DAYTONA BEACH, Fla., and TAMPA, Fla., July 10 /PRNewswire-FirstCall/ -- Brown & Brown, Inc. (NYSE: BRO) announced net income for the second quarter of 2002 of $21,401,000, or $0.31 per share, an earnings per share increase of 55.0% over the $12,420,000, or $0.20 per share, reported for the quarter ended June 30, 2001. Total revenue for the quarter ended June 30, 2002 was $114,903,000, compared with 2001 second-quarter revenue of $89,933,000, an increase of 27.8%.
Total revenue for the six months ended June 30, 2002 was $225,939,000, compared with first-half 2001 revenue of $179,343,000, up 26.0%. Net income for the first six months of 2002 was $41,564,000 versus $25,296,000 during the same period in 2001, an increase of 64.3%. Net income per share for the six months ended June 30, 2002 was $0.62, versus the $0.40 per share posted during the comparable 2001 period, an increase of 55.0%.
By way of comparison, the Company's cash earnings per share for the second quarter of 2002 were $0.40, versus $0.30 in the second quarter of 2001. Cash earnings per share for the first six months of 2002 were $0.79, compared with $0.59 for the same period in 2001. (Cash earnings per share are calculated as net income plus amortization, depreciation and non-cash compensation stock grants, divided by diluted weighted average shares outstanding.)
Commenting on the Company's results, J. Hyatt Brown, Chairman, President and CEO, said, "Our people continue to grind out new business and earnings each and every day, with the unrelenting fortitude and determination that is a hallmark of our culture. The ongoing implementation of our long-term growth strategy, of constant and consistent increases in our earnings per share, is evidenced by our thirty-eighth consecutive quarter of 15% or greater net income per share growth. At the same time, we continue to see the same consistent firming of insurance renewal pricing increases as experienced during the past few quarters. In general, property and casualty renewal rates continue to escalate in many areas, however, we are also finding that the pricing for some products, such as workers' compensation in Florida, remains flat."
Brown & Brown, Inc. and its subsidiaries provide a broad range of insur- ance and reinsurance products and services, as well as risk management, employee benefit administration, and managed health care services through offices located across the United States. The Company is ranked by Business Insurance magazine as the nation's eighth largest independent insurance intermediary organization. Our Web address is www.bbinsurance.com.
This press release may contain certain statements relating to future results which are forward-looking statements. These statements are not his- torical facts, but instead represent only the Company's belief regarding future events, many of which, by their nature, are inherently uncertain and outside of the Company's control. It is possible that the Company's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, are contained in the Company's filings with the Securities and Exchange Commission. Some factors include: general economic conditions around the country; downward commercial property and casualty premium pres- sures; the competitive environment; the integration of the Company's opera- tions with those of businesses or assets the Company has acquired or may acquire in the future and the failure to realize the expected benefits of such integration; and the potential occurrence of a disaster that affects certain areas of the States of Arizona, Florida and/or New York, where significant portions of the Company's business are concentrated. All forward-looking statements included in this press release are made only as of the date of this press release, and we do not undertake any obligation to publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or of which we hereafter become aware.
Brown & Brown, Inc.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30 June 30
2002 2001 2002 2001
REVENUES
Commissions and fees $114,262 $87,908 $225,088 $175,478
Investment income 943 1,092 1,298 2,309
Other income (loss) (302) 933 (447) 1,556
Total revenues 114,903 89,933 225,939 179,343
EXPENSES
Employee compensation
and benefits 55,604 46,705 111,006 93,590
Other operating
expenses 16,431 14,200 31,357 27,629
Amortization 3,490 4,164 6,759 7,586
Depreciation 1,745 1,757 3,460 3,441
Interest 1,158 1,381 2,394 3,130
Non-cash compensation
stock grants 785 497 1,561 985
Total expenses 79,213 68,704 156,537 136,361
Income before income
taxes and minority
interest 35,690 21,229 69,402 42,982
Income taxes 13,741 8,429 26,720 16,896
Minority interest,
net of tax 548 380 1,118 790
Net income $ 21,401 $12,420 $ 41,564 $ 25,296
Net income per share:
Basic $0.31 $0.20 $0.63 $0.41
Diluted $0.31 $0.20 $0.62 $0.40
Weighted average number
of shares outstanding:
Basic 68,327 62,348 66,324 62,307
Diluted 69,231 63,042 67,212 62,957
Brown & Brown, Inc.
Internal Growth Schedule
Core Commissions and Fees (1)
Three-Months ended June 30, 2002
(In thousands)
(unaudited)
Quarter Quarter Total Total Less Internal
Ended Ended Net Net Acquisition Net
6/30/02 6/30/01 Change Growth % Revenues Growth %
Florida Retail $ 33,087 $28,351 $4,736 16.7% $667 14.4%
National Retail 30,504 23,124 7,380 31.9% 6,576 3.5%
Western Retail 18,383 14,727 3,656 24.8% 2,935 4.9%
Total Retail 81,974 66,202 15,772 23.8% 10,178 8.4%
Professional
Programs 3,715 3,430 285 8.3% -- 8.3%
Special Programs 7,994 5,612 2,382 42.4% 814 27.9%
Total Programs 11,709 9,042 2,667 29.5% 814 20.5%
Brokerage 5,778 2,581 3,197 123.9% 1,769 55.3%
TPA Services 6,980 6,235 745 11.9% 329 6.7%
Total Core Commissions
and Fees (1) $106,441 $84,060 $22,381 26.6% $13,090 11.1%
(1) Total Commissions and Fees excluding profit sharing contingency revenues and divestitures.
Brown & Brown, Inc.
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31,
2002 2001
(Unaudited)
ASSETS
Cash and cash equivalents $153,899 $ 16,048
Restricted cash 87,272 50,328
Short-term investments 507 451
Premiums, commissions and fees receivable 117,575 101,449
Other current assets 13,895 8,230
Total current assets 373,148 176,506
Fixed assets, net 25,333 25,544
Goodwill, net 131,562 112,974
Other intangible assets, net 168,077 155,337
Investments 11,189 8,983
Deferred income taxes 1,812 1,519
Other assets 7,006 7,874
Total assets $718,127 $488,737
LIABILITIES
Premiums payable to insurance companies $179,373 $151,649
Premium deposits and credits due customers 15,812 12,078
Accounts payable 30,899 10,085
Accrued expenses 35,118 31,930
Current portion of long-term debt 17,669 20,855
Total current liabilities 278,871 226,597
Long-term debt 69,304 78,195
Other liabilities 5,543 6,308
Minority Interest 1,951 2,352
SHAREHOLDERS' EQUITY
Common stock, par value $0.10 per share;
authorized 140,000 shares; issued and
outstanding, 68,437 at 2002 and 63,194
at 2001 6,843 6,319
Additional paid-in capital 161,762 11,181
Retained earnings 188,710 153,392
Accumulated other comprehensive income 5,143 4,393
Total shareholders' equity 362,458 175,285
Total liabilities and shareholders' equity $718,127 $488,737
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SOURCE Brown & Brown, Inc.
Web site: http: //www.bbinsurance.com
CONTACT: Cory T. Walker, Chief Financial Officer, Brown & Brown, +1-386-239-7250