UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED: SEPTEMBER 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM .................... TO ..................
COMMISSION FILE NUMBER: 0-27662
IPC HOLDINGS, LTD.
(Exact name of registrant as specified in its charter)
BERMUDA NOT APPLICABLE
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
AMERICAN INTERNATIONAL BUILDING, 29 RICHMOND ROAD, PEMBROKE, HM 08, BERMUDA
(Address of principal executive offices)
(441) 298-5100
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes ...X... No ......
The number of outstanding common shares, par value U.S. $0.01 per share, of IPC
Holdings, Ltd. as of November 6, 1997 was 25,017,603.
TOTAL PAGES 14
EXHIBIT INDEX LOCATED ON PAGE 12
1
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
IPC HOLDINGS, LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of United States dollars, except for per share amounts)
<TABLE>
<CAPTION>
As of As of
September 30, 1997 December 31, 1996
(unaudited) (audited)
<S> <C> <C>
ASSETS:
Fixed maturity investments:
Available for sale, at fair market value (Amortized
cost 1997: $447,834; 1996: $254,890) $449,513 $250,992
Held to maturity, at amortized cost (Fair market value
1997: $0; 1996: $229,464) 0 229,057
Equity investments, at fair market value (Cost 1997: $79,545;
1996: 0) 84,044 0
Cash and cash equivalents 18,582 23,797
Reinsurance balances receivable (Related party 1997:
$5,707; 1996: $3,799) 42,572 25,687
Accrued investment income 12,441 15,015
Deferred acquisition costs 4,885 2,354
Prepaid expenses and other assets 2,941 1,179
-------- --------
TOTAL ASSETS $614,978 $548,081
======== ========
LIABILITIES:
Reserve for losses and loss adjustment expenses $27,477 $28,483
Unearned premiums 48,906 21,898
Accounts payable and accrued liabilities (Related party
1997: $829; 1996: $794) 2,393 1,565
-------- --------
TOTAL LIABILITIES 78,776 51,946
-------- --------
SHAREHOLDERS' EQUITY:
Share capital (Common shares outstanding, par value
U.S. $0.01: 1997 - 25,017,103; 1996 - 25,000,000) 250 250
Additional paid in capital 299,525 299,267
Unrealized gain (loss) on investments 6,178 (3,898)
Retained earnings 230,249 200,516
-------- --------
TOTAL SHAREHOLDERS' EQUITY 536,202 496,135
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $614,978 $548,081
======== ========
</TABLE>
See accompanying Notes to Consolidated Financial Statements
2
<PAGE>
IPC HOLDINGS, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Expressed in thousands of United States dollars, except for per share amounts)
<TABLE>
<CAPTION>
Quarter ended September 30, Nine months ended September 30,
1997 1996 1997 1996
(unaudited) (unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C>
REVENUES:
Premiums written $21,721 $22,467 $111,295 $103,017
Change in unearned premiums 6,838 6,416 (27,008) (18,558)
---------- ---------- ---------- ----------
Premiums earned 28,559 28,883 84,287 84,459
Net investment income 7,091 7,414 22,694 21,286
Realized capital gains (losses), net (1,314) (358) (3,490) 2,270
---------- ---------- ---------- ----------
TOTAL REVENUES 34,336 35,939 103,491 108,015
---------- ---------- ---------- ----------
EXPENSES:
Losses and loss adjustment expenses 2,857 12,086 8,039 22,288
Acquisition costs 3,387 3,004 9,336 8,667
General and administrative expenses 1,980 2,013 6,026 7,652
Exchange (gain) loss, net 578 (405) 1,516 (58)
---------- ---------- ---------- ----------
TOTAL EXPENSES 8,802 16,698 24,917 38,549
---------- ---------- ---------- ----------
NET INCOME $25,534 $19,241 $78,574 $69,466
========== ========== ========== ==========
Net income per common share $0.96 $0.74 $2.97 $2.66
Weighted average number of common shares 26,608,829 26,011,495 26,481,640 26,071,231
Dividends declared per common share $0.3175 $0.2875 $1.9525 $0.575
</TABLE>
See accompanying Notes to Consolidated Financial Statements
3
<PAGE>
IPC HOLDINGS, LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in thousands of United States dollars)
<TABLE>
<CAPTION>
Nine months ended September 30,
1997 1996
(unaudited) (unaudited)
<C> <S> <S>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $78,574 $69,466
Adjustments to reconcile net income to cash provided
by operating activities:
Amortization of investment premium, net 1,352 2,650
Realized capital (gains) losses, net 3,490 (2,270)
Changes in, net:
