ROCK
ISLAND, Ill., March 4,
2024 /PRNewswire/ -- ICC Holdings, Inc. (NASDAQ:
ICCH) (the Company), parent company of Illinois Casualty Company, a
regional, multi-line property and casualty insurance company
focusing exclusively on the food and beverage industry, today
reported unaudited results for the fourth quarter and twelve months
ended December 31, 2023.
FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2023 – FINANCIAL
RESULTS
Net earnings totaled $3,058,000,
or $1.04 per share, for the fourth
quarter of 2023, compared to net earnings of $3,078,000, or $1.05 per share, for the fourth quarter of 2022.
For the twelve months ended December 31,
2023, the Company reported net earnings of $4,454,000, or $1.51 per share, compared to a net loss of
$582,000, or $0.19 per share, for the same period in 2022. The
change for the twelve months ended December
31, 2023, was driven by increased writings and positive
changes in net unrealized gains and losses on equity securities.
Book value per share increased to $21.35 at December 31,
2023, from $19.16 at
December 31, 2022. This increase in
book value is due to net income and the improvement in the market
value of our fixed income holdings.
Direct premiums written increased by $3,059,000, or 14.5%, to $24,091,000 for the fourth quarter of 2023,
from $21,032,000 for the same period
in 2022. For the twelve months ended December 31, 2023, direct premiums written
increased by $10,264,000, or 12.4%,
to $92,991,000 compared to
$82,727,000 for the same period in
2022. The growth for both periods is primarily due to rate
increases. Net premiums earned increased by $1,896,000, or 10.4%, to $20,188,000 for the three months ended
December 31, 2023, from $18,292,000 for the same period in 2022. Net
premiums earned increased by $6,660,000, or 9.6%, to $75,717,000 for the twelve months ended
December 31, 2023, from $69,057,000 for the same period in 2022. The
increase in net premiums earned is driven by the increased
premium writings in 2023.
For the fourth quarter of 2023, the Company ceded to reinsurers
$2,637,000 of earned premiums,
compared to $2,435,000 of earned
premiums for the fourth quarter of 2022. For the twelve months
ended December 31, 2023, the Company
ceded earned premiums of $10,703,000,
compared to $9,512,000 for the same
period in 2022. This increase is a result of increased direct
earned premiums.
Net investment income increased by $244,000, or 21.5%, to $1,381,000 for the fourth quarter of 2023, as
compared to $1,137,000 for the same
period in 2022. For the twelve months ended December 31, 2023, net investment income
increased by $1,145,000, or 28.4%, to
$5,179,000 from $4,034,000 for the same period in 2022. The
increase is the result of both an increase in the interest
rates earned on the investments in our portfolio and an
increase in the overall size of our investment holdings.
Net unrealized gains on equity securities decreased $404,000 year over year to $1,071,000 in gains for the fourth quarter of
2023, compared to gains of $1,475,000
for the same period in 2022. The decrease in the fourth quarter was
driven by a planned reduction in our equity holdings, which
resulted in $404,000 of unrealized
gains becoming realized. Net unrealized gains and losses on equity
securities increased $6,056,000 year
over year to $1,350,000 in gains as
of December 31, 2023, compared
to a loss of $4,706,000 as of
December 31, 2022.
Losses and settlement expenses increased by $1,089,000, or 10.7%, to $11,231,000 for the fourth quarter of 2023, from
$10,142,000 for the same period in
2022. This increase was largely driven by prior year accident
development on Liquor Liability claims and Business Owner's
Liability claims. Losses and settlement expenses
increased by $3,397,000, or
7.6%, to $47,930,000
for the twelve months ended December
31, 2023, from $44,533,000 for
the same period in 2022. This increase was driven in large part by
prior year development of Liquor Liability claims.
Policy acquisition costs and other operating expenses increased
by $902,000, or 13.3%, to
$7,662,000 for the fourth quarter of
2023, from $6,760,000 for the same
period in 2022. Policy acquisition costs and other operating
expenses increased by $3,590,000, or
14.4%, to $28,486,000 for the
twelve months ended December 31,
2023, from $24,896,000 for the
same period in 2022. The change in both periods is due to
increased commissions stemming from business growth and
agency profitability.
