared to the first nine months of 2015.  






Net premiums earned of $2.0 billion increased 5.8% compared to the first nine months of 2015.  Net premiums earned decreased 5.7% in the Diversified Reinsurance segment to $538.2 million compared to the first three quarters of 2015. The AmTrust Reinsurance segment net premiums earned were up 10.9% to $1.4 billion compared to the first three quarters 2015.
 
Net loss and loss adjustment expenses of $1.3 billion were up 4.9% compared to the first nine months of 2015.  The loss ratio(8) of 66.2% was lower than the 66.7% in the first three quarters of 2015.
 
Commission and other acquisition expenses, increased $35.8 million to $587.5 million in the first nine months of 2016 versus the comparable period a year ago, while the expense ratio(11) rose to 32.5% for the first nine months of 2016 compared with 32.4% in the same period last year. General and administrative expenses for the first three quarters of 2016 totaled $49.7 million compared with $49.0 million in the first nine months of 2015. The general and administrative expense ratio(10) decreased to 2.5% in the first three quarters of 2016 versus 2.7% in the same period during 2015.
 
The combined ratio(12) for the first three quarters of 2016 was 98.7% and lower than the 99.1% combined ratio reported for the first nine months of 2015. The Diversified Reinsurance segment had a combined ratio of 102.8% in the first three quarters of 2016, which is the same as the first nine months of 2015. The AmTrust Reinsurance segment combined ratio was 95.4% in the first three quarters of 2016 compared to 95.1% in the comparable period in 2015.

Net investment income of $107.3 million in the first three quarters of 2016 increased 11.5% compared to the first three quarters of 2015.


(1)(4)(7) 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.
 
(8)(10)(11)(12) 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 Chief Executive Officer, Art Raschbaum and Chief Financial Officer, Karen Schmitt will review these results tomorrow via teleconference and live audio webcast beginning at 12:00 p.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: 5957381
Webcast: http://www.maiden.bm/news_events
A replay of the conference call will be available beginning at 3:00 p.m. ET on November 3, 2016 through 2:00 p.m. ET on November 10, 2016. 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: 5957381; or access http://www.maiden.bm/news_events.


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, 2016, Maiden had $6.5 billion in assets and shareholders' equity of $1.6 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, 2015 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, Senior 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, except share and per share data)
 
 
 
 
 
 
 
September 30, 2016 (Unaudited)
 
December 31, 2015 (Audited)
ASSETS
 
 
 
 
Investments:
 
 
 
 
Fixed maturities, available-for-sale, at fair value (amortized cost 2016: $3,660,873; 2015: $3,562,864)
 
$
3,748,342

 
$
3,508,088

Fixed maturities, held-to-maturity, at amortized cost (fair value 2016: $798,081; 2015: $598,975)
 
759,973

 
607,843

Other investments, at fair value (cost 2016: $10,860; 2015: $10,816)
 
12,268

 
11,812

Total investments
 
4,520,583

 
4,127,743

Cash and cash equivalents
 
67,459

 
89,641

Restricted cash and cash equivalents
 
366,563

 
242,859

Accrued investment income
 
33,884

 
32,288

Reinsurance balances receivable, net
 
535,015

 
377,318

Reinsurance recoverable on unpaid losses
 
97,070

 
71,248

Loan to related party
 
167,975

 
167,975

Deferred commission and other acquisition expenses, net
 
451,698

 
397,548

Goodwill and intangible assets, net
 
80,135

 
81,920

Other assets
 
147,580

 
115,038

Total assets
 
$
6,467,962

 
$
5,703,578

LIABILITIES
 
 
 
 
Reserve for loss and loss adjustment expenses
 
$
2,759,518

 
$
2,510,101

Unearned premiums
 
1,571,435

 
1,354,572

Accrued expenses and other liabilities
 
150,741

 
135,897

Liability for securities purchased
 
78,581

 
3,976

Senior Notes - principal amount
 
362,500

 
360,000

Less unamortized debt issuance costs
 
11,172

 
10,067

Senior notes, net
 
351,328

 
349,933

Total liabilities
 
4,911,603

 
4,354,479

Commitments and Contingencies
 
 
 
