Press Release

James River Group Holdings, Ltd. Announces Second Quarter 2017 Results

08/01/17

SECOND QUARTER 2017 NET INCOME OF $14.5 MILLION -- $0.48 PER DILUTED SHARE, AND ADJUSTED NET OPERATING INCOME OF $14.9 MILLION -- $0.49 PER DILUTED SHARE

GROSS FEE INCOME OF $6.9 MILLION; 99% INCREASE OVER THE SECOND QUARTER OF 2016

8.6% GROWTH IN PRE DIVIDEND TANGIBLE EQUITY PER SHARE SINCE DECEMBER 31, 2016; 13.4% SIX MONTH ANNUALIZED ADJUSTED NET OPERATING RETURN ON AVERAGE TANGIBLE EQUITY

RECORD LOW EXPENSE RATIO OF 26.5%; 4.9 PERCENTAGE POINT IMPROVEMENT OVER SECOND QUARTER OF 2016

PEMBROKE, Bermuda, Aug. 01, 2017 (GLOBE NEWSWIRE) -- James River Group Holdings, Ltd. (NASDAQ:JRVR) today reported second quarter 2017 net income of $14.5 million ($0.48 per diluted share), compared to $14.6 million ($0.49 per diluted share) for the second quarter of 2016.  Adjusted net operating income for the second quarter of 2017 was $14.9 million ($0.49 per diluted share), compared to $13.7 million ($0.46 per diluted share) for the same period in 2016.

   
Earnings Per Diluted Share Three Months Ended
June 30,
  2017   2016
       
Net Income $ 0.48     $ 0.49  
Adjusted Net Operating Income     $ 0.49     $ 0.46  
               

J. Adam Abram, Chairman and Chief Executive Officer of James River Group Holdings, Ltd., commented, “We are pleased with our second quarter results.  Our low expense ratio allows us to maintain our focus on underwriting profit while still growing.  This quarter we also reacted to some negative developments in our business; it is our practice to do so quickly. With our 13.4% annualized operating return on tangible equity based on year-to-date results, we reiterate our guidance of a 12% or greater return.”

Second Quarter 2017 Operating Results

  • Net written premiums of $207.8 million, consisting of the following:
     
  Three Months Ended June 30,  
($ in thousands) 2017   2016   % Change
Excess and Surplus Lines $ 124,197     $ 81,890     52 %
Specialty Admitted Insurance   16,900     11,679     45 %
Casualty Reinsurance 66,727     39,489     69 %
  $ 207,824     $ 133,058     56 %
                     
  • Net earned premiums of $184.1 million, consisting of the following:
     
  Three Months Ended June 30,  
($ in thousands) 2017   2016   % Change
Excess and Surplus Lines $ 117,268     $ 70,565     66 %
Specialty Admitted Insurance   17,760     12,207     45 %
Casualty Reinsurance 49,049     35,783     37 %
  $ 184,077     $ 118,555     55 %
                     
  • The Excess and Surplus Lines segment grew largely due to increases in Commercial Auto (with a focus on the Company’s rideshare business), Environmental and Allied Health divisions, which were partially offset by declines in Manufacturing & Contractors and Excess Casualty;
  • The Specialty Admitted Insurance segment grew largely due to the June 2016 addition of a significant fronting contract, 90% of which is reinsured to third parties;
  • The Casualty Reinsurance Segment grew largely due to a timing difference of a renewal treaty;
  • Accident year loss ratio of 70.3% increased from 68.7% in the prior year quarter due to changes in mix of business, specifically growth in the Commercial Auto division within the Excess and Surplus Lines segment which carries a higher initial loss pick but also a lower expense ratio than the segment as a whole;
  • Combined ratio of 97.7% increased from 96.1% in the prior year quarter principally due to a prior period commission adjustment for three profitable contracts in the Casualty Reinsurance segment.  As a result of this adjustment, other operating expense was increased by $2.0 million, or 4.0 combined ratio points on the segment and 1.1 points on the Company as a whole;
  • Expense ratio of 26.5% improved from 31.4% in the prior year quarter, driven principally by increased net earned premium and fee income, as well as growth in lines of business which carry relatively low expense ratios, partially offset by the commission adjustment in the Casualty Reinsurance segment;
  • Unfavorable reserve development of $1.7 million compared to favorable reserve development of $4.7 million in the prior year quarter (representing a 0.9 point increase and 4.0 point reduction to the Company’s loss ratio in each period, respectively).  The current year quarter's unfavorable development was largely driven by reported losses in the Casualty Reinsurance segment from the 2010 and 2012 treaty years of one reinsurance program which the Company no longer writes and adverse development from canceled programs in the Specialty Admitted segment, offset partially by favorable development in the Excess and Surplus Lines segment and workers' compensation business.  Pre-tax favorable (unfavorable) reserve development by segment was as follows:
   
