American Physicians Capital, Inc. Reports Second Quarter 2010 Results
American Physicians Capital, Inc. (APCapital) (NASDAQ:ACAP) today announced net income of $9.4 million or $.98 per diluted common share for the second quarter of 2010. This compares to net income of $11.0 million, or $.97 per diluted common share for the second quarter of 2009. Year-to-date, the Company has generated net income of $18.4 million or $1.88 per diluted common share in 2010, compared to $21.1 million or $1.82 per diluted common share in the first six months of 2009. At June 30, 2010, APCapital’s book value per share was $25.20 based on 9,339,087 shares outstanding.
As announced on July 8, 2010, APCapital has entered into a definitive merger agreement with The Doctors Company, the largest national insurer of physician and surgeon medical liability, pursuant to which The Doctors Company will acquire APCapital for $41.50 per share in cash. The transaction is expected to close in the fourth quarter of 2010 and is subject to customary closing conditions.
|Consolidated Income Statement|
|(Dollars in thousands)|
|Three Months Ended||Six Months Ended|
|June 30,||June 30,|
|Direct Premiums Written||$||24,001||$||24,245||$||51,297||$||54,367|
|Net Premiums Written||$||25,095||$||23,389||$||51,130||$||52,109|
|Net Premiums Earned||$||29,388||$||28,382||$||56,083||$||57,688|
|Incurred Loss and Loss Adjustment Expenses:|
|Current Accident Year Losses||22,928||23,200||44,841||47,036|
|Prior Year Losses||(8,276||)||(10,087||)||(16,397||)||(18,311||)|
|Other Income (1)||282||212||857||435|
|Federal Income Taxes||3,138||4,354||6,566||8,270|
|Current Accident Year||78.0||%||81.7||%||80.0||%||81.5||%|
|Prior Year Development||-28.1||%||-35.5||%||-29.3||%||-31.7||%|
|Underwriting Expense Ratio||24.0||%||25.8||%||24.4||%||25.1||%|
|(1) Includes realized gains and losses|
Direct premiums written were $24.0 million in the second quarter of 2010, down $244,000 or 1.0% from the same period a year ago. Year-to-date, direct premiums written are down $3.1 million or 5.6%. The rate of decline in direct premiums written slowed in the second quarter of 2010 due to an increase in new business written in Illinois. However, direct premiums have continued to decrease due to rate reductions based on lower claims frequency trends and competitive pressures. We insured 8,631 physicians at June 30, 2010, down from 8,821 insureds at year end 2009.
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