UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported)
 
August 8, 2023

ATLANTIC AMERICAN CORPORATION
(Exact name of registrant as specified in its charter)

Georgia
0-3722
58-1027114
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

4370 Peachtree Road, N.E., Atlanta, Georgia

30319
(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code
 
(404) 266-5500

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class

Trading
Symbol(s)

Name of each exchange on which registered
Common Stock, par value $1.00 per share

AAME

The Nasdaq Global Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02.
Results of Operations and Financial Condition

On August 8, 2023, Atlantic American Corporation (the “Registrant”) reported its results of operations for its second quarter ended June 30, 2023. A copy of the press release issued by the Registrant concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01.
Financial Statements and Exhibits

(d) Exhibits

Exhibit
Number

Description of Exhibit

Press release dated August 8, 2023.
104

Cover Page Interactive Data File (embedded within the Inline XBRL document).

The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing of the Registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing. The information in this report, including the exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933.


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, hereunto duly authorized.


ATLANTIC AMERICAN CORPORATION




By:
/s/ J. Ross Franklin


J. Ross Franklin


Vice President, Chief Financial Officer and Secretary

Date:  August 8, 2023



Exhibit 99.1

ATLANTIC AMERICAN CORPORATION REPORTS
SECOND QUARTER RESULTS FOR 2023;
DECLARES ANNUAL DIVIDEND

ATLANTA, Georgia, August 8, 2023 - Atlantic American Corporation (Nasdaq- AAME) today reported net income for the three month period ended June 30, 2023 of $1.7 million, or $0.08 per diluted share, as compared to net loss of $1.7 million, or $0.09 per diluted share, for the comparable period in 2022.  For the six month period ended June 30, 2023, the Company reported net income of $0.3 million, or nil per diluted share, as compared to net income of $1.2 million, or $0.05 per diluted share, for the comparable period in 2022.  The increase in net income for the three month period ended June 30, 2023 was primarily the result of a $5.4 million increase in unrealized gains on equity securities due to appreciation in market values in addition to more favorable loss experience in the life and health operations, from the comparable period in 2022. The decrease in net income for the six month period ended June 30, 2023 was primarily attributable to ancillary costs related to implementation of the new actuarial valuation system, coupled with an increase in administrative costs related to the growth in the group lines of business within the life and health operations.

Operating income (as defined below) decreased $1.2 million in the three month period ended June 30, 2023 from the three month period ended June 30, 2022.  For the six month period ended June 30, 2023, operating income decreased $2.2 million from the comparable period in 2022.  The decrease in operating income for the three and six months period ended June 30, 2023 was primarily attributable to ancillary costs related to implementation of the new actuarial valuation system, coupled with an increase in administrative costs related to the growth in the group lines of business within the life and health operations, as mentioned above.

Commenting on the results, Hilton H. Howell, Jr., Chairman, President and Chief Executive Officer, stated, “Overall we are quite pleased with our second quarter results and excited to report that our subsidiary, Atlantic Capital Life Assurance Company, has expanded its footprint into additional states.  Furthermore, the Worksite division has enjoyed a steady pace of premium growth and we believe the division is well positioned to have a successful open enrollment season.  Although inflationary pressures have impacted claims within our property and casualty operations, we remain profitable and optimistic about the future. Accordingly, the Board of Directors recently approved the Company’s annual dividend of $0.02 per share, which is payable on September 12, 2023 to shareholders of record on August 22, 2023.”

Atlantic American Corporation 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, Bankers Fidelity Assurance Company and Atlantic Capital Life Assurance Company.

Note regarding non-GAAP financial measure: Atlantic American Corporation presents its consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP).  However, from time to time, the Company may present, in its public statements, press releases and filings with the Securities and Exchange Commission, non-GAAP financial measures such as operating income (loss). We define operating income (loss) as net income (loss) excluding: (i) income tax expense (benefit); (ii) realized investment gains, net; and (iii) unrealized (gains) losses on equity securities, net.  Management believes operating income (loss) is a useful metric for investors, potential investors, securities analysts and others because it isolates the “core” operating results of the Company before considering certain items that are either beyond the control of management (such as income tax expense (benefit), which is subject to timing, regulatory and rate changes depending on the timing of the associated revenues and expenses) or are not expected to regularly impact the Company’s operating results (such as any realized and unrealized investment gains (losses), which are not a part of the Company’s primary operations and are, to a limited extent, subject to discretion in terms of timing of realization).  The financial data attached includes a reconciliation of operating income (loss) to net income (loss), the most comparable GAAP financial measure.  The Company’s definition of operating income (loss) may differ from similarly titled financial measures used by others.  This non-GAAP financial measure should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP.