Total assets increased by $18,904,000, or 9.8%, from $192,162,000 on December
31, 2022, to $211,066,000 on
December 31, 2023. This increase was
partially due to $8.7M in positive
cash flow from operations, which allowed the Company to increase
the investment portfolio. The investment portfolio, which consists
of fixed income securities, common stocks, preferred stocks,
property held for investment, and other invested assets, increased
by $13,567,000, or 10.7%, from
$127,325,000 on December 31, 2022, to $140,892,000 on December
31, 2023. These increases are a result of improved market
conditions impacting both our fixed income and equity
portfolios.
Total equity increased by $6,590,000, or 10.9%, from $60,441,000 as of December
31, 2022, to $67,031,000 as of
December 31, 2023. The main drivers
of this increase was current earnings and improved market
conditions favorably impacting our fixed income portfolio.
FOURTH QUARTER ENDED DECEMBER 31,
2023 – FINANCIAL RATIOS
The Company's losses and settlement expense ratio (defined as
losses and settlement expenses divided by net premiums earned) was
55.6% and 63.3% for the fourth quarter and twelve months ended
December 31, 2023, compared with
55.4% and 64.5% for the same periods in 2022.
The expense ratio (defined as the amortization of deferred
policy acquisition costs and underwriting and administrative
expenses divided by net premiums earned) was 38.0% and 37.6% for
the fourth quarter and twelve months ended December 31, 2023, compared to 37.0% and 36.1%
for the same periods in 2022.
The Company's GAAP combined ratio (defined as the sum of the
losses and settlement expense ratio and the expense ratio) was
93.6% and 100.9% for the fourth quarter and
twelve months ended December 31,
2023, compared to 92.4% and 100.6% for the same periods in
2022.
MANAGEMENT COMMENTARY
"We finished 2023 with a strong fourth quarter. The underwriting
measures shared in the Q3 Earnings Release have taken hold,
particularly with Liquor Liability, leading to a lower overall loss
and settlement expense ratio of 63.3% in 2024. We
finished the year with significantly fewer open claims in
comparison to the last four years, which should lead to a lower
loss and settlement expense ratio in 2024. Inflationary pressures
on operating expenses continued resulting in a slightly higher
expense ratio and a combined ratio of 100.9%, which is comparable
to the 100.6% from 2022.
"Improved investment market conditions in 2023 drove our net
unrealized gains on fixed maturity securities and stocks up
considerably from 2022. In addition, increased rates and holdings
expanded our net investment income in 2023 and we expect that trend
to continue in 2024.
"We continue to be optimistic for 2024 as our core insurance
business remains strong, our investments are performing well,
and the new states we are entering will enhance premium growth in
2024," stated Arron Sutherland,
President and Chief Executive Officer.
ABOUT ICC HOLDINGS, INC.
ICC Holdings, Inc. is a vertically integrated company created to
facilitate the growth, expansion, and diversification of its
subsidiaries to maximize value to its stakeholders. The group of
companies consolidated under ICC Holdings, Inc. engages in diverse,
yet complementary business activities, including property and
casualty insurance, real estate, and information technology.
The Company's common shares trade on the NASDAQ Capital Market
under the ticker symbol "ICCH". For more information about ICC
Holdings, visit http://ir.iccholdingsinc.com.
FORWARD-LOOKING STATEMENTS
This press release, and oral statements made regarding the
subjects of this release, contains forward-looking statements,
within the meaning of the Private Securities Litigation Reform Act
of 1995, or the Reform Act, which may include, but are not limited
to, statements regarding the Company's, plans, objectives,
expectations, and intentions and other statements contained in this
press release that are not historical facts, including statements
identified by words such as "believe," "plan," "seek," "expect,"
"intend," "estimate," "anticipate," "will," and similar
expressions. All statements addressing operating performance,
events, or developments that the Company expects or anticipates
will occur in the future, including statements relating to revenue
and profit growth; future responses to and effects of the COVID-19
pandemic, including their effects on claims activity and the
business operations of the Company and of our current and potential
customers; new theories of liability; judicial, legislative,
regulatory, and other governmental developments, including, but not
limited to, liability related to business interruption claims
related to COVID-19; litigation tactics and developments; product
and segment expansion; regulatory approval in connection with
expansion; downturns and volatility in global economies and equity
and credit markets, including as a result of inflation and supply
chain disruptions and continued labor shortages; interest rates and
changes in rates could adversely affect the Company's business and
profitability; and market share, as well as statements expressing
optimism or pessimism about future operating results, are
forward-looking statements within the meaning of the Reform Act.
