GREENLIGHT CAPITAL RE, LTD. - FORM 8-K - EX-99.1 - FIRST QUARTER 2011 FINANCIAL RESULTS - May 2, 2011

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8-K - FORM 8-K - GREENLIGHT CAPITAL RE, LTD.form8k.htm
EX-99.2 - LEN GOLDBERG TO RETIRE AS CEO OF GREENLIGHT RE - GREENLIGHT CAPITAL RE, LTD.lenpressrelease.htm
EX-99.3 - GREENLIGHT RE PROMOTES BART HEDGES TO CEO - GREENLIGHT CAPITAL RE, LTD.bartpressrelease.htm
 
 
GREENLIGHT RE ANNOUNCES
FIRST QUARTER 2011 FINANCIAL RESULTS

GRAND CAYMAN, Cayman Islands (May 2, 2011) - Greenlight Capital Re, Ltd. (NASDAQ: GLRE) today announced financial results for the first quarter of 2011.  Greenlight Re reported a net loss of $43.0 million for the first quarter of 2011 compared to a net loss of $12.4 million for the same period in 2010.  The net loss per share was $1.19 for the first quarter of 2011, compared to a net loss per share of $0.34 for the same period in 2010.
 
Fully diluted adjusted book value per share was $20.23 as of March 31, 2011, an 8.8% increase from $18.60 per share as of March 31, 2010.
 
“A number of global events occurred in the first quarter of 2011 which impacted the reinsurance sector.  We reported a small underwriting loss in what remains a challenging environment,” said David Einhorn, Chairman of the Board of Directors of Greenlight Re.  “Our investment portfolio continued to be defensively positioned, and suffered a loss due principally to the underperformance of our short positions.”
 
Other financial and operating highlights for Greenlight Re for the first quarter ended March 31, 2011 include:
 
·
Gross written premiums in the first quarter of 2011 were $100.7 million compared to $66.9 million in the first quarter of 2010, while net earned premiums were $105.2 million, an increase from $55.3 million reported in the first quarter of last year.
 
·  
Gross loss provisions totaling $10.0 million have been booked in respect of estimated losses from first quarter 2011 earthquakes in Japan and New Zealand. The loss, net of additional premiums, was $8.8 million.  The combined ratio was 107.4% in the first quarter of 2011 compared to 92.6% in the first quarter of 2010.
 
·  
A net investment loss of $36.2 million or 3.4% was reported on the investment portfolio in the first quarter of 2011, compared to a net investment loss of $16.8 million, or 1.9%, in the first quarter of 2010.
 
“Our frequency-oriented portfolio was not impacted materially by the large events that resonated throughout the industry,” said Len Goldberg, Chief Executive Officer of Greenlight Re.  “We remain committed to our strategy and are pleased with our underwriting portfolio. We are well positioned to take advantage of any upturn in pricing that may result from recent industry events.”
 
 
 
Conference Call Details
 
Greenlight Re will hold a live conference call to discuss its financial results for the first quarter of 2011 on Tuesday, May 3, 2011 at 9:00 a.m. Eastern time.  The conference call title is Greenlight Capital Re, Ltd. First Quarter 2011 Earnings Call.
 
 
 
 
 
 
To participate, please dial in to the conference call at:
 
U.S. toll free                             1-877-317-6789
International                              1-412-317-6789
 
The conference call can also be accessed via webcast at:
 
https://services.choruscall.com/links/glre110503.html
 
A telephone replay of the call will be available from 11:00 a.m. Eastern time on May 3, 2011 until 9:00 a.m. Eastern time on May 18, 2011.  The replay of the call may be accessed by dialing 1-877-344-7529 (U.S. toll free) or 1-412-317-0088 (international), access code 450270. An audio file of the call will also be available on the Company’s website, www.greenlightre.ky .
 

###

Regulation G
Fully diluted adjusted book value per share is a non-GAAP measure and represents basic adjusted book value per share combined with the impact from dilution of share based compensation including in-the-money stock options as of any period end.  Book value is adjusted by subtracting the amount of the non-controlling interest in joint venture from total shareholders’ equity to calculate adjusted book value.  We believe that long term growth in fully diluted adjusted book value per share is the most relevant measure of our financial performance.  In addition, fully diluted adjusted book value per share may be of benefit to our investors, shareholders and other interested parties to form a basis of comparison with other companies within the reinsurance industry.

Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the U.S. Federal securities laws. These statements involve risks and uncertainties that could cause actual results to differ materially from those contained in forward-looking statements made on behalf of the Company. These risks and uncertainties include the impact of general economic conditions and conditions affecting the insurance and reinsurance industry, the adequacy of our reserves, our ability to assess underwriting risk, trends in rates for property and casualty insurance and reinsurance, competition, investment market fluctuations, trends in insured and paid losses, catastrophes, regulatory and legal uncertainties and other factors described in our annual report on Form 10-K filed with the Securities Exchange Commission.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Greenlight Capital Re, Ltd.
Greenlight Re (www.greenlightre.ky) is an AM Best "A-" (Excellent) rated specialist property and casualty reinsurance company based in the Cayman Islands.  The Company provides a variety of custom-tailored reinsurance solutions to the insurance, risk retention group, captive and financial marketplaces.  Established in 2004, Greenlight Re selectively offers customized reinsurance solutions in markets where capacity and alternatives are limited.  With a focus on deriving superior returns from both sides of the balance sheet, Greenlight Re's assets are managed according to a value-oriented equity-focused strategy that complements the Company's business goal of long-term growth in book value per share.
 
