Diluted GAAP earnings per share ("EPS") of $0.56, non-GAAP adjusted EPS¹ of $0.64
Annualized return on average equity ("ROE") of 16.9%
Direct premiums written of $396.5 million, up 8.5% from the prior year quarter
Direct premiums earned up 10.4% from the prior year quarter
Net combined ratio of 97.9%, up 4.8 points from the prior year quarter
Repurchased 320,528 shares for $3.9 million. Total capital returned to shareholders of $8.9 million, including $0.16 per share regular quarterly dividend.

Universal Insurance Holdings (NYSE:UVE) ("Universal" or the "Company") reported 2022 first quarter diluted EPS of $0.56 on a GAAP basis and $0.64 on a non-GAAP¹ adjusted basis.

¹Reconciliations of GAAP to non-GAAP financial measures are provided in the attached tables.

"We reported a 16.9% annualized ROE despite the challenging external environment, which is a testament to the strength and resilience of our business," said Stephen J. Donaghy, Chief Executive Officer. "Direct premiums written were up 8.5% from the prior year quarter, significantly outpacing a 6.1% policies in force decline, as meaningful rate increases benefited premium volumes. We are laser focused on improving underwriting profitability, as we prioritize combined ratio improvement over top line growth. In addition to raising rates across Florida and our broader footprint, we've reduced exposure to less profitable geographies, tightened underwriting criteria, renegotiated commission rates with our agency partners and exercised prudent expense management. Lastly, rising yields are benefiting our investment income results, and should continue to serve as a tailwind moving forward. Given our strong capital position, the profitability of our business and the steps we continue to take to improve results, we believe we stand out favorably as reinsurers increasingly differentiate amongst cedants in the current market."

Quarterly Financial Results

Summary Financial Results

($thousands, except per share data)	Three Months Ended March 31,
	2022			2021			Change
GAAP comparison
Total revenue	$	287,482		$	262,757		9.4	%
Income before income taxes	$	22,471		$	36,351		(38.2	) %
Income before income taxes margin		7.8	%		13.8	%	(6.0) pts

Net income	$	17,537		$	26,408		(33.6	) %
Diluted EPS	$	0.56		$	0.84		(33.3	) %
Annualized ROE		16.9	%		23.2	%	(6.3) pts

Non-GAAP comparison²
Adjusted operating income	$	27,417		$	36,323		(24.5	) %

Adjusted net income	$	20,052		$	26,371		(24.0	) %
Adjusted EPS	$	0.64		$	0.84		(23.8	) %

Underwriting Summary
Premiums:
Premiums in force	$	1,703,151		$	1,548,657		10.0	%
Policies in force		916,745			976,250		(6.1	) %

Direct premiums written	$	396,481		$	365,314		8.5	%
Direct premiums earned	$	414,603		$	375,606		10.4	%
Ceded premiums earned	$	(145,539	)	$	(132,301	)	10.0	%
Ceded premium ratio		35.1	%		35.2	%	(0.1) pts
Net premiums earned	$	269,064		$	243,305		10.6	%

Net ratios:
Loss ratio		68.8	%		59.2	%	9.6 pts
Expense ratio³		29.1	%		33.9	%	(4.8) pts
Combined ratio		97.9	%		93.1	%	4.8 pts
²Reconciliation of GAAP to non-GAAP financial measures are provided in the attached tables. Non-GAAP adjusted EPS excludes net realized and unrealized gains and losses on investments, as well as extraordinary reinstatement premiums and associated commissions. Adjusted operating income excludes net realized and unrealized gains and losses on investments, interest expense, and any extraordinary reinstatement premiums and associated commissions.
³Expense ratio excludes interest expense.

Net Income and Adjusted Net Income

Net income was $17.5 million, down from $26.4 million in the prior year quarter, and adjusted net income was $20.1 million, down from $26.4 million in the prior year quarter. The decline in adjusted net income primarily stems from a higher net combined ratio, partly offset by higher net premiums earned, commission revenue, net investment income and a lower effective tax rate.

Revenues

Overall revenue was $287.5 million, up 9.4% from the prior year quarter. The increase in revenue primarily stems from higher direct premiums earned associated with rate increases in the Florida homeowners book of business, partly offset by unrealized losses on equity securities.

