Atlantic American Corporation Reports Fourth Quarter and Year End Results for 2018; Declares Annual Dividend
April 01 2019 - 2:04PM
Atlantic American Corporation (Nasdaq- AAME) today reported its
results for the fourth quarter and year ended December 31,
2018. For the fourth quarter ended December 31, 2018, the
Company reported net income of $0.2 million, or $0.01 per diluted
share, down from $2.5 million, or $0.12 per diluted share, in the
fourth quarter of 2017. The decrease in net income was
primarily attributable to an increase in unrealized losses on
equity securities recognized in net income of $2.9 million and a
decrease in realized investment gains of $2.0 million, partially
offset by improvements in underwriting results. Premiums for
the fourth quarter of 2018 increased 12.4% to $45.3 million
compared to $40.3 million for the fourth quarter of 2017, as
premiums in the life and health operations and property and
casualty operations increased 14.4% and 8.3%, respectively, as
compared to 2017.
For the year ended December 31, 2018, the
Company reported a net loss of $0.7 million, or $0.05 per diluted
share, as compared to net income of $4.5 million, or $0.20 per
diluted share, for the year ended December 31, 2017. The
decrease was primarily attributable to a decline in realized
investment gains of $4.0 million coupled with $2.2 million in
unrealized losses on equity securities recognized in net
income. Total premiums during 2018 increased 5.9% to $172.9
million from $163.3 million in 2017, as premiums in the life and
health operations increased 8.6% in 2018 as compared to 2017.
Commenting on the results, Hilton H. Howell,
Jr., chairman, president and chief executive officer, stated, “We
are pleased with the year over year growth in premium revenues in
each of our insurance subsidiaries and remain focused on refining
processes and improving profitability. Rate increases
implemented in our life and health operations are beginning to take
hold and we are pleased to report the renewal of a significant
multi-year state contract with our property and casualty
operations, which also included a rate increase. While
prudent pricing practices are key to profitability, the Company has
embarked on a number of initiatives to enhance underwriting, better
educate our agents, and improve the policyholder experience.
We remain confident in the long-term viability of our strategy and
in our commitment to deliver value to our shareholders.
Accordingly, the Board of Directors recently approved the Company’s
8th annual dividend, which is payable on April 24, 2019 to
shareholders of record on April 10, 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 |
Atlantic American
CorporationFinancial Data
|
Three Months Ended |
|
Year ended |
|
December 31, |
|
December 31, |
(Unaudited; In
thousands, except per share data) |
2018 |
|
2017 |
|
2018 |
|
2017 |
Insurance premiums |
|
|
|
|
|
|
|
Life and health |
|
|
|
|
|
|
|
Gross earned
premiums |
$ |
47,425 |
|
|
$ |
39,749 |
|
|
$ |
180,583 |
|
|
$ |
142,251 |
|
Ceded premiums |
|
(16,606 |
) |
|
|
(12,811 |
) |
|
|
(61,459 |
) |
|
|
(32,585 |
) |
Net earned premiums |
|
30,819 |
|
