KANSAS CITY, Mo., May 4, 2020 /PRNewswire/ -- Kansas City Life Insurance Company recorded net income of $0.2 million or $0.02 per share in the first quarter of 2020, a decrease of $3.9 million or $0.40 per share relative to the first quarter of 2019. The decline in net income in 2020 was primarily due to the COVID-19 pandemic that has dramatically impacted both financial markets and the overall economy. The allowance for mortgage loan losses was increased in the first quarter of 2020 due to the worsening economic outlook. The change in the fair value of equity securities resulted in a loss in the first quarter of 2020 compared to a gain in the first quarter of 2019. The change in the fair value of the guaranteed minimum withdrawal benefits (GMWB) rider contributed additional expense in the first quarter of 2020 compared to the prior year. Also, the amortization of deferred acquisition costs associated with the variable product line increased compared to the prior year, mainly due to decreased investment performance in the separate accounts. Partially offsetting these items, income tax expense was lower than the prior year due to the impact of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). In addition to these COVID-19-related impacts were decreases in policyholder benefits and operating expenses.
The COVID-19 pandemic has also impacted our administrative operations. During the first quarter of 2020, many state and local governments have issued stay-at-home orders for citizens, and non-essential businesses have been closed. The Company, as a financial institution, is classified as an essential business. In response to these challenges, we have instituted our business continuity plan and our home office remains open to ensure that we remain fully operational. We continue to provide Security Assured and to deliver effective and timely service to our policyholders, customers, and field force.
Kansas City Life Insurance Company KCLI was established in 1895 and is based in Kansas City, Missouri. The Company's primary business is providing financial protection through the sale of life insurance and annuities. The Company operates in 49 states and the District of Columbia. For more information, please visit www.kclife.com.
Kansas City Life Insurance Company | |||||
Condensed Consolidated Income Statement | |||||
(amounts in thousands, except share data) | |||||
Quarter Ended | |||||
March 31 | |||||
2020 | 2019 | ||||
Revenues | $ | 123,035 | $ | 130,103 | |
Net income | $ | 150 | $ | 4,035 | |
Net income per share, basic and diluted | $ | 0.02 | $ | 0.42 | |
Dividends paid | $ | 0.27 | $ | 0.27 | |
Average number of shares outstanding | 9,683,414 | 9,683,414 | |||
SOURCE Kansas City Life Insurance Company
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