 
EQUITY
 
 
 
 
Preference shares
 
315,000

 
480,000

Common shares
 
872

 
747

Additional paid-in capital
 
747,203

 
579,178

Accumulated other comprehensive income (loss)
 
123,876

 
(23,767
)
Retained earnings
 
373,340

 
316,184

Treasury shares, at cost
 
(4,991
)
 
(4,521
)
Total Maiden shareholders’ equity
 
1,555,300

 
1,347,821

Noncontrolling interest in subsidiaries
 
1,059

 
1,278

Total equity
 
1,556,359

 
1,349,099

Total liabilities and equity
 
$
6,467,962

 
$
5,703,578

 
 
 
 
 
Book value per common share(4)
 
$
14.40

 
$
11.77

 
 
 
 
 
Common shares outstanding
 
86,128,999

 
73,721,140







Maiden Holdings, Ltd.
Income Statement
(in thousands of U.S. dollars, except share and per share data)
(Unaudited)
 
 
For the Three Months Ended September 30, 2016
 
For the Three Months Ended September 30, 2015
 
For the Nine Months Ended September 30, 2016
 
For the Nine Months Ended September 30, 2015
Revenues:
 
 
 
 
 
 
 
 
Gross premiums written
 
$
706,854

 
$
628,501

 
$
2,259,290

 
$
2,136,935

Net premiums written
 
$
690,653

 
$
599,153

 
$
2,133,911

 
$
2,025,754

Change in unearned premiums
 
7,625

 
59,367

 
(182,060
)
 
(180,495
)
Net premiums earned
 
698,278

 
658,520

 
1,951,851

 
1,845,259

Other insurance revenue
 
2,345

 
2,177

 
8,696

 
9,408

Net investment income
 
35,666

 
32,843

 
107,291

 
96,260

Net realized gains on investment
 
1,900

 
1,216

 
4,511

 
2,327

Total other-than-temporary impairment losses
 

 
(1,060
)
 

 
(1,060
)
Portion of loss recognized in other comprehensive income (loss)
 

 

 

 

Net impairment losses recognized in earnings
 

 
(1,060
)
 

 
(1,060
)
Total revenues
 
738,189

 
693,696

 
2,072,349

 
1,952,194

Expenses:
 
 
 
 
 
 
 
 
Net loss and loss adjustment expenses
 
466,751

 
444,172

 
1,297,361

 
1,236,505

Commission and other acquisition expenses
 
206,706

 
197,639

 
587,501

 
551,678

General and administrative expenses
 
16,952

 
16,453

 
49,738

 
48,951

Total expenses
 
690,409

 
658,264

 
1,934,600

 
1,837,134

Income from operations(2)
 
47,780

 
35,432

 
137,749

 
115,060

Other expenses
 
 
 
 
 
 
 
 
Interest and amortization expenses
 
(6,856
)
 
(7,266
)
 
(21,314
)
 
(21,796
)
Accelerated amortization of senior note issuance cost
 

 

 
(2,345
)
 

Amortization of intangible assets
 
(616
)
 
(710
)
 
(1,846
)
 
(2,130
)
Foreign exchange and other gains
 
687

 
1,427

 
6,474

 
4,062

Total other expenses
 
(6,785
)
 
(6,549
)
 
(19,031
)
 
(19,864
)
Income before income taxes
 
40,995

 
28,883

 
118,718

 
95,196

Income tax expense
 
199

 
368

 
1,206

 
1,636

Net income
 
40,796

 
28,515

 
117,512

 
93,560

Add: loss attributable to noncontrolling interest
 
56

 
69

 
166

 
116

Net income attributable to Maiden
 
40,852

 
28,584

 
117,678

 
93,676

Dividends on preference shares(6)
 
(9,023
)
 
(6,085
)
 
(27,723
)
 
(18,253
)
Net income attributable to Maiden common shareholders
 
$
31,829

 
$
22,499

 
$
89,955

 
$
75,423

Net operating earnings attributable to Maiden common shareholders(1)
 
