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Brown & Brown, Inc. Announces Company Record Fourth-Quarter Earnings of $47.2 Million and 2013 Net Income Growth of 18.0%


February 3, 2014 - Daytona Beach, Fl And Tampa, FL

Brown & Brown, Inc. (NYSE: BRO) today announced its preliminary, unaudited financial results for the fourth quarter of 2013.

Net income for the fourth quarter of 2013 was $47,225,000, or $0.32 per share, compared with $42,637,000, or $0.29 per share for the same quarter of 2012, an increase of 10.8%. Total revenue for the fourth quarter was $343,165,000, compared with 2012 fourth-quarter revenue of $302,830,000, an increase of 13.3%.

Total revenue for the twelve months ended December 31, 2013 was $1,363,279,000, compared with total revenue for the same period of 2012 of $1,200,032,000, an increase of 13.6%. Net income for the twelve-month period ended December 31, 2013 was $217,112,000, or $1.48 per share, compared with $184,045,000, or $1.26 per share for the same period of 2012, an increase of 18.0%.

J. Powell Brown, President and Chief Executive Officer of the Company, noted, "We are very pleased that we grew our net income 18.0% in 2013. Our Colonial Claims subsidiary, which adjusts flood claims, had core commissions and fees of $1.3 million in the fourth quarter of 2013, but had $7.4 million of core commissions and fees in the fourth quarter of 2012 as a result of the significant flood claims attributable to SuperStorm Sandy. Excluding the impact of Colonial Claims, our core organic commissions and fees in the fourth quarter of 2013 grew by 4.5%. In addition, we continued to improve certain operating profit margins in the fourth quarter."

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' seventh 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 and full year of 2013. 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 and full year of 2013 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, 2012, 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 For the
Three Months Ended Twelve Months Ended
December 31, December 31,
--------------------- ---------------------
2013 2012 2013 2012
---------- ---------- ---------- ----------
REVENUES
Commissions and fees $ 339,364 $ 300,296 $1,355,503 $1,189,081
Investment income 128 236 638 797
Other income, net 3,673 2,298 7,138 10,154
---------- ---------- ---------- ----------
Total revenues 343,165 302,830 1,363,279 1,200,032
---------- ---------- ---------- ----------

EXPENSES
Employee compensation and
benefits 179,460 158,467 683,000 608,506
Non-cash stock-based
compensation 7,699 4,472 22,603 15,865
Other operating expenses 51,839 44,995 195,677 174,389
Amortization 17,792 16,123 67,932 63,573
Depreciation 4,589 3,990 17,485 15,373
Interest 4,324 4,004 16,440 16,097
Change in estimated acquisition
earn-out payables 1,020 1,552 2,533 1,418
---------- ---------- ---------- ----------
Total expenses 266,723 233,603 1,005,670 895,221
---------- ---------- ---------- ----------

Income before income taxes 76,442 69,227 357,609 304,811

Income taxes 29,217 26,590 140,497 120,766
---------- ---------- ---------- ----------

Net income $ 47,225 $ 42,637 $ 217,112 $ 184,045
========== ========== ========== ==========

Net income per share:
Basic $ 0.32 $ 0.30 $ 1.50 $ 1.28
========== ========== ========== ==========
Diluted $ 0.32 $ 0.29 $ 1.48 $ 1.26
========== ========== ========== ==========

Weighted average number of
shares outstanding:
Basic 141,355 139,681 141,033 139,364
========== ========== ========== ==========
Diluted 143,036 142,314 142,624 142,010
========== ========== ========== ==========

Dividends declared per share $ 0.100 $ 0.090 $ 0.3700 $ 0.3450
========== ========== ========== ==========



Brown & Brown, Inc.
INTERNAL GROWTH SCHEDULE
Core Organic Commissions and Fees(1)
Three Months Ended December 31, 2013
(in thousands)
(unaudited)


Total Internal Internal
Quarter Quarter Total Net Less Net Net
Ended Ended Net Growth Acquisition Growth Growth
12/31/13 12/31/12 Change % Revenues $ %
-------- -------- ------- ------ ---------- ------- -------

Retail(2) $184,996 $151,041 $33,955 22.5% $ 33,625 $ 330 0.2%

National
Programs 73,528 64,090 9,438 14.7% 3,094 6,344 9.9%

Wholesale
Brokerage 46,238 40,299 5,939 14.7% - 5,939 14.7%

Services 28,273 34,398 (6,125) -17.8% - (6,125) -17.8%
-------- -------- ------- ---------- -------

Total Core
Commissions
and Fees
(1) $333,035 $289,828 $43,207 14.9% $ 36,719 $ 6,488 2.2%
======== ======== ======= ========== =======



Reconciliation of Internal Growth Schedule
to Total Commissions and Fees
Included in the Consolidated Statements of Income
For the Three Months Ended December 31, 2013 and 2012
(in thousands)
(unaudited)

Quarter Quarter
Ended Ended
12/31/13 12/31/12
------------- -------------
Total core commissions and fees(1) $ 333,035 $ 289,828
Profit-sharing contingent commissions 4,382 6,342
Guaranteed supplemental commissions 1,947 1,937
Divested business - 2,189
------------- -------------

Total commissions & fees $ 339,364 $ 300,296
============= =============

(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,
2013 2012
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 202,952 $ 219,821
Restricted cash and investments 250,009 164,564
Short-term investments 10,624 8,183
Premiums, commissions and fees receivable 395,915 302,725
Deferred income taxes 29,276 24,408
Other current assets 39,260 39,811
------------- -------------
Total current assets 928,036 759,512

Fixed assets, net 74,733 74,337
Goodwill 2,006,173 1,711,514
Amortizable intangible assets, net 618,888 566,538
Other assets 21,678 16,157
------------- -------------
Total assets $ 3,649,508 $ 3,128,058
============= =============

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Premiums payable to insurance companies $ 534,360 $ 406,704
Premium deposits and credits due customers 80,959 32,867
Accounts payable 34,158 48,524
Accrued expenses and other liabilities 157,400 79,593
Current portion of long-term debt 100,000 93
------------- -------------
Total current liabilities 906,877 567,781

Long-term debt 380,000 450,000

Deferred income taxes, net 291,704 237,630

Other liabilities 63,786 65,314

Shareholders' equity:
Common stock, par value $0.10 per share;
authorized 280,000 shares; issued and
outstanding 145,419 at 2013 and 143,878 at
2012 14,542 14,388
Additional paid-in capital 371,960 335,872
Retained earnings 1,620,639 1,457,073
------------- -------------
Total shareholders' equity 2,007,141 1,807,333
------------- -------------

Total liabilities and shareholders' equity $ 3,649,508 $ 3,128,058
============= =============

Cory T. Walker
Chief Financial Officer
(386) 239-7250

MarketWire

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