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Form 8-K GREENLIGHT CAPITAL RE, For: May 04

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May 4, 2015 4:52 PM EDT




UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 

FORM 8-K

 
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
May 4, 2015
Date of report (Date of earliest event reported) 

GREENLIGHT CAPITAL RE, LTD.
(Exact name of registrant as specified in charter)
 
 
 
 
Cayman Islands
(State or other jurisdiction of incorporation)
001-33493
(Commission file number)
N/A
(IRS employer identification no.)
 
 
 
65 Market Street, Suite 1207,
Jasmine Court, Camana Bay,
P.O. Box 31110
Grand Cayman, Cayman Islands
(Address of principal executive offices)
 
KY1-1205
(Zip code)
 
(345) 943-4573
(Registrant’s telephone number, including area code)
 
Not Applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))







Item 2.02 Results of Operations and Financial Condition
 
On May 4, 2015, Greenlight Capital Re, Ltd. (the "Registrant") issued a press release announcing its financial results for the first quarter ended March 31, 2015. A copy of the press release is attached hereto as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.
 
In accordance with general instruction B.2 to Form 8-K, the information set forth in this Item 2.02 (including Exhibit 99.1) shall be deemed “furnished” and not “filed” with the Securities and Exchange Commission for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, (the "Exchange Act"), or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. 


Item 5.07 Submission of Matters to a Vote of Security Holders

The Registrant held its 2015 Annual General Meeting of Shareholders on April 29, 2015. Pursuant to the Registrant’s Third Amended and Restated Articles of Association (the "Articles of Association"), each Class A ordinary share is entitled to one vote per share and each Class B ordinary share is entitled to ten votes per share; provided, however, that the total voting power of the issued and outstanding Class B ordinary shares shall not exceed 9.5% of the total voting power of all issued and outstanding ordinary shares. Since, on the record date of the 2015 Annual Meeting of Shareholders, the total voting power of the issued and outstanding Class B ordinary shares exceeded 9.5% of the total voting power, the voting power of the Class B ordinary shares was reduced with the excess being allocated to the Class A ordinary shares in accordance with Article 53 of the Articles of Association. In addition, the Articles of Association provide that no holder of Class A ordinary shares shall be permitted to acquire an amount of shares which would cause any person to own 9.9% or more of the total voting power of the issued and outstanding ordinary shares. Therefore, the excess voting power from the Class B ordinary shares allocated to the Class A ordinary shares and the Class A ordinary shares allocated to other Class A ordinary shares were restricted to 9.9% for each holder of Class A ordinary shares with the excess being allocated to the other holders of Class A ordinary shares in accordance with Article 54 of the Articles of Association.

The following tables summarize the final voting results after adjustment of the voting power. For more information on the following proposals, see the Registrant's Proxy Statement dated March 6, 2015.

(1) The following eight persons were elected Directors of the Registrant by shareholders to serve for the term expiring at the Annual General Meeting of Shareholders in 2016.
Director
 
Class A For
 
Class A Against
 
Class A Abstain
 
Class A broker non-votes
 
Class B For
 
Class B Against
 
Class B Abstain
 
Class B broker non-votes
 
Alan Brooks
 
48,336,246

 
691,081

 
95,184

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
David Einhorn
 
47,089,804

 
1,966,492

 
66,216

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Leonard Goldberg
 
45,374,491

 
3,673,885

 
74,135

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Barton Hedges
 
48,135,624

 
912,238

 
74,649

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Ian Isaacs
 
48,060,768

 
966,736

 
95,007

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Frank Lackner
 
48,175,037

 
873,277

 
74,198

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Bryan Murphy
 
48,308,391

 
720,303

 
93,818

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Joseph Platt
 
48,128,902

 
921,556

 
72,054

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 









(2) The following eight persons were elected Directors of Greenlight Reinsurance, Ltd. by shareholders to serve for the term expiring at the Annual General Meeting of Shareholders in 2016.
Director
 
Class A For
 
Class A Against
 
Class A Abstain
 
Class A broker non-votes
 
Class B For
 
Class B Against
 
Class B Abstain
 
Class B broker non-votes
 
Alan Brooks
 
48,685,419

 
270,140

 
166,952

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
David Einhorn
 
47,344,473

 
1,641,012

 
137,026

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Leonard Goldberg
 
47,457,444

 
1,520,192

 
144,875

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Barton Hedges
 
48,487,082

 
488,256

 
147,174

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Ian Isaacs
 
48,582,138

 
374,555

 
165,818

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Frank Lackner
 
48,646,180

 
332,139

 
144,192

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Bryan Murphy
 
48,655,104

 
301,821

 
165,587

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Joseph Platt
 
48,650,332

 
328,494

 
143,686

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 

(3) The following five persons were elected Directors of Greenlight Reinsurance Ireland, Ltd. by shareholders to serve for the term expiring at the Annual General Meeting of Shareholders in 2016.
Director
 
Class A For
 
Class A Against
 
Class A Abstain
 
Class A broker non-votes
 
Class B For
 
Class B Against
 
Class B Abstain
 
Class B broker non-votes
 
Philip Harkin
 
48,680,897

 
271,063

 
170,552

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Barton Hedges
 
48,585,751

 
390,405

 
146,355

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Frank Lackner
 
48,674,689

 
303,630

 
144,192

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Caryl Traynor
 
48,679,651

 
299,993

 
142,867

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 
Brendan Tuohy
 
48,677,954

 
274,825

 
169,733

 
20,633,020

 
8,904,133

 
—

 
—

 
—

 

(4) The shareholders ratified the appointment of BDO USA, LLP to serve as the independent auditors of the Registrant for the fiscal year ending December 31, 2015.
 