$
30,196

 
$
25,758

 
$
86,974

 
$
80,791

Basic earnings per common share attributable to Maiden shareholders
 
$
0.42

 
$
0.31

 
$
1.20

 
$
1.03

Diluted earnings per common share attributable to Maiden shareholders
 
$
0.40

 
$
0.30

 
$
1.15

 
$
0.99

Basic operating earnings per common share attributable to Maiden shareholders
 
$
0.40

 
$
0.35

 
$
1.16

 
$
1.10

Diluted operating earnings per common share attributable to Maiden shareholders
 
$
0.39

 
$
0.34

 
$
1.11

 
$
1.05

Dividends declared per common share
 
$
0.14

 
$
0.13

 
$
0.42

 
$
0.39

 
 
 
 
 
 
 
 
 
Weighted average number of common shares - basic
 
75,993,451

 
73,638,980

 
74,625,839

 
73,403,998

Adjusted weighted average number of common shares and assumed conversions - diluted
 
86,150,951

 
85,743,005

 
86,018,019

 
85,486,002

 
 
 
 
 
 
 
 
 





Net loss and LAE ratio(8)
 
66.6
%
 
67.2
%
 
66.2
%
 
66.7
%
Commission and other acquisition expense ratio(9)
 
29.5
%
 
29.9
%
 
30.0
%
 
29.7
%
General and administrative expense ratio(10)
 
2.4
%
 
2.5
%
 
2.5
%
 
2.7
%
Expense ratio(11)
 
31.9
%
 
32.4
%
 
32.5
%
 
32.4
%
Combined ratio(12)
 
98.5
%
 
99.6
%
 
98.7
%
 
99.1
%
Annualized return on common equity
 
11.6
%
 
9.8
%
 
12.2
%
 
11.0
%
Annualized operating return on common equity(7)
 
11.0
%
 
11.3
%
 
11.8
%
 
11.8
%






Maiden Holdings, Ltd.
Non - GAAP Financial Measure
(in thousands of U.S. dollars, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended September 30, 2016
 
For the Three Months Ended September 30, 2015
 
For the Nine Months Ended September 30, 2016
 
For the Nine Months Ended September 30, 2015
Reconciliation of net income attributable to Maiden common shareholders to net operating earnings:
 
 
 
 
 
 
 
 
Net income attributable to Maiden common shareholders
 
$
31,829

 
$
22,499

 
$
89,955

 
$
75,423

Add (subtract)
 
 
 
 
 
 
 
 
   Net realized gains on investment
 
(1,900
)
 
(1,216
)
 
(4,511
)
 
(2,327
)
   Net impairment losses recognized in earnings
 

 
1,060

 

 
1,060

   Foreign exchange and other gains
 
(687
)
 
(1,427
)
 
(6,474
)
 
(4,062
)
   Amortization of intangible assets
 
616

 
710

 
1,846

 
2,130

   Divested excess and surplus ("E&S") business and NGHC run-off
 
47

 
3,841

 
2,942

 
7,696

   Accelerated amortization of senior note issuance cost
 

 

 
2,345

 

   Non-cash deferred tax expense
 
291

 
291

 
871

 
871

Net operating earnings attributable to Maiden common shareholders(1)
 
$
30,196

 
$
25,758

 
$
86,974

 
$
80,791

Operating earnings per common share attributable to Maiden shareholders:
 
 
 
 
 
 
 
 
Basic earnings per common share attributable to Maiden shareholders
 
$
0.40

 
$
0.35

 
$
1.16

 
$
1.10

Diluted earnings per common share attributable to Maiden shareholders
 
$
0.39

 
$
0.34

 
$
1.11

 
$
1.05

Reconciliation of net income attributable to Maiden to income from operations:
 
 
 
 
 
 
 
 
Net income attributable to Maiden
 
$
40,852

 
$
28,584

 
$
117,678

 
$
93,676

Add (subtract)
 
 
 
 
 
 
 
 
   Foreign exchange and other gains
 
(687
)
 
(1,427
)
 
(6,474
)
 
(4,062
)
   Amortization of intangible assets
 
616

 
710

 
1,846

 
2,130

   Interest and amortization expenses
 
6,856

 
7,266

 
21,314

 
21,796

   Accelerated amortization of senior note issuance cost
 

 

