1st QUARTER
REPORT 2015
The result for Norwegian Hull Club (NHC) in the first quarter of 2015 is minus USD 9.3
million. Technical result of insurance operations is minus USD 2.9 million and net result
of financial items is minus USD 6.3 million. Profitability on insurance operations is below
expectations.
The underlying gross earned premiums are in line with 2014, although last years figures
were affected by run-off losses on premium estimates.
There has been two major claims impacting the insurance result.
Return on the investment portfolio is 1.3 % in local currency. In USD, the return is minus 0.9
%, corresponding to minus USD 3.6 mill. The balance of financial income items stems from
interest earned on bank accounts and receivables as well as currency items.
Capital, the sum of equity and provision for risk equalization, is USD 305.8 mill at the end of
March 2015.
Key figures (in USD 1,000):
31.03.2015
31.03.2014
Gross premium earned
52 908
46 315
01.01.-31.03.2015
01.01.-31.03.2014 2014
Gross earned premiums 52 908 46 315 203 825
Gross claims -62 454 -30 849 -104 988
Gross result -9 546 15 466 98 837
Premiums for own account 43 498 39 289 171 179
Claims for own account -42 621 -26 950 -105 811
Insurance result for own account 877 12 339 65 368
Net operating expenses -3 870 -5 393 -19 872
Technical result -2 993 6 946 45 496
Net financial items -6 311 6 150 -7 804
Operating result -9 304 13 096 37 692 Loss ratio 98,0 % 68,6 % 61,8 % Combined ratio 106,9 % 82,3 % 73,4 % 31.03.15 31.12.14 Investment portfolio 418 504 417 227 Bank deposits 40 096 35 505 Receivables 172 236 165 771 Other assets 33 059 34 477 TOTAL ASSETS 663 897 652 979
Equity & provision for risk equalisation 305 788 315 091
Claims provision 200 618 173 361
Other provisions 114 409 109 926
Payables and other liabilities 43 082 54 601
TOTAL EQUITY AND LIABILITIES 663 897 652 979
KEY FIGURES
Operating Result Net financial income Technical result
01.01.2015 - 31.03.2015 -9 304 -6 311 -2 933 01.01.2015 - 31.03.2015 13 096 6 150 6 946 -12000 -9000 -6000 -3000 0 3000 6000 9000 12000 15000 OPERATING RESULT NET FINANCIAL INCOME TECHNICAL RESULT
(USD) 31.03.15 31.03.2014
Gross premiums 57 307 012 64 762 631
Reinsurance premiums -12 570 417 -13 370 146
Change in provisions for unearned gross premiums -4 398 603 -17 737 053
Reinsurers' share of change in provisions 3 159 655 5 633 511
A Premiums for own account 43 497 647 39 288 943
B Allocated investment return from non technical
accounts 1 011 000 2 207 000
C Other insurance related income 1 562 110 1 868 481
Gross paid claims 35 197 036 33 144 741
Reinsurers share of gross claims -2 535 592 -7 511 834
Change in gross claims reserve 27 256 992 -2 295 545
Reinsurers' share of change in gross claims reserve -17 297 732 3 612 464
D Claims for own account 42 620 705 26 949 826
Marketing expenses 4 286 015 5 670 791
Commissions earned -507 784 -569 459
E Total insurance related expenses for own account 3 778 231 5 101 331
F Other insurance related expenses 1 653 689 2 159 939
G Operating result technical accounts before change in solvency capital (A+B+C-D-E-F)
-1 981 869 9 153 327
Change in provisions for risk equalisation -9 303 707 13 095 901
H Total changes in risk provisions -9 303 707 13 095 901
I Operating result technical accounts (G-H) 7 321 838 -3 942 574
(USD) 31.03.15 31.03.2014
Financial income 4 330 321 6 592 926
Realised gains and losses 8 350 437 1 384 503
Adjustment investment portfolio -18 712 051 -1 323 703
J Total financial income -6 031 292 6 653 727
K Administration expenses financial assets 279 545 504 153
L Allocated investment return transferred to
technical accounts 1 011 000 2 207 000
M Result from ordinary operations (I+J-K-L) - -
31.03.15 31.12.14
Deferred tax benefit 1 501 161 1 501 161
Total intangible assets 1 501 161 1 501 161
Shares in subsidiaries 2 356 629 2 356 629
Other shares 1 281 925 1 281 925
Mortgage loans 16 551 906 18 100 165
Stocks and shares 98 960 522 100 424 614
Bonds and foreign exchange contracts 307 272 710 292 320 665
Financial derivatives - 5 905 348
Bank deposits investment portfolio 12 270 891 18 576 328
Total financial assets 438 694 583 438 965 674
Reinsured proportion of gross premium provisions 19 045 733 15 886 077
Reinsured proportion of gross claims provision 37 336 985 20 039 253
Total reinsured proportion of insurance provisions 56 382 718 35 925 331
Insurance related receivables 103 905 862 103 535 729
Reinsurance receivables 355 400 355 400
Disbursements 6 963 599 12 657 091
Other receivables 4 628 857 13 297 470
Total receivables 115 853 718 129 845 690
Properties 3 722 300 3 693 909
Equipment and fixtures 5 367 801 5 604 194
Cash and bank deposits 40 096 466 35 504 891
Deferred tax - -
