Atlantic American Reports Third Quarter And Year To Date Net Income And Announces A New Share Repurchase Authorization

  • Life and health premiums increased 10.8% and 6.3%, respectively, during the three month and nine month periods ended September 30, 2016 as compared to the comparable periods in 2015.
  • Loss ratio in the property and casualty operation decreased in the nine month period ended September 30, 2016 as compared to the comparable period in 2015.

ATLANTA, Nov. 14, 2016 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq:AAME) today reported net income of $0.1 million, or nil per diluted share, for the three month period ended September 30, 2016, compared to net income of $0.2 million, or $0.01 per diluted share, for the three month period ended September 30, 2015.  For the nine month period ended September 30, 2016, net income was $1.3 million, or $0.05 per diluted share, compared to net income of $4.3 million, or $0.19 per diluted share, for the comparable period in 2015.  Realized investment gains for the three month and nine month periods ended September 30, 2016 were $0.5 million and $1.4 million, respectively, as compared to $7,000 and $5.1 million in the comparable three month and nine month periods of 2015.  Operating income (income before income taxes and realized investment gains, net) for the three month period ended September 30, 2016 was a loss of $0.2 million, as compared to income of $0.4 million for the three month period ended September 30, 2015.  For the nine month period ended September 30, 2016, operating income was $0.6 million as compared to the $0.5 million for the comparable nine month period of 2015.

Total revenues for the three month period ended September 30, 2016 were $42.4 million, increasing 5.2% from $40.4 million for the three month period ended September 30, 2015.  Insurance premiums during this three month period increased $1.6 million from the comparable 2015 premiums.  While life and health premiums increased 10.8%; property and casualty premiums decreased 7.2%.  For the nine month period ended September 30, 2016, total revenues were $126.0 million, consistent with the comparable 2015 period.  Premiums earned from the Company's life and health operation increased 6.3% for the nine month period ended September 30, 2016 while decreasing 2.1% in the property and casualty operation during the comparable period.

Additionally, the Company announced that the Board of Directors has terminated the Company's existing stock repurchase plan and approved a new repurchase plan that allows for the repurchase of up to 750,000 shares of the Company's common stock from time to time in accordance with applicable securities laws and other requirements.

Commenting, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, "Throughout the year we have been making significant investments in our life and health product line and distribution network.  It is now obvious that such investments are being realized in our increasing premium volumes. With life and health premiums up over 10% in the third quarter of 2016, we are poised to continue on our growth trajectory.  And even though our property and casualty premiums declined slightly, the selective underwriting, which is the hallmark of American Southern, continued to produce strong profits in that operation."

Atlantic American 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 subsidiaries consist of American Southern Insurance Company, American Safety Insurance Company, Bankers Fidelity Life Insurance Company and Bankers Fidelity Assurance Company.

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.
Atlantic American Corporation
Financial Data
         
    Three months ended   Nine months ended
    September 30,   September 30,
(Unaudited; In thousands, except per share data)   2016   2015   2016   2015
                 
Insurance premiums                
Life and health   $ 26,548     $ 23,971     $ 76,636     $ 72,100  
Property and casualty     12,884       13,888       40,376       41,249  
Investment income     2,453       2,456       7,523       7,547  
Realized investment gains, net     527       7       1,411       5,106  
Other income     35       37       102       78  
                 
Total revenue     42,447       40,359       126,048       126,080  
                 
Insurance benefits and losses incurred                
Life and health     18,448       16,311       53,464       50,055  
Property and casualty     8,507       8,326       25,238       26,206  
Commissions and underwriting expenses     11,558       11,816       34,339       33,024  
Interest expense     396       361       1,154       1,064  
Other expense     3,221       3,180       9,803       10,167  
                 
Total benefits and expenses     42,130       39,994       123,998       120,516  
                 
Income before income taxes     317       365       2,050       5,564  
                 
Income tax expense     168       127       762       1,290  
                 
Net income   $   149     $   238     $   1,288     $   4,274  
                 
Earnings per common share (basic and diluted)   $    -     $   0.01     $   0.05     $   0.19  
                 
Reconciliation of Non-GAAP Financial Measure                
                 
Net income   $ 149     $ 238     $ 1,288     $ 4,274  
Income tax expense     168       127       762       1,290  
Realized investment gains, net     (527 )     (7 )     (1,411 )     (5,106 )
                 
Operating income (loss)   $  (210 )   $  358     $    639     $    458  
                 
                 
    September 30,   December 31,      
Selected Balance Sheet Data   2016   2015        
                 
Total cash and investments   $ 260,815     $ 254,007          
Insurance subsidiaries     238,518       229,092          
Parent and other     22,297       24,915          
Total assets     321,503       314,603          
Insurance reserves and policyholder funds     161,600       163,345          
Debt     33,738       33,738          
Total shareholders' equity     108,951       102,492          
Book value per common share     5.06       4.75          
Statutory capital and surplus                
Life and health     32,959       35,322          
Property and casualty     40,920       38,308          
                         
For further information contact:John G. Sample, Jr.Senior Vice President and Chief Financial OfficerAtlantic American Corporation404-266-5501Hilton H. Howell, Jr.Chairman, President & CEOAtlantic American Corporation404-266-5505

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