• Filing Date: 2019-03-08
  • Form Type: 10-K
  • Description: Annual report
v3.10.0.1
Condensed Financial Information of HCI Group, Inc.
12 Months Ended
Dec. 31, 2018
Condensed Financial Information Disclosure [Abstract]  
Condensed Financial Information of HCI Group, Inc.
Note 27 — Condensed Financial Information of HCI Group, Inc.
Condensed financial information of HCI Group, Inc. is as follows:
Balance Sheets
 
 
December 31,
 
 
 
2018
 
 
2017
 
Assets
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
42,292
 
 
$
53,755
 
Fixed-maturity securities, available for sale, at fair value
 
 
38,224
 
 
 
34,529
 
Equity securities, at fair value
 
 
7,299
 
 
 
11,283
 
Short-term investments
 
 
25,275
 
 
 
 
Limited partnership investments, at equity
 
 
21,711
 
 
 
15,232
 
Note receivable – related party
 
 
1,280
 
 
 
7,280
 
Investment in subsidiaries
 
 
290,469
 
 
 
310,779
 
Property and equipment, net
 
 
445
 
 
 
617
 
Income tax receivable
 
 
3,019
 
 
 
3,023
 
Other assets
 
 
1,136
 
 
 
1,019
 
Total assets
 
$
431,150
 
 
$
437,517
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders’ Equity
 
 
 
 
 
 
 
 
Accrued expenses and other liabilities
 
$
4,772
 
 
$
4,499
 
Deferred income taxes, net
 
 
3,594
 
 
 
2,511
 
Long-term debt
 
 
219,301
 
 
 
211,890
 
Due to related parties
 
 
22,042
 
 
 
24,642
 
Total liabilities
 
 
249,709
 
 
 
243,542
 
Total stockholders’ equity
 
 
181,441
 
 
 
193,975
 
Total liabilities and stockholders’ equity
 
$
431,150
 
 
$
437,517
 
Statements of Income
 
 
 
 
 
 
Years Ended December 31,
 
 
 
2018
 
 
2017
 
 
2016
 
Net investment income
 
$
5,348
 
 
$
2,799
 
 
$
1,204
 
Net realized investment gains
 
 
1,544
 
 
 
367
 
 
 
151
 
Net unrealized investment (losses) gains
 
 
(1,514
)
 
 
92
 
 
 
 
Other-than-temporary impairment losses
 
 
(80
)
 
 
(209
)
 
 
(15
)
Gain on repurchases of convertible senior notes
 
 
 
 
 
 
 
 
153
 
Loss on repurchases of senior notes
 
 
 
 
 
(743
)
 
 
 
Interest expense
 
 
(17,007
)
 
 
(15,704
)
 
 
(10,346
)
Operating expenses
 
 
(5,429
)
 
 
(5,489
)
 
 
(5,158
)
Loss before income tax benefit and equity in income of subsidiaries
 
 
(17,138
)
 
 
(18,887
)
 
 
(14,011
)
Income tax benefit
 
 
1,856
 
 
 
9,605
 
 
 
4,878
 
Net loss before equity in income of subsidiaries
 
 
(15,282
)
 
 
(9,282
)
 
 
(9,133
)
Equity in income of subsidiaries
 
 
33,007
 
 
 
2,389
 
 
 
38,154
 
Net income (loss)
 
$
17,725
 
 
$
(6,893
)
 
$
29,021
 
Statements of Cash Flows
 
 
 
 
 
 
Years Ended December 31,
 
 
 
2018
 
 
2017
 
 
2016
 
Cash flows from operating activities:
 
 
 
 
 
 
 
 
 
 
 
 
Net income (loss)
 
$
17,725
 
 
$
(6,893
)
 
$
29,021
 
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
 
 
 
 
 
 
 
 
 
 
 
 
Stock-based compensation
 
 
2,550
 
 
 
2,630
 
 
 
2,878
 
Net realized investment gains
 
 
(1,544
)
 
 
(367
)
 
 
(151
)
Net unrealized investment losses (gains)
 
 
1,514
 
 
 
(92
)
 
 
 
Amortization of (discounts) premiums on investments in fixed-maturity securities
 
 
(3
)
 
 
51
 
 
 
 
Depreciation and amortization
 
 
7,737
 
 
 
6,673
 
 
 
3,899
 
Net income from limited partnership investments
 
 
(3,007
)
 
 
(1,354
)
 
 
(523
)
Distributions from limited partnership interests
 
 
1,495
 
 
 