  Three Months Ended
June 30,
($ in thousands) 2017   2016
Excess and Surplus Lines $ 1,440     $ 3,611  
Specialty Admitted Insurance   (949 )   617  
Casualty Reinsurance (2,206 )   520  
  $ (1,715 )   $ 4,748  
               
  • Gross fee income of $6.9 million, an increase of 99% over the prior year quarter as a result of increased program and fronting volume in the Specialty Admitted Insurance segment and increased fee-for-service business in the Excess and Surplus Lines segment.  This fee income resulted in a 3.7 percentage point reduction to the Company’s second quarter 2017 expense ratio;
  • Net investment income of $13.7 million, an increase of 19% over the prior year quarter, driven by an increased contribution from renewable energy investments which significantly exceeded our expectations.  Further details can be found in the ‘Investment Results’ section below.

Investment Results

Net investment income for the second quarter of 2017 was $13.7 million, which compares to $11.6 million for the same period in 2016.  The increase was principally driven by fair value gains in the Company’s renewable energy portfolio which significantly exceeded our expectations.  The Company’s net investment income consisted of the following:

     
  Three Months Ended
June 30,
 
($ in thousands) 2017   2016   % Change
Renewable Energy Investments $ 1,521     $ (1,451 )   -  
Other Private Investments   838     1,972     (58 )%
All Other Net Investment Income     11,355     11,032     3 %
Total Net Investment Income $ 13,714     $ 11,553     19 %
                     

The Company’s annualized gross investment yield on average fixed maturity and bank loan securities for the three months ended June 30, 2017 was 3.6% (3.5% for the three months ended June 30, 2016) and the average duration of the fixed maturity and bank loan portfolio was 3.4 years at June 30, 2017 (3.7 years at June 30, 2016).

During the second quarter, the Company recognized $307,000 of pre-tax net realized gains ($1.6   million of net realized gains in the same period in 2016) which included $321,000 of realized gains on bank loan participations.

Taxes

The tax rate for the three months ended June 30, 2017 and 2016 was 6.5% and 6.4%, respectively.

Tangible Equity

Tangible equity before dividends increased 9.4% from $472.5 million at December 31, 2016 to $517.0 million at June 30, 2017, largely due to net income of $33.0 million and $10.7 million of unrealized gains, net of taxes, on available-for-sale securities.  Tangible equity after dividends increased 5.7% from $472.5 million at December 31, 2016 to $499.3 million at June 30, 2017.  Tangible equity per common share was $16.94 at June 30, 2017, net of $17.7 million of dividends the Company paid during 2017.  The year-to-date annualized adjusted net operating income return on average tangible equity was 13.4%, which compares to 10.9% for the same period in 2016.

Capital Management

The Company announced that its Board of Directors declared a cash dividend of $0.30 per common share, the same amount as the prior quarter.  This dividend is payable on Friday, September 29, 2017 to all shareholders of record on Monday, September 11, 2017.  James River Group Holdings, Ltd. has paid cumulative dividends, including this upcoming payment, of approximately $140 million since its December 2014 initial public offering.

Conference Call

James River Group Holdings, Ltd. will hold a conference call to discuss its second quarter results tomorrow, August 2, 2017, at 8:00 a.m. Eastern Daylight Time. Investors may access the conference call by dialing (877) 930-8055 Conference ID# 53066366 or via the internet by going to www.jrgh.net and clicking on the “Investor Relations” link. Please visit the website at least 15 minutes early to register and download any necessary audio software. A replay of the call will be available until 11:00 a.m. (Eastern Daylight Time) on September 1, 2017 and can be accessed by dialing (855) 859-2056 or by visiting the company website.

Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, intend, project, anticipate, plan, estimate, guidance or similar words. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements.  Although it is not possible to identify all of these risks and factors, they include, among others, the following: the inherent uncertainty of estimating reserves and the possibility that incurred losses may be greater than our loss and loss adjustment expense reserves; inaccurate estimates and judgments in our risk management which may expose us to greater risks than intended; the potential loss of key members of our management team or key employees and our ability to attract and retain personnel; adverse economic factors; a decline in our financial strength rating resulting in a reduction of new or renewal business; reliance on a select group of brokers and agents for a significant portion of our business and the impact of our potential failure to maintain such relationships; reliance on a select group of customers for a significant portion of our business and the impact of our potential failure to maintain such relationships; a failure of any of the loss limitations or exclusions we employ; potential effects on our business of emerging claim and coverage issues; exposure to credit risk, interest rate risk and other market risk in our investment portfolio; changes in laws or government regulation, including tax or insurance laws and regulations; our ability to obtain reinsurance coverage at reasonable prices or on terms that adequately protect us; losses resulting from reinsurance counterparties failing to pay us on reinsurance claims or insurance companies with whom we have a fronting arrangement failing to pay us for claims; the potential impact of internal or external fraud, operational errors, systems malfunctions or cyber security incidents; our ability to manage our growth effectively; inadequacy of premiums we charge to compensate us for our losses incurred; in the event we do not qualify for the insurance company exception to the passive foreign investment company (“PFIC”) rules and are therefore considered a PFIC, there could be material adverse tax consequences to an investor that is subject to U.S. federal income taxation; the Company or any of its foreign subsidiaries becoming subject to U.S. federal income taxation; failure to maintain effective internal controls in accordance with Sarbanes-Oxley Act of 2002, as amended; and  changes in our financial condition, regulations or other factors that may restrict our subsidiaries’ ability to pay us dividends. Additional information about these risks and uncertainties, as well as others that may cause actual results to differ materially from those in the forward-looking statements, is contained in our filings with the U.S. Securities and Exchange Commission ("SEC"), including our Annual Report on Form 10-K filed with the SEC on March 10, 2017. These forward-looking statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Non-GAAP Financial Measures

In presenting James River Group Holdings, Ltd.’s results, management has included financial measures that are not calculated under standards or rules that comprise accounting principles generally accepted in the United States (“GAAP”). Such measures, including underwriting profit, adjusted net operating income, tangible equity and pre dividend tangible equity per share, are referred to as non-GAAP measures. These non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those measures determined in accordance with GAAP. Reconciliations of such measures to the most comparable GAAP figures are included at the end of this press release.

About James River Group Holdings, Ltd.

James River Group Holdings, Ltd. (or “the Company”) is a Bermuda-based insurance holding company which owns and operates a group of specialty insurance and reinsurance companies founded by members of our management team. The Company operates in three specialty property-casualty insurance and reinsurance segments: Excess and Surplus Lines, Specialty Admitted Insurance and Casualty Reinsurance. The Company tends to focus on accounts associated with small or medium-sized businesses in each of its segments. Each of the Company’s regulated insurance subsidiaries are rated “A” (Excellent) by A.M. Best Company.

Visit James River Group Holdings, Ltd. on the web at www.jrgh.net

James River Group Holdings, Ltd. and Subsidiaries
Condensed Consolidated Balance Sheet Data
(Unaudited)
 
 

 
June 30,
2017
  December 31,
2016
               
  ($ in thousands, except for share data)
ASSETS      
Invested assets:      
Fixed maturity securities, available-for-sale $ 982,133     $ 941,077  
Fixed maturity securities, trading 3,814     5,063  
Equity securities, available-for-sale 81,357     76,401  
Bank loan participations, held-for-investment 241,516     203,526  
Short-term investments 41,348     50,844  
Other invested assets 65,481     55,419  
Total invested assets 1,415,649     1,332,330  
       
Cash and cash equivalents 87,771     109,784  
Accrued investment income 6,802     7,246  
Premiums receivable and agents’ balances 329,519     265,315  
Reinsurance recoverable on unpaid losses 221,553     182,737  
Reinsurance recoverable on paid losses 8,422     2,877  
Deferred policy acquisition costs 69,382     64,789  
Goodwill and intangible assets 220,464     220,762  
Other assets 172,491     160,693  
Total assets $ 2,532,053     $ 2,346,533  
       
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Reserve for losses and loss adjustment expenses $ 1,061,061     $ 943,865  
Unearned premiums 420,997     390,563  
Senior debt 88,300     88,300  
Junior subordinated debt 104,055     104,055  
Accrued expenses 35,123     36,884  
Other liabilities 102,798     89,645  
Total liabilities 1,812,334     1,653,312  
       