Reinsurance balances receivable (16,885) (10,260)
Accrued investment income 2,574 (810)
Deferred acquisition costs (2,531) (1,764)
Prepaid expenses and other assets (1,762) (1,070)
Reserve for losses and loss adjustment expenses (1,006) 6,814
Unearned premiums 27,008 18,558
Accounts payable and accrued liabilities 828 (1,098)
---------- ----------
91,642 80,216
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equity investments (79,564) 0
Proceeds from sales of equities 22 0
Purchases of fixed maturity investments:
Available for sale (307,277) (292,650)
Held to maturity (17,814) (34,006)
Proceeds from sales of fixed maturity investments:
Available for sale 304,009 261,710
Held to maturity 0 0
Proceeds from maturities of fixed maturity investments:
Available for sale 28,600 0
Held to maturity 23,750 13,000
---------- ----------
(48,274) (51,946)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Additional share capital 258 0
Cash dividends paid to shareholders (48,841) (14,376)
---------- ----------
(48,583) (14,376)
---------- ----------
Net increase (decrease) in cash and cash equivalents (5,215) 13,894
Cash and cash equivalents at beginning of period 23,797 18,109
---------- ----------
Cash and cash equivalents at end of period $18,582 $32,003
========== ==========
</TABLE>
See accompanying Notes to Consolidated Financial Statements
4
<PAGE>
IPC HOLDINGS, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in thousands of United States dollars, except for per share amounts)
(unaudited)
- --------------------------------------------------------------------------------
1. GENERAL:
The consolidated interim financial statements presented herein have been
prepared on the basis of United States generally accepted accounting
principles ("GAAP") and include the accounts of IPC Holdings, Ltd. (the
"Company"), its wholly owned subsidiaries, International Property
Catastrophe Reinsurance Company, Ltd. ("IPC Re") and IPC Re Services,
Limited ("Services" and, together with the Company and IPC Re, "IPC"). In
the opinion of management, these financial statements reflect all
adjustments (consisting of normal recurring accruals) necessary for a fair
presentation of the results of operations for the three and nine month
periods ended September 30, 1997 and 1996, respectively, the balance sheet
at September 30, 1997 and the cash flows for the nine month periods ended
September 30, 1997 and 1996, respectively. These interim consolidated
financial statements should be read in conjunction with the audited
consolidated financial statements for the year ended December 31, 1996. The
results of operations for any interim period are not necessarily indicative
of results for the full year.
2. INVESTMENTS:
In June, 1997, IPC Re purchased shares of stock in all of the companies
which comprise the Standard & Poor's 500 Index ("S. & P. 500"). The number
of shares of stock purchased was such that their weighting within the
Company's portfolio would match the weighting of each stock within the
index. The total amount invested in this manner was approximately $80,000,
and was financed with cash on hand and through the sale of certain fixed
income securities within the "available for sale" portfolio. Equity
investments are carried at market value, and unrealized gains and losses are
included as a separate component of shareholders' equity.
As of June 30, 1997, the Company reclassified the portion of its fixed
income investment portfolio previously classified as "held to maturity" as
"available for sale", as defined in Statement of Financial Accounting
Standard No. 115. All fixed income investments classified as "available for
sale" are carried at market value. Unrealized gains and losses are included
as a separate component of shareholders' equity. As a result of the
reclassification, both total assets and shareholders' equity were reduced by
approximately $500, representing the net unrealized loss on the securities
at the date of the transfer.
3. DIVIDENDS:
On February 28, 1997, the Directors declared a dividend of $0.3175 per share
on March 27, 1997 to shareholders of record on March 11, 1997.
On April 25, 1997, the Directors declared an extraordinary dividend of $1.00
per share, in addition to a quarterly dividend of $0.3175 per share on June
26, 1997 to shareholders of record on June 10, 1997.
