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): April 18, 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 April 18, 2011, Brown & Brown, Inc. issued a press release announcing its results of operations for the first quarter ended March 31, 2011.  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: April 18, 2011

 

 

                                              News Release

Cory T. Walker

April 18, 2011                                                                         Chief Financial Officer

                                                                                                (386) 239-7250

 

 

 

BROWN & BROWN, INC. 

ANNOUNCES

4.9% INCREASE IN FIRST-QUARTER NET INCOME

 

(Daytona Beach and Tampa, Florida) . . . Brown & Brown, Inc. (NYSE:BRO) today announced its financial results for the first quarter of 2011. 

 

Net income for the first quarter of 2011 was $46,293,000, or $0.32 per share, compared with $44,128,000, or $0.31 per share for the same quarter of 2010, an increase of 4.9%.  Total revenue for the first quarter ended March 31, 2011 was $262,228,000, compared with 2010 first-quarter revenue of $252,273,000, an increase of 3.9%.

 

J. Powell Brown, President and Chief Executive Officer of Brown & Brown, Inc., noted, "We are pleased with the continued incremental improvement in our operating results.  Many of our middle-market clients continue to experience pressure on their businesses, with the consequence that their revenues and payrolls are flat to slightly down.  Yet our team continues to deliver for our clients, as evidenced by our Wholesale Brokerage Division's positive first-quarter performance."

 

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; and 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.  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. 

 

# # #

 

 

-2-

 

Brown & Brown, Inc.

CONSOLIDATED STATEMENTS OF INCOME

For the Three Months Ended March 31, 2011 and 2010

  (in thousands, except per share data)

(unaudited)

 

                         

 

2011

2010

REVENUES

 

 

Commissions and fees

$261,452

$250,674

Investment income

224

331

Other income, net

  __    552

     1,268

    Total revenues

  262,228

  252,273

 

 

 

EXPENSES

 

 

Employee compensation and benefits

126,557

122,183

Non-cash stock-based compensation

2,773

1,955

Other operating expenses

36,076

36,333

Amortization

13,509

12,553

Depreciation

3,135

3,253

Interest

     3,607

3,608

Change in estimated acquisition earn-out     payables

 

      (99)

 

     (696)

     Total expenses

  185,558

  179,189

 

 

 

Income before income taxes

76,670

73,084

 

 

 

Income taxes

30,377

   28,956

 

 

 

Net income

$ 46,293

$ 44,128

 

======

======

Net income per share:

 

 

  Basic

$0.32

$0.31

 

====

====

  Diluted

$0.32

$0.31

 

====

====

Weighted average number of shares outstanding:

 

 

  Basic

138,351

137,623

 

======

======

  Diluted

140,648

137,791

 

======

======

 

 

 

Dividends declared per share

$0.0800

$0.0775

 

=====

=====

 

 

-3-

Brown & Brown, Inc.

INTERNAL GROWTH SCHEDULE

Core Commissions and Fees(1)

Three Months Ended March 31, 2011

  (in thousands)

(unaudited)

 

 

 

 

Quarter
Ended
03/31/11

Quarter
Ended
03/31/10

Total
Net
Change

Total
Net
Growth %

Less
Acquisition
Revenues

Internal
Net
Growth $

Internal
Net
Growth %

 

 

 

 

 

 

 

 

Florida Retail

      $  38,626

      $  37,778

$ 848

    2.2%

$        1,779

$        (931)

   (2.5)%

National Retail

82,223

77,324

    4,899

   6.3%

   7,422

         (2,523)

   (3.3)%

Western Retail

    24,658

       21,958

   2,700

     12.3%

    3,360

       (660)

   (3.0)%

  Total Retail

  145,507

      137,060

   8,447

   6.2%

  12,561

  (4,114)

   (3.0)%

 

 

 

 

 

 

 

 

Professional Programs

9,523

9,826

         (303)

    (3.1)%

        -

          (303)

(3.1)%

Special Programs

    27,663

    28,542

     (879)

  (3.1)%

            -

     (879)

   (3.1)%

  Total National Programs

    37,186

    38,368

  (1,182)

    (3.1)%

             -

    (1,182)

     (3.1)%

 

 

 

 

 

 

 

 

Wholesale Brokerage

34,056

33,723

333

    1.0%

     -

     333

  1.0%

 

 

 

 

 

 

 

 

Services

     15,823

        8,996

    6,827

  75.9%

     6,856

         (29)

  (0.3)%

 

 

 

 

 

 

 

 

Total Core Commissions
    and Fees
(1)


$232,572


$218,147


$14,425


6.6%


$19,417


$(4,992)


(2.3)%

 

=====

=====

====

 

====

=====

 

 

 

 

 

Reconciliation of Internal Growth Schedule

to Total Commissions and Fees

Included in the Consolidated Statements of Income

For the Three Months Ended March 31, 2011 and 2010

(in thousands)

(unaudited)

 

 

 

Quarter

Quarter

 

Ended

Ended

 

03/31/11

03/31/10

 

 

 

Total core commissions and fees(1)

$232,572

$218,147

Contingent commissions

  28,880

  32,236

Divested business

              -

         291

 

 

 

Total commission & fees

$261,452

$250,674

 

======

======

 

 

 

(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).

 

 

-4-

Brown & Brown, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)

 

 

 

March 31,

December 31,

 

2011

2010

ASSETS

 

 

Current assets:

 

 

  Cash and cash equivalents

$     265,682

$     272,984

  Restricted cash and investments

   115,635

   123,594

  Short-term investments

7,481

7,678

  Premiums, commissions and fees receivable

232,688

214,446

  Deferred income taxes

8,235

20,076

  Other current assets

          25,242

          14,031

    Total current assets

654,963

652,809

 

 

 

Fixed assets, net

59,574

59,713

Goodwill

1,225,357

1,194,827

Amortizable intangible assets, net

485,530

481,900

Other assets

        18,572

        11,565

    Total assets

$2,443,996

$2,400,814

 

========

========

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

Current liabilities:

 

 

  Premiums payable to insurance companies

$   330,745

$   311,346

  Premium deposits and credits due customers

31,555

28,509

  Accounts payable

31,627

33,693

  Accrued expenses and other liabilities

64,709

94,947

  Current portion of long-term debt

          1,212

          1,662

    Total current liabilities

459,848

470,157

 

 

 

Long-term debt

250,067

250,067

 

 

 

Deferred income taxes, net

153,160

146,482

 

 

 

Other liabilities

36,509

27,764

 

 

 

Shareholders' equity:

 

 

  Common stock, par value $0.10 per share;
     authorized 280,000 shares;  issued and
     outstanding 142,548 at 2011 and 142,795 at 2010



14,255



14,279

  Additional paid-in capital

290,197

286,997

  Retained earnings

1,239,954

1,205,061

  Accumulated other comprehensive income

                 6

                 7

 

 

 

    Total shareholders' equity

  1,544,412

  1,506,344

 

 

 

    Total liabilities and shareholders' equity

$2,443,996

$2,400,814

 

========

========

-5-