 
Class A
 
Class B
 
For
 
69,476,547

 
8,904,133

 
Against
 
210,946

 
—

 
Abstain
 
68,038

 
—

 
Broker non-votes
 
—

 
—

 

(5) The shareholders ratified the appointment of BDO Cayman Ltd. to serve as the independent auditors of Greenlight Reinsurance, Ltd. for the fiscal year ending December 31, 2015.
 
 
Class A
 
Class B
 
For
 
69,464,767

 
8,904,133

 
Against
 
225,085

 
—

 
Abstain
 
65,680

 
—

 
Broker non-votes
 
—

 
—

 








(6) The shareholders ratified the appointment of BDO, Registered Auditors in Ireland, to serve as the independent auditors of Greenlight Reinsurance Ireland, Ltd. for the fiscal year ending December 31, 2015.
 
 
Class A
 
Class B
 
For
 
69,467,912

 
8,904,133

 
Against
 
218,453

 
—

 
Abstain
 
69,167

 
—

 
Broker non-votes
 
—

 
—

 

(7) The shareholders approved the compensation of the Registrant's executive officers pursuant to the compensation disclosure rules of the Securities and Exchange Commission, or "say-on-pay" votes.
 
 
Class A
 
Class B
 
For
 
47,392,159

 
8,904,133

 
Against
 
1,486,678

 
—

 
Abstain
 
243,675

 
—

 
Broker non-votes
 
20,633,020

 
—

 



Item 9.01 Financial Statements and Exhibits
 
(d) Exhibits
 
99.1 Earnings press release, "GREENLIGHT RE ANNOUNCES FIRST QUARTER 2015 FINANCIAL RESULTS", dated May 4, 2015, issued by the Registrant.




SIGNATURE
 
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.

 
 
GREENLIGHT CAPITAL RE, LTD.
 
(Registrant)
 
 
 
 
By:
/s/ Tim Courtis              
 
Name:
Tim Courtis
 
Title:
Chief Financial Officer
 
Date:
May 4, 2015






GREENLIGHT RE ANNOUNCES
FIRST QUARTER 2015 FINANCIAL RESULTS

GRAND CAYMAN, Cayman Islands - May 4, 2015 - Greenlight Capital Re, Ltd. (NASDAQ: GLRE) today announced financial results for the first quarter ended March 31, 2015. Greenlight Re reported a net loss of $24.0 million for the first quarter of 2015, compared to a net loss of $8.9 million for the same period in 2014. The net loss per share for the first quarter of 2015 was $0.65, compared to a net loss per share of $0.24 for the same period in 2014.

Fully diluted adjusted book value per share was $30.09 as of March 31, 2015, a 9.0% increase from $27.61 per share as of March 31, 2014.

“We are pleased with the new business and relationships we developed during the first quarter,”
said Bart Hedges, Chief Executive Officer of Greenlight Re. “At the same time, we continue to maintain our underwriting discipline in this competitive environment.”

Financial and operating highlights for Greenlight Re for the first quarter ended March 31, 2015 include:

•
Gross written premiums of $129.7 million, an increase from $118.9 million in the first quarter of 2014; net earned premiums were $94.8 million, a decrease from $111.7 million reported in the prior-year period.

•
Underwriting income of $4.7 million, compared to underwriting income of $6.5 million in the first quarter of 2014.

•
A net investment loss of 1.8% on Greenlight Re's investment portfolio managed by DME Advisors, LP compared to a net investment loss of 0.7% in the first quarter of 2014.

“Our investment portfolio had a small loss during the quarter. We became more defensively positioned through the quarter as we anticipate earnings headwinds to manifest this year,” stated David Einhorn, Chairman of the Board of Directors. “We are encouraged by the increase in underwriting activity during the quarter as we prudently develop new relationships.”
 
Conference Call Details

Greenlight Re will hold a live conference call to discuss its financial results for the first quarter ended March 31, 2015 on Tuesday, May 5, 2015 at 9:00 a.m. Eastern time.  The conference call title is Greenlight Capital Re, Ltd. First Quarter 2015 Earnings Call.