On July 28, 1997, the Directors declared a dividend of $0.3175, per share on
September 25, 1997 to shareholders of record on September 9, 1997.
On October 20, 1997, the Directors declared an extraordinary dividend of
$1.00 per share, in addition to a quarterly dividend of $0.3175 per share,
payable on December 18, 1997 to shareholders of record on December 2, 1997.
5
<PAGE>
4. NET INCOME PER SHARE:
Net income per share is computed by dividing net income by the weighted
average number of shares of common stock and common stock equivalents
outstanding during the period. Stock options held by a shareholder of the
Company were considered common stock equivalents and were included in the
weighted average shares outstanding using the treasury stock method. Stock
options granted to employees on February 15, 1996, July 25, 1996 and January
2, 1997 were also considered common stock equivalents for the purpose of
computing net income per share.
In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard No. 128, "Earnings per Share" ("SFAS 128"),
which is effective for financial statements issued for periods ending after
December 15, 1997. SFAS 128 replaces the presentation of primary earnings
per share ("EPS") with a presentation of basic EPS and requires dual
presentation of basic and diluted EPS on the face of the income statement.
SFAS 128 requires restatement of all prior-period EPS data presented.
The Company will comply with the requirements of SFAS 128 beginning with its
annual financial statements for the year ending December 31, 1997. For the
three and nine month periods ended September 30, 1997 and 1996, the Company
would have reported EPS under SFAS 128 as follows:
<TABLE>
<CAPTION>
Quarter ended September 30, Nine months ended September 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Basic EPS $1.02 $0.77 $3.14 $2.78
Diluted EPS $0.96 $0.74 $2.97 $2.66
</TABLE>
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS, QUARTERS ENDED SEPTEMBER 30, 1997 AND 1996
In the quarters ended September 30, 1997 and 1996, IPC Re wrote premiums of
$21.7 million and $22.5 million, respectively, a decrease of 3.3%. IPC Re
had better signings from existing clients and selectively wrote business for
new clients, although these increases were more than offset by rate
reductions in the period, generally in the region of 15%, but as high as 20%
in some cases where risk retentions by ceding companies were higher. In
addition, reinstatement premiums which are accrued when claims are incurred,
were lower in the third quarter of 1997 than in the corresponding period of
1996 because of the low level of claim activity in the current year.
Premiums earned in the three months ended September 30, 1997 were $28.6
million, compared to $28.9 million in the same period in 1996, a decrease of
1.1%.
Net investment income was $7.1 million in the quarter ended September 30,
1997, compared to $7.4 million for the quarter ended September 30, 1996, a
decrease of 4.4%. A shift in part of the investment portfolio to equities,
which took place at the end of the second quarter of 1997 has contributed to
the decrease in investment income. Although such securities do not presently
produce significant investment income for the company, changes in their
market value are reflected in shareholders' equity.
There was a net realized loss from the sale of investments in the quarter
ended September 30, 1997 of $1.3 million, compared to a net loss in the same
period of 1996 of $0.4 million. Net realized gains and losses fluctuate from
period to period, depending on the individual securities sold, as
recommended by IPC Re's investment advisor.
In the three months ended September 30, 1997, incurred losses were $2.9
million, compared to $12.1 million in the corresponding period last year.
There was very little claim activity in the three months ended September 30,
1997, with the majority of the incurred losses related to some property per
risk claims, as well as reserves established for current year marine and
aviation business, offset by reductions from prior year claims. In the third
quarter of 1996, IPC Re incurred losses resulting from Hurricane Fran, which
was the fourth most costly windstorm in U.S history. Accordingly, IPC's loss
and loss expense ratio (the ratio of losses and loss adjustment expenses to
premiums earned) was 41.8% in the third quarter of 1996 compared to 10.0% in
the corresponding period this year.
Acquisition costs incurred, which consist primarily of commissions and
brokerage fees paid to intermediaries for the production of business, were
$3.4 million for the quarter ended September 30, 1997, compared to $3.0
million in the same period of 1996. Certain contracts have been written with
profit commission clauses, which return a portion of the net underwriting
profits generated from those contracts as a commission to the insureds. This
has resulted in an increase in the level of acquisition cost as a percentage
of premiums earned. General and administrative expenses were $2.0 million in
the quarter ended September 30, 1997, which matches the $2.0 million
incurred in the corresponding period in 1996. IPC's expense ratio (the ratio
of acquisition costs plus general and administrative expenses to premiums
earned) was 18.8% for the quarter ended September 30, 1997 compared to 17.4%
for the corresponding period in 1996.