Total other assets 49 186 567 44 802 994
Accrued interest 2 277 765 1 938 536
EQUITY AND LIABILITIES
31.03.15 31.12.14
Equity 8 042 072 8 042 072
Other equity 30 296 314 30 296 314
Total equity 38 338 386 38 338 386
Unearned gross premium provision 113 079 481 108 680 877
Gross claims provision 200 617 680 173 360 687
Unearned commission provision 1 329 570 1 245 599
Total gross insurance provisions 315 026 731 283 287 163
Provision for risk equalisation 267 449 313 276 753 020
Total risk provisions etc. 267 449 313 276 753 020
Pension liability 20 249 955 20 249 955
Withheld payroll tax, social security etc. 2 309 814 2 333 529
Deferred tax 4 359 602 4 359 602
Taxes payable - 0
Total tax etc. payable 26 919 370 26 943 085
Payables direct insurance accounts 6 667 647 6 580 465
Payables reinsurance 2 078 976 12 864 812
Payables other accounts 7 416 088 8 212 456
CHANGES IN EQUITY
Owners' funds Other equity Total equity Norwegian Hull Club
Equity at 31.12.2013 8 042 072 29 383 948 37 426 020
Adjustments pension liability 6 733 969 6 733 969
Adjusted result (change in
equalisation reserve) -6 733 969 -6 733 969
Equity 31.12.2013 8 042 072 29 383 948 37 426 020
Equity at 1.1.2014 8 042 072 29 383 948 37 426 020
Adjustments pension liability 5 053 103 5 053 103
Adjusted result ( change in
equalisation reserve) -5 053 103 -5 053 103
Allocation 912 365 912 365
Equity at 31.12.2014 8 042 072 30 296 313 38 338 385
Allocation 31.03.2015 - -
Statement of cash flows - USD
31.03.15 31.03.14
Profit of the year before tax - -
Change in net technical reserves 1 978 473 26 727 751
Net profit on sale of fixed shares - -
Change in disbursements 5 693 493 -1 506 829
Net profit on sale of fixed assets - -
Change in net pension funds - -
Change in net receivables -3 559 486 -26 084 460
Depreciation 207 040 183 935
Taxes paid - -
Net cash flow from operations before financial assets 4 319 520 -679 603
Change in net bonds -14 952 045 3 143 157
Change in net stocks and shares 1 464 093 -5 670 594
Change in net financial derivatives 5 905 348 1 341 718
- -
Net cash flow from financial assets -7 582 604 -1 185 718
A
Net cash flow from operational activities -3 263 084 -1 865 321 Cash generated / used by investing activitiesNet receipts/payments related to purchase/capitalization
of subsidiaries and associated companies - -
Net receipts/payments related to sale/purchase of fixed
assets -29 353 -779 413
Change in mortgage loans 1 548 259 -944 053
Explanatory notes to the interim financial report
Note 1 - Accounting policies
Norwegian Hull Clubs interim financial report is presented in accordance with IAS 34 interim financial reporting and in compliance with the Norwegian Accounting Act, Finance Ministry's prescribed regulations from December 16, 1998 on Financial Statements for Insurance companies and regulations from January 21, 2008 on simplified IFRS.
The application of IAS 34 means that the report is limited relative to presentation of a full annual report. The accounting policies are unchanged from the annual report 2014 and the annual report contains the full description of the accounting policies.
IAS19 has been implemented in the first quarter of 2015 and this has adjusted the balance sheet as of 31.12.2014. The increased pension liability is a change of accounting principle and has been booked against equity. In order to fullfill capital requirements the equity is retained at the same level and the equalisation reserve has been reduced accordingly.
Note 2 - Claims expenses
31.03.15 31.03.2014
Gross paid claims 35 197 036 33 144 741
Change in outstanding gross claims reserve 27 256 992 -2 295 545
Gross claims 62 454 028 30 849 196
Paid claims for own account 32 661 444 25 632 907
Change in outstanding claims reserve for own account 9 959 261 1 316 918
Note 3 - Market value adjustments
31.12.14 31.03.15 Change
Book
Value MarketValue ValueBook MarketValue ValueBook MarketValue Bonds 292 320 665 292 320 665 307 272 710 307 272 710 14 952 045 14 952 045 Stocks and shares 100 424 614 100 424 614 98 960 522 98 960 522 (1 464 093) (1 464 093) Derivatives 5 905 348 5 905 348 (1 479 868) (1 479 868) (7 385 216) (7 385 216) In total 398 650 628 398 650 628 404 753 364 404 753 364 6 102 736 6 102 736 31.03.15 31.12.14
Guarantee liability regarding claims
Gross guarantees issued 118 719 666 127 248 819
Counter-guarantees from co-insurers 93 341 098 97 620 472
Guarantees for own account 25 378 568 29 628 347
Note 4 - Off balance items
Note 5 - Material events subsequent to the end of the interim period
To our best knowledge there has been no material events subsequent to the end of the interim period
All guarantees relate to clients` liabilities in connection with collisions, groundings etc. associated with the Club`s activities.