 
2,345

 

   Income tax expense
 
199

 
368

 
1,206

 
1,636

   Loss attributable to noncontrolling interest
 
(56
)
 
(69
)
 
(166
)
 
(116
)
Income from operations(2)
 
$
47,780

 
$
35,432

 
$
137,749

 
$
115,060

 
 
 
 
 
 
 
 
 
 
 
September 30, 2016
 
December 31, 2015
 
 
 
 
Investable assets:
 
 
 
 
 
 
 
 
Total investments
 
$
4,520,583

 
$
4,127,743

 
 
 
 
Cash and cash equivalents
 
67,459

 
89,641

 
 
 
 
Restricted cash and cash equivalents
 
366,563

 
242,859

 
 
 
 
Loan to related party
 
167,975

 
167,975

 
 
 
 
Total investable assets(3)
 
$
5,122,580

 
$
4,628,218

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
September 30, 2016
 
December 31, 2015
 
 
 
 
Capital:
 
 
 
 
 
 
 
 
Preference shares
 
$
315,000

 
$
480,000

 
 
 
 
Common shareholders' equity
 
1,240,300

 
867,821

 
 
 
 
Total Maiden shareholders' equity
 
1,555,300

 
1,347,821

 
 
 
 
2011 Senior Notes
 

 
107,500

 
 
 
 
2012 Senior Notes
 
100,000

 
100,000

 
 
 
 
2013 Senior Notes
 
152,500

 
152,500

 
 
 
 





2016 Senior Notes
 
110,000

 

 
 
 
 
Total capital resources(5)
 
$
1,917,800

 
$
1,707,821

 
 
 
 
(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, net impairment losses recognized in earnings, foreign exchange and other gains and losses, amortization of intangible assets, divested excess and surplus business and NGHC run-off, accelerated amortization of senior note issuance cost and non-cash deferred tax expense 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, accelerated amortization of senior note issuance cost, 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 and loan to a related party.
 
 
 
 
 
 
 
(4) Book value per common share is calculated using common shareholders’ equity (shareholders' equity excluding the aggregate liquidation value of our preference shares) divided by the number of common shares outstanding.
 
 
 
 
 
 
 
(5) Total capital resources is the sum of the Company's principal amount of debt and Maiden shareholders' equity.
 
 
 
 
 
 
 
(6) Dividends on preference shares consist of $3,094 and $9,282 paid to Preference Shares - Series A and $2,991 and $8,971 paid to Preference shares - Series B during the three and nine months ended September 30, 2016 and 2015, respectively, and $2,938 and $9,470 paid to Preference shares - Series C during the three and nine months ended September 30, 2016, respectively.
 
 
 
 
 
 
 
(7) Operating return on average common equity is a non-GAAP financial measure. Management uses operating return on average common shareholders' equity as a measure of profitability that focuses on the return to Maiden common shareholders. It is calculated using operating earnings available to common shareholders divided by average Maiden common shareholders' equity. For the three and nine months ended September 30, 2016, the average common shareholders' equity is adjusted for the period the Mandatory Convertible Preference Shares - Series B are outstanding (prior to mandatory conversion date of September 15, 2016).






Maiden Holdings, Ltd.
Supplemental Financial Data - Segment Information
(in thousands of U.S. dollars)
(Unaudited)
For the Three Months Ended September 30, 2016
 
Diversified Reinsurance
 
AmTrust Reinsurance
 
Other
 
Total
Gross premiums written
 
$
186,750

 
$
520,104

 
$

 
$
706,854

Net premiums written
 
$
179,092

 
$
511,561

 
$

 
$
690,653

Net premiums earned
 
$
175,141

 
$
523,137

 
$

 
$
698,278

Other insurance revenue
 
2,345

 

 

 
2,345

Net loss and loss adjustment expenses ("LAE")
 
(132,396
)
 
(334,310
)
 
(45
)
 
(466,751
)
Commission and other acquisition expenses
 
(39,868
)
 
(166,836
)
 
(2
)
 
(206,706
)
General and administrative expenses
 
(9,038
)
 