The following table summarizes the loss and loss expense ratio, expense
ratio and combined ratio (sum of loss and loss expense ratio, plus expense
ratio) for the quarter ended September 30, 1997 and 1996, respectively:
Quarter ended September 30,
1997 1996
Loss & loss expense ratio 10.0% 41.8%
Expense ratio 18.8% 17.4%
Combined ratio 28.8% 59.2%
Net income for the quarter ended September 30, 1997 was $25.5 million,
compared to $19.2 million for the corresponding period in 1996, an increase
of 32.7%. Excluding the effects of realized gains and losses arising from
the sale of investments, net operating income for the third quarter of 1997
was $26.8 million, compared to $19.6 million for the third quarter of 1996,
an increase of 37.0%.
7
<PAGE>
RESULTS OF OPERATIONS, NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
In the nine months ended September 30, 1997 and 1996, IPC Re wrote premiums
of $111.3 million and $103.0 million, respectively, an increase of 8.0%. IPC
Re wrote business for new clients and had better signings from existing
clients, although the increase was partly offset by rate reductions in the
period, typically of 10% to 15% but as high as 20%, in some cases. In
addition, IPC Re has not renewed some marine business where premium rates
had fallen to unacceptable levels. New business included $4.1 million of
written premiums from the California Earthquake Authority. Premiums earned
in the nine months ended September 30, 1997 were $84.3 million, compared to
$84.5 million in the same period in 1996, a decrease of 0.2%. Premiums
earned did not grow proportionately to written premiums, primarily because
some programs were written which had policy periods greater than twelve
months.
Net investment income was $22.7 million in the nine months ended September
30, 1997, compared to $21.3 million for the nine months ended September 30,
1996, an increase of 6.6%. This increase was primarily due to the increased
average investment base, which was 12.2% larger, but was partially offset by
the effect of investing part of the investment portfolio in U.S. equities,
which took place at the end of June of this year. Although such securities
do not presently produce significant investment income for the company,
changes in their market value are reflected in shareholders' equity.
There was a net realized loss from the sale of investments in the nine
months ended September 30, 1997 of $3.5 million, compared to a net gain in
the same period of 1996 of $2.3 million. Net realized gains and losses
fluctuate from period to period, depending on the individual securities
sold, as recommended by IPC Re's investment advisor. There have been a
number of transactions in the investment portfolio in 1997 which have
effectively reduced the average modified duration of the portfolio. This
strategy has been employed to assist the reduction of volatility in the
value of the portfolio.
In the nine months ended September 30, 1997, incurred losses were $8.0
million, compared to $22.3 million in the corresponding period last year.
There was comparatively little claim activity in the nine months ended
September 30, 1997, with the majority of the incurred losses related to
reserves established for current year property, marine and aviation
business, offset by reductions from prior year claims. In 1996 there was a
much larger number of catastrophic events, including Hurricane Fran, the
fourth most costly windstorm in U.S. history. Accordingly, IPC's loss and
loss expense ratio (the ratio of losses and loss adjustment expenses to
premiums earned) was 9.6% in the nine months to September 30, 1997, compared
to 26.4% in the corresponding period of 1996.
Acquisition costs incurred, which consist primarily of commissions and
brokerage fees paid to intermediaries for the production of business, were
$9.3 million for the nine months ended September 30, 1997, compared to $8.7
million in the same period of 1996. Certain contracts have been written with
profit commission clauses, which return a portion of the net underwriting
profits generated from those contracts as a commission to the insureds. This
has resulted in an increase in the level of acquisition cost as a percentage
of premiums earned. General and administrative expenses were $6.0 million in
the nine months ended September 30, 1997, in comparison to $7.7 million in
the corresponding period in 1996. In 1996, general and administrative
expenses included $0.4 million in respect of the Company's initial public
offering, and $1.6 million incurred in connection with the Company's bid for
Tempest Reinsurance Company Limited. IPC's expense ratio (the ratio of
acquisition costs plus general and administrative expenses to premiums
earned) was 18.2% for the nine months ended September 30, 1997 compared to
19.3% for the corresponding period in 1996.