The forward-looking statements are based on management's current
views and assumptions regarding future events and operating
performance, and are inherently subject to significant business,
economic, and competitive uncertainties and contingencies and
changes in circumstances, many of which are beyond the Company's
control. The statements in this press release are made as of the
date of this press release, even if subsequently made available by
the Company on its website or otherwise. The Company does not
undertake any obligation to update or revise these statements to
reflect events or circumstances occurring after the date of this
press release.
Although the Company does not make forward-looking statements
unless it believes it has a reasonable basis for doing so, the
Company cannot guarantee their accuracy. The foregoing factors,
among others, could cause actual results to differ materially from
those described in these forward-looking statements. For a list of
other factors which could affect the Company's results, see the
Company's filings with the Securities and Exchange Commission,
"Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations," including
"Forward-Looking Information," set forth in the Company's
Annual Report on Form 10-K for the year ended December 31, 2022. No undue reliance should be
placed on any forward-looking statements.
ICC Holdings, Inc.
and Subsidiaries
Condensed
Consolidated Balance Sheets
|
|
|
|
|
|
As of
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
Investments and
cash:
|
|
|
|
|
|
|
|
|
Fixed maturity
securities (amortized cost of $119,336,041 at 12/31/2023 and
$104,580,681 at 12/31/2022)
|
|
$
|
110,955,697
|
|
|
$
|
93,388,971
|
|
Common stocks at fair
value
|
|
|
12,191,621
|
|
|
|
20,438,907
|
|
Preferred stocks at
fair value
|
|
|
2,896,296
|
|
|
|
2,772,605
|
|
Other invested
assets
|
|
|
8,937,409
|
|
|
|
4,722,137
|
|
Property held for
investment, at cost, net of accumulated depreciation of $682,402 at
12/31/2023 and $609,282 at 12/31/2022
|
|
|
5,910,864
|
|
|
|
6,002,233
|
|
Cash and cash
equivalents
|
|
|
1,632,063
|
|
|
|
3,139,986
|
|
Total investments and
cash
|
|
|
142,523,950
|
|
|
|
130,464,839
|
|
Accrued investment
income
|
|
|
915,156
|
|
|
|
791,812
|
|
Premiums and
reinsurance balances receivable, net of allowances for credit
losses of $130,000 at 12/31/2023 and $50,000 at
12/31/2022
|
|
|
37,233,433
|
|
|
|
31,270,460
|
|
Ceded unearned
premiums
|
|
|
755,099
|
|
|
|
947,851
|
|
Reinsurance balances
recoverable on unpaid losses and settlement expenses, net of
allowances for credit losses of $82,000 at 12/31/2023
and $0 at 12/31/2022
|
|
|
12,736,579
|
|
|
|
13,610,295
|
|
Income taxes -
current
|
|
|
120,355
|
|
|
|
22,042
|
|
Income taxes -
deferred
|
|
|
2,647,636
|
|
|
|
3,296,688
|
|
Deferred policy
acquisition costs, net
|
|
|
8,552,459
|
|
|
|
7,167,036
|
|
Property and
equipment, at cost, net of accumulated depreciation of $6,990,076
at 12/31/2023 and $6,590,602 at 12/31/2022
|
|
|
3,325,322
|
|
|
|
3,313,719
|
|
Other Assets, net of
allowances for credit losses of $57,000 at 12/31/2023 and $0 at
12/31/2022
|
|
|
2,256,286
|
|
|
|
1,277,469
|
|
Total assets
|
|
$
|
