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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: MAY 14, 1998
DATE OF EARLIEST EVENT REPORTED: MAY 14, 1998
STIRLING COOKE BROWN HOLDINGS LIMITED
(Exact name of registrant as specified in its charter)
BERMUDA 000-23427 NOT APPLICABLE
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification Number)
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 May 14, 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 May 14, 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: May 14, 1998.
STIRLING COOKE BROWN HOLDINGS LIMITED
By: /s/ George W. Jones
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George W. Jones
Chief Financial Officer
and Director
EXHIBIT INDEX
Exhibit Description
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99.1 Press Release issued May 14, 1998
EXHIBIT 99.1
[Stirling Cooke Brown Holdings Limited Letterhead]
FOE 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 1ST QUARTER ENDED MARCH 31ST, 1998
Hamilton, Bermuda (May 14th, 1998) - Stirling Cooke Brown Holdings Limited
(NASDAQ: "SCBHF") today reported results for the first quarter ended March
31st, 1998.
Quarter Ended March 31
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1997 1998
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(Dollars in thousands except per share data)
NET INCOME $2,820 $3,987
BASIC EPS
Net Income per share $ 0.35 $ 0.41
Avg. no. of ordinary shares
outstanding - Basic (000's) 8,086 9,823
DILUTED EPS
Net Income per ordinary share $ 0.34 $ 0.40
Avg. no. of ordinary shares
outstanding - Diluted (000's) 8,339 9,867
Mark Cooke, Chairman, President and Chief Executive Officer, said:
"The operating results for the first quarter 1998 were most satisfying,
reflecting the continued growth of the Company's business. Net income for
the first quarter grew by 41% to $4.0 million, compared to $2.8 million in
the first quarter of 1997. Diluted net income per share increased by 18%,
to $0.40, for the first three months of 1998 as compared to $0.34 in 1997."
Risk management fee income increased $2.5 million, or 24%, to $12.8 million
for the quarter compared to $10.3 million for the corresponding quarter in
1997. The Company experienced strong growth in managing general agency fees
which increased $1.2 million in the first three months of 1998, to $3.7
million, from $2.5 million in 1997 reflecting the continued expansion of
the Company's managing general agency network in the Southeastern United
States. The Company's brokerage operations also produced satisfactory
growth, increasing fee income by $0.8 million in the first three months of
1998 to $6.1 million compared to $5.3 million in 1997. Policy issuance fees
earned by Realm National Insurance Company Limited ("Realm National")
increased $0.2 million to $0.4 million in the first three months of 1998
compared to $0.2 million in 1997. Net investment income increased $0.8
million, or 62%, to $2.0 million for the quarter compared to $1.2 million
for 1997. Net premiums earned increased $1.8 million to $4.5 million in the
first three months of 1998 from $2.7 million in 1997. This increase was due
to significant growth in workers' compensation business being written by
Realm National during the first three months of 1998. Overall total
revenues increased $5.6 million, or 39%, to $19.9 million for the first
three months of 1998 compared to $14.3 million in 1997.
Total expenses increased $4.3 million, or 40%, to $15.1 million for the
first three months of 1998 compared to $10.8 million for the corresponding
quarter in 1997. $2.6 million of this increase related to increased
insurance costs. This increase was partly due to the corresponding $1.8
million increase in net premiums earned 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 $1.7 million, or 21%, to $9.7 million for the
first three months of 1998 compared to $8.0 million for 1997 reflecting the
general expansion of the Company as reflected in the Company's growth in
revenues.
Gross premiums written and assumed for the first three months of 1998
increased to $18.4 million compared to $6.1 million in 1997. This increase
in written premium reflects the continued growth in premiums written by
Realm National. Gross premiums written by Realm National in the first three
months of 1998 increased by $10.8 million to $13.6 million compared to $2.8
million 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 in the Southeastern United States.
The Company will pay a second quarter dividend of 3 cents per ordinary
share. The dividend will be payable June 9, 1998 to shareholders of record
on May 26, 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
First Quarter Reported Earnings
Quarter Ended March 31
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1997 1998
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(Dollars in thousands except share data)
INCOME STATEMENT DATA:
Revenues
Risk management fees $ 10,266 $ 12,775
Net premiums earned 2,694 4,486
Net investment income 1,212 1,966
Other income 173 716
Total revenues ------------- --------------
14,345 19,943
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Expenses
Net losses and loss expenses
2,376 4,767
Acquisition costs 360 566
Salaries and benefits 4,058 4,665
General and administration expenses 3,991 5,065
Total expenses ------------ --------------
Total expenses 10,785 15,063
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Income before taxation 3,560 4,880
Taxation 740 893
Net income ------------ --------------
$ 2,820 $ 3,987
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BASIC
Net income per share $ 0.35 $ 0.41
Average number of ordinary shares
outstanding -
- Basic (000's) 8,086 9,823
DILUTED
Net income per share $ 0.34 $ 0.40
Average number of ordinary shares
outstanding -
- Diluted (000's) 8,339 9,867
(a) All per share amounts have been
adjusted to reflect the four for
one stock split which was effected
on June 30, 1997.
Balance Sheet Data:
December 31, 1997 March 31, 1998
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(Dollars in thousands)
Total Assets $ 406,330 $ 446,673
Shareholders' Equity $ 83,103 $ 86,826