The following table summarizes the loss and loss expense ratio, expense
ratio and combined ratio for the nine months ended September 30, 1997 and
1996, respectively:
Nine months ended September 30,
1997 1996
Loss & loss expense ratio 9.6% 26.4%
Expense ratio 18.2% 19.3%
Combined ratio 27.8% 45.7%
Net income for the nine months ended September 30, 1997 was $78.6 million,
compared to $69.5 million for the corresponding period in 1996, an increase
of 13.1%. Excluding the effects of realized gains and losses arising from
the sale of investments, net operating income for the first nine months of
1997 was $82.1 million, compared to $67.2 million for the first nine months
of 1996, an increase of 22.1%.
8
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash flows will continue to rely primarily on cash dividends
and reimbursement of expenses from IPC Re. The dividends that IPC Re may pay
are limited under Bermuda legislation. The Bermuda Insurance Act of 1978 and
subsequent amendments thereto require IPC Re to maintain a minimum solvency
margin and a minimum liquidity ratio. The maximum dividend payable by IPC Re
in accordance with these restrictions as of January 1, 1997 was
approximately $123.5 million.
IPC Re's sources of funds consist of premiums written, investment income and
proceeds from sales and redemptions of investments. Cash is used primarily
to pay losses and loss adjustment expenses, brokerage commissions, excise
taxes, general and administrative expenses and dividends. The potential for
a large catastrophe means that unpredictable and substantial payments may
need to be made within relatively short periods of time. Hence the Company's
cash flows may fluctuate significantly from period to period.
Cash flows from operating activities in the first nine months of 1997 were
$91.6 million compared to $80.2 million in the first nine months of 1996,
which represents an increase of 14.2%.
Net cash flows used in investing activities in the first nine months of 1997
were $48.3 million. In addition, dividends totalling $48.8 million were paid
to shareholders on March 27, 1997, June 26, 1997 and September 25, 1997.
Cash and cash equivalents decreased by $5.2 million in the nine months,
resulting in a balance of $18.6 million at September 30, 1997. At September
30, 1997, 48.5% of IPC's fixed income portfolio (based on market value) was
held in United States Treasury notes and in securities rated AAA, and 43.7%
was held in securities rated AA. The average modified duration of IPC's
fixed income portfolio was 2.6 years. As of June 30, 1997, IPC Re
reclassified the portion of its fixed income investment portfolio previously
classified as "held to maturity" as "available for sale", as defined in
Statement of Financial Accounting Standard No. 115. In June, 1997, IPC Re
purchased shares of stock in all of the companies which comprise the S. & P.
500. The number of shares of stock purchased was such that their weighting
within IPC Re's portfolio would match the weighting of each stock within the
index. The total cost of such investment was approximately $80 million, and
this was financed with cash on hand and through the sale of certain fixed
income securities within the "available for sale" portfolio. IPC's portfolio
does not contain any investments in real estate or mortgage loans.
Management believes that, given the relatively high quality of its
portfolio, adequate market liquidity exists to meet IPC's cash demands.
Neither the Company, IPC Re nor Services any material commitments for
capital expenditures.
