NI Holdings Files Q2 2024 10-Q Amendment

TL;DR

NI Holdings amended its Q2 2024 10-Q. Check for updates.

AI Summary

NI Holdings, Inc. filed an amendment (Amendment No. 1) to its quarterly report on Form 10-Q for the period ended June 30, 2024. This filing, submitted on November 5, 2024, provides updated information regarding the company's financial performance and operations during the second quarter of 2024.

Why It Matters

This amended filing provides updated financial and operational details for NI Holdings, Inc. for the quarter ending June 30, 2024, which is crucial for investors assessing the company's current performance.

Risk Assessment

Risk Level: low — This is an amendment to a routine quarterly filing, not indicating new material adverse events.

Key Players & Entities

• NI Holdings, Inc. (company) — Registrant
• June 30, 2024 (date) — Quarterly period end date
• November 5, 2024 (date) — Filing date
• 001-37973 (company) — SEC file number

FAQ

Key Financial Figures

• $0.01 — ange on which registered Common Stock, $0.01 par value per share NODK Nasdaq Capital
• $3.4 million — tionally failed to record approximately $3.4 million of receivables on Westminster's closing
• $3.4 m — he Company's total net loss by the same $3.4 million, or $0.17 and $0.16 per basic and
• $0.17 — l net loss by the same $3.4 million, or $0.17 and $0.16 per basic and diluted share f
• $0.16 — by the same $3.4 million, or $0.17 and $0.16 per basic and diluted share for the thr

Filing Documents

• nodk-20240630.htm (10-Q/A) — 2063KB
• ex31-1.htm (EX-31.1) — 9KB
• ex31-2.htm (EX-31.2) — 10KB
• ex32.htm (EX-32) — 6KB
• 0001174947-24-001214.txt ( ) — 12697KB
• nodk-20240630_cal.xml (EX-101.CAL) — 114KB
• nodk-20240630_def.xml (EX-101.DEF) — 472KB
• nodk-20240630_lab.xml (EX-101.LAB) — 834KB
• nodk-20240630_pre.xml (EX-101.PRE) — 491KB
• nodk-20240630.xsd (EX-101.SCH) — 108KB
• nodk-20240630_htm.xml (XML) — 2656KB

, Item 1 – Financial Statements

Part I, Item 1 – Financial Statements

, Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations

Part I, Item 2 – Management's Discussion and Analysis of Financial Condition and Results of Operations

, Item 4 – Controls and Procedures

Part I, Item 4 – Controls and Procedures

, Item 6 – Exhibits

Part II, Item 6 – Exhibits The exhibit list included in Part II, Item 6 "Exhibits" herein has been amended to contain currently dated certifications from the Company's Interim Chief Executive Officer and Chief Financial Officer, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 and filed as Exhibits 31.1, 31.2, and 32. In accordance with applicable SEC rules, this Amended Second Quarter 2024 Quarterly Report also includes an updated signature page.

, Item 1, Note 2 "Basis of Presentation and Accounting Policies"

Part I, Item 1, Note 2 "Basis of Presentation and Accounting Policies" of this Quarterly Report on Form 10-Q/A also includes information related to this restatement, including a summary of the impacts of these adjustments. iii TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS 2

- FINANCIAL INFORMATION

Part I. - FINANCIAL INFORMATION 3

- Financial Statements

Item 1. - Financial Statements 3 Consolidated Balance Sheet – June 30, 2024 (As Restated) (Unaudited) and December 31, 2023 3 Consolidated 4 Consolidated 2023 5 Consolidated Restated) and 2023 6 Consolidated 8 Notes to Unaudited Consolidated Financial Statements (As Restated) 10 Item 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations (As Restated) 46

- Quantitative and Qualitative Disclosures about Market Risk

Item 3. - Quantitative and Qualitative Disclosures about Market Risk 55 Item 4. - Controls and Procedures (As Restated) 55

- OTHER INFORMATION

Part II. - OTHER INFORMATION 56

- Legal Proceedings

Item 1. - Legal Proceedings 56

- Risk Factors

Item 1A. - Risk Factors 56

- Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. - Unregistered Sales of Equity Securities and Use of Proceeds 57