211,066,275
|
|
|
$
|
192,162,211
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Unpaid losses and
settlement expenses
|
|
$
|
71,919,585
|
|
|
$
|
67,614,063
|
|
Unearned
premiums
|
|
|
47,259,637
|
|
|
|
40,527,182
|
|
Reinsurance balances
payable
|
|
|
1,132,301
|
|
|
|
1,405,337
|
|
Corporate
debt
|
|
|
15,000,000
|
|
|
|
15,000,000
|
|
Accrued
expenses
|
|
|
7,504,566
|
|
|
|
6,072,020
|
|
Other
liabilities
|
|
|
1,218,895
|
|
|
|
1,102,678
|
|
Total
liabilities
|
|
|
144,034,984
|
|
|
|
131,721,280
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
Common
stock1
|
|
|
35,000
|
|
|
|
35,000
|
|
Treasury stock, at
cost2
|
|
|
(5,710,324)
|
|
|
|
(5,463,535)
|
|
Additional paid-in
capital
|
|
|
33,330,846
|
|
|
|
33,119,125
|
|
Accumulated other
comprehensive (loss), net of tax
|
|
|
(6,790,801)
|
|
|
|
(8,841,517)
|
|
Retained
earnings
|
|
|
48,041,575
|
|
|
|
43,701,233
|
|
Less: Unearned
Employee Stock Ownership Plan shares at cost3
|
|
|
(1,875,005)
|
|
|
|
(2,109,375)
|
|
Total
equity
|
|
|
67,031,291
|
|
|
|
60,440,931
|
|
Total liabilities and
equity
|
|
$
|
211,066,275
|
|
|
$
|
192,162,211
|
|
|
1 Par
value $0.01; authorized: 2023 – 10,000,000 shares and
2022 – 10,000,000 shares; issued: 2023 –
3,500,000 shares and 2022 – 3,500,000 shares;
outstanding: 2023 – 3,138,976 and 2022 –
3,153,741 shares
|
2 2023 – 361,024
shares and 2022 – 346,259 shares
|
3 2023 – 187,498
shares and 2022 – 210,935 shares
|
ICC Holdings, Inc.
and Subsidiaries
Condensed
Consolidated Statements of Earnings and Comprehensive Earnings
(Unaudited)
|
|
|
|
For the Three-Months
Ended
|
|
|
|
December
31,
|
|
|
|
2023
|
|
|
2022
|
|
Net premiums
earned
|
|
$
|
20,188,241
|
|
|
$
|
18,291,583
|
|
Net investment
income
|
|
|
1,380,911
|
|
|
|
1,137,327
|
|
Net realized investment
gains
|
|
|
404,481
|
|
|
|
88,870
|
|
Net unrealized gains on
equity securities
|
|
|
1,071,317
|
|
|
|
1,475,087
|
|
Other income
|
|
|
76,231
|
|
|
|
87,143
|
|
Consolidated
revenues
|
|
|
23,121,181
|
|
|
|
21,080,010
|
|
Losses and settlement
expenses
|
|
|
11,230,999
|
|
|
|
10,142,399
|
|
Policy acquisition
costs and other operating expenses
|
|
|
7,662,496
|
|
|
|
6,760,016
|
|
Interest expense on
debt
|
|
|
46,409
|
|
|
|
46,409
|
|
General corporate
expenses
|
|
|
168,003
|
|
|
|
213,121
|
|
Total
expenses
|
|
|
19,107,907
|
|
|
|
17,161,945
|
|
Earnings before income
taxes
|
|
|
4,013,274
|
|
|
|
3,918,065
|
|
Income tax expense
(benefit):
|
|
|
|
|
|
|
|
|
Current
|
|
|
676,800
|
|
|
|
448,656
|
|
Deferred
|
|
|
278,444
|
|
|
|
391,904
|
|
Total income tax
expense
|
|
|
955,244
|
|
|
|
840,560
|
|
Net earnings
|
|
$
|
3,058,030
|
|
|
$
|
3,077,505
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
earnings, net of tax
|
|
|
4,243,947
|
|
|
|
608,594
|
|
Comprehensive
earnings
|
|
$
|
7,301,977
|
|
|
$
|
3,686,099
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
Basic net earnings per
share
|
|
$
|
1.04
|
|
|
$
|
1.05
|
|
Diluted:
|
|
|
|
|
|
|
|
|
Diluted net earnings
per share
|
|
$
|
1.03
|
|
|
$
|
1.05
|
|
|
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
2,947,623
|
|
|
|
2,939,218
|
|
Diluted
|
|
|
2,967,409
|
|
|
|
2,939,218
|
|
ICC Holdings, Inc.
