Atlantic American Reports Third Quarter Results
November 12 2019 - 1:08PM
Atlantic American Corporation (Nasdaq- AAME) today reported net
loss for the three month period ended September 30, 2019 of $1.4
million, or $0.07 per common share, as compared to net income of
$0.9 million, or $0.04 per common share, for the comparable period
in 2018. For the nine month period ended September 30, 2019,
the Company reported net loss of $1.7 million, or $0.10 per common
share, as compared to net loss of $0.9 million, or $0.06 per common
share, for the comparable period in 2018.
Premium revenue for the three month period ended
September 30, 2019 increased $2.4 million, or 5.8%, to $45.0
million from $42.6 million for the comparable period in 2018.
For the nine month period ended September 30, 2019, premium revenue
increased $7.7 million, or 6.0%, to $135.3 million from $127.6
million for the comparable period in 2018. The increase in
premium revenue was primarily attributable to an increase in the
Medicare supplement line of business in the Company’s life and
health operations, coupled with an increase in the automobile
physical damage line of business in the Company’s property and
casualty operations.
Excluding the effects of realized or unrealized
gains or losses and taxes, operating loss (as defined below)
increased to $2.3 million for the three month period ended
September 30, 2019, as compared to operating loss of $0.5 million
for the comparable period in 2018. For the nine month period
ended September 30, 2019, the Company reported operating loss of
$5.7 million, as compared to operating loss of $2.8 million for the
comparable period in 2018. The increase in operating losses
for the three and nine month periods ended September 30, 2019 was
primarily the result of increased claims in the Medicare supplement
line of business in the Company’s life and health
operations.
Commenting on the third quarter, Hilton H.
Howell, Jr., chairman, president and chief executive officer,
stated, “We are working vigorously to turn our Medicare supplement
line of business back to profitability with appropriate rate
adjustments coupled with controlled underwriting and
distribution. And sales in the Company’s ancillary lines of
business have reached historical highs, primarily as a result of
success in the Worksite division. This is proof positive that
our product diversification efforts are bearing fruit.
Additionally, our property and casualty operations continue to
steadily grow the business and return profits to the bottom
line.”
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 and Bankers
Fidelity 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). 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, 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 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 |
Atlantic American
CorporationFinancial Data
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30, |
|
September 30, |
|
(Unaudited; In thousands, except per share data) |
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
Insurance premiums |
|
|
|
|
|
|
|
|
Life and health |
$ |
30,530 |
|
|
$ |
29,507 |
|
|
$ |
92,221 |
|
|
$ |
88,305 |
|
|
Property and casualty |
|
14,475 |
|
|
|
13,050 |
|
|
|
43,035 |
|
|
|
39,299 |
|
|
Insurance premiums, net |
|
45,005 |
|
|
|
42,557 |
|
|
|
135,256 |
|
|
|
127,604 |
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
2,187 |
|
|
|
2,215 |
|
|
|
6,834 |
|
|
|
7,111 |
|
|
Realized investment gains (losses), net |
|
(430 |
) |
|
|
484 |
|
|
|
1,565 |
|
|
|
797 |
|
|
Unrealized gains on equity securities, net |
|
944 |
|
|
|
1,083 |
|
|
|
2,096 |
|
|
|
753 |
|
|
Other income |
|
39 |
|
|
|
31 |
|
|
|
139 |
|
|
|
88 |
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
47,745 |
|
|
|
46,370 |
|
|
|
145,890 |
|
|
|
136,353 |
|
|
|
|
|
|
|
|
|
|
|
Insurance benefits and losses incurred |
|
|
|
|
|
|
|
|
Life and health |
|
25,279 |
|
|
|
22,415 |
|
|
|
75,831 |
|
|
|
69,934 |
|
|
Property and casualty |
|
9,440 |
|
|
|
10,672 |
|
|
|
28,346 |
|
|
|
28,544 |
|
|
Commissions and underwriting expenses |
|
11,471 |
|
|
|
8,722 |
|
|
|
33,995 |
|
|
|
28,456 |
|
|
Interest expense |
|
533 |
|
|
|
529 |
|
|
|
1,624 |
|
|
|
1,497 |
|
|
Other expense |
|
2,766 |
|
|
|
2,960 |
|
|
|
8,142 |
|
|
|
9,168 |
|
|
|
|
|
|
|
|
|
|
|
Total benefits and expenses |
|
49,489 |
|
|
|
45,298 |
|
|
|
147,938 |
|
|
|
137,599 |
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes |
|
(1,744 |
) |
|
|
1,072 |
|
|
|
(2,048 |
) |
|
|
(1,246 |
) |
|
Income tax expense (benefit) |
|
(352 |
) |
|
|
138 |
|
|
|
(392 |
) |
|
|
(341 |
) |
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
(1,392 |
) |
|
$ |
934 |
|
|
$ |
(1,656 |
) |
|
$ |
(905 |
) |
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per common share (basic and
diluted) |
$ |
(0.07 |
) |
|
$ |
0.04 |
|
|
$ |
(0.10 |
) |
|
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measure |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
(1,392 |
) |
|
$ |
934 |
|
|
$ |
(1,656 |
) |
|
$ |
(905 |
) |
|
Income tax expense (benefit) |
|
(352 |
) |
|
|
138 |
|
|
|
(392 |
) |
|
|
(341 |
) |
|
Realized investment (gains) losses, net |
|
430 |
|
|
|
(484 |
) |
|
|
(1,565 |
) |
|
|
(797 |
) |
|
Unrealized gains on equity securities, net |
|
(944 |
) |
|
|
(1,083 |
) |
|
|
(2,096 |
) |
|
|
(753 |
) |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating gain (loss) |
$ |
(2,258 |
) |
|
$ |
(495 |
) |
|
$ |
(5,709 |
) |
|
$ |
(2,796 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December
31, |
|
|
|
|
|
Selected Balance Sheet Data |
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash and investments |
$ |
283,405 |
|
|
$ |
254,559 |
|
|
|
|
|
|
Insurance subsidiaries |
|
265,289 |
|
|
|
235,796 |
|
|
|
|
|
|
Parent and other |
|
18,116 |
|
|
|
18,763 |
|
|
|
|
|
|
Total assets |
|
383,335 |
|
|
|
344,274 |
|
|
|
|
|
|
Insurance reserves and policyholder funds |
|
198,324 |
|
|
|
189,048 |
|
|
|
|
|
|
Debt |
|
33,738 |
|
|
|
33,738 |
|
|
|
|
|
|
Total shareholders' equity |
|
116,411 |
|
|
|
101,372 |
|
|
|
|
|
|
Book value per common share |
|
5.42 |
|
|
|
4.75 |
|
|
|
|
|
|
Statutory capital and surplus |
|
|
|
|
|
|
|
|
Life and health |
|
26,644 |
|
|
|
34,214 |
|
|
|
|
|
|
Property and casualty |
|
45,386 |
|
|
|
43,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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