Brown & Brown, Inc. Announces 4.9% Increase in First-Quarter Net Income

DAYTONA BEACH, FL and TAMPA, FL--(Marketwire - April 18, 2011) - Brown & Brown, Inc. (NYSE: [ BRO ]) today announced its financial results for the first quarter of 2011.

Net income for the first quarter of 2011 was $46,293,000, or $0.32 per share, compared with $44,128,000, or $0.31 per share for the same quarter of 2010, an increase of 4.9%. Total revenue for the first quarter ended March 31, 2011 was $262,228,000, compared with 2010 first-quarter revenue of $252,273,000, and increase of 3.9%.

J. Powell Brown, President and Chief Executive Officer of Brown & Brown, Inc., noted, "We are pleased with the continued incremental improvement in our operating results. Many of our middle-market clients continue to experience pressure on their businesses, with the consequence that their revenues and payrolls are flat to slightly down. Yet our team continues to deliver for our clients, as evidenced by our Wholesale Brokerage Division's positive first-quarter performance."

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 future financial results and to acquisition opportunities. 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. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results and condition, as well as its other achievements, are contained in the Company's filings with the Securities and Exchange Commission. Some factors include: general economic conditions around the country; downward commercial property and casualty premium pressures; the effects of legislative and regulatory changes in Florida pertaining to the insurance industry, including those relating to coastal property coverages; the competitive environment; the integration of the Company's operations with those of businesses or assets the Company has acquired or may acquire in the future and the failure to realize the expected benefits of such integration; and the potential occurrence of a disaster that affects certain areas of the States of California, Florida, Indiana, Michigan, New Jersey, New York, Pennsylvania, Texas and/or Washington, where significant portions of the Company's business are concentrated. 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
For the Three Months Ended March 31, 2011 and 2010
(in thousands, except per share data)
(unaudited)
			2011			2010
REVENUES
Commissions and fees			$	261,452		$	250,674
Investment income				224			331
Other income, net				552			1,268
		Total revenues		262,228			252,273

EXPENSES
Employee compensation and benefits				126,557			122,183
Non-cash stock-based compensation				2,773			1,955
Other operating expenses				36,076			36,333
Amortization				13,509			12,553
Depreciation				3,135			3,253
Interest				3,607			3,608
Change in estimated acquisition earn-out payables				(99	)		(696	)
		Total expenses		185,558			179,189

Income before income taxes				76,670			73,084

Income taxes				30,377			28,956

Net income			$	46,293		$	44,128

Net income per share:
	Basic		$	0.32		$	0.31
	Diluted		$	0.32		$	0.31

Weighted average number of shares outstanding:
	Basic			138,351			137,623
	Diluted			140,648			137,791

Dividends declared per share			$	0.0800		$	0.0775



Brown & Brown, Inc.
INTERNAL GROWTH SCHEDULE
Core Commissions and Fees⁽¹⁾
Three Months Ended March 31, 2011
(in thousands)
(unaudited)

		Quarter Ended 03/31/11		Quarter Ended 03/31/10		Total Net Change			Total Net Growth %		Less Acquisition Revenues		Internal Net Growth $			Internal Net Growth %

Florida Retail		$	38,626	$	37,778	$	848		2.2	%	$	1,779	$	(931	)	(2.5	)%
National Retail			82,223		77,324		4,899		6.3	%		7,422		(2,523	)	(3.3	)%
Western Retail			24,658		21,958		2,700		12.3	%		3,360		(660	)	(3.0	)%
	Total Retail		145,507		137,060		8,447		6.2	%		12,561		(4,114	)	(3.0	)%

Professional Programs			9,523		9,826		(303	)	(3.1	)%		-		(303	)	(3.1	)%
Special Programs			27,663		28,542		(879	)	(3.1	)%		-		(879	)	(3.1	)%
Total National Programs			37,186		38,368		(1,182	)	(3.1	)%		-		(1,182	)	(3.1	)%

Wholesale Brokerage			34,056		33,723		333		1.0	%		-		333		1.0	%

Services			15,823		8,996		6,827		75.9	%		6,856		(29	)	(0.3	)%

Total Core Commissions and Fees⁽¹⁾		$	232,572	$	218,147	$	14,425		6.6	%	$	19,417	$	(4,992	)	(2.3	)%



Reconciliation of Internal Growth Schedule
to Total Commissions and Fees
Included in the Consolidated Statements of Income
For the Three Months Ended March 31, 2011 and 2010
(in thousands)
(unaudited)
	Quarter Ended 03/31/11		Quarter Ended 03/31/10
Total core commissions and fees⁽¹⁾	$	232,572	$	218,147
Contingent commissions		28,880		32,236
Divested business		-		291

Total commission & fees	$	261,452	$	250,674

(1) Total core commissions and fees are our total commissions and fees less (i) profit-sharing contingent commissions (revenue 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), and (ii) divested business (commissions and fees generated from offices, books of business or niches sold by the Company or terminated).


Brown & Brown, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
(unaudited)

			March 31, 2011		December 31, 2010
ASSETS
Current assets:
	Cash and cash equivalents		$	265,682	$	272,984
	Restricted cash and investments			115,635		123,594
	Short-term investments			7,481		7,678
	Premiums, commissions and fees receivable			232,688		214,446
	Deferred income taxes			8,235		20,076
	Other current assets			25,242		14,031
		Total current assets		654,963		652,809

Fixed assets, net				59,574		59,713
Goodwill				1,225,357		1,194,827
Amortizable intangible assets, net				485,530		481,900
Other assets				18,572		11,565
		Total assets	$	2,443,996	$	2,400,814

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Premiums payable to insurance companies		$	330,745	$	311,346
	Premium deposits and credits due customers			31,555		28,509
	Accounts payable			31,627		33,693
	Accrued expenses and other liabilities			64,709		94,947
	Current portion of long-term debt			1,212		1,662
		Total current liabilities		459,848		470,157

Long-term debt				250,067		250,067

Deferred income taxes, net				153,160		146,482

Other liabilities				36,509		27,764

Shareholders' equity:
	Common stock, par value $0.10 per share; authorized 280,000 shares; issued and outstanding 142,548 at 2011 and 142,795 at 2010			14,255		14,279
	Additional paid-in capital			290,197		286,997
	Retained earnings			1,239,954		1,205,061
	Accumulated other comprehensive income			6		7

		Total shareholders' equity		1,544,412		1,506,344

		Total liabilities and shareholders' equity	$	2,443,996	$	2,400,814

Contributing Sources

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Brown & Brown, Inc. Announces 4.9% Increase in First-Quarter Net Income