Atlantic American Reports Third Quarter Results
November 13 2018 - 12:09PM
Atlantic American Corporation (Nasdaq- AAME) today reported net
income for the three month period ended September 30, 2018 of $0.9
million, or $0.04 per share, as compared to $0.7 million, or $0.03
per share, for the comparable period of 2017. For the nine
month period ended September 30, 2018, the company reported a net
loss of $0.9 million, or $0.06 per share, as compared to net income
of $2.0 million, or $0.08 per share, for the comparable period of
2017. The increase in net income during the third quarter of
2018 was primarily due to $1.1 million of net unrealized gains in
equity securities during the third quarter of 2018 compared to nil
for the third quarter of 2017. The net loss for the nine
month period ended September 30, 2018 was primarily due to an
increase in operating losses as a result of higher levels of
morbidity experienced in the Medicare supplement line of business
during the first half of 2018.
Total revenues for the three month period ended
September 30, 2018 were $46.4 million as compared to $44.8 million
for the three month period ended September 30, 2017. The
above mentioned unrealized gains in equity securities and an
increase in insurance premiums were the most significant
contributors to the increase in total revenues. Insurance
premiums during the three month period ended September 30, 2018
increased $0.5 million or 1.1% from the comparable 2017 period and
was primarily the result of an increase in Medicare supplement
premiums in the Company’s life and health operations somewhat
offset by a decrease in property and casualty premiums. For
the nine month period ended September 30, 2018, revenues were
$136.4 million, increasing 3.1% from the comparable 2017 period
revenues of $132.3 million, primarily as a result of an increase in
Medicare supplement premium revenues. Insurance premiums
during the nine month period ended September 30, 2018 of $127.6
million increased 3.7% from the comparable 2017 period amount of
$123.0 million.
Commenting on the third quarter, Hilton H.
Howell, Jr., chairman, president and chief executive officer,
stated, “Our senior leadership team at Bankers Fidelity continues
to drive efforts focused on improving profitability, enhancing the
product portfolio, and delivering superior customer service to our
policyholders and agents. Although the year to date Medicare
supplement results did not meet expectations, we are encouraged by
the continued growth in the life and health operation and are
confident strategic rate adjustments implemented throughout the
year will result in improved margins. Even though our
property and casualty premiums declined slightly, American Southern
continues to deliver profitable operating results through prudent
underwriting of their programs. While anticipating a good
close to the current year, we feel well positioned for a successful
2019.”
Atlantic American is an insurance holding
company involved through its subsidiary companies in specialty
markets of the life, health, and property and casualty insurance
industries. Its principal insurance subsidiaries are American
Southern Insurance Company, American Safety Insurance Company,
Bankers Fidelity Life Insurance Company and Bankers Fidelity
Assurance Company.
Note regarding Private Securities Litigation
Reform Act: Except for historical information contained herein,
this press release contains forward-looking statements that involve
a number of risks and uncertainties. Actual results could
differ materially from those indicated by such forward-looking
statements due to a number of factors and risks detailed from time
to time in statements and reports that Atlantic American
Corporation files with the Securities and Exchange Commission.
For
further information contact: |
|
|
J.
