Hub International Limited: Financial Results For The Three Months Ended March 31, 2002

 

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 Add Title:  Hub International Limited: Financial Results For The Three Months Ended March 31, 2002
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 Location:  Chicago and Toronto
 Date:    2002-05-09  
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Total revenue for Hub International Limited (TSE: HBG- news) for the quarter ended March 31, 2002 increased by $21.4 million or 76% to $49.5 million compared to $28.1 million for the quarter ended March 31, 2001. Of this increase, $18.8 million was attributable to acquisitions and reflects the inclusion of the results of each brokerage the Corporation acquired during the last twelve months. Excluding the effects of acquisitions, total revenue increased $2.6 million or 9%. This increase was mainly attributable to growth in commission income due, in part, to premium increases. Net earnings for the quarter ended March 31, 2002 increased by $2.4 million or 100% to $4.9 million compared to $2.5 million in 2001 as a result of the acquisitions and organic growth noted above. Basic earnings per share for the quarter ended March 31, 2002 increased by $0.12 or 92% to $0.25 per share compared to $0.13 per share for the quarter in 2001. Diluted earnings per share for the quarter ended March 31, 2002 increased by $0.08 or 62% to $0.21 per share compared to $0.13 per share for the quarter in 2001.

Effective January 1, 2002, the Corporation adopted the Canadian Institute of Chartered Accountants Accounting Standards Board Handbook Section 3062, "Goodwill and Other Intangible Assets" without restatement of prior periods. As required under Section 3062, no goodwill amortization expense was incurred for the quarter ended March 31, 2002. For the quarter ended March 31, 2001, the Corporation incurred goodwill amortization expense of $0.8 million before tax and approximately $0.7 million after tax ($0.04 per share). Net earnings, basic earnings per share and diluted earnings per share for the quarter ended March 31, 2001 adjusted for goodwill amortization were $3.1 million, $0.17 per share and $0.17 per share, respectively. Accordingly, net earnings, basic earnings per share and diluted earnings per share for the quarter ended March 31, 2002 increased 57%, 47% and 24%, respectively, as compared to amounts for the same period last year adjusted for goodwill amortization.

The consolidated financial statements of the Corporation historically have been expressed in Canadian dollars. Effective September 30, 2001, the Corporation adopted the United States of America (U.S.) dollar as its reporting currency. Comparative financial information has been restated in U.S. dollars using the translation of convenience method. As at September 30, 2001, all historical financial statements including financial results for the quarter ended March 31, 2001 were converted from Canadian to U.S. dollars at the exchange rate in effect at September 30, 2001 of one Canadian dollar to 0.6338 U.S. dollar. Revenue and expenses for the quarter ended March 31, 2002 were translated to U.S. dollars at the average exchange rate for the period.

Hub International is a leading North American insurance brokerage providing a broad array of property and casualty, life and health, employee benefits, investment and risk management products and services.

         HUB INTERNATIONAL LIMITED
    Consolidated Statements of Earnings
For the three months ended March 31, 2002 and 2001
(in thousands of U.S. dollars, except per share amounts)
                 (Unaudited)
                                2002                2001
                                ----                ----
                                             (Restated as
                                                per above)
Revenue
Commission income                      $41,393             $23,211
Contingent commissions and
volume overrides                        6,175               4,001
Other                                    1,916                 885
                            --------            --------
                              49,484              28,097
                            --------            --------
Expenses
Remuneration                            27,690              16,083
Selling                                  2,921               1,719
Occupancy                                2,725               1,569
Depreciation                             1,280                 572
Administration                           5,214               2,832
                            --------            --------
                              39,830              22,775
                            --------            --------
Net earnings before the following         9,654               5,322
Interest expense                         2,694                 589
Goodwill and other intangible
asset amortization                        379                 771
(Gain) loss on disposal of
capital assets and investments            (42)                 25
Other income - put option liability       (373)                ---
                            --------            --------
Net earnings before income taxes          6,996               3,937
                            --------            --------
Provision for income tax
expense (benefit)
Current                                 2,781               1,295
Future                                   (724)                176
                            --------            --------
                               2,057               1,471
                            --------            --------
Net Earnings                             $4,939              $2,466
                            --------            --------
                            --------            --------
Earnings per share
Basic                                   $0.25               $0.13
Diluted                                 $0.21               $0.13
Weighted average shares
outstanding - Basic (000's)             19,503              18,571
Weighted average shares
outstanding - Diluted (000's)           27,460              18,571

 

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CONTACT:
Hub International Limited
W. Kirk James 312/279-4881
kjames@hubinternational.com
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 SOURCE :   Hub International Limited