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Federated National Holding Company Message Board

  • guppy_in_a_shark_tank guppy_in_a_shark_tank Oct 29, 2009 9:43 AM Flag

    bye bye TCHC !

    The only thing management here overvalues is itself ! lol they pay themselves well for running you into the ground

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    • "Michael H. Braun, Chief Executive Officer of 21st Century Holding Company, said, "We believe that today's announcement of a share repurchase delivers significant value to shareholders and demonstrates the Board's confidence in the company's future performance. We are facing a difficult economic environment that is affecting the industry as a whole. 21st Century, despite improved gross written premium and improved investment income and gains, still faces some challenges that will affect profitability in the near-term due to reinsurance costs and wind mitigation credits. While 21st Century will not report profits in the 3rd or 4th quarters of 2009, we anticipate returning to profitability thereafter. We believe that pursuing 21st Century's existing strategic growth plan will enable our shareholders to realize the inherent value of the company." "

      One has to wonder if they have some toxic assets on the balance sheet dragging them down given that they see no chance of profits for Q3 and Q4 ?

      Maybe management shoulda grabbed the lifeline HCII threw them but then maybe HCII is better off now and wont have the dead weight of TCHC dragging it under.

      • 1 Reply to guppy_in_a_shark_tank
      • Nope. Their balance sheet should be pristine. Not sure how long you've followed them. They went to an outside investment manager around the beginning of the year. The investments have been recently redone. There shouldn't be any toxic assets. The reasons for the lack of profitability have been occuring now for over a year: writing marginally profitable business, high operating expenses, and poor management.

        Here's my response of your last sentence. HCII needs TCHC's licenses and assets. TCHC shareholders could use HCII's management team. HCII got too cute with their low offer. My hypothesis is the low offer is related to who ends up with control of the combined entity.

    • I may be optimistic but I believe this means two things, either or both fit.

      1.) This means the Qs P&L is going to good and be at or above trend.

      2.) The cash and liquid assets improved over the quarter to make the offer unacceptable. They started a share repurchase program on top of their dividend. I think that supports this position. Who starts a share repurchase program when your free cash flow supports future diminishing cash flows?...

      I am betting on a good Q in the next two weeks.

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