Total shareholders’ equity 719,719     693,221  
Total liabilities and shareholders’ equity $ 2,532,053     $ 2,346,533  
       
Tangible equity (a) $ 499,255     $ 472,459  
Tangible equity per common share outstanding (a) $ 16.94     $ 16.15  
Total shareholders’ equity per common share
  outstanding
$ 24.42    

 
$ 23.69  
Common shares outstanding 29,467,647     29,257,566  
Debt (b) to total capitalization ratio 21.1 %   21.7 %
(a) See “Reconciliation of Non-GAAP Measures”.
(b) Includes senior debt and junior subordinated debt.
     


James River Group Holdings, Ltd. and Subsidiaries
Condensed Consolidated Income Statement Data
(Unaudited)
       
  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2017   2016   2017   2016
                               
  ($ in thousands, except for share data)
REVENUES              
Gross written premiums $ 281,475     $ 170,671     $ 505,654     $ 303,742  
Net written premiums 207,824     133,058       365,734     239,959  
               
Net earned premiums 184,077     118,555     338,764     235,685  
Net investment income 13,714     11,553     30,447     22,825  
Net realized investment gains 307     1,619     1,354     2,166  
Other income 4,296     2,784     8,231     5,164  
Total revenues 202,394     134,511     378,796     265,840  
               
EXPENSES              
Losses and loss adjustment expenses 131,084     76,659     236,453     150,165  
Other operating expenses 53,036     39,974     101,929     81,153  
Other expenses 346     91     232     79  
Interest expense 2,224     2,041     4,347     4,215  
Amortization of intangible assets 149     149     298     298  
Total expenses 186,839     118,914     343,259     235,910  
Income before taxes 15,555     15,597     35,537     29,930  
Income tax expense 1,014     1,001     2,546     2,497  
NET INCOME $ 14,541     $ 14,596     $ 32,991     $ 27,433  
ADJUSTED NET OPERATING INCOME (a) $ 14,864     $ 13,665     $ 32,583     $ 26,503  
               
EARNINGS PER SHARE              
Basic $ 0.49     $ 0.50     $ 1.12     $ 0.95  
Diluted $ 0.48     $ 0.49     $ 1.09     $ 0.92  
               
ADJUSTED NET OPERATING INCOME PER SHARE            
Basic $ 0.51     $ 0.47     $ 1.11     $ 0.91  
Diluted $ 0.49     $ 0.46     $ 1.07     $ 0.89  
               
Weighted-average common shares outstanding:              
Basic 29,406,877     29,035,512     29,348,557     28,994,260  
Diluted 30,307,099     29,825,914     30,317,585     29,784,083  
Cash dividends declared per common share $ 0.30     $ 0.20     $ 0.60     $ 0.40  
               
Ratios:              
Loss ratio 71.2 %   64.7 %   69.8 %   63.7 %
Expense ratio 26.5 %   31.4 %   27.7 %   32.3 %
Combined ratio 97.7 %   96.1 %   97.5 %   96.0 %
Accident year loss ratio 70.3 %   68.7 %   70.3 %   67.7 %
(a) See "Reconciliation of Non-GAAP Measures".
           


James River Group Holdings, Ltd. and Subsidiaries
Segment Results
               
EXCESS AND SURPLUS LINES              
               
  Three Months Ended
June 30,
      Six Months Ended
June 30,
   
  2017   2016   % Change   2017   2016   % Change
                                         
($ in thousands)      
Gross written premiums $ 138,004     $ 97,427     41.6 %   $ 246,999     $ 179,535     37.6 %
Net written premiums $ 124,197     $ 81,890     51.7 %   $ 221,168     $ 153,425     44.2 %
                       
Net earned premiums $ 117,268     $ 70,565     66.2 %   $ 211,117     $ 136,070     55.2 %
Losses and loss adjustment expenses (86,521 )   (46,061 )   87.8 %   (153,089 )   (86,724 )   76.5 %
Underwriting expenses (19,018 )   (14,721 )   29.2 %   (37,499 )   (30,359 )   23.5 %
Underwriting profit (a), (b) $ 11,729     $ 9,783     19.9 %   $ 20,529     $ 18,987     8.1 %
                       