and Subsidiaries
Condensed
Consolidated Statements of Earnings and Comprehensive Earnings
(Unaudited)
|
|
|
|
For the
Twelve-Months Ended
|
|
|
|
December
31,
|
|
|
|
2023
|
|
|
2022
|
|
Net premiums
earned
|
|
$
|
75,717,108
|
|
|
$
|
69,057,343
|
|
Net investment
income
|
|
|
5,179,343
|
|
|
|
4,034,228
|
|
Net realized investment
gains
|
|
|
672,857
|
|
|
|
874,470
|
|
Net unrealized gains
(losses) on equity securities
|
|
|
1,350,417
|
|
|
|
(4,706,405)
|
|
Other income
|
|
|
236,945
|
|
|
|
420,202
|
|
Consolidated
revenues
|
|
|
83,156,670
|
|
|
|
69,679,838
|
|
Losses and settlement
expenses
|
|
|
47,929,630
|
|
|
|
44,532,729
|
|
Policy acquisition
costs and other operating expenses
|
|
|
28,486,101
|
|
|
|
24,896,120
|
|
Interest expense on
debt
|
|
|
184,122
|
|
|
|
196,070
|
|
General corporate
expenses
|
|
|
784,307
|
|
|
|
776,747
|
|
Total
expenses
|
|
|
77,384,160
|
|
|
|
70,401,666
|
|
Earnings (loss) before
income taxes
|
|
|
5,772,510
|
|
|
|
(721,828)
|
|
Income tax
expense:
|
|
|
|
|
|
|
|
|
Current
|
|
|
1,184,243
|
|
|
|
984,897
|
|
Deferred
|
|
|
134,165
|
|
|
|
(1,125,063)
|
|
Total income tax
expense (benefit)
|
|
|
1,318,408
|
|
|
|
(140,166)
|
|
Net earnings
(loss)
|
|
$
|
4,454,102
|
|
|
$
|
(581,662)
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
Basic net earnings
(loss) per share
|
|
$
|
1.51
|
|
|
$
|
(0.19)
|
|
Diluted:
|
|
|
|
|
|
|
|
|
Diluted net earnings
(loss) per share
|
|
$
|
1.50
|
|
|
$
|
(0.19)
|
|
|
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
2,946,892
|
|
|
|
3,032,155
|
|
Diluted
|
|
|
2,966,679
|
|
|
|
3,032,155
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss)
|
|
$
|
4,454,102
|
|
|
$
|
(581,662)
|
|
Other comprehensive
earnings (loss), net of tax
|
|
|
|
|
|
|
|
|
Unrealized gains and
losses on fixed maturity securities:
|
|
|
|
|
|
|
|
|
Unrealized holdings
gains (losses) arising during the period, net of income tax expense
(benefit) of $532,787 in 2023 and $(3,128,757) in 2022
|
|
$
|
2,004,296
|
|
|
$
|
(11,770,084)
|
|
Reclassification
adjustment for losses included in net income, net of income tax
(benefit) of $(12,340) in 2023 and $(2,270) in 2022
|
|
|
46,420
|
|
|
|
8,540
|
|
Total other
comprehensive earnings (loss)
|
|
|
2,050,716
|
|
|
|
(11,761,544)
|
|
Comprehensive earnings
(loss)
|
|
$
|
6,504,818
|
|
|
$
|
(12,343,206)
|
|
Contact Info: Arron K. Sutherland, President and CEO
Illinois Casualty Company
(309) 732-0105
arrons@ilcasco.com
225 20th Street, Rock Island,
IL 61201
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SOURCE ICC Holdings, Inc.