Filed Pursuant to Rule 424(b)(3)
Registration No. 333-32995
Prospectus Supplement No. 1
to
Prospectus Dated August 10, 1998
_________________
STIRLING COOKE BROWN HOLDINGS LIMITED
Ordinary Shares
(par value $0.25 per share)
__________________
See "Risk Factors" beginning on page 10 of the Prospectus dated August 10, 1998
for certain considerations relevant to an investment in the Ordinary Shares.
The Ordinary Shares are quoted in the Nasdaq National Market under the symbol
"SCBHF".
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
_____________________
This Prospectus Supplement, together with the Prospectus dated August 10,
1998, has been prepared for and is to be used by Goldman, Sachs & Co. in
connection with offers and sales of the Ordinary Shares related to
market-making transactions, at prevailing market prices, related prices or
negotiated prices. The Company will not receive any of the proceeds of such
sales. Goldman, Sachs & Co. may act as a principal or agent in such
transactions. See "Plan of Distribution".
GOLDMAN, SACHS & CO.
____________________
The date of this Prospectus Supplement is August 10, 1998.
This Prospectus Supplement is intended to be read in conjunction with
the Prospectus dated August 10, 1998 (the "Prospectus"). Capitalized terms
used in this Prospectus Supplement and not otherwise defined herein have the
same meanings as in the Prospectus.
On August 10, 1998, the Company filed with the Securities and Exchange
Commission a Current Report on Form 8-K, a copy of which is attached hereto
and deemed to be a part hereof.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of Report: August 10, 1998
Date of Earliest Event Reported: August 10, 1998
STIRLING COOKE BROWN HOLDINGS LIMITED
(Exact name of registrant as specified in its charter)
Bermuda 000-23427 Not Applicable
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification
incorporation or Number)
organization)
Victoria Hall, Third Floor
11 Victoria Street
Hamilton, HM 11, Bermuda
(Address of principal executive offices)
Registrant's telephone number, including area code: (441) 295-7556
Item 5. Other Events.
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On August 10, 1998, the registrant issued the press release filed as
Exhibit 99.1 hereto.
Item 7. Financial Statements and Exhibits.
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Exhibit Description
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99.1 Press Release issued August 10, 1998
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on behalf of the
undersigned hereunto duly authorized.
Dated: August 10, 1998.
STIRLING COOKE BROWN HOLDINGS LIMITED
By: /s/ George W. Jones
-----------------------------
George W. Jones
Chief Financial Officer
and Director
EXHIBIT INDEX
Exhibit Description
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99.1 Press Release issued August 10, 1998
Exhibit 99.1
[Stirling Cooke Brown Holdings Limited Letterhead]
FOR IMMEDIATE RELEASE Contact: Mark Cooke
George Jones
Tel: 441-295-7556
Fax: 441-295-7201
Address above
STIRLING COOKE BROWN HOLDINGS LIMITED REPORTS
RESULTS FOR 2nd QUARTER ENDED JUNE 30TH, 1998
Hamilton, Bermuda (August 10th, 1998) - Stirling Cooke Brown Holdings
Limited (NASDAQ: "SCBHF") today reported results for the second quarter
ended June 30th, 1998.
Three months ended Six months ended
June 30th June 30th June 30th June 30th
1997 1998 1997 1998
---- ---- ---- ----
(Dollars in thousands except per share data)
Net Income $3,172 $4,025 $5,992 $8,012
Basic EPS
Net Income per share $ 0.40 $ 0.41 $ 0.75 $ 0.82
Avg. no. of ordinary shares
outstanding - Basic (000's) 7,928 9,823 8,007 9,823
Diluted EPS
Net Income per ordinary share $ 0.39 $ 0.41 $0.72 $ 0.81
Avg. no. of ordinary shares
outstanding - Diluted (000's) 8,196 9,884 8,268 9,875
Mark Cooke, Chairman, President and Chief Executive Officer, said:
"The operating results for the second quarter 1998 were most satisfying,
once again reflecting the continued growth of the Company's business. Net
income grew by 27% in the second quarter to $4.0 million, and grew by 33%
to $8.0 million for the first six months of 1998, as compared to $3.2
million and $6.0 million, respectively, in 1997".
Diluted net income per share increased by 5% for the second quarter of 1998
to $0.41 and increased by 10% to $0.82 for the first six months of 1998, as
compared to $0.39 and $0.75, respectively, in 1997.
Risk management fees increased $2.4 million, or 20% to $14.1 million for
the quarter and by $4.8 million or 22% to $26.8 million for the first six
months of 1998 compared to the corresponding periods in 1997. The Company
continued to experience good growth in managing general agency fees which
increased $0.9 million in the second quarter of 1998, to $3.5 million and
by $2.1 million to $7.2 million for the first six months of 1998 compared
to the corresponding periods in 1997. This growth reflected the continued
expansion of the Company's managing general agency network primarily in the
Southeastern United States. The Company's brokerage operations also
produced satisfactory growth, increasing fee income by $0.4 million in the
second quarter of 1998 to $6.9 million and by $1.1 million to $12.9 million
for the first six months of 1998 compared to the corresponding periods in
1997. Policy issuance fees earned by Realm National Insurance Company
Limited ("Realm National") increased $0.4 million to $0.6 million in the
second quarter of 1998 and by $0.6 million to $1.0 million for the first
six months of 1998 compared to the corresponding periods in 1997.
