The Midland Company Expects Minimal Earnings Impact from Hurricane
August 19 2004 - 9:17AM
PR Newswire (US)
The Midland Company Expects Minimal Earnings Impact from Hurricane
* Hurricane Charley losses not expected to change full-year outlook
CINCINNATI, Aug. 19 /PRNewswire-FirstCall/ -- The Midland Company
(NASDAQ:MLAN), a highly focused provider of specialty insurance
products and services, today announced its losses to date from
Hurricane Charley. "Widespread power outages and the fact that many
residents spend less time in Florida during the summer months may
have made it difficult for victims of the storm to file claims. As
a result, it's too soon to say with certainty what the ultimate
financial impact on Midland will be," according to John W. Hayden,
president and chief executive officer. "Through mid-day on
Wednesday, August 18, 2004, losses of approximately $4.0 million
from Hurricane Charley had been reported to the company. Given the
favorable results that we continue to experience in our core lines
of business, our profit outlook for the remainder of the year is
virtually unchanged." Hayden added that, "Catastrophe losses are
part of doing business in the specialty property and casualty
industry. We prepare for events like Charley through disciplined
exposure management and a comprehensive reinsurance program.
Fortunately, the strong underwriting results we were experiencing
prior to the storm should help mitigate the bottom line impact of
the hurricane. So far in the third quarter, we've seen a
continuation of the encouraging results experienced in the first
half of the year in our site- built dwelling, motorcycle,
watercraft and manufactured housing lines of business," he said.
"Those results will help temper the financial impact of Charley on
our operating results." American Modern Insurance Group, Midland's
insurance subsidiary, has set up catastrophe claim offices in
Lakeland, Florida and Lake City, Florida. We currently have 21
employee adjusters manning the on-site offices to process claims
and get customers back into their homes as quickly as possible.
According to Hayden, American Modern consistently settles more than
85 percent of all property claims within 30 days -- and most within
seven days of being reported. "Quick claims payment and superior
adjuster training are especially important in disaster situations,
and we're working to make certain our policyholders receive help as
soon as possible," Hayden explained. "This is when American Modern
really proves its value to our policyholders, and we have the
financial strength to meet our obligations to them. "Given the
level of catastrophe losses that we've experienced in the third
quarter and assuming normalized weather throughout the remainder of
the year, we reaffirm our full-year combined ratio to be in the
targeted range of 96.5 to 98.0 percent and we would also reaffirm
our previously reported full-year earnings per share guidance in
the range of $2.40 to $2.60 per share, which includes 18 cents of
capital gains realized through June 30, 2004," Hayden added. About
the Company Midland, which is headquartered in Cincinnati, Ohio, is
a provider of specialty insurance products and services through its
wholly owned subsidiary, American Modern Insurance Group, which
accounts for approximately 96 percent of Midland's consolidated
revenue. American Modern specializes in writing physical damage
insurance and related coverages on manufactured housing and has
expanded to other specialty insurance products including coverage
for site-built homes, motorcycles, watercraft, snowmobiles,
recreational vehicles, physical damage on long-haul trucks,
extended service contracts, excess and surplus lines coverages,
credit life and related products as well as collateral protection
and mortgage fire products sold to financial institutions and their
customers. Midland also owns a niche transportation business, M/G
Transport Group, which operates a fleet of dry cargo barges for the
movement of dry bulk commodities on the inland waterways. Midland's
common stock is traded on the Nasdaq National Market under the
symbol MLAN. Additional information on the company can be found on
the Internet at http://www.midlandcompany.com/ . Forward Looking
Statements Disclosure Certain statements made in this press release
are forward-looking and are made pursuant to the safe harbor
provisions of the Securities Litigation Reform Act of 1995. These
statements include certain discussions relating to underwriting,
premium and investment income volume, business strategies,
profitability and business relationships, as well as any other
statements concerning the year 2004 and beyond. The forward-looking
statements involve risks, uncertainties and other factors that may
cause results to differ materially from those anticipated in those
statements. Factors that might cause results to differ from those
anticipated include, without limitation, adverse weather
conditions, changes in underwriting results affected by adverse
economic conditions, fluctuations in the investment markets,
changes in the retail marketplace, changes in the laws or
regulations affecting the operations of the company or its
subsidiaries, changes in the business tactics or strategies of the
company, its subsidiaries or its current or anticipated business
partners, the financial condition of the company's business
partners, acquisitions or divestitures, changes in market forces,
litigation and the other risk factors that have been identified in
the company's filings with the SEC, any one of which might
materially affect the operations of the company or its
subsidiaries. Any forward-looking statements speak only as of the
date made. We undertake no obligation to update any forward-looking
statements to reflect events or circumstances arising after the
date on which they are made. DATASOURCE: The Midland Company
CONTACT: John I. Von Lehman, Executive Vice President and CFO of
The Midland Company, +1-513-943-7100 Web site:
http://www.midlandcompany.com/
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