(759
)
 

 
(9,797
)
Underwriting income (loss)
 
$
(3,816
)
 
$
21,232

 
$
(47
)
 
$
17,369

Reconciliation to net income
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
37,566

Interest and amortization expenses
 
 
 
 
 
 
 
(6,856
)
Amortization of intangible assets
 
 
 
 
 
 
 
(616
)
Foreign exchange and other gains
 
 
 
 
 
 
 
687

Other general and administrative expenses
 
 
 
 
 
 
 
(7,155
)
Income tax expense
 
 
 
 
 
 
 
(199
)
Net income
 
 
 
 
 
 
 
$
40,796

 
 
 
 
 
 
 
 
 
Net loss and LAE ratio(8)
 
74.6
%
 
63.9
%
 
 
 
66.6
%
Commission and other acquisition expense ratio(9)
 
22.5
%
 
31.9
%
 
 
 
29.5
%
General and administrative expense ratio(10)
 
5.1
%
 
0.1
%
 
 
 
2.4
%
Combined ratio(12)
 
102.2
%
 
95.9
%
 
 
 
98.5
%






For the Three Months Ended September 30, 2015
 
Diversified Reinsurance
 
AmTrust Reinsurance
 
Other
 
Total
Gross premiums written
 
$
174,307

 
$
454,194

 
$

 
$
628,501

Net premiums written
 
$
163,710

 
$
435,443

 
$

 
$
599,153

Net premiums earned
 
$
193,207

 
$
465,313

 
$

 
$
658,520

Other insurance revenue
 
2,177

 

 

 
2,177

Net loss and LAE
 
(142,468
)
 
(297,780
)
 
(3,924
)
 
(444,172
)
Commission and other acquisition expenses
 
(51,714
)
 
(146,008
)
 
83

 
(197,639
)
General and administrative expenses
 
(8,218
)
 
(656
)
 

 
(8,874
)
Underwriting income (loss)
 
$
(7,016
)
 
$
20,869

 
$
(3,841
)
 
$
10,012

Reconciliation to net income
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
34,059

Net impairment losses recognized in earnings
 
 
 
 
 
 
 
(1,060
)
Interest and amortization expenses
 
 
 
 
 
 
 
(7,266
)
Amortization of intangible assets
 
 
 
 
 
 
 
(710
)
Foreign exchange and other gains
 
 
 
 
 
 
 
1,427

Other general and administrative expenses
 
 
 
 
 
 
 
(7,579
)
Income tax expense
 
 
 
 
 
 
 
(368
)
Net income
 
 
 
 
 
 
 
$
28,515

 
 
 
 
 
 
 
 
 
Net loss and LAE ratio(8)
 
72.9
%
 
63.9
%
 
 
 
67.2
%
Commission and other acquisition expense ratio(9)
 
26.5
%
 
31.4
%
 
 
 
29.9
%
General and administrative expense ratio(10)
 
4.2
%
 
0.1
%
 
 
 
2.5
%
Combined ratio(12)
 
103.6
%
 
95.4
%
 
 
 
99.6
%









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


For the Nine Months Ended September 30, 2016
 
Diversified Reinsurance
 
AmTrust Reinsurance
 
Other
 
Total
Gross premiums written
 
$
667,388

 
$
1,591,902

 
$

 
$
2,259,290

Net premiums written
 
$
626,522

 
$
1,507,389

 
$

 
$
2,133,911

Net premiums earned
 
$
538,152

 
$
1,413,699

 
$

 
$
1,951,851

Other insurance revenue
 
8,696

 

 

 
8,696

Net loss and LAE
 
(395,718
)
 
(898,703
)
 
(2,940
)
 
(1,297,361
)
Commission and other acquisition expenses
 
(139,895
)
 
(447,604
)
 
(2
)
 
(587,501
)
General and administrative expenses
 
(26,717
)
 
(2,308
)
 

 
(29,025
)
Underwriting income (loss)
 
$
(15,482
)
 
$
65,084

 
$
(2,942
)
 
$
46,660

Reconciliation to net income
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
111,802

Interest and amortization expenses
 
 
 
