Atlantic American Reports Second Quarter Results
August 13 2019 - 12:13PM
Atlantic American Corporation (Nasdaq- AAME) today reported net
loss for the three month period ended June 30, 2019 of $4.4
million, or $0.22 per common share, as compared to net income of
$3.2 million, or $0.15 per common share, for the comparable period
in 2018. For the six month period ended June 30, 2019, the
Company reported net loss of $0.3 million, or $0.02 per common
share, as compared to net loss of $1.8 million, or $0.10 per common
share, for the comparable period in 2018. The net loss during
the second quarter of 2019 was primarily due to $5.3 million of net
unrealized losses on equity securities during the second quarter of
2019 as compared to $4.1 million of unrealized gains on equity
securities during the second quarter of 2018. Changes in
unrealized gains and losses on equity securities for the applicable
periods are primarily the result of fluctuations in the market
values of the Company’s equity investments.
Excluding the effects of realized or unrealized
gains or losses and taxes, operating loss (as defined below)
increased to $3.5 million for the six month period ended June 30,
2019 as compared to operating loss of $2.3 million for the
comparable period in 2018. The increase in operating losses
for the six month period ended June 30, 2019 is primarily the
result of a higher than expected level of claims in the Medicare
supplement line of business in the Company’s life and health
operations.
Commenting on the second quarter, Hilton H.
Howell, Jr., chairman, president and chief executive officer,
stated, “In recent years our Medicare supplement line of business
experienced unprecedented growth. While profits margins were
strained in the early years of our growth cycle, we are confident
profitability will improve in renewal years. Management has
taken a strategic and measured approach with our pricing decisions,
product development, and marketing, which gives us confidence in
the long term health of our Medicare supplement line of
business. We are excited about the increased sales activity
within our ancillary product lines and are well positioned for the
busy enrollment season currently underway. Additionally, our
property and casualty operations continue to grow the top line
while delivering steady 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
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 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 Corporation |
Financial Data |
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
(Unaudited; In thousands, except per share data) |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
Insurance premiums |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Life and health |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross earned premiums |
|
$ |
48,591 |
|
|
$ |
44,280 |
|
|
$ |
97,052 |
|
|
$ |
87,590 |
|
Ceded premiums |
|
|
(17,876 |
) |
|
|
(14,977 |
) |
|
|
(35,361 |
) |
|
|
(28,792 |
) |
Net earned premiums |
|
|
30,715 |
|
|
|
29,303 |
|
|
|
61,691 |
|
|
|
58,798 |
|
Property and casualty |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross earned premiums |
|
|
16,067 |
|
|
|
14,770 |
|
|
|
31,248 |
|
|
|
28,680 |
|
Ceded premiums |
|
|
(1,313 |
) |
|
|
(1,228 |
) |
|
|
(2,688 |
) |
|
|
(2,431 |
) |
Net earned premiums |
|
|
14,754 |
|
|
|
13,542 |
|
|
|
28,560 |
|
|
|
26,249 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
|
2,313 |
|
|
|
2,537 |
|
|
|
4,647 |
|
|
|
4,896 |
|
Realized investment gains
(losses), net |
|
|
610 |
|
|
|
(57 |
) |
|
|
1,995 |
|
|
|
313 |
|
Unrealized gains (losses) on
equity securities, net |
|
|
(5,337 |
) |
|
|
4,089 |
|
|
|
1,152 |
|
|
|
(330 |
) |
Other income |
|
|
72 |
|
|
|
29 |
|
|
|
100 |
|
|
|
57 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue |
|
|
43,127 |
|
|
|
49,443 |
|
|
|
98,145 |
|
|
|
89,983 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance benefits and losses
incurred |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Life and health |
|
|
24,288 |
|
|
|
23,524 |
|
|
|
50,552 |
|
|
|
47,519 |
|
Property and casualty |
|
|
9,863 |
|
|
|
8,695 |
|
|
|
18,906 |
|
|
|
17,872 |
|
Commissions and underwriting
expenses |
|
|
11,509 |
|
|
|
9,715 |
|
|
|
22,524 |
|
|
|
19,734 |
|
Interest expense |
|
|
545 |
|
|
|
506 |
|
|
|
1,091 |
|
|
|
968 |
|
Other expense |
|
|
2,511 |
|
|
|
2,970 |
|
|
|
5,376 |
|
|
|
6,208 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total benefits and expenses |
|
|
48,716 |
|
|
|
45,410 |
|
|
|
98,449 |
|
|
|
92,301 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income
taxes |
|
|
(5,589 |
) |
|
|
4,033 |
|
|
|
(304 |
) |
|
|
(2,318 |
) |
Income tax expense
(benefit) |
|
|
(1,163 |
) |
|
|
848 |
|
|
|
(40 |
) |
|
|
(479 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
$ |
(4,426 |
) |
|
$ |
3,185 |
|
|
$ |
(264 |
) |
|
$ |
(1,839 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
common share (basic and diluted) |
|
$ |
(0.22 |
) |
|
$ |
0.15 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Non-GAAP Financial Measure |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(4,426 |
) |
|
$ |
3,185 |
|
|
$ |
(264 |
) |
|
$ |
(1,839 |
) |
Income tax expense
(benefit) |
|
|
(1,163 |
) |
|
|
848 |
|
|
|
(40 |
) |
|
|
(479 |
) |
Realized investment (gains)
losses, net |
|
|
(610 |
) |
|
|
57 |
|
|
|
(1,995 |
) |
|
|
(313 |
) |
Unrealized (gains) losses on
equity securities, net |
|
|
5,337 |
|
|
|
(4,089 |
) |
|
|
(1,152 |
) |
|
|
330 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Operating
gain (loss) |
|
$ |
(862 |
) |
|
$ |
1 |
|
|
$ |
(3,451 |
) |
|
$ |
(2,301 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
December 31, |
|
Selected Balance Sheet
Data |
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
Total cash and
investments |
|
$ |
265,843 |
|
|
$ |
254,559 |
|
|
Insurance subsidiaries |
|
|
249,403 |
|
|
|
235,796 |
|
|
Parent and other |
|
|
16,440 |
|
|
|
18,763 |
|
|
Total assets |
|
|
371,730 |
|
|
|
344,274 |
|
|
Insurance reserves and
policyholder funds |
|
|
202,541 |
|
|
|
189,048 |
|
|
Debt |
|
|
33,738 |
|
|
|
33,738 |
|
|
Total shareholders'
equity |
|
|
112,770 |
|
|
|
101,372 |
|
|
Book value per common
share |
|
|
5.32 |
|
|
|
4.75 |
|
|
Statutory capital and
surplus |
|
|
|
|
|
|
|
|
|
Life and health |
|
|
30,450 |
|
|
|
34,214 |
|
|
Property and casualty |
|
|
44,961 |
|
|
|
43,467 |
|
|
|
|
|
|
Atlantic American (NASDAQ:AAME)
Historical Stock Chart
From Mar 2024 to Apr 2024
Atlantic American (NASDAQ:AAME)
Historical Stock Chart
From Apr 2023 to Apr 2024