ATLANTIC AMERICAN CORPORATION REPORTS FOURTH QUARTER AND YEAR END RESULTS FOR 2019
March 24 2020 - 2:11PM
Atlantic American Corporation (Nasdaq- AAME) today reported its
results for the fourth quarter and year ended December 31,
2019. For the fourth quarter ended December 31, 2019, the
Company reported net income of $1.3 million, or $0.06 per diluted
share, up from $0.2 million, or $0.01 per diluted share, in the
fourth quarter of 2018. The increase in net income was
primarily attributable to an increase in unrealized gains on equity
securities recognized in net income of $6.4 million, partially
offset by a decrease in realized investment gains of $4.3 million
and $0.6 million increase in operating loss. Premiums for the
fourth quarter of 2019 increased 3.0% to $46.7 million compared to
$45.3 million for the fourth quarter of 2018, as premiums in the
property and casualty operations increased 7.8% while the life and
health operations increased slightly, as compared to 2018.
For the year ended December 31, 2019, the
Company reported a net loss of $0.4 million, or $0.04 per diluted
share, as compared to $0.7 million, or $0.05 per diluted share, for
the year ended December 31, 2018. The decrease in net loss
was primarily attributable to an increase in unrealized gains on
equity securities recognized in net income of $7.7 million,
partially offset by decreases in realized gains of $3.6 million and
an increase in operating loss of $3.6 million. Total premiums
during 2019 increased 5.2% to $181.9 million from $172.9 million in
2018, as premiums in the property and casualty operations increased
9.1% while the life and health operations increased 3.5%, as
compared to 2018.
Commenting on the results, Hilton H. Howell,
Jr., chairman, president and chief executive officer, stated, “We
are delighted with the performance of our property and casualty
operations, reporting year over year premium growth accompanied by
a significant improvement in operating income. And while
profitability in the life and health operations were strained due
to prior expansion of our Medicare supplement business, I believe
we reached the nadir of this cycle during 2019 and expect a
positive trend for 2020 and beyond.”
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.
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For further information contact: |
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J. Ross Franklin |
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Hilton H. Howell, Jr. |
Chief Financial Officer |
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Chairman, President & CEO |
Atlantic American Corporation |
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Atlantic American Corporation |
404-266-5580 |
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404-266-5505 |
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Atlantic
American CorporationFinancial Data |
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Three Months
Ended |
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Year ended |
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December 31, |
|
December 31, |
(Unaudited;
In thousands, except per share data) |
2019 |
|
2018 |
|
2019 |
|
2018 |
Insurance
premiums |
|
|
|
|
|
|
|
Life and health |
$ |
31,024 |
|
|
$ |
30,819 |
|
|
$ |
123,245 |
|
|
$ |
119,124 |
|
Property and casualty |
|
15,645 |
|
|
|
14,508 |
|
|
|
58,680 |
|
|
|
53,807 |
|
Insurance premiums, net |
|
46,669 |
|
|
|
45,327 |
|
|
|
181,925 |
|
|
|
172,931 |
|
|
|
|
|
|
|
|
|
Net
investment income |
|
2,145 |
|
|
|
2,438 |
|
|
|
8,979 |
|
|
|
9,549 |
|
Realized
investment gains, net |
|
9 |
|
|
|
4,357 |
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|
|
1,574 |
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|
|
5,154 |
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Unrealized
gains (losses) on equity securities, net |
|
3,415 |
|
|
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(2,947 |
) |
|
|
5,511 |
|
|
|
(2,194 |
) |
Other
income |
|
51 |
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|
25 |
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|
|
190 |
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|
113 |
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Total revenue |
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52,289 |
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|
49,200 |
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|
198,179 |
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|
185,553 |
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|
|
|
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Insurance
benefits and losses incurred |
|
|
|
|
|
|
|
Life and health |
|
23,853 |
|
|
|
23,887 |
|
|
|
99,684 |
|
|
|
93,821 |
|
Property and casualty |
|
11,195 |
|
|
|
10,285 |
|
|
|
39,541 |
|
|
|
38,829 |
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Commissions
and underwriting expenses |
|
11,482 |
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|
|
10,586 |
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|
|
45,477 |
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|
|
39,042 |
|
Interest
expense |
|
506 |
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|
|
540 |
|
|
|
2,130 |
|
|
|
2,037 |
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Other
expense |
|
3,612 |
|
|
|
3,627 |
|
|
|
11,754 |
|
|
|
12,795 |
|
|
|
|
|
|
|
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Total benefits and expenses |
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50,648 |
|
|
|
48,925 |
|
|
|
198,586 |
|
|
|
186,524 |
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|
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|
|
|
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Income
(loss) before income taxes |
|
1,641 |
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|
|
275 |
|
|
|
(407 |
) |
|
|
(971 |
) |
Income tax
expense (benefit) |
|
371 |
|
|
|
74 |
|
|
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(21 |
) |
|
|
(267 |
) |
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Net
income (loss) |
$ |
1,270 |
|
|
$ |
201 |
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|
$ |
(386 |
) |
|
$ |
(704 |
) |
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Earnings (loss) per common share (basic and
diluted) |
$ |
0.06 |
|
|
$ |
0.01 |
|
|
$ |
(0.04 |
) |
|
$ |
(0.05 |
) |
|
|
|
|
|
|
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Reconciliation of Non-GAAP Financial Measure |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Net income
(loss) |
$ |
1,270 |
|
|
$ |
201 |
|
|
$ |
(386 |
) |
|
$ |
(704 |
) |
Income tax
expense (benefit) |
|
371 |
|
|
|
74 |
|
|
|
(21 |
) |
|
|
(267 |
) |
Realized
investment gains, net |
|
(9 |
) |
|
|
(4,357 |
) |
|
|
(1,574 |
) |
|
|
(5,154 |
) |
Unrealized
(gains) losses on equity securities, net |
|
(3,415 |
) |
|
|
2,947 |
|
|
|
(5,511 |
) |
|
|
2,194 |
|
|
|
|
|
|
|
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Non-GAAP Operating loss |
$ |
(1,783 |
) |
|
$ |
(1,135 |
) |
|
$ |
(7,492 |
) |
|
$ |
(3,931 |
) |
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December 31, |
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December 31, |
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Selected Balance Sheet Data |
2019 |
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2018 |
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Total cash
and investments |
$ |
281,530 |
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$ |
254,559 |
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|
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Insurance subsidiaries |
|
274,730 |
|
|
|
235,796 |
|
|
|
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Parent and other |
|
6,800 |
|
|
|
18,763 |
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|
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Total
assets |
|
377,626 |
|
|
|
344,274 |
|
|
|
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Insurance
reserves and policyholder funds |
|
201,906 |
|
|
|
189,048 |
|
|
|
|
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Debt |
|
33,738 |
|
|
|
33,738 |
|
|
|
|
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Total
shareholders' equity |
|
118,394 |
|
|
|
101,372 |
|
|
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Book value
per common share |
|
5.51 |
|
|
|
4.75 |
|
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Statutory
capital and surplus |
|
|
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|
|
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Life and health |
|
35,546 |
|
|
|
34,214 |
|
|
|
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Property and casualty |
|
45,827 |
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|
|
43,467 |
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