Ratios:                      
Loss ratio 73.8 %   65.3 %       72.5 %   63.7 %    
Expense ratio 16.2 %   20.9 %       17.8 %   22.3 %    
Combined ratio 90.0 %   86.1 %       90.3 %   86.0 %    
Accident year loss ratio 75.0 %   70.4 %       74.7 %   69.6 %    
                       
(a) See "Reconciliation of Non-GAAP Measures".                    
(b) Underwriting results include fee income of $4.2 million and $2.7 million for the three months ended June 30, 2017 and 2016, respectively, and $8.1 million and $5.0 million for the respective six month periods. These amounts are included in “Other income” in our Condensed Consolidated Income Statements.


SPECIALTY ADMITTED INSURANCE              
  Three Months Ended
June 30,
      Six Months Ended
June 30,
   
  2017   2016   % Change   2017   2016   % Change
                                         
($ in thousands)      
Gross written premiums $ 76,771     $ 34,201     124.5 %   $ 149,235     $ 62,888     137.3 %
Net written premiums $ 16,900     $ 11,679     44.7 %   $ 34,959     $ 24,725     41.4 %
                       
Net earned premiums $ 17,760     $ 12,207     45.5 %   $ 34,013     $ 23,612     44.0 %
Losses and loss adjustment expenses (11,867 )   (7,480 )   58.6 %   (21,848 )   (14,080 )   55.2 %
Underwriting expenses (5,340 )   (4,602 )   16.0 %   (10,770 )   (8,932 )   20.6 %
Underwriting profit (a), (b) $ 553     $ 125     342.4 %   $ 1,395     $ 600     132.5 %
                       
Ratios:                      
Loss ratio 66.8 %   61.3 %       64.2 %   59.6 %    
Expense ratio 30.1 %   37.7 %       31.7 %   37.8 %    
Combined ratio 96.9 %   99.0 %       95.9 %   97.5 %    
Accident year loss ratio 61.5 %   66.3 %       61.6 %   63.6 %    
                       
(a) See "Reconciliation of Non-GAAP Measures".                    
(b) Underwriting results include fee income of $2.7 million and $742,000 for the three months ended June 30, 2017 and 2016, respectively, and $4.7 million and $1.6 million for the respective six month periods.


CASUALTY REINSURANCE              
  Three Months Ended
June 30,
      Six Months Ended
June 30,
   
  2017   2016   % Change   2017   2016   % Change
                                         
($ in thousands)      
Gross written premiums $ 66,700     $ 39,043     70.8 %   $ 109,420     $ 61,319     78.4 %
Net written premiums $ 66,727     $ 39,489     69.0 %   $ 109,607     $ 61,809     77.3 %
                       
Net earned premiums $ 49,049     $ 35,783     37.1 %   $ 93,634     $ 76,003     23.2 %
Losses and loss adjustment expenses (32,696 )   (23,118 )   41.4 %   (61,516 )   (49,361 )   24.6 %
Underwriting expenses (18,376 )   (12,459 )   47.5 %   (33,048 )   (26,102 )   26.6 %
Underwriting (loss) profit (a) $ (2,023 )   $ 206     -     $ (930 )   $ 540     -  
                       
Ratios:                      
Loss ratio 66.7 %   64.6 %       65.7 %   64.9 %    
Expense ratio 37.4 %   34.8 %       35.3 %   34.3 %    
Combined ratio 104.1 %   99.4 %       101.0 %   99.3 %    
Accident year loss ratio 62.2 %   66.1 %       63.5 %   65.6 %    
                       
(a) See "Reconciliation of Non-GAAP Measures".                    


RECONCILIATION OF NON-GAAP MEASURES

Underwriting Profit

The following table reconciles the underwriting profit (loss) by individual operating segment and for the entire Company to consolidated income before taxes. We believe that these measures are useful to investors in evaluating the performance of our Company and its operating segments because our objective is to consistently earn underwriting profits.  We evaluate the performance of our operating segments and allocate resources based primarily on underwriting profit (loss) of operating segments.  Our definition of underwriting profit (loss) of operating segments and underwriting profit (loss) may not be comparable to that of other companies.