- Defaults upon Senior Securities

Item 3. - Defaults upon Senior Securities 57

- Mine Safety Disclosures

Item 4. - Mine Safety Disclosures 57

- Other Information

Item 5. - Other Information 58

- Exhibits

Item 6. - Exhibits 58

Signatures

Signatures 59 iv CERTAIN IMPORTANT INFORMATION Unless the context otherwise requires, as used in this Quarterly Report on Form 10-Q/A ("Form 10-Q/A"): "NI Holdings", "the Company", "we", "us", and "our" refer to NI Holdings, Inc., together with Nodak Insurance Company and its subsidiaries, Direct Auto Insurance Company, and Westminster American Insurance Company (sold on June 30, 2024), for periods discussed after completion of the conversion, and for periods discussed prior to completion of the conversion refer to Nodak Mutual Insurance Company and all of its subsidiaries and Battle Creek Mutual Insurance Company; the "Nodak conversion" refers to the series of transactions consummated on March 13, 2017, by which Nodak Mutual Insurance Company converted from a mutual insurance company to a stock insurance company, as Nodak Insurance Company, and became a wholly-owned subsidiary of NI Holdings, an intermediate stock holding company formed on the date of conversion; "Nodak Mutual Group" refers to Nodak Mutual Group, Inc., which is the majority shareholder of NI Holdings; "Nodak Mutual" refers to Nodak Mutual Insurance Company, the predecessor company to Nodak Insurance Company prior to the conversion; "Nodak Insurance" refers to Nodak Insurance Company or Nodak Mutual Insurance Company interchangeably; "members" refers to the policyholders of Nodak Insurance, who are the named insureds under insurance policies issued by Nodak Insurance; "Battle Creek" refers to Battle Creek Mutual Insurance Company or Battle Creek Insurance Company interchangeably. Battle Creek Mutual Insurance Company became affiliated with Nodak Insurance in 2011 and, prior to January 2, 2024, was controlled by Nodak Insurance via a surplus note. The terms of the surplus note allowed Nodak Insurance to appoint two-thirds of the Battle Creek Mutual Insurance Company Board of Directors. As of January 2, 2024, the North Dakota Secretary of State approved the conversion of Battle Cree

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This report contains, and management may make, certain "forward-looking historical facts, may be forward-looking statements. Words such as "may", "will", "should", "likely", "anticipates", "expects", "intends", "plans", "projects", "believes", "views", "estimates", and similar expressions are used to identify these forward-looking statements. These statements include, among other things, the Company's statements about: our anticipated operating and financial performance, business plans, and prospects; strategic reviews, capital allocation objectives, dividends, and share repurchases; plans for and prospects of acquisitions, dispositions, and other business development activities, and our ability to successfully capitalize on these opportunities; the impact of a future pandemic and related economic conditions, including the potential impact on the Company's investments; our ability to enter new markets successfully and capitalize on growth opportunities either through acquisitions or the expansion of our distribution network; cyclical changes in the insurance industry, competition, and innovation and emerging technologies; expectations for impact of, or changes to, existing or new government regulations or laws; our ability to anticipate and respond to macroeconomic, geopolitical, health and industry trends, pandemics, acts of war, and other large-scale crises; developments in general economic conditions, domestic and global financial markets, interest rates, unemployment, or inflation, that could affect the performance of our insurance operations and/or investment portfolio; and our ability to effectively manage future growth, including additional necessary capital, systems, and personnel. Given their nature, we cannot assure that any outcome expressed in these or other forward-looking state

- FINANCIAL INFORMATION

PART I. - FINANCIAL INFORMATION

- Financial Statements

Item 1. - Financial Statements NI Holdings, Inc. Consolidated Balance Sheets (dollar amounts in thousands, except par value) June 30, 2024 (As Restated) December 31, 2023 (Unaudited) Assets: Cash and cash equivalents $ 51,390 $ 41,037 Fixed income securities, at fair value (net of allowance for expected credit losses of $ 0 at June 30, 2024 and December 31, 2023) 303,415 289,399 Equity securities, at fair value 22,973 21,983 Other investments 2,006 2,006 Total cash and investments 379,784 354,425 Premiums and agents' balances receivable (net of allowance for expected credit losses of $ 348 at June 30, 2024 and $ 394 at December 31, 2023) 92,831 56,154 Deferred policy acquisition costs 31,157 26,790 Reinsurance premiums receivable (payable) — ( 1,403 ) Reinsurance recoverables on losses (net of allowance for expected credit losses of $ 0 at June 30, 2024 and December 31, 2023) 9,423 6,460 Income tax recoverable 8,069 — Accrued investment income 2,473 2,325 Property and equipment, net 7,586 7,452 Deferred income taxes 10,236 9,228 Receivable from Federal Crop Insurance Corporation 13,793 17,404 Goodwill and other intangibles 2,728 2,728 Other assets 12,907 10,866 Assets of discontinued operations — 162,457 Total assets $ 570,987 $ 654,886 Liabilities: Unpaid losses and loss adjustment expenses $ 148,527 $ 119,185 Unearned premiums 157,730 126,100 Reinsurance premiums payable 912 — Income tax payable — 147 Accrued expenses and other liabilities 27,754 17,758 Liabilities of discontinued operations — 141,297 Total liabilities 334,923 404,487 Shareholders' equity: Common stock, $ 0.01 par value, authorized: 25,000,000 shares; issued: 23,000,000 shares; and outstanding: 2024 – 20,648,642 shares, 2023 – 20,599,908 shares 230 230 Additional paid-in capital 96,581 96,294 Unearned employee stock ownership plan shares ( 698 ) ( 698 ) Retained earnings

