Market Overview

Atlantic American Reports First Quarter Results

Share:

ATLANTA, May 11, 2018 (GLOBE NEWSWIRE) -- Atlantic American Corporation (NASDAQ:AAME) today reported a first quarter 2018 net loss of $5.0 million, or $0.25 per common share, as compared to a net loss of $0.2 million, or $0.02 per common share, in the first quarter of 2017.  The increase in net loss during the first quarter of 2018 was primarily due to the impact of a newly adopted accounting standard effective January 1, 2018.  This accounting standard requires changes in the fair value of investments in equity securities to be reported in net income on the statement of operations.  Under previous accounting guidelines, changes in the fair values of equity securities were recognized in other comprehensive income on the balance sheet.  As a result, net unrealized losses on equity securities reported in net loss on the income statement were $4.4 million during the first quarter of 2018 compared to nil for the first quarter of 2017 in accordance with then-applicable accounting guidelines.  Total insurance premiums for the quarter ended March 31, 2018 increased 3.5% to $42.2 million as compared to $40.8 million in the first quarter of 2017, due primarily to increased Medicare supplement premiums in the life and health operation.  Operating loss for the first quarter of 2018 was $2.3 million compared to $1.2 million in the first quarter of 2017.  The increase in operating loss for the quarter was primarily attributable to higher than expected levels of claims in the life and health operation.  Most notable were the early season Medicare supplement Part B deductible expenses which are principally incurred in the first quarter. 

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.  Diversification of our sales portfolio in both the individual and group market continues to be a primary focus.  Our Worksite/Group division is experiencing an encouraging level of sales and has released a full suite of products to offer in the upcoming sales season.  We expect that the increased level of Medicare supplement benefit expenses we experienced in the first quarter will moderate as the rate increases implemented in prior year earn out, 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.

For further information contact:    
J. Ross Franklin   Hilton H. Howell, Jr.
Chief Financial Officer   Chairman, President & CEO
Atlantic American Corporation   Atlantic American Corporation
404-266-5580   404-266-5505



 
 
Atlantic American Corporation
Financial Data
 
 
  Three Months Ended
  March 31,
(Unaudited; In thousands, except per share data)   2018       2017  
Insurance premiums              
Life and health $ 29,495     $ 27,691  
Property and casualty   12,707       13,091  
Investment income   2,359       2,159  
Realized investment gains, net   370       883  
Unrealized losses on equity securities, net   (4,419 )     -  
Other income   28       35  
               
Total revenue     40,540         43,859  
               
Insurance benefits and losses incurred              
Life and health   23,995       21,713  
Property and casualty   9,177       8,284  
Commissions and underwriting expenses   10,019       10,614  
Interest expense   462       409  
Other expense   3,238       3,186  
               
Total benefits and expenses   46,891       44,206  
               
Loss before income taxes   (6,351 )     (347 )
Income tax benefit   (1,327 )     (126 )
               
Net loss $    (5,024 )   $    (221 )
               
Loss per common share (basic and diluted) $    (0.25 )   $    (0.02 )
               
Reconciliation of Non-GAAP Financial Measure              
               
Net loss $ (5,024 )   $ (221 )
Income tax benefit   (1,327 )     (126 )
Realized investment gains, net   (370 )     (883 )
Unrealized losses on equity securities, net   4,419       -  
               
Operating loss $    (2,302 )   $    (1,230 )
               
    March 31,       December 31,  
Selected Balance Sheet Data   2018       2017  
               
Total cash and investments
View Comments and Join the Discussion!
 
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com