|
|
26,938 |
|
|
|
119,124 |
|
|
|
109,666 |
|
Property and casualty |
|
|
|
|
|
|
|
Gross earned premiums |
|
15,914 |
|
|
|
14,589 |
|
|
|
58,882 |
|
|
|
58,449 |
|
Ceded premiums |
|
(1,406 |
) |
|
|
(1,196 |
) |
|
|
(5,075 |
) |
|
|
(4,788 |
) |
Net earned premiums |
|
14,508 |
|
|
|
13,393 |
|
|
|
53,807 |
|
|
|
53,661 |
|
|
|
|
|
|
|
|
|
Insurance premiums,
net |
|
45,327 |
|
|
|
40,331 |
|
|
|
172,931 |
|
|
|
163,327 |
|
Net investment
income |
|
2,438 |
|
|
|
2,116 |
|
|
|
9,549 |
|
|
|
8,496 |
|
Realized investment
gains, net |
|
4,357 |
|
|
|
6,350 |
|
|
|
5,154 |
|
|
|
9,168 |
|
Unrealized losses on
equity securities, net |
|
(2,947 |
) |
|
|
- |
|
|
|
(2,194 |
) |
|
|
- |
|
Other income |
|
25 |
|
|
|
28 |
|
|
|
113 |
|
|
|
123 |
|
|
|
|
|
|
|
|
|
Total
revenue |
|
49,200 |
|
|
|
48,825 |
|
|
|
185,553 |
|
|
|
181,114 |
|
|
|
|
|
|
|
|
|
Insurance benefits and
losses incurred |
|
|
|
|
|
|
|
Life and health |
|
23,887 |
|
|
|
21,462 |
|
|
|
93,821 |
|
|
|
83,029 |
|
Property and casualty |
|
10,285 |
|
|
|
8,607 |
|
|
|
38,829 |
|
|
|
34,486 |
|
Commissions and
underwriting expenses |
|
10,586 |
|
|
|
11,646 |
|
|
|
39,042 |
|
|
|
43,446 |
|
Interest expense |
|
540 |
|
|
|
450 |
|
|
|
2,037 |
|
|
|
1,723 |
|
Other expense |
|
3,627 |
|
|
|
3,773 |
|
|
|
12,795 |
|
|
|
13,074 |
|
|
|
|
|
|
|
|
|
Total benefits and expenses |
|
48,925 |
|
|
|
45,938 |
|
|
|
186,524 |
|
|
|
175,758 |
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes |
|
275 |
|
|
|
2,887 |
|
|
|
(971 |
) |
|
|
5,356 |
|
Income tax expense
(benefit) |
|
74 |
|
|
|
345 |
|
|
|
(267 |
) |
|
|
828 |
|
|
|
|
|
|
|
|
|
Net income
(loss) |
$ |
201 |
|
|
$ |
2,542 |
|
|
$ |
(704 |
) |
|
$ |
4,528 |
|
|
|
|
|
|
|
|
|
Earnings (loss)
per common share (basic and diluted) |
$ |
0.01 |
|
|
$ |
0.12 |
|
|
$ |
(0.05 |
) |
|
$ |
0.20 |
|
|
|
|
|
|
|
|
|
Reconciliation
of Non-GAAP Financial Measure |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
201 |
|
|
$ |
2,542 |
|
|
$ |
(704 |
) |
|
$ |
4,528 |
|
Income tax expense
(benefit) |
|
74 |
|
|
|
345 |
|
|
|
(267 |
) |
|
|
828 |
|
Realized investment
gains, net |
|
(4,357 |
) |
|
|
(6,350 |
) |
|
|
(5,154 |
) |
|
|
(9,168 |
) |
Unrealized losses on
equity securities, net |
|
2,947 |
|
|
|
- |
|
|
|
2,194 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
Non-GAAP
operating loss |
$ |
(1,135 |
) |
|
$ |
(3,463 |
) |
|
$ |
(3,931 |
) |
|
$ |
(3,812 |
) |
|
|
|
|
|
|
December 31, |
|
December 31, |
|
Selected
Balance Sheet Data |
2018 |
|
2017 |
|
|
|
|
|
|
Total cash and
investments |
$ |
254,559 |
|
|
$ |
272,058 |
|
|
Insurance subsidiaries |
|
235,796 |
|
|
|
244,754 |
|
|
Parent and other |
|
18,763 |
|
|
|
27,304 |
|
|
Total assets |
|
344,274 |
|
|
|
343,239 |
|
|
Insurance reserves and
policyholder funds |
|
189,048 |
|
|
|
173,583 |
|
|
Debt |
|
33,738 |
|
|
|
33,738 |
|
|
Total shareholders'
equity |
|
101,372 |
|
|
|
112,983 |
|
|
Book value per common
share |
|
4.75 |
|
|
|
5.26 |
|
|
Statutory capital and
surplus |
|
|
|
|
Life and health |
|
34,214 |
|
|
|
34,135 |
|
|
Property and casualty |
|
43,467 |
|
|
|
43,348 |
|
|
|
|
|
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