financial statements

financial statements. 6 NI Holdings, Inc. Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (dollar amounts in thousands) Three Months Ended June 30, 2023 Common Stock Additional Paid-in Capital Unearned Employee Stock Plan Shares Retained Earnings Accumulated Other Comprehensive Loss, Net of Income Taxes Treasury Stock Non-Controlling Interest Total Shareholders' Equity Balance, April 1, 2023 $ 230 $ 95,568 $ ( 941 ) $ 209,710 $ ( 24,848 ) $ ( 28,803 ) $ 2,155 $ 253,071 Battle Creek demutualization — — — — — — — — Net loss — — — ( 8,122 ) — — ( 113 ) ( 8,235 ) Impact of Westminster unrealized investment gains/losses — — — — — — — — Other comprehensive income (loss), net of income taxes — — — — ( 2,138 ) — ( 108 ) ( 2,246 ) Purchase of treasury stock — — — — — ( 2,602 ) — ( 2,602 ) Share-based compensation — 396 — — — — — 396 Issuance of vested award shares — ( 214 ) — ( 70 ) — 283 — ( 1 ) Balance, June 30, 2023 $ 230 $ 95,750 $ ( 941 ) $ 201,518 $ ( 26,986 ) $ ( 31,122 ) $ 1,934 $ 240,383 Six Months Ended June 30, 2023 Common Stock Additional Paid-in Capital Unearned Employee Stock Plan Shares Retained Earnings Accumulated Other Comprehensive Loss, Net of Income Taxes Treasury Stock Non-Controlling Interest Total Shareholders' Equity Balance, January 1, 2023 $ 230 $ 95,671 $ ( 941 ) $ 214,121 $ ( 29,286 ) $ ( 28,818 ) $ 2,230 $ 253,207 Battle Creek demutualization — — — — — — — — Net loss — — — ( 12,332 ) — — ( 403 ) ( 12,735 ) Impact of Westminster unrealized investment gains/losses — — — — — — — — Other comprehensive income (loss), net of income taxes — — — — 2,300 — 107 2,407 Purchase of treasury stock — — — — — ( 3,223 ) — ( 3,223 ) Share-based compensation — 901 — — — — — 901 Issuanc

financial statements

financial statements. 7 NI Holdings, Inc. Consolidated Statements of Cash Flows (Unaudited) (dollar amounts in thousands) Six Months Ended June 30, 2024 (As Restated) 2023 Cash flows from operating activities: Net income (loss) $ ( 13,203 ) $ ( 12,735 ) Less net income (loss) from discontinued operations, net of taxes ( 1,512 ) ( 11,973 ) Adjustments to reconcile net income (loss) to net cash flows from operating activities: Net investment gains ( 876 ) ( 1,230 ) Deferred income tax expense (benefit) ( 491 ) ( 3,690 ) Depreciation of property and equipment 341 309 Amortization of intangibles — 25 Share-based compensation 1,136 901 Amortization of deferred policy acquisition costs 36,107 31,788 Deferral of policy acquisition costs ( 40,474 ) ( 35,585 ) Net amortization of premiums and discounts on investments 331 523 Gain on sale of property and equipment ( 72 ) ( 44 ) Changes in operating assets and liabilities: Premiums and agents' balances receivable ( 36,677 ) ( 43,904 ) Reinsurance premiums receivable / payable ( 491 ) 253 Reinsurance recoverables on losses ( 2,963 ) ( 2,362 ) Accrued investment income ( 148 ) ( 152 ) Federal Crop Insurance Corporation receivable / payable 3,611 1,430 Other assets ( 2,041 ) ( 863 ) Unpaid

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