 
 
 
 
(21,314
)
Accelerated amortization of senior note issuance cost
 
 
 
 
 
 
 
(2,345
)
Amortization of intangible assets
 
 
 
 
 
 
 
(1,846
)
Foreign exchange and other gains
 
 
 
 
 
 
 
6,474

Other general and administrative expenses
 
 
 
 
 
 
 
(20,713
)
Income tax expense
 
 
 
 
 
 
 
(1,206
)
Net income
 
 
 
 
 
 
 
$
117,512

 
 
 
 
 
 
 
 
 
Net loss and LAE ratio(8)
 
72.4
%
 
63.5
%
 
 
 
66.2
%
Commission and other acquisition expense ratio(9)
 
25.6
%
 
31.7
%
 
 
 
30.0
%
General and administrative expense ratio(10)
 
4.8
%
 
0.2
%
 
 
 
2.5
%
Combined ratio(12)
 
102.8
%
 
95.4
%
 
 
 
98.7
%







For the Nine Months Ended September 30, 2015
 
Diversified Reinsurance
 
AmTrust Reinsurance
 
Other
 
Total
Gross premiums written
 
$
631,294

 
$
1,505,642

 
$
(1
)
 
$
2,136,935

Net premiums written
 
$
602,693

 
$
1,423,060

 
$
1

 
$
2,025,754

Net premiums earned
 
$
570,694

 
$
1,274,563

 
$
2

 
$
1,845,259

Other insurance revenue
 
9,408

 

 

 
9,408

Net loss and LAE
 
(417,846
)
 
(811,016
)
 
(7,643
)
 
(1,236,505
)
Commission and other acquisition expenses
 
(152,332
)
 
(399,291
)
 
(55
)
 
(551,678
)
General and administrative expenses
 
(25,976
)
 
(2,200
)
 

 
(28,176
)
Underwriting income (loss)
 
$
(16,052
)
 
$
62,056

 
$
(7,696
)
 
$
38,308

Reconciliation to net income
 
 
 
 
 
 
 
 
Net investment income and realized gains on investment
 
 
 
 
 
 
 
98,587

Net impairment losses recognized in earnings
 
 
 
 
 
 
 
(1,060
)
Interest and amortization expenses
 
 
 
 
 
 
 
(21,796
)
Amortization of intangible assets
 
 
 
 
 
 
 
(2,130
)
Foreign exchange and other gains
 
 
 
 
 
 
 
4,062

Other general and administrative expenses
 
 
 
 
 
 
 
(20,775
)
Income tax expense
 
 
 
 
 
 
 
(1,636
)
Net income
 
 
 
 
 
 
 
$
93,560

 
 
 
 
 
 
 
 
 
Net loss and LAE ratio(8)
 
72.0
%
 
63.6
%
 
 
 
66.7
%
Commission and other acquisition expense ratio(9)
 
26.3
%
 
31.3
%
 
 
 
29.7
%
General and administrative expense ratio(10)
 
4.5
%
 
0.2
%
 
 
 
2.7
%
Combined ratio(12)
 
102.8
%
 
95.1
%
 
 
 
99.1
%

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





logo1a08.jpgExhibit 99.2
PRESS RELEASE
Maiden Holdings Increases Quarterly Dividend on Common Shares by 7.1% and Declares Dividends on Preference Shares

HAMILTON, Bermuda, November 1, 2016 -- Maiden Holdings, Ltd. (NASDAQ: MHLD) today announced that its Board of Directors approved a quarterly cash dividend of $0.15 per share of common stock, an increase of $0.01 per share or 7.1% from the previous rate. The dividend will be payable on January 17, 2017 to shareholders of record as of January 3, 2017.

Maiden’s Board of Directors also approved the following cash dividends on its preference shares that are payable on December 15, 2016 to shareholders of record as of December 1, 2016:

Series A 8.25% Non-Cumulative Preference Shares of $0.515625 per Preference Share
Series C 7.125% Non-Cumulative Preference Shares of $0.445313 per Preference Share

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 June 30, 2016, Maiden had $6.3 billion in assets and shareholders' equity of $1.5 billion.

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