Ross Franklin |
|
Hilton
H. Howell, Jr. |
Chief
Financial Officer |
|
Chairman, President & CEO |
Atlantic American Corporation |
|
Atlantic
American Corporation |
404-266-5580 |
|
404-266-5505 |
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Atlantic American
CorporationFinancial Data
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
September 30, |
(Unaudited; In
thousands, except per share data) |
2018 |
|
2017 |
|
2018 |
|
2017 |
Insurance premiums |
|
|
|
|
|
|
|
Life and
health |
|
|
|
|
|
|
|
Gross earned
premiums |
$ |
45,568 |
|
|
$ |
36,671 |
|
|
$ |
133,158 |
|
|
$ |
102,502 |
|
Ceded
premiums |
|
(16,061 |
) |
|
|
(8,623 |
) |
|
|
(44,853 |
) |
|
|
(19,774 |
) |
Net
earned premiums |
|
29,507 |
|
|
|
28,048 |
|
|
|
88,305 |
|
|
|
82,728 |
|
Property
and casualty |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
earned premiums |
|
14,288 |
|
|
|
15,284 |
|
|
|
42,968 |
|
|
|
43,860 |
|
Ceded
premiums |
|
(1,238 |
) |
|
|
(1,238 |
) |
|
|
(3,669 |
) |
|
|
(3,592 |
) |
Net
earned premiums |
|
13,050 |
|
|
|
14,046 |
|
|
|
39,299 |
|
|
|
40,268 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment
income |
|
2,215 |
|
|
|
2,136 |
|
|
|
7,111 |
|
|
|
6,380 |
|
Realized investment
gains, net |
|
484 |
|
|
|
539 |
|
|
|
797 |
|
|
|
2,818 |
|
Unrealized gains on
equity securities, net |
|
1,083 |
|
|
|
- |
|
|
|
753 |
|
|
|
- |
|
Other income |
|
31 |
|
|
|
29 |
|
|
|
88 |
|
|
|
95 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
|
46,370 |
|
|
|
44,798 |
|
|
|
136,353 |
|
|
|
132,289 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance benefits and
losses incurred |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Life and
health |
|
22,415 |
|
|
|
20,754 |
|
|
|
69,934 |
|
|
|
61,567 |
|
Property
and casualty |
|
10,672 |
|
|
|
9,663 |
|
|
|
28,544 |
|
|
|
25,879 |
|
Commissions and
underwriting expenses |
|
8,722 |
|
|
|
10,176 |
|
|
|
28,456 |
|
|
|
31,800 |
|
Interest expense |
|
529 |
|
|
|
440 |
|
|
|
1,497 |
|
|
|
1,273 |
|
Other expense |
|
2,960 |
|
|
|
3,134 |
|
|
|
9,168 |
|
|
|
9,301 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
benefits and expenses |
|
45,298 |
|
|
|
44,167 |
|
|
|
137,599 |
|
|
|
129,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes |
|
1,072 |
|
|
|
631 |
|
|
|
(1,246 |
) |
|
|
2,469 |
|
Income tax expense
(benefit) |
|
138 |
|
|
|
(116 |
) |
|
|
(341 |
) |
|
|
483 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
$ |
934 |
|
|
$ |
747 |
|
|
$ |
(905 |
) |
|
$ |
1,986 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per common share (basic and diluted) |
$ |
0.04 |
|
|
$ |
0.03 |
|
|
$ |
(0.06 |
) |
|
$ |
0.08 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
of Non-GAAP Financial Measure |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
934 |
|
|
$ |
747 |
|
|
$ |
(905 |
) |
|
$ |
1,986 |
|
Income tax expense
(benefit) |
|
138 |
|
|
|
(116 |
) |
|
|
(341 |
) |
|
|
483 |
|
Realized investment
gains, net |
|
(484 |
) |
|
|
(539 |
) |
|
|
(797 |
) |
|
|
(2,818 |
) |
Unrealized gains on
equity securities, net |
|
(1,083 |
) |
|
|
- |
|
|
|
(753 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating gain
(loss) |
$ |
(495 |
) |
|
$ |
92 |
|
|
$ |
(2,796 |
) |
|
$ |
(349 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
Selected
Balance Sheet Data |
2018 |
|
2017 |
|
|
|
|
|
|
Total cash and
investments |
$ |
255,058 |
|
|
$ |
272,058 |
|
|
Insurance
subsidiaries |
|
234,696 |
|
|
|
244,754 |
|
|
Parent
and other |
|
20,362 |
|
|
|
27,304 |
|
|
Total assets |
|
339,549 |
|
|
|
343,239 |
|
|
Insurance reserves and
policyholder funds |
|
187,813 |
|
|
|
173,583 |
|
|
Debt |
|
33,738 |
|
|
|
33,738 |
|
|
Total shareholders'
equity |
|
102,118 |
|
|
|
112,983 |
|
|
Book value per common
share |
|
4.78 |
|
|
|
5.26 |
|
|
Statutory capital and
surplus |
|
|
|
|
|
|
|
|
Life and
health |
|
30,845 |
|
|
|
34,135 |
|
|
Property
and casualty |
|
43,922 |
|
|
|
43,348 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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