  Three Months Ended
June 30,
  Six Months Ended
June 30,
  2017   2016   2017   2016
  (in thousands)
Underwriting profit (loss) of the operating segments:              
Excess and Surplus Lines $ 11,729     $ 9,783     $ 20,529     $ 18,987  
Specialty Admitted Insurance 553     125     1,395     600  
Casualty Reinsurance (2,023 )   206     (930 )   540  
Total underwriting profit of operating segments 10,259     10,114     20,994     20,127  
Other operating expenses of the Corporate and Other segment (6,095 )   (5,475 )   (12,556 )   (10,727 )
Underwriting profit (a) 4,164     4,639     8,438     9,400  
Net investment income 13,714     11,553     30,447     22,825  
Net realized investment gains 307     1,619     1,354     2,166  
Other income and expenses (257 )   (24 )   (57 )   52  
Interest expense (2,224 )   (2,041 )   (4,347 )   (4,215 )
Amortization of intangible assets (149 )   (149 )   (298 )   (298 )
Consolidated income before taxes $ 15,555     $ 15,597     $ 35,537     $ 29,930  
               
(a)  Included in underwriting results for the three months ended June 30, 2017 and 2016 is fee income of $6.9 million and $3.5 million, respectively, and $12.8 million and $6.6 million for the respective six month periods.
 

Adjusted Net Operating Income

We define adjusted net operating income as net income excluding net realized investment gains and losses, as well as non-operating expenses including those that relate to due diligence costs for various merger and acquisition activities, professional fees related to the filing of a registration statement for the sale of our securities, and severance costs associated with terminated employees. We use adjusted net operating income as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance.  Adjusted net operating income should not be viewed as a substitute for net income calculated in accordance with GAAP, and our definition of adjusted net operating income may not be comparable to that of other companies.

Our income before taxes and net income for the three and six months ended June 30, 2017 and 2016, respectively, reconciles to our adjusted net operating income as follows:

  Three Months Ended June 30,
  2017   2016
  Income Before Taxes   Net Income   Income Before Taxes   Net Income
                               
  (in thousands)
Income as reported $ 15,555     $ 14,541     $ 15,597     $ 14,596  
Net realized investment gains (307 )   (248 )   (1,619 )   (1,257 )
Other expenses (a) 346     368     91     127  
Interest expense on leased building the Company is deemed to own for accounting purposes 313     203     306     199  
Adjusted net operating income $ 15,907     $ 14,864     $ 14,375     $ 13,665  
               
  Six Months Ended June 30,
  2017   2016
  Income Before Taxes   Net Income   Income Before Taxes   Net Income
                               
  (in thousands)
Income as reported $ 35,537     $ 32,991     $ 29,930     $ 27,433  
Net realized investment gains (1,354 )   (1,082 )   (2,166 )   (1,564 )
Other expenses (a) 232     268     79     119  
Interest expense on leased building the Company is deemed to own for accounting purposes 625     406     792     515  
Adjusted net operating income $ 35,040     $ 32,583     $ 28,635     $ 26,503  
               
(a)  Other expenses in 2017 were primarily legal and other professional services associated with the Company's May 2017 secondary offering.
 

Tangible Equity (per Share) and Pre Dividend Tangible Equity (per Share)

We define tangible equity as shareholders’ equity less goodwill and intangible assets (net of amortization).  Our definition of tangible equity may not be comparable to that of other companies, and it should not be viewed as a substitute for shareholders’ equity calculated in accordance with GAAP.  We use tangible equity internally to evaluate the strength of our balance sheet and to compare returns relative to this measure.  The following table reconciles shareholders’ equity to tangible equity for June 30, 2017, December 31, 2016, and June 30, 2016 and reconciles tangible equity to tangible equity before dividends for June 30, 2017.

  June 30, 2017   December 31, 2016   June 30, 2016
($ in thousands, except for share data) Equity   Equity per share   Equity   Equity per share   Equity   Equity per share
Shareholders' equity $ 719,719     $ 24.42     $ 693,221     $ 23.69     $ 729,898     $ 25.09  
Goodwill and intangible assets 220,464     7.48     220,762     7.54     221,061     7.60  
Tangible equity $ 499,255     $ 16.94     $ 472,459     $ 16.15     $ 508,837     $ 17.49  
Dividends to shareholders for the six months ended June 30, 2017 17,728     0.60                  
Pre dividend tangible equity $ 516,983     $ 17.54                  

 

For more information contact:

Kevin Copeland
Investor Relations
441-278-4573
InvestorRelations@jrgh.net

James River Group Holdings, Ltd.