Contact:
Alex Stanton
Stanton Public Relations & Marketing
(212) 780-0701
astanton@stantonprm.com
 
 
 
 
 
 
GREENLIGHT CAPITAL RE, LTD.
 CONDENSED CONSOLIDATED BALANCE SHEETS
 
March 31, 2011 and December 31, 2010
(expressed in thousands of U.S. dollars, except per share and share amounts)
 
   
March 31, 2011 (unaudited)
    
December 31, 2010 (audited)
  
Assets
            
Investments
            
Debt instruments, trading, at fair value
  
$
2,912
    
$
15,610
  
Equity securities, trading, at fair value
    
897,429
      
839,921
  
Other investments, at fair value
    
197,461
      
196,490
  
Total investments
    
1,097,802
      
1,052,021
  
Cash and cash equivalents
    
37,029
      
45,540
  
Restricted cash and cash equivalents
    
938,173
      
977,293
  
Financial contracts receivable, at fair value
    
26,700
      
28,701
  
Reinsurance balances receivable
    
109,421
      
109,567
  
Loss and loss adjustment expenses recoverable
    
14,580
      
11,976
  
Deferred acquisition costs, net
    
87,090
      
87,389
  
Unearned premiums ceded
    
7,809
      
7,424
  
Notes receivable
    
15,367
      
14,205
  
Other assets
    
2,557
      
3,886
  
Total assets
  
$
2,336,528
    
$
2,338,002
  
Liabilities and shareholders’ equity
                
Liabilities
                
Securities sold, not yet purchased, at fair value
  
$
636,675
    
$
726,737
  
Financial contracts payable, at fair value
    
12,648
      
22,746
  
Due to prime brokers
    
401,474
      
273,071
  
Loss and loss adjustment expense reserves
    
219,709
      
186,467
  
Unearned premium reserves
    
227,630
      
234,983
  
Reinsurance balances payable
    
18,845
      
20,164
  
Funds withheld
    
24,562
      
22,887
  
Other liabilities
    
9,331
      
11,786
  
Total liabilities
    
1,550,874
      
1,498,841
  
Shareholders’ equity
                
Preferred share capital (par value $0.10; authorized, 50,000,000; none issued)
    
  —
      
—
  
Ordinary share capital (Class A: par value $0.10; authorized, 100,000,000; issued and outstanding, 30,285,572 (2010: 30,200,835): Class B: par value $0.10; authorized, 25,000,000; issued and outstanding, 6,254,949 (2010: 6,254,949))
    
3,654
      
 
3,646
  
Additional paid-in capital
    
486,566
      
485,555
  
Non-controlling interest in joint venture
    
34,222
      
45,758
  
Retained earnings
    
261,212
      
304,202
  
Total shareholders’ equity
    
785,654
      
839,161
  
Total liabilities and shareholders’ equity
  
$
2,336,528
    
$
2,338,002
  
 
 
 
 
 
 
 
GREENLIGHT CAPITAL RE, LTD.
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
 (UNAUDITED)
 
For the three months ended March 31, 2011 and 2010
(expressed in thousands of U.S. dollars, except per share and share amounts)
 
   
Three months ended
 March 31,
  
   
2011
    
2010
  
Revenues
            
Gross premiums written
  
$
100,739
    
$
66,887
    
Gross premiums ceded
    
(3,476
)
    
(578
)
  
Net premiums written
    
97,263
      
66,309
    
Change in net unearned premium reserves
    
7,894
      
(10,993
)
  
Net premiums earned
    
105,157
      
55,316
    
Net investment loss
    
(36,176
)
    
(16,831
)
  
Other income (expense), net
    
(261
)
    
(154
)
  
Total revenues
    
68,720
      
38,331
    
Expenses
                
Loss and loss adjustment expenses incurred, net
    
65,725
      
29,135
    
Acquisition costs, net
    
42,121
      
16,910
    
General and administrative expenses
    
4,999
      
5,147
    
Total expenses
    
112,845
      
51,192
    
Net loss before non-controlling interest and income tax expense
    
(44,125
)
    
(12,861
)
  
Non-controlling interest in loss of joint venture
    
1,136
      
479
    
Net loss before income tax expense
    
(42,989
)
    
(12,382
)
  
Income tax expense
    
(1
)
    
(9
)
  
Net loss
  
$
(42,990
)
  
$
(12,391
)
  
Loss per share
                
Basic
  
$
(1.19
)
  
$
(0.34
)
  
Diluted
  
$
(1.19
)
  
$
(0.34
)
  
Weighted average number of ordinary shares used in the determination of:
                
Basic
    
36,118,963
      
35,949,107
    
Diluted
    
36,118,963
      
35,949,107
    
 
 
 
 
The following table provides the ratios for the three months ended March 31, 2011 and 2010.

 
   
Three months ended
March 31, 2011
    
Three months ended
March 31, 2010
  
   
Frequency
    
Severity
    
Total
    
Frequency
    
Severity
    
Total
  
Loss ratio
    
57.1
% 
    
139.8
% 
    
62.5
%
    
62.6
%
    
4.4
%
    
52.7
%
Acquisition cost ratio
    
42.0
%
    
11.7
% 
    
40.1
%
    
34.9
%
    
9.7
%
    
30.6
%
Composite ratio
    
99.1
% 
    
151.5
% 
    
102.6
%
    
97.5
%
    
14.1
%
    
83.3
%
Internal expense ratio
                    
4.8
%
                    
9.3
%
Combined ratio
                    
107.4
%
                    
92.6
%

 

GREENLIGHT CAPITAL RE, LTD. Reports