NEW YORK, Nov. 9, 2010 (GLOBE NEWSWIRE) -- American Independence Corp. (Nasdaq:AMIC) today reported 2010 third-quarter and nine-months results. This press release contains both GAAP and non-GAAP financial information for which reconciliations can be found at the end of this release.

Financial Results

Net income increased to $0.6 million ($.07 per share, diluted), for the three months ended September 30, 2010, compared to $0.2 million ($.03 per share, diluted), for the three months ended September 30, 2009. Net income decreased to $1.9 million ($.23 per share, diluted), for the nine months ended September 30, 2010, compared to $2.1 million ($.25 per share, diluted), for the nine months ended September 30, 2009.

The Company's operating income (1) for the three months ended September 30, 2010 was $1.1 million ($.13 per share, diluted), as compared to $0.6 million ($.07 per share, diluted) for the three months ended September 30, 2009. Operating income was $3.3 million ($.39 per share, diluted), for the nine months ended September 30, 2010, as compared to $3.4 million ($.41 per share, diluted) for the nine months ended September 30, 2009.

Revenues decreased to $21.8 million for the three months ended September 30, 2010, compared to revenues of $25.7 million for the three months ended September 30, 2009.  Revenues decreased to $68.4 million for the nine months ended September 30, 2010, compared to revenues of $79.2 million for the nine months ended September 30, 2009, primarily due to a reduction of premiums.

Chief Executive Officer's Comments

Roy Thung, Chief Executive Officer, commented, "We are gratified with our improved operating earnings for the third quarter of 2010 of $1.1 million or $.13 per share from $0.6 million or $.07 per share for the comparable period of 2009. Our financial condition and balance sheet remain strong. We have no debt, $274 million of federal net operating loss carryforwards, and have grown our book value to $11.00 per share at September 30, 2010 from $10.46 per share at December 31, 2009.  Our investment portfolio is rated, on average, AA and has a low duration although we are experiencing pressure on investment income due to lower yields on our fixed income portfolio. The regulations proposed to-date (including those mandating minimum loss ratios) seem to have validated our strategy of pursuing niche lines of business across many states utilizing multiple carriers, and we believe they will have minimal impact on the Company in the near future."

Non-GAAP Financial Measures

The Company provides non-GAAP financial measures to complement its consolidated financial statements presented in accordance with GAAP: (i) Operating income is net income excluding non-cash charges related to the amortization of intangible assets recorded in purchase accounting, net realized investment gains (losses), net income attributable to the non-controlling interest, and the federal income tax charge related to deferred taxes due to its federal net operating loss carryforwards, and (ii) Operating income per share is operating income (loss) on a per share basis. These non-GAAP financial measures are intended to supplement the user's overall understanding of the Company's current financial performance and its prospects for the future. Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by identifying certain expenses that, when excluded from the GAAP results, may provide additional understanding of the Company's core operating results or business performance. However, these non-GAAP financial measures are not intended to supersede or replace the Company's GAAP results. A reconciliation of the non-GAAP results to the GAAP results is provided in the "Reconciliation of GAAP Income from Continuing Operations to Non-GAAP Operating Income from Continuing Operations" schedule below. 

About American Independence Corp.

AMIC, through Independence American Insurance Company and its other subsidiaries, offers health insurance solutions to individuals and employer groups. AMIC provides to the individual and self-employed markets health insurance and related products, which are distributed through its subsidiaries, Independent Producers of America, LLC and healthinsurance.org, LLC. AMIC markets medical stop-loss through managing general underwriters, including Marlton Risk Group LLC and Risk Assessment Strategies, Inc.

Certain statements in this news release may be considered forward-looking statements, such as statements relating to management's views with respect to future events and financial performance. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the markets in which AMIC operates, new federal or state governmental regulation, AMIC's ability to effectively operate, integrate and leverage any past or future strategic acquisition, and other factors which can be found in AMIC's other news releases and filings with the Securities and Exchange Commission.  

 
AMERICAN INDEPENDENCE CORP.
THIRD QUARTER REPORT  
SEPTEMBER 30, 2010  
(In thousands except per share data)  
 
  Three Months Ended Nine Months Ended
  September 30, September 30,
  2010 2009 2010 2009
         
Premiums earned $17,833  $20,987  $55,650  $65,063 
MGU and agency income 3,077  3,968  10,292  11,406 
Net investment income 612  783  1,887  2,261 
Net realized investment gains (losses) 136  (27) 445  234 
Other-than-temporary impairment losses --  --  (29) -- 
Other income 141  24  183  207 
         
  Revenues 21,799  25,735  68,428  79,171 
         
Insurance benefits, claims and reserves 11,808  15,414  38,139  44,801 
Selling, general and administrative expenses 8,584  9,569  25,966  30,039 
Amortization and depreciation 215  210  646  629 
         
  Expenses 20,607  25,193  64,751  75,469 
         
Income before income tax 1,192  542  3,677  3,702 
Provision for income taxes 324  141  1,021  1,168 
         
Net income 868  401  2,656  2,534 
  Less: Net income attributable to the non-controlling interest (245) (176) (717) (443)
         
Net income attributable to American Independence Corp. $623  $225  $1,939  $2,091 
         
Basic income per common share:        
    Net income attributable to American Independence Corp. common stockholders $.07  $.03  $.23  $.25 
         
Weighted-average shares outstanding 8,512  8,506  8,509  8,505 
         
Diluted income per common share:        
    Net income attributable to American Independence Corp. common stockholders $.07  $.06  $.23  $.25 
         
Weighted-average diluted shares outstanding 8,512  8,506  8,509 8,505 
               

As of September 30, 2010 there were 8,508,591 common shares outstanding, net of treasury shares.

RECONCILIATION OF GAAP INCOME FROM CONTINUING OPERATIONS TO NON-GAAP
OPERATING INCOME FROM CONTINUING OPERATIONS
(In thousands except per share data)
         
  Three Months Ended Nine Months Ended
  September 30, September 30,
  2010 2009 2010 2009
         
Income from continuing operations $868  $401  $2,656  $2,534 
Amortization of intangible assets related to purchase accounting 34  34  101  101 
Net realized investment (gains) losses (136) 27  (445) (234)
Other-than-temporary impairment losses --  --  29  -- 
Federal income tax charge related to deferred taxes for operating income 314  115  954  1,048 
         
         
Operating Income from continuing operations $1,080  $577  $3,295  $3,449 
         
Non - GAAP Basic Income Per Common Share:        
         
  Operating Income from continuing operations $.13  $.07  $.39  $.41 
         
Non - GAAP Diluted Income Per Common Share:        
         
  Operating Income from continuing operations $.13  $.07  $.39  $.41 

 

(1) Operating income is a non-GAAP measure and is defined as net income excluding non-cash charges related to the amortization of certain intangible assets recorded in purchase accounting, net realized investment losses, losses from discontinued operations and the federal income tax charge related to deferred taxes. The Company believes that the presentation of operating income may offer a better understanding of the core operating results of the Company. A reconciliation of net income to operating income is presented as an attachment to this press release.

CONTACT:  American Independence Corp.          David T. Kettig          (212) 355-4141 Ext. 3047          www.americanindependencecorp.com