Market Overview

Atlantic American Reports Second Quarter Earnings

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  • Insurance premiums increased 2.6% and 4.3% for the three month and six month periods ended June 30, 2017, respectively, as compared to the comparable periods of 2016
  • Net income for the three month and six month periods ended June 30, 2017 was $1.5 million and $1.2 million, respectively, as compared to $0.2 million and $1.1 million, respectively, for the comparable periods of 2016

ATLANTA, Aug. 14, 2017 (GLOBE NEWSWIRE) -- Atlantic American Corporation (NASDAQ:AAME) today reported net income of $1.5 million, or $0.07 per diluted share, for the three month period ended June 30, 2017, compared to net income of $0.2 million, or $0.01 per diluted share, for the three month period ended June 30, 2016.  For the six month period ended June 30, 2017, net income was $1.2 million, or $0.05 per diluted share, compared to net income of $1.1 million, or $0.05 per diluted share, for the comparable period in 2016.  Realized investment gains for the three month and six month periods ended June 30, 2017 were $1.4 million and $2.3 million, respectively, as compared to $0.1 million and $0.9 million in the comparable three month and six month periods of 2016.  Operating income (income before income taxes and realized investment gains, net) for the three month period ended June 30, 2017 was $0.8 million, as compared to $0.2 million for the three month period ended June 30, 2016.  For the six month period ended June 30, 2017, the Company had an operating loss of $0.4 million as compared to operating income of $0.8 million for the comparable six month period of 2016.  The operating loss was attributable to higher than expected levels of claims in both life and health lines of business during the first quarter of 2017.

Total revenues for the three month period ended June 30, 2017 were $43.6 million, increasing 4.2% from $41.9 million for the three month period ended June 30, 2016.  While life and health premiums increased 6.4%, property and casualty premiums decreased 4.6%.  For the six month period ended June 30, 2017, total revenues were $87.5 million, increasing 4.7% from the comparable 2016 period.  Premiums earned from the Company's life and health operation increased 9.2% for the six month period ended June 30, 2017 while decreasing 4.6% in the property and casualty operation during the comparable period.

Commenting on the quarter, Hilton H. Howell, Jr., chairman, president and chief executive officer, noted, "We are pleased that the level of Medicare supplement benefit expenses and life insurance claims returned to historical levels in the second quarter.  Our distribution network for the life and health operation continues to perform exceptionally well and we expect another record year in premium growth.  In addition, the Worksite division has enjoyed a steady pace of sales activity and we believe they are well positioned going into the second half of the year when open enrollment kicks into high gear.  Although premiums in the property and casualty operations were down slightly, they continue to produce strong profits."

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        Six months ended        
  June 30,   June 30,
(Unaudited; In thousands, except per share data) 2017   2016   2017   2016
               
Insurance premiums              
Life and health $26,989     $25,355     $54,680     $50,088  
Property and casualty   13,131       13,767       26,222       27,492  
Investment income   2,085       2,563       4,244       5,070  
Realized investment gains, net   1,396       132       2,279       884  
Other income   31       37       66       67  
               
Total revenue   43,632       41,854       87,491       83,601  
               
Insurance benefits and losses incurred              
Life and health   19,100       18,105       40,813       35,016  
Property and casualty   7,932       8,817       16,216       16,731  
Commissions and underwriting expenses   11,010       10,954       21,624       22,781  
Interest expense   424       385       833       758  
Other expense   2,981       3,236       6,167       6,582  
               
  Total benefits and expenses   41,447       41,497       85,653       81,868  
               
Income before income taxes   2,185       357       1,838       1,733  
               
Income tax expense   725       116       599       594  
               
Net income   $1,460       $241      
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