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

 

Date of Report (Date of earliest event reported): February 7, 2011

 

BROWN & BROWN, INC.

(Exact name of registrant as specified in its charter)

 

Florida

0-7201

59-0864469

(State or other jurisdiction

(Commission File Number)

(IRS Employer

of incorporation)

 

Identification No.)

 

220 South Ridgewood Avenue, Florida 32114

(Address of principal executive offices)    (Zip Code)

 

Registrant's telephone number, including area code:     (386) 252-9601

 

N/A

(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:

 

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

[  ]  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 February 7, 2011, Brown & Brown, Inc. issued a press release announcing its results of operations for the fourth quarter and 2010 year-end results.  A copy of the press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

 

The information furnished herewith pursuant to Item 2.02 of this Current Report shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.  The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

 

SIGNATURES

 

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 hereunto duly authorized.

 

 

                                                            BROWN & BROWN, INC.

                                                            (Registrant)

                                                                    /S/ CORY T. WALKER

                                                            By:                                                                 

                                                                 Cory T. Walker, Chief Financial Officer

Date: February 7, 2011

 

 

 

  

                                      News Release
                                                                                         
Cory T. Walker
     February 7, 2011                                                          Chief Financial Officer
                                                                                            (386) 239-7250

 

 

 

BROWN & BROWN, INC. 

ANNOUNCES

A 35.9% INCREASE IN FOURTH-QUARTER NET INCOME

 

(Daytona Beach and Tampa, Florida) . . . Brown & Brown, Inc. (NYSE:BRO) today announced its net income and net income per share for the fourth quarter of 2010. 

 

Net income for the fourth quarter of 2010 was $32,146,000, or $0.22 per share, compared with $23,653,000, or $0.17 per share for the same quarter of 2009.  Total revenue for the fourth quarter ended December 31, 2010 was $229,938,000, compared with 2009 fourth-quarter revenue of $214,162,000. 

 

Total revenue for the twelve months ended December 31, 2010 was $973,492,000, compared with total revenue for the twelve months ended December 31, 2009 of $967,877,000.  Net income for the twelve-month period ended December 31, 2010 was $161,752,000, or $1.12 per share, compared with $153,294,000, or $1.08 per share, for the same period of 2009.

 

J. Powell Brown, President and Chief Executive Officer of Brown & Brown, Inc., noted, "2010 was another challenging year and yet we continued to add value for our clients and grow our business.  We are proud of all of our team members.  Our fourth-quarter and annual results are a testament to the dedication of our people."

 

Brown & Brown, Inc., through its subsidiaries offers a broad range of insurance and reinsurance products and services.  Additionally, certain Brown & Brown subsidiaries offer a variety of risk management, third party administration, and other services. Serving business, public entity, individual, trade and professional association clients nationwide, the Company is ranked by Business Insurance magazine as the United States' seventh largest independent insurance intermediary. The Company's Web address is www.bbinsurance.com. 

 

This press release may contain certain statements relating to future results which are forward-looking statements, including those relating to future financial results and to acquisition opportunities. These statements are not historical facts, but instead represent only the Company's current 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, financial condition and achievements may differ, possibly materially, from the anticipated results, financial condition and achievements contemplated by these forward-looking statements. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results and condition, as well as its other achievements, 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 pressures; the effects of legislative and regulatory changes in Florida pertaining to the insurance industry, including those relating to coastal property coverages; the competitive environment; the integration of the Company's operations 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; the potential occurrence of a disaster that affects certain areas of the States of California, Florida, Indiana, Michigan, New Jersey, New York, Pennsylvania, Texas and/or Washington, where significant portions of the Company's business are concentrated; and the cost and impact on the Company of previously disclosed regulatory inquiries regarding industry and Company practices with respect to compensation received from insurance carriers. All forward-looking statements made herein are made only as of the date of this release, and the Company does not undertake any obligation to publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or of which the Company hereafter becomes aware. 

 

# # #

 

   

 

 

 

Brown & Brown, Inc.
CONSOLIDATED STATEMENTS OF INCOME
  (in thousands, except per share data)
(unaudited)
                         

 

 

 

For the
Three Months Ended
December 31

 

For the
Twelve Months Ended
December 31

 

2010

2009

 

2010

2009

REVENUES

 

 

 

 

 

Commissions and fees

$229,088

$213,288

 

$966,917

$964,863

Investment income

304

216

 

1,326

1,161

Other income, net

        546

         658

 

      5,249

      1,853

    Total revenues

  229,938

  214,162

 

  973,492

  967,877

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

Employee compensation and benefits

122,264

115,107

 

487,820

484,680

Non-cash stock-based compensation

1,615

2,115

 

6,845

7,358

Other operating expenses

34,595

36,382

 

135,851

143,389

Amortization

13,370

12,485

 

51,442

49,857

Depreciation

3,141

3,285

 

12,639

13,240

Interest

     3,624

     3,711

 

    14,471

    14,599

Change in estimated acquisition earn-out     payables

       (638)

              -

 

  (1,674)

            -

     Total expenses

  177,971

  173,085

 

  707,394

  713,123

 

 

 

 

 

 

Income before income taxes

51,967

41,077

 

266,098

254,754

 

 

 

 

 

 

Income taxes

    19,821

    17,424

 

    104,346

    101,460

 

 

 

 

 

 

Net income

$ 32,146

$ 23,653

 

$161,752

$153,294

 

======

======

 

=======

=======

Net income per share:

 

 

 

 

 

  Basic

$0.23

$0.17

 

$1.14

$1.08

 

====

====

 

====

====

  Diluted

$0.22

$0.17

 

$1.12

$1.08

 

====

====

 

====

====

Weighted average number of shares outstanding:

 

 

 

 

 

  Basic

138,190

137,531

 

137,924

137,173

 

======

======

 

======

======

  Diluted

139,660

137,779

 

139,318

137,507

 

======

======

 

======

======

 

 

 

 

 

 

Dividends declared per share

$0.08

$0.0775

 

$0.3125

$0.3025

 

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======

 

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Brown & Brown, Inc.