NOTE ON FORWARD-LOOKING STATEMENTS
This Report contains certain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934. Forward-looking statements are
statements other than historical information or statements of current
condition. Some forward-looking statements may be identified by use of terms
such as "believes", "anticipates", "intends", or "expects". These
forward-looking statements relate to the plans and objectives of the
Company, for future operations. In light of the risks and uncertainties
inherent in all future projections, the inclusion of forward-looking
statements in this report should not be considered as a representation by
the Company or any other person that the objectives or plans of the Company
will be achieved. Numerous factors could cause the Company's actual results
to differ materially from those in the forward-looking statements, including
the following: (i) the occurrence of catastrophic events with a frequency or
severity exceeding the Company's estimates; (ii) a decrease in the level of
demand for property catastrophe reinsurance, or increased competition owing
to increased capacity of property catastrophe reinsurers; (iii) any lowering
or loss of one of the financial ratings of IPC Re, or the Company's
non-admitted status in United States jurisdictions; (iv) loss of services of
any one of the Company's executive officers; (v) the passage of federal or
state legislation subjecting the Company to supervision or regulation in the
United States; (vi) challenges by insurance regulators in the United States
or the United Kingdom to the Company's claim of exemption from insurance
regulation under current laws; or (vii) a contention by the United States
Internal Revenue Service that the Company or IPC Re is engaged in the
conduct of a trade or business within the U.S. The foregoing review of
important factors should not be construed as exhaustive; the Company
undertakes no obligation to release publicly the results of any future
revisions it may make to forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
9
<PAGE>
PART II-OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
NONE
ITEM 2. CHANGES IN SECURITIES
NONE
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
NONE
ITEM 5. OTHER INFORMATION
NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Unless otherwise indicated, exhibits are incorporated by
reference to the corresponding numbered exhibits to the Company's
Registration Statement on Form S-1 (Registration No. 333-00088).
EXHIBIT
NUMBER DESCRIPTION
3.1 Memorandum of Association of the Company
3.2 Amended and Restated Bye-laws of the Company
3.3 Form of Memorandum of Increase of Share Capital
11.1* Statement regarding Computation of Per Share Earnings
27.1* Financial Data Schedule
* Filed herewith
(b) Reports on Form 8-K
NONE
10
<PAGE>
IPC HOLDINGS, LTD.
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 THEREUNTO DULY AUTHORIZED.
IPC HOLDINGS, LTD.
(REGISTRANT)
DATE NOVEMBER 6, 1997 /s/ John P. Dowling
---------------- -------------------------------------
JOHN P. DOWLING
PRESIDENT AND CHIEF EXECUTIVE OFFICER
DATE NOVEMBER 6, 1997 /s/ John R. Weale
---------------- -------------------------------------
JOHN R. WEALE
VICE PRESIDENT AND CHIEF FINANCIAL
OFFICER
11
<PAGE>
EXHIBIT INDEX
Unless otherwise indicated, exhibits are incorporated by reference to the
corresponding numbered exhibits to the Company's Registration Statement on
Form S-1 (Registration No. 333-00088).
EXHIBIT
NUMBER DESCRIPTION
3.1 Memorandum of Association of the Company
3.2 Amended and Restated Bye-laws of the Company
3.3 Form of Memorandum of Increase of Share Capital
11.1* Statement regarding Computation of Per Share Earnings
27.1* Financial Data Schedule
* Filed herewith
12
<PAGE>
EXHIBIT 11.1
IPC HOLDINGS, LTD. AND SUBSIDIARIES
COMPARISON OF NET INCOME PER COMMON SHARE
(Expressed in thousands of United States dollars, except for per share amounts)
- --------------------------------------------------------------------------------
PRIMARY Nine months ended September 30,
1997 1996
(unaudited) (unaudited)
Net income $78,574 $69,466
Common shares outstanding at January 1, 1997 25,000,000 25,000,000
Common shares outstanding at September 30, 1997 25,017,103 25,000,000
Weighted average common shares outstanding 25,007,601 25,000,000
Dilutive effect of share options 1,414,911 1,071,231
-------------------------------
Total 26,422,512 26,071,231
-------------------------------
Net income per common share $2.97 $2.66
FULLY DILUTED Nine months ended September 30,
1997 1996
(unaudited) (unaudited)
Net income $78,574 $69,466
Common shares outstanding at January 1, 1997 25,000,000 25,000,000
Common shares outstanding at September 30, 1997 25,017,103 25,000,000
Weighted average common shares outstanding 25,007,601 25,000,000
Dilutive effect of share options 1,474,039 1,071,231
-------------------------------
Total 26,481,640 26,071,231
-------------------------------
Net income per common share $2.97 $2.66
13
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE REPORT ON FORM 10-Q OF IPC HOLDINGS, LTD. FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
THE FINANCIAL STATEMENTS (AND THE NOTES THERETO) CONTAINED IN SUCH REPORT.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<DEBT-HELD-FOR-SALE> 449,513
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 84,044
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 533,557
<CASH> 18,582
<RECOVER-REINSURE> 0
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0
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