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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: MARCH 16, 1998
DATE OF EARLIEST EVENT REPORTED: MARCH 16, 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 VICTORIA HALL, THIRD FLOO Number)
organization) 11 VICTORIA STREET
AMILTON, 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 March 16, 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 March 16, 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: March 16, 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 March 16, 1998
Exhibit 99.1
[Stirling Cooke Brown Holdings Limited Letterhead]
FOR IMMEDIATE RELEASE Contact: Mark Cooke
George Jones
Tel:441-295-7556
Fax:441-295-9659
Address above
STIRLING COOKE BROWN HOLDINGS LIMITED REPORTS
1997 RESULTS
Hamilton, Bermuda (March 16, 1998) - Stirling Cooke Brown Holdings Limited
(Nasdaq: "SCBHF") today reported results for both the fourth quarter of
1997 and the full year.
Quarter Ended Year Ended
December 31, December 31,
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1996 1997 1996 1997
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(Dollars in thousands, except per share data)
NET INCOME $1,796 $ 3,411 $9,918 $12,993
BASIC EPS
Net income per ordinary
share $0.22 $0.38 $1.22 $1.55
Avg no. of ordinary shares 8,086 9,031 8,104 8,383
outstanding-Basic (000's)
DILUTED EPS
Net income per ordinary
share $0.22 $0.38 $1.19 $1.53
Avg no. of ordinary shares 8,323 9,038 8,317 8,515
outstanding-Diluted (000's)
Mark Cooke, Chairman, President and Chief Executive Officer, said
"The operating results for both the fourth quarter and the full year were
most satisfactory, completing the most eventful and successful year in the
Company's history. Net income for the fourth quarter grew to $3.4 million,
or $.038 per ordinary share, compared to $1.8 million in 1996. For the full
year, 1997 net income increased by 31% to $13.0 million, compared to $9.9
million in 1996."
Diluted earnings per share increased by 29% to $1.53, in 1997 from $1.19 in
1996. Net income for the fourth quarter of 1997 benefited from a $0.5
million profit arising from the disposal of one of the Company's
London-based non core brokering operations. Following completion of the
Initial Public Offering, shareholders equity at December 31, 1997 amounted
to $83.1 million compared to $29.0 million at December 31, 1996. The
Initial Public Offering resulted in Shareholder's equity increasing by
$26.8 million, being the net proceeds from the offering, and $14.5 million,
from a reclassification of ordinary shares to Shareholder's equity
following the cancellation of redemption rights.
Risk management fee income increased $3.0 million, or 33%, to $12.0 million
for the quarter and $11.6 million, or 34%, to $45.7 million for the year
compared to $9.0 million and $34.1 million, respectively, for the quarter
and year in 1996. Net investment income increased $0.4 million, or 30%, to
$1.5 million for the quarter and $2.4 million, or 70%, to $5.8 million for
the year compared to $1.1 million and $3.4 million, respectively, for the
quarter and year in 1996. Overall total revenues increased $4.1 million, or
31%, to $17.3 million for the quarter and $18.2 million, or 39%, to $65.3
million for the year compared to $13.2 million and $47.1 million,
respectively, for the quarter and year in 1996. The growth in revenues
reflects the increased volume of business generated by the Company's
programs.
Total expenses increased $1.8 million, or 16%, to $13.0 million for the
quarter and $14.5 million, or 42%, to $49.4 million for the year compared
to $11.2 million and $34.9 million, respectively, for the quarter and year
in 1996. Total expenses excluding insurance costs increased $2.0 million,
or 24%, to $10.2 million for the quarter and $10.8 million, or 41%, to
$37.1 million for the year compared to $8.2 million and $26.3 million,
respectively, for the quarter and year in 1996 reflecting the general
expansion of the Company as reflected in the Company's growth in revenues.
Gross premiums written and assumed for the year increased to $35.9 million
in 1997 from $16.5 million in 1996. Net premiums earned for the year
increased to $11.8 million in 1997 from $8.8 million in 1996. The increase
in premium reflects the growth in business written by Realm National
Insurance Company Limited during the year.
The Company is continuing the process of integrating Realm National's
underwriting capabilities and completing and expanding Realm National's
business to include workers' compensation and other specialty casualty
insurance lines. Realm National has now completed licensing for Property
Casualty lines in all of the Company's primary states of operation in the
Southeastern United States. During the year, Realm National successfully
extended its writings of workers' compensation business into fifteen
states. The Company has now completed the licensing process in Florida and
Texas, which are important states to the Company, being the base of four of
the Company's Managing General Agency operations.
The Company declared a first quarter dividend of 3 cents per ordinary share
on March 13, 1998. The Dividend will be payable March 30, 1998 to
shareholders of record on March 23, 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
FOURTH QUARTER REPORTED EARNINGS
Quarter Ended Year Ended
December 31, December 31,
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1996 1997 1996 1997
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(Dollars in thousands, except per share data)
INCOME STATEMENT DATA:
Revenues
Risk management fees........ $ 8,961 $11,950 $ 34,061 $45,664
Net premiums earned......... 2,955 2,679 8,754 11,790
Net investment income....... 1,124 1,464 3,405 5,782
Other income................ 118 1,208 841 2,074
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Total revenues........... 13,158 17,301 47,061 65,310
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Expenses
Net losses and loss expenses 2,674 2,523 6,765 10,951
incurred....................
Acquisition costs........... 334 337 1,837 1,344
Salaries and benefits....... 4,236 5,218 13,106 18,503
General and administration 3,996 4,957 13,154 18,594
expenses.................... ------- ------- -------- -------
Total expenses........... 11,240 13,035 34,862 49,392
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Income before taxation......... 1,918 4,266 12,199 15,918
Taxation.................... 122 855 2,281 2,925
Net income............... ------- ------- -------- -------
$ 1,796 $ 3,411 $ 9,918 $12,993
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BASIC
Net income per ordinary share.. $ 0.22 $ 0.38 $ 1.22 $ 1.55
Average number of ordinary shares
outstanding - Basic (000's). 8,086 9,031 8,104 8,383
DILUTED
Net income per ordinary share.. $ 0.22 $ 0.38 $ 1.19 $ 1.53
Average number of ordinary shares
outstanding - Diluted (000's) 8,323 9,038 8,307 8,516
(a) Other income includes $478 net gain on the sale of subsidiaries.
(b) All per share amounts have been adjusted to reflect the four for
one stock split which was effected on June 30, 1997.
Year ended December 31,
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1996 1997
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(Dollars in thousands)
Total Assets $ 235,084 $ 406,330
Shareholders' Equity $ 29,001 $ 83,103