Direct premiums written were $396.5 million, up 8.5% from the prior year quarter. The increase stems from 8.9% growth in Florida and 6.4% growth in other states. Overall growth primarily reflects rate increases, partly offset by lower policies in force.

Direct premiums earned were $414.6 million, up 10.4% from the prior year quarter. The increase stems from direct premiums written growth over the past twelve months.

The ceded premium ratio was 35.1%, basically in line with 35.2% in the prior year quarter.

Net premiums earned were $269.1 million, up 10.6% from the prior year quarter. The increase is primarily attributable to higher direct premiums earned, as described above.

Net investment income was $4.0 million, up from $3.0 million in the prior year quarter. The increase stems from higher fixed income reinvestment yields.

Commissions, policy fees and other revenue were $17.7 million, up 7.9% from the prior year quarter. The increase primarily reflects higher commission revenue, which benefited from higher ceded premiums, partly offset by policy fee and other revenue declines associated with lower policies in force.

Margins

The income before income taxes margin was 7.8%, down 6.0 points from the prior year quarter, with the decrease stemming from a higher net combined ratio and unrealized losses on equity securities, partly offset by higher commission revenues.

The net loss ratio was 68.8%, up 9.6 points compared to the prior year quarter. The increase primarily reflects a higher initial accident year attritional loss pick associated with the challenging Florida claims environment, higher weather above plan and a smaller benefit from our claims adjusting affiliate.

The net expense ratio (excludes interest expense) was 29.1%, down 4.8 points compared to the prior year quarter. The reduction primarily reflects lower renewal commission rates paid to our agents, lower employee compensation and benefits expense and economies of scale.

The net combined ratio was 97.9%, up 4.8 points compared to the prior year quarter. The increase reflects a higher net loss ratio, partly offset by a lower net expense ratio, as described above.

Capital Deployment

During the first quarter, the Company repurchased approximately 321 thousand shares at an aggregate cost of $3.9 million. The Company's current share repurchase authorization program has $13.9 million remaining as of March 31, 2022 and runs through November 3, 2022.

On April 20, 2022, the Board of Directors declared a quarterly cash dividend of 16 cents per share of common stock, payable on May 20, 2022, to shareholders of record as of the close of business on May 13, 2022.

Guidance

The Company is maintaining its guidance for 2022 (assuming no further extraordinary weather events and no realized or unrealized gains in 2022):

GAAP and Non-GAAP Adjusted EPS in a range of $1.80 - $2.20
Annualized return on average equity in a range of 12.5% - 15.0%

Conference Call and Webcast

Friday, April 29, 2022 at 10:00 a.m. ET
U.S. Dial-in Number: (855) 752-6647
International: (503) 343-6667
Participant code: 9789558
Listen to live webcast: UniversalInsuranceHoldings.com/investors
Replay of the call will be available on the UVE website and by phone at (855) 859-2056 or internationally at (404) 537-3406 using the participant code: 3793583 through May 13, 2022

About Universal

Universal Insurance Holdings, Inc. (NYSE:UVE) is a holding company offering property and casualty insurance and value-added insurance services. We develop, market, and write insurance products for consumers predominantly in the personal residential homeowners lines of business and perform substantially all other insurance-related services for our primary insurance entities, including risk management, claims management and distribution. We sell insurance products through both our appointed independent agents and through our direct online distribution channels in the United States across 19 states (primarily Florida). Learn more at UniversalInsuranceHoldings.com.

Non-GAAP Financial Measures and Key Performance Indicators

This press release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission ("SEC"), including adjusted net income and adjusted earnings per share, which exclude the impact of the net realized and unrealized gains and losses on investments as well as extraordinary reinstatement premiums and associated commissions. Extraordinary reinstatement premiums are not covered by reinstatement premium protection and attach just below the Florida Hurricane Catastrophe Fund ("FHCF") reinsurance layer. Adjusted operating income excludes the impact of the net realized and unrealized gains and losses on investments, extraordinary reinstatement premiums and associated commissions and interest expense. A "non-GAAP financial measure" is generally defined as a numerical measure of a company's historical or future performance that excludes or includes amounts, or is subject to adjustments, so as to be different from the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles ("GAAP"). UVE management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. UVE management also believes that these non-GAAP financial measures enhance the ability of investors to analyze UVE's business trends and to understand UVE's performance. UVE's management utilizes these non-GAAP financial measures as guides in long-term planning. Non-GAAP financial measures should be considered in addition to, and not as a substitute for or superior to, financial measures presented in accordance with GAAP. For more information regarding our key performance indicators, please refer to the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operations – Key Performance Indicators" in our forthcoming Quarterly Report on Form 10-Q for the year ended March 31, 2022.

