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 1, 2013
 
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 1, 2013, Brown & Brown, Inc. issued a press release announcing its results of operations for the fourth quarter and 2012 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.
 
/S/ CORY WALKER
By: ________________________
Cory Walker
Sr. Vice President, Treasurer and
Chief Financial Officer
Date: February 1, 2013
 

 

 

 

 

â                                      News Release

   Cory T. Walker

February 1, 2013

Chief Financial Officer

(386) 239-7250

 

 

 

BROWN & BROWN, INC. ANNOUNCES

RECORD FOURTH-QUARTER EARNINGS OF $42.6 MILLION

 

(Daytona Beach and Tampa, Florida) . . . Brown & Brown, Inc. (NYSE:BRO) today announced its preliminary, unaudited financial results for the fourth quarter of 2012.

 

Net income for the fourth quarter of 2012 was $42,637,000, or $0.29 per share, compared with $36,494,000, or $0.25 per share for the same quarter of 2011, an increase of 16.8%. Total revenue for the fourth quarter was $302,830,000, compared with 2011 fourth-quarter revenue of $244,097,000, an increase of 24.1%.

 

Total revenue for the twelve months ended December 31, 2012 was $1,200,032,000, compared with total revenue for the same period of 2011 of $1,013,542,000, an increase of 18.4%. Net income for the twelve-month period ended December 31, 2012 was $184,045,000, or $1.26 per share, compared with $163,995,000, or $1.13 per share for the same period of 2011, an increase of 12.2%.

 

J. Powell Brown, President and Chief Executive Officer of the Company, noted, “The fourth-quarter results were the culmination of the hard work of our 6,300-plus teammates throughout 2012. Two of our most important goals for 2012 - to grow our revenues organically and to improve each and every quarter - were accomplished. I am very proud of what we achieved in the fourth quarter and for the year. We will continue to work tirelessly for the benefit of our clients in 2013.

 

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’ sixth 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 the Company's anticipated financial results for the fourth quarter of 2012. 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. These risks and uncertainties include, but are not limited to, the Company's determination as it finalizes its financial results for the fourth quarter of 2012 that its financial results differ from the current preliminary unaudited numbers set forth herein, other factors that the Company may not have currently identified or quantified, and other risks, relevant factors and uncertainties identified in the Company's Annual Report on Form 10-K for the year ended December 31, 2011, and the Company’s other filings with the Securities and Exchange Commission. 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,

  2012 2011   2012 2011
REVENUES          
Commissions and fees $300,296 $241,350   $1,189,081 $1,005,962
Investment income 236 333   797 1,267
Other income, net __ 2,298     2,414   10,154 6,313
Total revenues 302,830 244,097   1,200,032 1,013,542
           
EXPENSES          
Employee compensation and benefits 158,467 129,389   608,506 508,675
Non-cash stock-based compensation 4,472 2,856   15,865 11,194
Other operating expenses 44,995 34,590   174,389 144,079
Amortization 16,123 13,965   63,573 54,755
Depreciation 3,990 3,116   15,373 12,392
Interest 4,004 3,352   16,097 14,132
Change in estimated acquisition earn-out payables

 

1,552

 

(2,862)

 

 

1,418

 

(2,206)

Total expenses 233,603 184,406   895,221 743,021
           
Income before income taxes 69,227 59,691   304,811 270,521
           
Income taxes 26,590 23,197   120,766 106,526
           
Net income $ 42,637 $ 36,494   $ 184,045 $ 163,995
           
Net income per share:          
Basic $0.30 $0.25   $1.28 $1.15
Diluted $0.29 $0.25   $1.26 $1.13
           
Weighted average number of shares outstanding:          
Basic 139,681 138,796   139,364 138,582
Diluted 142,314 140,547   142,010 140,264
           
Dividends declared per share $0.090 $0.0850   $0.3450 $0.3250
 
 

 

 
 

 

 
 

Brown & Brown, Inc.

INTERNAL GROWTH SCHEDULE

Core Organic Commissions and Fees(1)

Three Months Ended December 31, 2012

(in thousands)

(unaudited)

 

 

Quarter

Ended

12/31/12

Quarter

Ended

12/31/11

Total

Net

Change

Total

Net

Growth %

Less

Acquisition

Revenues

Internal

Net

Growth $

Internal

Net

Growth %

               
Retail(2) $153,230 $139,257 $13,973 10.0% $6,166 $7,807 5.6%
               
National Programs 64,090 41,057 23,033 56.1% 22,957 76 0.2%
               
Wholesale Brokerage 40,299 35,595 4,704 13.2% 1,738 2,966 8.3%
               
Services 34,398 16,482 17,916 108.7% 16,106 1,810 11.0%
               
Total Core Commissions and Fees (1)

 

$292,017

 

$232,391

 

$59,626

 

25.7%

 

$46,967

 

$12,659

 

5.4%

 

 

 

Reconciliation of Internal Growth Schedule

to Total Commissions and Fees

Included in the Consolidated Statements of Income

For the Three Months Ended December 31, 2012 and 2011

(in thousands)

(unaudited)

 

 

Quarter

Ended

12/31/12

Quarter

Ended

12/31/11

Total core commissions and fees(1) $292,017 $232,391
Profit-sharing contingent commissions

 

6,342

 

4,810

Guaranteed supplemental commissions

 

1,937

 

2,459

Divested business - 1,690
     
Total commissions & fees $300,296 $241,350

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Total core commissions and fees are our total commissions and fees less (i) profit-sharing contingent

commissions (revenues 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), (ii) guaranteed supplemental commissions (GSC) (revenues derived from special revenue-sharing commissions from insurance companies based solely upon the volume of the business placed with such companies during the current year),and (iii) divested business (commissions and fees generated from offices, books of business or niches sold by the Company or terminated).

 

(2) The Retail segment includes commissions and fees reported in the “Other” column of the Segment Information, which includes corporate and consolidation items.

 
 

 

 
 

Brown & Brown, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)

 

December 31, December 31,

2012 2011

ASSETS    
Current assets:    
Cash and cash equivalents $ 219,821 $ 286,305
Restricted cash and investments 164,564 130,535
Short-term investments 8,183 7,627
Premiums, commissions and fees receivable 302,725 240,257
Deferred income taxes 24,408 19,863
Other current assets 39,811 23,540
Total current assets 759,512 708,127
     
Fixed assets, net 74,337 61,360
Goodwill 1,711,514 1,323,469
Amortizable intangible assets, net 566,538 496,182
Other assets 16,157 17,873
Total assets $3,128,058 $2,607,011
     
LIABILITIES AND SHAREHOLDERS’ EQUITY    
Current liabilities:    
Premiums payable to insurance companies $ 406,704 $ 327,096
Premium deposits and credits due customers 32,867 30,048
Accounts payable 48,524 22,384
Accrued expenses and other liabilities 79,593 100,865
Current portion of long-term debt 93 1,227
Total current liabilities 567,781 481,620
     
Long-term debt 450,000 250,033
     
Deferred income taxes, net 237,630 178,052
     
Other liabilities 65,314 53,343
     
Shareholders’ equity:    

  Common stock, par value $0.10 per share;

   authorized 280,000 shares; issued and

  outstanding 143,878 at 2012 and 143,352 at 2011

 

 

14,388

 

 

14,335

  Additional paid-in capital 335,872 307,059
  Retained earnings 1,457,073 1,322,562
  Accumulated other comprehensive income - 7
     
Total shareholders’ equity 1,807,333 1,643,963
     
    Total liabilities and shareholders’ equity $3,128,058 $2,607,011