881
 
 
 
544
 
Other-than-temporary impairment losses
 
 
80
 
 
 
209
 
 
 
15
 
Gain on repurchases of convertible senior notes
 
 
 
 
 
 
 
 
(153
)
Loss on repurchases of senior notes
 
 
 
 
 
743
 
 
 
 
Loss from disposal of property and equipment
 
 
 
 
 
17
 
 
 
 
Equity in income of subsidiaries
 
 
(33,007
)
 
 
(2,389
)
 
 
(38,154
)
Deferred income taxes
 
 
1,075
 
 
 
(4,224
)
 
 
(1,542
)
Changes in operating assets and liabilities:
 
 
 
 
 
 
 
 
 
 
 
 
Income taxes receivable
 
 
4
 
 
 
(1,461
)
 
 
(1,563
)
Other assets
 
 
(144
)
 
 
(106
)
 
 
(129
)
Accrued expenses and other liabilities
 
 
273
 
 
 
1,544
 
 
 
(716
)
Income taxes payable
 
 
 
 
 
 
 
 
(1,518
)
Due to related parties
 
 
(2,600
)
 
 
(54,896
)
 
 
60,075
 
Net cash (used in) provided by operating activities
 
 
(7,852
)
 
 
(59,034
)
 
 
51,983
 
Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
 
 
 
Investment in limited partnership interest
 
 
(5,125
)
 
 
(4,611
)
 
 
(2,710
)
Investment in note receivable – related party
 
 
 
 
 
(7,280
)
 
 
 
Purchase of fixed-maturity securities
 
 
(5,864
)
 
 
(31,034
)
 
 
(371
)
Purchase of equity securities
 
 
(16,913
)
 
 
(12,483
)
 
 
(2,853
)
Purchase of short-term and other investments
 
 
(50,510
)
 
 
 
 
 
 
Purchase of property and equipment
 
 
(154
)
 
 
(306
)
 
 
(202
)
Proceeds from sales of fixed-maturity securities
 
 
2,215
 
 
 
667
 
 
 
423
 
Proceeds from calls, repayments and maturities of fixed-maturity securities
 
 
 
 
 
 
 
 
130
 
Proceeds from sales of equity securities
 
 
20,698
 
 
 
8,886
 
 
 
2,602
 
Proceeds from sales, redemptions and maturities of short-term and other investments
 
 
25,401
 
 
 
 
 
 
 
Collection of note receivable – related party
 
 
6,000
 
 
 
 
 
 
 
Distributions from limited partnership interests
 
 
158
 
 
 
11,758
 
 
 
 
Dividends received from subsidiary
 
 
42,000
 
 
 
105,000
 
 
 
19,000
 
Return of capital from subsidiary
 
 
10,000
 
 
 
 
 
 
 
Investment in subsidiaries
 
 
 
 
 
 
 
 
(25,250
)
Net cash provided by (used in) investing activities
 
 
27,906
 
 
 
70,597
 
 
 
(9,231
)
 
Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
 
 
 
Repurchases of common stock
 
 
(1,151
)
 
 
(30,718
)
 
 
(464
)
Repurchases of common stock under share repurchase plan
 
 
(20,015
)
 
 
(15,154
)
 
 
(20,026
)
Repurchases of convertible senior notes
 
 
 
 
 
 
 
 
(11,347
)
Repurchases of senior notes
 
 
 
 
 
(40,250
)
 
 
 
Debt issuance costs paid
 
 
 
 
 
(4,975
)
 
 
 
Cash dividends paid to stockholders
 
 
(11,318
)
 
 
(13,906
)
 
 
(12,438
)
Cash dividends received under share repurchase forward contract
 
 
967
 
 
 
1,073
 
 
 
747
 
Proceeds from exercise of stock options
 
 
 
 
 
75
 
 
 
150
 
Proceeds from issuance of long-term debt
 
 
 
 
 
143,750
 
 
 
 
Tax benefits on stock-based compensation
 
 
 
 
 
 
 
 
641
 
Net cash (used in) provided by financing activities
 
 
(31,517
)
 
 
39,895
 
 
 
(42,737
)
Net (decrease) increase in cash and cash equivalents
 
 
(11,463
)
 
 
51,458
 
 
 
15
 
Cash and cash equivalents at beginning of year
 
 
53,755
 
 
 
2,297
 
 
 
2,282
 
Cash and cash equivalents at end of year
 
$
42,292
 
 
$
53,755
 
 
$
2,297