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, including the Company’s ability to remediate the identified material weakness in its internal control over financial reporting and those other risks and uncertainties detailed in statements and reports that Atlantic American Corporation files from time to time 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


Atlantic American Corporation
Financial Data

   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
(Unaudited; In thousands, except per share data)
 
2023
   
2022
   
2023
   
2022
 
Insurance premiums
                       
Life and health
 
$
28,180
   
$
28,296
   
$
57,069
   
$
58,034
 
Property and casualty
   
17,880
     
18,769
     
35,091
     
36,112
 
Insurance premiums, net
   
46,060
     
47,065
     
92,160
     
94,146
 
                                 
Net investment income
   
2,559
     
2,529
     
5,100
     
4,869
 
Realized investment gains (losses), net
   
70
     
(62
)
   
70
     
(72
)
Unrealized gains (losses) on equity securities, net
   
494
     
(4,866
)
   
(1,881
)
   
(2,673
)
Other income
   
5
     
3
     
8
     
7
 
                                 
Total revenue
   
49,188
     
44,669
     
95,457
     
96,277
 
                                 
Insurance benefits and losses incurred
                               
Life and health
   
15,817
     
18,713
     
33,617
     
39,404
 
Property and casualty
   
13,548
     
14,040
     
26,208
     
24,518
 
Commissions and underwriting expenses
   
12,848
     
10,215
     
25,766
     
23,051
 
Interest expense
   
807
     
414
     
1,557
     
768
 
Other expense
   
3,951
     
3,402
     
7,910
     
6,855
 
                                 
Total benefits and expenses
   
46,971
     
46,784
     
95,058
     
94,596
 
                                 
Income (loss) before income taxes
   
2,217
     
(2,115
)
   
399
     
1,681
 
Income tax expense (benefit)
   
473
     
(436
)
   
101
     
518
 
                                 
Net income (loss)
 
$
1,744
   
$
(1,679
)
 
$
298
   
$
1,163
 
                                 
Earnings (loss) per common share (basic)
 
$
0.08
   
$
(0.09
)
 
$
-
   
$
0.05
 
Earnings (loss) per common share (diluted)
 
$
0.08
   
$
(0.09
)
 
$
-
   
$
0.05
 
                                 
Reconciliation of non-GAAP financial measure
                               
                                 
Net income (loss)
 
$
1,744
   
$
(1,679
)
 
$
298
   
$
1,163
 
Income tax expense (benefit)
   
473
     
(436
)
   
101
     
518
 
Realized investment (gains) losses, net
   
(70
)
   
62
     
(70
)
   
72
 
Unrealized (gains) losses on equity securities, net
   
(494
)
   
4,866
     
1,881
     
2,673
 
                                 
Non-GAAP operating income
 
$
1,653
   
$
2,813
   
$
2,210
   
$
4,426
 

Selected Balance Sheet Data
 
June 30,
2023
   
December 31,
2022
 
             
Total cash and investments
 
$
252,209
   
$
257,575
 
Insurance subsidiaries
   
245,520
     
251,378
 
Parent and other
   
6,689
     
6,197
 
Total assets
   
372,955
     
367,064
 
Insurance reserves and policyholder funds
   
209,304
     
202,651
 
Debt
   
36,738
     
35,747
 
Total shareholders’ equity
   
103,486
     
102,193
 
Book value per common share
   
4.80
     
4.74
 
Statutory capital and surplus
               
Life and health
   
35,650
     
36,672
 
Property and casualty
   
51,955
     
53,023
 



v3.23.2
Document and Entity Information
Aug. 08, 2023
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date Aug. 08, 2023
Entity File Number 0-3722
Entity Registrant Name ATLANTIC AMERICAN CORPORATION
Entity Central Index Key 0000008177
Entity Incorporation, State or Country Code GA
Entity Tax Identification Number 58-1027114
Entity Address, Address Line One 4370 Peachtree Road
Entity Address, Address Line Two N.E.
Entity Address, City or Town Atlanta
Entity Address, State or Province GA
Entity Address, Postal Zip Code 30319
City Area Code 404
Local Phone Number 266-5500
Title of 12(b) Security Common Stock, par value $1.00 per share
Trading Symbol AAME
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false

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