Forward-Looking Statements

This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "will," "plan," and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such statements may include commentary on plans, products and lines of business, marketing arrangements, reinsurance programs and other business developments and assumptions relating to the foregoing. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, including those risks and uncertainties described under the heading "Risk Factors" and "Liquidity and Capital Resources" in our 2021 Annual Report on Form 10-K, and supplemented in our subsequent Quarterly Reports on Form 10-Q. Future results could differ materially from those described, and the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information regarding risk factors that could affect the Company's operations and future results, refer to the Company's reports filed with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K and the most recent quarterly reports on Form 10-Q.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except per share data)

	March 31,			December 31,
	2022			2021
ASSETS:
Invested Assets
Fixed maturities, at fair value	$	1,014,677		$	1,040,455
Equity securities, at fair value		65,126			47,334
Investment real estate, net		5,845			5,891
Total invested assets		1,085,648			1,093,680
Cash and cash equivalents		165,398			250,508
Restricted cash and cash equivalents		2,635			2,635
Prepaid reinsurance premiums		109,401			240,993
Reinsurance recoverable		104,660			185,589
Premiums receivable, net		61,670			64,923
Property and equipment, net		54,170			53,682
Deferred policy acquisition costs		103,622			108,822
Goodwill		2,319			2,319
Other assets		59,432			52,990
TOTAL ASSETS	$	1,748,955		$	2,056,141

LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Unpaid losses and loss adjustment expenses	$	244,482		$	346,216
Unearned premiums		839,647			857,769
Advance premium		85,120			53,694
Reinsurance payable, net		12,723			188,662
Long-term debt, net		103,384			103,676
Other liabilities		67,258			76,422
Total liabilities		1,352,614			1,626,439
STOCKHOLDERS' EQUITY:
Cumulative convertible preferred stock ($0.01 par value)⁴		—			—
Common stock ($0.01 par value)⁵		471			470
Treasury shares, at cost - 16,117 and 15,797		(230,994	)		(227,115	)
Additional paid-in capital		109,099			108,202
Accumulated other comprehensive income (loss), net of taxes		(58,478	)		(15,568	)
Retained earnings		576,243			563,713
Total stockholders' equity		396,341			429,702
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,748,955		$	2,056,141

Notes:
⁴ Cumulative convertible preferred stock ($0.01 par value): Authorized - 1,000 shares; Issued - 10 and 10 shares; Outstanding - 10 and 10 shares; Minimum liquidation preference - $9.99 and $9.99 per share.
⁵ Common stock ($0.01 par value): Authorized - 55,000 shares; Issued - 47,063 and 47,018 shares; Outstanding 30,946 and 31,221 shares.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands)

	Three Months Ended
	March 31,
	2022			2021
REVENUES
Net premiums earned	$	269,064		$	243,305
Net investment income		4,042			2,986
Net realized gains on investments		58			542
Net change in unrealized (losses) of equity securities		(3,396	)		(494	)
Commission revenue		11,161			9,126
Policy fees		4,779			5,387
Other revenue		1,774			1,905
Total revenues		287,482			262,757

EXPENSES
Losses and loss adjustment expenses		185,106			143,963
Policy acquisition costs		54,723			56,458
Other operating expenses		23,574			25,965
Total operating costs and expenses		263,403			226,386
Interest expense		1,608			20
Income before income taxes		22,471			36,351
Income tax expense		4,934			9,943
NET INCOME	$	17,537		$	26,408

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SHARE AND PER SHARE INFORMATION

(in thousands, except per share data)

	Three Months Ended
	March 31,
	2022			2021
Weighted average common shares outstanding - basic		31,147			31,208
Weighted average common shares outstanding - diluted		31,227			31,277
Shares outstanding, end of period		30,946			31,216
Basic earnings per common share	$	0.56		$	0.85
Diluted earnings per common share	$	0.56		$	0.84
Cash dividend declared per common share	$	0.16		$	0.16
Book value per share, end of period	$	12.80		$	14.56
Annualized return on average equity (ROE)		16.9	%		23.2	%