INTERNAL GROWTH SCHEDULE

Core Commissions and Fees(1)

Three Months Ended December 31, 2010

  (in thousands)

(unaudited)


 

Quarter
Ended
12/31/10

Quarter
Ended
12/31/09

Total
Net
Change

Total
Net
Growth %

Less
Acquisition
Revenues

Internal
Net
Growth $

Internal
Net
Growth %

 

 

 

 

 

 

 

 

Florida Retail

      $  37,382

      $  37,014

$ 368

    1.0%

$        1,452

$(1,084)

   (2.9)%

National Retail

74,589

71,527

    3,062

   4.3%

   5,588

         (2,526)

   (3.5)%

Western Retail

    22,375

    22,594

   (219)

     (1.0)%

     2,131

    (2,350)

   (10.4)%

  Total Retail

  134,346

  131,135

   3,211

   2.4%

    9,171

  (5,960)

   (4.5)%

 

 

 

 

 

 

 

 

Professional Programs

10,842

11,493

         (651)

    (5.7)%

        -

          (651)

(5.7)%

Special Programs

    30,107

    30,417

   (310)

  (1.0)%

              -

      (310)

   (1.0)%

  Total National Programs

    40,949

    41,910

   (961)

    (2.3)%

              -

      (961)

     (2.3)%

 

 

 

 

 

 

 

 

Wholesale Brokerage

31,433

31,389

      44

    0.1%

     59

     (15)

  0.0%

 

 

 

 

 

 

 

 

Services

      15,975

      8,049

     7,926

  98.5%

      7,987

       (61)

  (0.8)%

 

 

 

 

 

 

 

 

Total Core Commissions

 

 

 

 

 

 

 

    and Fees (1)

$222,703

$212,483

$10,220

4.8%

$17,217

$(6,997)

(3.3)%

 

=======

=======

======

 

=======

=======

 

 

 

 

 

Reconciliation of Internal Growth Schedule

to Total Commissions and Fees

Included in the Consolidated Statements of Income

For the Three Months Ended December 31, 2010 and 2009

(in thousands)

(unaudited)


 

 

 

Quarter
Ended
12/31/10

Quarter
Ended
12/31/09

Total core commissions and fees(1)

$222,703

$212,483

Contingent commissions

  6,385

  484

Divested business

              -

           321

 

 

 

Total commission & fees

$229,088

$213,288

 

======

======

   

 

(1)

Total core commissions and fees are our total commissions and fees less (i) profit-sharing contingent   commissions (revenue derived from special revenue-sharing commissions from insurance companies based upon the volume and the growth and/or profitability of the business placed with such companies during the prior year), and (ii) divested business (commissions and fees generated from offices, books of business or niches sold by the Company or terminated).

Brown & Brown, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)

                                                                       

 

 

December 31,

December 31,

 

2010

2009

ASSETS

 

 

Current assets:

 

 

  Cash and cash equivalents

$      272,984   

$      197,113   

  Restricted cash and investments

   123,594

   155,257

  Short-term investments

7,678

8,213

  Premiums, commissions and fees receivable

214,446

209,462

  Deferred income taxes

20,076

11,791

  Other current assets

         14,031

       31,863

    Total current assets

652,809

613,699

 

 

 

Fixed assets, net

59,713

61,467

Goodwill

1,194,827

1,074,397

Amortizable intangible assets, net

481,900

468,862

Other assets

         11,565

         5,801

    Total assets

$2,400,814

$2,224,226

 

========

========

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

Current liabilities:

 

 

  Premiums payable to insurance companies

$   311,346

$   310,296

  Premium deposits and credits due customers

28,509

37,715

  Accounts payable

33,693

17,431

  Accrued expenses and other liabilities

94,947

96,387

  Current portion of long-term debt

      1,662

       17,124

    Total current liabilities

470,157

478,953

 

 

 

Long-term debt

250,067

250,209

 

 

 

Deferred income taxes, net

146,482

115,609

 

 

 

Other liabilities

27,764

9,581

 

 

 

Shareholders' equity:

 

 

  Common stock, par value $0.10 per share;

 

 

     authorized 280,000 shares;  issued and

 

 

     outstanding 142,795 at 2010 and 142,076 at 2009

14,279

14,208

  Additional paid-in capital

286,997

267,856

  Retained earnings

1,205,061

1,087,805

  Accumulated other comprehensive income

                 7

                 5

 

 

 

    Total shareholders' equity

  1,506,344

  1,369,874

 

 

 

    Total liabilities and shareholders' equity

$2,400,814

$2,224,226

 

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========