Net premiums earned increased $2.1 million to $5.1 million in the second
quarter of 1998 and by $3.9 million to $9.6 million for the first six
months of 1998 compared to the corresponding periods in 1997. This increase
was due to significant growth in workers' compensation business being
written by Realm National. Gross premiums written and assumed for the
second quarter of 1998 increased $8.2 million to $15.4 million, and
increased $20.3 million to $33.7 million for the first six months of 1998,
as compared to $7.2 and $13.4 million, respectively, in 1997. Gross
premiums written by Realm National in the second quarter of 1998 increased
by $9.0 million to $12.5 million and by $19.8 million to $26.1 million for
the first half of 1998 compared to the corresponding periods in 1997. The
growth in premiums written was primarily workers' compensation business
generated by the Company's M.G.A. network and independent M.G.A.s based
primarily in the Southeastern United States.
Net investment income increased $0.4 million to $2.1 million for the second
quarter of 1998 and by $1.2 million to $4.1 million for the first six
months of 1998 compared to the corresponding periods in 1997. Overall total
revenues increased $5.5 million, or 33% to $22.1 million for the second
quarter of 1998 and by $12 million or 36% to $42.0 million for the first
six months of 1998 compared to the corresponding periods in 1997.
Total expenses increased $4.2 million, or 33%, to $17.0 million for the
second quarter of 1998 and by $8.5 million or 36% to $32.1 million for the
first six months of 1998 compared to the corresponding periods in 1997.
$2.6 million of the increase in the second quarter and $5.2 million of the
increase for the first six months related to increased insurance costs
which was primarily due to a corresponding $2.1 million and $3.9 million
increase in net premiums earned in the respective periods and partly due to
adverse loss development on one particular program that covers bodily
injury and property risks in the construction industry. Total expenses
excluding insurance costs increased $1.6 million, or 17%, to $11.3 million
for the second quarter of 1998 and $3.3 million or 19% for the first six
months of 1998 as compared to the corresponding periods in 1998, reflecting
the general expansion of the Company as reflected in the Company's growth
in revenues.
The Company will pay a third quarter dividend of 3 cents per ordinary
share. The dividend will be payable on September 3, 1998 to shareholders of
record on August 20, 1998.
Stirling Cooke Brown Holdings Limited is a Bermuda holding company which,
through its subsidiaries, provides risk management services and products
predominantly to U.S. based small and mid-sized businesses, including those
seeking cost-effective alternatives to traditional commercial insurance for
certain of their risk exposures. In addition, the Company arranges
reinsurance for its products as well as for those offered by independent
insurance carriers and reinsurance companies active in the workers'
compensation, occupational accident and health and casualty insurance
markets.
Stirling Cooke Brown Holdings Limited Ordinary Shares are traded on the
NASDAQ market under the symbol "SCBHF".
STIRLING COOKE BROWN HOLDINGS LIMITED
SECOND QUARTER REPORTED EARNINGS
THREE MONTHS ENDED SIX MONTHS ENDED JUNE
JUNE 30 30
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1997 1998 1997 1998
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(DOLLARS IN THOUSANDS EXCEPT SHARE DATA)
INCOME STATEMENT DATA:
Revenues
Risk management fees......... $ 11,736 $ 14,065 $ 22,002 $ 26,840
Net premiums earned.......... 3,027 5,118 5,721 9,604
Net investment income........ 1,666 2,093 2,878 4,059
Other income................. 216 816 389 1,532
----------- ----------- ---------- ----------
Total revenues............ 16,645 22,092 30,990 42,035
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Expenses
Net losses and loss expenses
incurred..................... 2,794 4,954 5,170 9,721
Acquisition costs............ 361 794 721 1,360
Salaries and benefits........ 4,811 6,047 8,869 10,712
General and administration
expenses..................... 4,853 5,230 8,844 10,295
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Total expenses............ 12,819 17,025 23,604 32,088
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Income before taxation.......... 3,826 5,067 7,386 9,947
Taxation..................... 654 1,042 1,394 1,935
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Net income $ 3,172 $ 4,025 $ 5,992 $ 8,012
=========== =========== ========== ==========
BASIC
Net income per share $ 0.40 $ 0.41 $ 0.75 $ 0.82
Average number of ordinary
shares outstanding - Basic
(000's) 7,928 9,823 8,007 9,823
DILUTED
Net income per share $ 0.39 $ 0.41 $ 0.72 $ 0.81
Average number of ordinary
shares outstanding - Diluted
(000's) 8,196 9,884 8,268 9,875
BALANCE SHEET DATA:
December 31, 1997 June 30, 1998
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Total Assets $ 406,330 $ 501,675
Shareholders' Equity $ 83,103 $ 90,542
