Atlantic American Corporation Reports First Quarter Results for 2019

Date : 05/13/2019 @ 2:02PM
Source : GlobeNewswire Inc.
Stock : Atlantic American Corporation (AAME)
Quote : 1.9  0.0 (0.00%) @ 6:17PM

Atlantic American Corporation Reports First Quarter Results for 2019

Atlantic American (NASDAQ:AAME)
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1 Year : From Jan 2019 to Jan 2020

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Atlantic American Corporation (Nasdaq- AAME) today reported net income of $4.2 million in the first quarter of 2019 compared to a net loss of $5.0 million in the first quarter of 2018.  The increase in net income is primarily the result of unrealized gains on equity securities of $6.5 million in the current quarter compared to unrealized losses on equity securities of $4.4 million in the prior year quarter.  Excluding the effects of realized or unrealized gains or losses and taxes, operating loss (as defined below) increased to $2.6 million in the current year quarter from $2.3 million in the prior year quarter, primarily as a result of unfavorable loss experience in the Medicare supplement line of business in the Company’s life and health operations.  Total insurance premiums increased 6.1% to $44.8 million in the current year quarter compared to $42.2 million in the prior year quarter, with increases in insurance premiums reported in both the Company’s life and health and property and casualty operations. 

Commenting on the quarterly results, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, “Our property and casualty operations continue to perform exceptionally well and they are on track for another year of premium growth.  While the first quarter is typically the most challenging in the life and health operations due to early season Medicare supplement Part B deductible reimbursements, we trust the performance of that product line will see improvement over the balance of the year.  Additionally, we are delighted to announce two key hires within our life and health executive sales team who collectively bring us over four decades of experience in both the individual and group product portfolio.  We remain optimistic about the future growth and profitability of our companies.”

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 operational results (such as any realized and unrealized investment gains, 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 FranklinHilton H. Howell, Jr.
Chief Financial OfficerChairman, President & CEO
Atlantic American CorporationAtlantic American Corporation
404-266-5580404-266-5505

 
 
Atlantic American Corporation
Financial Data
 
 Three Months Ended
 March 31,
(Unaudited; In thousands, except per share data) 2019   2018 
Insurance premiums       
Life and health       
Gross earned premiums$48,461  $43,311 
Ceded premiums (17,485)  (13,816)
Net earned premiums 30,976   29,495 
Property and casualty       
Gross earned premiums 15,181   13,910 
Ceded premiums (1,375)  (1,203)
Net earned premiums 13,806   12,707 
        
Insurance premiums, net 44,782   42,202 
Net investment income 2,334   2,359 
Realized investment gains, net 1,385   370 
Unrealized gains (losses) on equity securities, net 6,489   (4,419)
Other income 28   28 
        
Total revenue   55,018      40,540  
        
Insurance benefits and losses incurred       
Life and health 26,264   23,995 
Property and casualty 9,043   9,177 
Commissions and underwriting expenses 11,015   10,019 
Interest expense 546   462 
Other expense 2,865   3,238 
        
Total benefits and expenses 49,733   46,891 
        
Income (loss) before income taxes 5,285   (6,351)
Income tax expense (benefit) 1,123   (1,327)
        
Net income (loss)$   4,162   $   (5,024)
        
Earnings (loss) per common share (basic)$   0.20   $   (0.25)
Earnings (loss) per common share (diluted)$   0.19   $   (0.25)
        
Reconciliation of Non-GAAP Financial Measure       
        
Net income (loss)$4,162  $(5,024)
Income tax expense (benefit) 1,123   (1,327)
Realized investment gains, net (1,385)  (370)
Unrealized (gains) losses on equity securities, net (6,489)  4,419 
        
Non-GAAP operating loss$   (2,589) $   (2,302)
        
 March 31, December 31,
Selected Balance Sheet Data 2019   2018 
        
Total cash and investments$262,359  $254,559 
Insurance subsidiaries 241,025   235,796 
Parent and other 21,334   18,763 
Total assets 354,244   344,274 
Insurance reserves and policyholder funds 184,281   189,048 
Debt 33,738   33,738 
Total shareholders' equity 111,487   101,372 
Book value per common share 5.26   4.75 
Statutory capital and surplus       
Life and health 33,176   34,214 
Property and casualty 44,766   43,467 
        

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