Market Overview

Atlantic American Reports First Quarter Results


ATLANTA, May 12, 2017 (GLOBE NEWSWIRE) -- Atlantic American Corporation (NASDAQ:AAME) today reported a first quarter 2017 net loss of $0.2 million, or $0.02 per common share, as compared to net income of $0.9 million, or $0.04 per common share, in the first quarter of 2016.  Realized investment gains during the first quarter of 2017 were $0.9 million as compared to $0.8 million in the first quarter of 2016.  The net loss was attributable to higher than expected levels of claims in both life and health lines of business.  Most notable were the early season Medicare Supplement Part B deductible reimbursements on new business which have not yet been through an annual earnings cycle.  Total insurance premiums for the quarter ended March 31, 2017 increased 6.0% to $40.8 million as compared to $38.5 million in the first quarter of 2016; while Medicare Supplement premiums increased 14.1% during the comparable period to $23.9 million from $20.9 million.  Total revenues were $43.9 million for the quarter ended March 31, 2017 as compared to $41.7 million for the quarter ended March 31, 2016.

Commenting on the quarter, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, "We continue to move forward with great optimism and confidence in our business strategies.  Our Worksite/Group division was officially launched in the first quarter and is experiencing an encouraging level of sales.  Our Individual division has recently released a new hospital indemnity product that we feel will have high market acceptance.  Diversification of our sales portfolio continues to be a primary focus.  We expect that the increased level of Medicare supplement benefit expenses and life insurance claims we experienced in the first quarter will moderate naturally and historically, thus allowing us to return to expected levels of profitability throughout the remainder of the year.  Our property and casualty operations continue to perform well and we look forward to better quarters in the balance of the year."

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 insurance subsidiaries are 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
  March 31,
(Unaudited; In thousands, except per share data)   2017       2016  
Insurance premiums      
Life and health $ 27,691     $ 24,733  
Property and casualty   13,091       13,725  
Investment income   2,159       2,507  
Realized investment gains, net   883       752  
Other income   35       30  
Total revenue   43,859       41,747  
Insurance benefits and losses incurred      
Life and health   21,713       16,911  
Property and casualty   8,284       7,914  
Commissions and underwriting expenses   10,614       11,827  
Interest expense   409       373  
Other expense   3,186       3,346  
Total benefits and expenses   44,206       40,371  
Income (loss) before income taxes   (347)       1,376  
Income tax expense (benefit)   (126)       478  
Net income (loss) $ (221)     $ 898  
Earnings (loss) per common share (basic and diluted) $ (0.02)     $ 0.04  
Reconciliation of Non-GAAP Financial Measure      
Net income (loss) $ (221)     $ 898  
Income tax expense (benefit)   (126)       478  
Realized investment gains, net   (883)       (752)  
Operating income (loss) $ (1,230)     $ 624  
  March 31,   December 31,
Selected Balance Sheet Data   2017       2016  
Total cash and investments $ 255,119     $ 257,429  
Insurance subsidiaries   231,870       235,499  
Parent and other   23,249       21,930  
Total assets   312,914       318,600  
Insurance reserves and policyholder funds   158,403       162,679  
Debt   33,738       33,738  
Total shareholders' equity   106,981       105,506  
Book value per common share   4.97       4.89  
Statutory capital and surplus      
Life and health  
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