To participate in the Greenlight Capital Re, Ltd. First Quarter 2015 Earnings Call, please dial in to the conference call at:
    
U.S. toll free             1-888-336-7152
International            1-412-902-4178





Telephone participants may avoid any delays by pre-registering for the call using the following link to receive a special dial-in number and PIN.
Conference Call registration link: http://dpregister.com/10064156

The conference call can also be accessed via webcast at:

http://services.choruscall.com/links/glre150505.html

A telephone replay of the call will be available from 11:00 a.m. Eastern time on May 5, 2015 until 9:00 a.m. Eastern time on May 12, 2015.  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 10064156. 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 and RSUs 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 a NASDAQ listed company with specialist property and casualty reinsurance companies based in the Cayman Islands and Ireland.  Greenlight Re 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:

Garrett Edson
ICR
(203) 682-8331

Media:
Brian Ruby
ICR
(203) 682-8268





GREENLIGHT CAPITAL RE, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
 
March 31, 2015 and December 31, 2014
(expressed in thousands of U.S. dollars, except per share and share amounts)
 
March 31, 2015
 
December 31, 2014
 
(unaudited)
 
(audited)
Assets
 
 
 
Investments
 
 
 
Debt instruments, trading, at fair value
$
47,338

 
$
49,212

Equity securities, trading, at fair value
1,245,720

 
1,266,175

Other investments, at fair value
159,604

 
115,591

Total investments
1,452,662

 
1,430,978

Cash and cash equivalents
11,466

 
12,030

Restricted cash and cash equivalents
1,524,999

 
1,296,914

Financial contracts receivable, at fair value
41,482

 
47,171

Reinsurance balances receivable
137,597

 
151,185

Loss and loss adjustment expenses recoverable
2,655

 
11,523

Deferred acquisition costs, net
42,554

 
34,420

Unearned premiums ceded
3,670

 
4,027

Notes receivable
30,115

 
1,566

Other assets
6,028

 
5,478

Total assets
$
3,253,228

 
$
2,995,292

Liabilities and equity
 
 
 
Liabilities
 
 
 
Securities sold, not yet purchased, at fair value
$
1,327,605

 
$
1,090,731

Financial contracts payable, at fair value
40,312

 
44,592

Due to prime brokers
255,660

 
211,070

Loss and loss adjustment expense reserves
260,310

 
264,243

Unearned premium reserves
160,981

 
128,736

Reinsurance balances payable
11,940

 
40,372

Funds withheld
6,770

 
6,558

Other liabilities
19,002

 
14,949

Total liabilities
2,082,580

 
1,801,251

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, 31,266,732 (2014: 31,129,648): Class B: par value $0.10; authorized, 25,000,000; issued and outstanding, 6,254,895 (2014: 6,254,895))
3,752

 
3,738

Additional paid-in capital
501,587

 
500,553

Retained earnings
636,813

 
660,860

Shareholders’ equity attributable to shareholders
1,142,152

 
1,165,151

Non-controlling interest in joint venture
28,496

 
28,890

Total equity
1,170,648

 
1,194,041

Total liabilities and equity
$
3,253,228

 
$
2,995,292






GREENLIGHT CAPITAL RE, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
 
For the three months ended March 31, 2015 and 2014
(expressed in thousands of U.S. dollars, except per share and share amounts)
 
2015
 
2014
Revenues
 
 
 
Gross premiums written
$
129,682

 
$
118,901

Gross premiums ceded
(1,626
)
 
(5,940
)
Net premiums written
128,056

 
112,961

Change in net unearned premium reserves
(33,263
)
 
(1,272
)
Net premiums earned
94,793

 
111,689

Net investment income (loss)
(24,829
)
 
(10,150
)
Other income (expense), net
1,588

 
182

Total revenues
71,552

 
101,721

Expenses

 

Loss and loss adjustment expenses incurred, net
63,207

 
67,363

Acquisition costs, net
26,841

 
37,796

General and administrative expenses
6,160

 
6,200

Total expenses
96,208

 
111,359

Loss before income tax expense
(24,656
)
 
(9,638
)
Income tax (expense) benefit
215

 
560

Net loss including non-controlling interest
(24,441
)
 
(9,078
)
Loss attributable to non-controlling interest in joint venture
394

 
197

Net loss
$
(24,047
)
 
$
(8,881
)
Earnings (loss) per share
 
 
 
Basic
$
(0.65
)
 
$
(0.24
)
Diluted
$
(0.65
)
 
$
(0.24
)
Weighted average number of ordinary shares used in the determination of earnings and loss per share
 
 
 
Basic
37,173,008

 
36,808,386

Diluted
37,173,008

 
36,808,386



The following table provides the ratios for the three months ended March 31, 2015 and 2014:
 
Three months ended March 31
 
 
 
2015
 
 
 
 
 
2014
 
 
 
Frequency
 
Severity
 
Total
 
Frequency
 
Severity
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio
69.5
%
 
29.8
%
 
66.7
%
 
62.8
%
 
18.8
%
 
60.3
%
Acquisition cost ratio
28.9
%
 
20.6
%
 
28.3
%
 
34.9
%
 
16.1
%
 
33.8
%
Composite ratio
98.4
%
 
50.4
%
 
95.0
%
 
97.7
%
 
34.9
%
 
94.1
%
Internal expense ratio
 
 
 
 
5.2
%
 
 
 
 
 
4.8
%
Corporate expense ratio
 
 
 
 
1.3
%
 
 
 
 
 
0.7
%
Combined ratio
 
 
 
 
101.5
%
 
 
 
 
 
99.6
%




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