SECURITIES AND EXCHANGE COMMISSION
WASHINGTON. D.C. 20549
FORM 10-Q
X Quarterly report pursuant to Section 13 or 15(d) of the Securities
- ---- Exchange Act of 1934
For quarterly period ended March 31, 2002
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Transition report pursuant to Section 13 or 15(d) of the Securities
- ---- Exchange Act of 1934
For the transition period from to
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Commission File Number 333-34088
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Integon Re (Barbados), Limited
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(Exact name of registrant as specified in its charter)
Barbados N/A
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Financial Place, Collymore Rock, St. Michael, Barbados N/A
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(Address of principal executive offices) (Zip Code)
(246) 436-4895
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes
of common stock as of the latest practicable date.
Class As of March 31, 2002
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Common Stock, no par-value 1,000,000
This quarterly report, filed pursuant to Rule 13a-13 of the General Rules
and Regulations under the Securities Exchange Act of 1934, consists of the
following information as specified in Form 10-Q:
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
1. Balance Sheets, March 31, 2002 and December 31, 2001.
2. Statements of Operations and Retained Earnings for the
three-month periods ended March 31, 2002 and 2001.
3. Statements of Cash Flows for the three-month periods ended March
31, 2002 and 2001.
In the opinion of Management, the accompanying financial statements reflect all
adjustments, consisting of normal recurring accruals, which are necessary for a
fair presentation of the results for the interim periods presented. The
information furnished for the three month period ended March 31, 2002 may not be
indicative of results for the full year.
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INTEGON RE (BARBADOS), LIMITED
BALANCE SHEETS
(Expressed in U.S. Dollars)
March 31, 2002 December 31, 2001
(unaudited) (Audited)
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ASSETS
Investments $ 1,000,000 $ 1,000,000
Cash and cash equivalents 9,311 12,372
Accrued investment income 178 86
Due from shareholder 69,143 63,804
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Total Assets $ 1,078,632 $ 1,076,262
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STOCKHOLDERS' EQUITY
Share Capital
Common Stock-no par value;
Authorized - unlimited
shares; issued and
outstanding - 1,000,000
shares at March 31, 2002
and December 31, 2001 $ 1,000,000 $ 1,000,000
Retained Earnings 78,632 76,262
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Total Stockholders' Equity $ 1,078,632 $ 1,076,262
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INTEGON RE (BARBADOS), LIMITED
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS FOR THE THREE
MONTH PERIODS ENDED MARCH 31, 2002 AND 2001
(UNAUDITED)
(Expressed in U.S. Dollars)
Three Month Period Three Month Period
Ended March 31, Ended March 31,
2002 2001
INCOME
Interest earned $ 2,370 $ 12,322
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TOTAL INCOME 2,370 12,322
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RETAINED EARNINGS, beginning of
period 76,262 43,667
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RETAINED EARNINGS, end of period $ 78,632 $ 55,989
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INTEGON RE (BARBADOS), LIMITED
STATEMENTS OF CASH FLOWS FOR THE THREE MONTH PERIODS ENDED
MARCH 31, 2002 AND 2001
UNAUDITED
(Expressed in U.S. Dollars)
Three Month Period Three Month Period
Ended March 31, 2002 Ended March 31, 2001
Cash flows from operating activities:
Administrative expenses paid $ (5,339) $ (13,139)
Investment income received 2,278 12,576
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Net cash used in operating activities (3,061) (563)
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Decrease in cash and cash equivalents (3,061) (563)
Cash and cash equivalents,
beginning of period 1,012,372 1,005,501
Cash and cash equivalents,
end of period $ 1,009,311 $ 1,004,938
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Reconciliation of net income to net cash
provided by operating activities:
Net income $ 2,370 $ 12,322
Change in:
Accrued investment income (92) 254
Due from shareholder (5,339) (13,139)
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Net cash used in operating activities $ (3,061) $ (563)
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Item 2. Management's Discussion And Analysis of Financial Condition And
Results of Operations
Liquidity
The Company was incorporated on March 20, 2000 and as of the date of this
report, has not commenced operations. When it does, its liquidity requirements
will relate to payment of insurance losses, administrative expenses, and
dividends. Premiums generated by the Company's reinsurance business, combined
with investment earnings plus proceeds from the sale of the Company's
Participating Shares, will be its principal sources of funds. The Company
believes that such funds will be sufficient to meet its liquidity requirements
in 2002? and in future years to which its reinsurance liabilities will extend.
No capital expenditures are expected during the next few years.
Capital Resources
The Company's capitalization on December 31, 2001 and March 31, 2002, consisted
of paid in capital with respect to the Common Stock of $1,000,000, and earnings
retained for use in its business in the amount of $76,262 and $78,632,
respectively. In the future, the Company's capitalization will also include paid
in capital with respect to the Participating Shares which will range from
$125,000 to $7,500,000 (depending on the number of Participating Shares sold).
Barbados insurance law requires that the Company maintain a minimum
capitalization of $125,000 and, in addition, that the recorded value of the
Company's assets exceed its liabilities by: (a) $125,000 where the Company's
earned premium in the preceding financial year did not exceed $750,000; (b) an
amount equal to 20% of the Company's earned premium for the preceding financial
year, where such income exceeded $750,000 but did not exceed $5,000,000; and (c)
an amount equal to the aggregate of $1,000,000 and 10% of the amount by which
the Company's earned premium for the preceding financial year exceeded
$5,000,000. If the Company's net assets are less than mandated by Barbados law,
the Company has the right to reduce the business related to a Subsidiary Capital
Account by retrocession or any other means to the extent necessary to permit the
Subsidiary Capital Account to meet its pro rata share of the Company's required
capital and surplus.
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Results of Operations
Because the Company has not commenced operations as of the date of this report,
the Company's only income since incorporation has consisted of investment income
that the Company earned on paid in capital with respect to the Common Stock. For
the quarter ended March 31, 2002, the Company had $2,370 of investment income
compared with $12,322 of investment income for the comparable period of the
prior year. The reduction in investment income in the quarter under review
compared to the comparable period in the prior year is attributable to
reductions in the rate of interest received on the Company's investments.
The foregoing Management Discussion and Analysis of Financial Condition and
Results of Operations contains various forward looking statements within the
meaning of applicable federal securities laws and are based upon the Company's
current expectations and assumptions concerning future events, which are subject
to a number of risks and uncertainties that could cause actual results to differ
materially from those anticipated.
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(b) No reports on Form 8-K were filed during the quarter for which this
report is filed.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INTEGON RE (BARBADOS), LIMITED (Registrant)
By: s/Ronald W. Jones
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Ronald W. Jones
Vice President, Finance
Signing on behalf of
the Registrant, and
Principal Financial Officer
Dated: May 15, 2002
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