Security National Financial Corporation Reports Financial Results for the Quarter Ended June 30, 2018
August 14 2018 - 9:17AM
Security National Financial Corporation (SNFC) (NASDAQ symbol
"SNFCA") announced financial results for the quarter ended June 30,
2018.
For the three months ended June 30, 2018, SNFC’s
after-tax earnings from operations increased 30.2% from $2,486,000
in 2017 to $3,238,000 in 2018, on a 6.1% decrease in revenues to
$68,865,000. SNFC’s after tax earnings for the six months
ended June 30, 2018 increased 364% to $25,349,000 from $6,892,000
in 2017.
Scott M. Quist, President of the Company, said,
“We are always pleased when we can report an increase in
profitability. But, more so than usual, there are numerous subplots
to the story. Our life insurance segment has shown excellent
revenue growth of 13.5% and good profitability growth of nearly 5%,
especially when one realizes that nearly $700,000 of depreciation
and interest costs related to our Centre53 project that are
accounted for in that calculation. As a major initiative we
are working hard to reorganize our final expense distribution
channel to better support the individual agent to make her/him more
successful.
“Our Memorial Cemetery and Mortuary group,
stripping out non-operational related real estate activities,
improved operating earnings 34%. That result was achieved
without regard to the gain associated with the sale of one of our
mortuary buildings to the dominant faith in Salt Lake City for use
in its charitable activities. As a general rule we dislike selling
operating properties, but given the proposed changes to that
neighborhood it made sense. We have made great progress on
our pre-need cemetery sales, those being up more than 20%.
“Our Mortgage segment continues to navigate in a
particularly challenged industry. Recent industry data report
that mortgage loan applications decreased 17% year-over-year. Our
own experience has been a 15% decrease in application volume for
the 2nd quarter as compared to the prior year. Our team has
worked very hard on efficiencies and decreased costs over 20% for
the same period. But margin compression, caused by increased
competitive pressures due to the decrease in industry volume,
decreased revenue by 23% for the same period. In this
environment, somewhat counterintuitively, we are stepping up our
recruiting activities believing that, over time, we can take
advantage of the industry difficulties. I am particularly
proud of all the work and efforts of our management and staff in
accomplishing the efficiency progress we have made and fully
recognize that we have not yet met our goals.
“Again, given the challenges we have had, we are
pleased to report the improvement in total
profitability.”
SNFC has three business segments. The
following table shows the revenues and earnings before taxes for
the three months ended June 30, 2018, as compared to 2017, for each
of the three business segments:
|
Revenues |
|
Earnings before Taxes |
|
|
2018 |
|
|
2017 |
|
|
|
|
2018 |
|
|
|
2017 |
|
|
Life
Insurance |
$ |
29,370,000 |
|
$ |
25,870,000 |
|
13.5% |
|
$ |
2,937,000 |
|
|
$ |
2,799,000 |
|
4.9% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cemeteries/Mortuaries |
$ |
5,281,000 |
|
$ |
3,309,000 |
|
59.6% |
|
$ |
2,072,000 |
|
|
$ |
325,000 |
|
537.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgages |
$ |
34,214,000 |
|
$ |
44,134,000 |
|
(22.5%) |
|
$ |
(847,000 |
) |
|
$ |
870,000 |
|
(197.4%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
$ |
68,865,000 |
|
$ |
73,313,000 |
|
(6.1%) |
|
$ |
4,162,000 |
|
|
$ |
3,994,000 |
|
4.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended June 30, 2018:
|
Revenues |
|
Earnings before Taxes |
|
|
2018 |
|
|
2017 |
|
|
|
|
2018 |
|
|
|
2017 |
|
|
Life
Insurance |
$ |
80,236,000 |
|
$ |
52,034,000 |
|
54.2% |
|
$ |
26,649,000 |
|
|
$ |
4,283,000 |
|
522.2% |
|
|
|
|
|
|
|
|
|
|
|
|
Cemeteries/Mortuaries |
$ |
9,051,000 |
|
$ |
6,908,000 |
|
31.0% |
|
$ |
2,932,000 |
|
|
$ |
1,084,000 |
|
170.5% |
|
|
|
|
|
|
|
|
|
|
|
|
Mortgages |
$ |
61,653,000 |
|
$ |
85,200,000 |
|
(27.6%) |
|
$ |
(4,232,000 |
) |
|
$ |
1,525,000 |
|
(377.5%) |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
$ |
150,940,000 |
|
$ |
144,142,000 |
|
4.7% |
|
$ |
25,349,000 |
|
|
$ |
6,892,000 |
|
267.8% |
|
|
|
|
Net earnings per common share was $.20 for the three months
ended June 30, 2018, compared to net earnings of $.15 per share for
the prior year, as adjusted for the effect of annual stock
dividends. Book value per common share was $10.43 as of June
30, 2018, compared to $9.23 as of December 31, 2017.
The Company has two classes of common stock
outstanding, Class A and Class C. There were 16,261,671 Class
A equivalent shares outstanding as of June 30, 2018.
If there are any questions, please contact Mr.
Garrett S. Sill, Mr. Brian Nelsen or Mr. Scott Quist at:
Security National Financial CorporationP.O. Box
57250Salt Lake City, Utah 84157Phone (801) 264-1060Fax
(801) 265-9882
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