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SUPPLEMENTARY INFORMATION

(in thousands, except for Policies In Force data)

	Three Months Ended
	March 31,
	2022			2021
*Premiums*
Direct premiums written - Florida	$	334,437		$	307,011
Direct premiums written - Other States		62,044			58,303
Direct premiums written - Total	$	396,481		$	365,314
Direct premiums earned	$	414,603		$	375,606
Net premiums earned	$	269,064		$	243,305

*Underwriting Ratios - Net*
Loss and loss adjustment expense ratio		68.8	%		59.2	%
Policy acquisition cost ratio		20.3	%		23.2	%
Other operating expense ratio⁶		8.8	%		10.7	%
Expense ratio⁶		29.1	%		33.9	%
Combined ratio		97.9	%		93.1	%

*Other Items*
(Favorable)/Unfavorable prior year's reserve development	$	655		$	(1,237	)
Points on the loss and loss adjustment expense ratio	0.2 pts			(0.5) pts

⁶Expense ratio excludes interest expense.

	As of
	March 31,
	2022		2021
Policies in force
Florida		672,029		721,321
Other States		244,716		254,929
Total		916,745		976,250

Premiums in force
Florida	$	1,416,185	$	1,279,464
Other States		286,966		269,193
Total	$	1,703,151	$	1,548,657

Total Insured Value
Florida	$	201,091,861	$	194,421,426
Other States		118,041,945		110,930,255
Total	$	319,133,806	$	305,351,681

	Three Months Ended March 31, 2022
	Direct		Loss Ratio		Ceded		Loss Ratio		Net		Loss Ratio
Premiums earned	$	414,603			$	145,539			$	269,064

Loss and loss adjustment expenses:
Core losses	$	179,950	43.4	%	$	44	—	%	$	179,906	66.9	%
Weather events⁷		4,545	1.1	%		—	—	%		4,545	1.7	%
Prior year's reserve development		10,660	2.6	%		10,005	6.9	%		655	0.2	%
Total losses and loss adjustment expenses	$	195,155	47.1	%	$	10,049	6.9	%	$	185,106	68.8	%

⁷Includes only current year weather events beyond those expected.

	Three Months Ended March 31, 2021
	Direct		Loss Ratio		Ceded		Loss Ratio		Net			Loss Ratio
Premiums earned	$	375,606				132,301			$	243,305

Loss and loss adjustment expenses:
Core losses	$	145,228	38.7	%	$	28	—	%	$	145,200		59.7	%
Weather events⁷		—	—	%		—	—	%		—		—	%
Prior year's reserve development		92,070	24.5	%		93,307	70.5	%		(1,237	)	(0.5	) %
Total losses and loss adjustment expenses	$	237,298	63.2	%	$	93,335	70.5	%	$	143,963		59.2	%

⁷Includes only current year weather events beyond those expected.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(in thousands, except for per share data)

	Three Months Ended						Guidance
	March 31,						Full Year 2022E
		2022			2021
GAAP Operating Income to Adjusted Operating Income
Income Before Income Taxes	$	22,471		$	36,351
less: Net realized gains on investments		58			542
less: Net change in unrealized (losses) of equity securities		(3,396	)		(494	)
less: Interest (expense)		(1,608	)		(20	)
Adjusted Operating Income	$	27,417		$	36,323

GAAP Net Income to Adjusted Net Income
GAAP Net Income	$	17,537		$	26,408
less: Net realized gains on investments		58			542
less: Net change in unrealized (losses) of equity securities		(3,396	)		(494	)
Total pre-tax adjustments		(3,338	)		48
less: Income tax (expense) benefit on above adjustments		823			(11	)
Total adjustments		(2,515	)		37
Adjusted Net Income	$	20,052		$	26,371

GAAP Diluted EPS to Adjusted EPS
GAAP Diluted EPS	$	0.56		$	0.84		$ 1.80 - 2.20
less: Net realized gains on investments		—			0.02		—
less: Net change in unrealized (losses) of equity securities		(0.11	)		(0.02	)	—
Total pre-tax adjustments		(0.11	)		—		—
less: Income (tax) benefit on above adjustments		0.03			—		—
Total adjustments		(0.08	)		—		—
Adjusted EPS	$	0.64		$	0.84		$ 1.80 - 2.20

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