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Atlantic American Corporation Reports Second Quarter Results for 2024
Source: Nasdaq GlobeNewswire / 14 Aug 2024 12:11:59 America/New_York
ATLANTA, Aug. 14, 2024 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq- AAME) today reported net loss of $0.7 million, or $(0.04) per diluted share, for the three month period ended June 30, 2024, compared to net income of $1.7 million, or $0.08 per diluted share, for the three month period ended June 30, 2023. The Company had net loss of $2.7 million, or $(0.14) per diluted share, for the six month period ended June 30, 2024, compared to net income of $0.3 million, or $0.00 per diluted share, for the six month period ended June 30, 2023. The increase in net loss for the three month and six month periods ended June 30, 2024 was primarily the result of unfavorable loss experience in the Company’s life and health operations, as well as in the Company’s property and casualty operations, compared to the prior year periods.
Operating income decreased $2.8 million in the three month period ended June 30, 2024 from the three month period ended June 30, 2023. For the six month period ended June 30, 2024, operating income decreased $5.7 million from the comparable period in 2023. The decrease in operating income for the three month and six month periods ended June 30, 2024 was primarily the result of unfavorable loss experience in the life and health operations due to an increase in incurred losses in the group life and Medicare supplement lines of business. Also contributing to the decrease in operating income was unfavorable loss experience in the property and casualty operations due to the frequency and severity of claims in the automobile liability line of business.
Commenting on the results, Hilton H. Howell, Jr., Chairman, President and Chief Executive Officer, stated, “Although this year has presented challenges in our life and health operations, we believe our strategic investments in technology and talent will provide the foundation for future performance. We believe our recent product launches in several key states position us well for a strong sales season during the upcoming annual enrollment period. Additionally, our property and casualty division has demonstrated remarkable resilience in a softening market, consistently writing profitable business. We remain committed to our long-term strategy and are optimistic about the opportunities that lie ahead.”
Atlantic American Corporation 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, Bankers Fidelity Assurance Company and Atlantic Capital Life Assurance Company.
Note regarding non-GAAP financial measure: Atlantic American Corporation presents its consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP). However, from time to time, the Company may present, in its public statements, press releases and filings with the Securities and Exchange Commission, non-GAAP financial measures such as operating income (loss). We define operating income (loss) as net income (loss) excluding: (i) income tax expense (benefit); (ii) realized investment (gains) losses, net; and (iii) unrealized (gains) losses on equity securities, net. Management believes operating income (loss) is a useful metric for investors, potential investors, securities analysts and others because it isolates the “core” operating results of the Company before considering certain items that are either beyond the control of management (such as income tax expense (benefit), which is subject to timing, regulatory and rate changes depending on the timing of the associated revenues and expenses) or are not expected to regularly impact the Company’s operating results (such as any realized and unrealized investment gains (losses), which are not a part of the Company’s primary operations and are, to a limited extent, subject to discretion in terms of timing of realization). The financial data attached includes a reconciliation of operating income (loss) to net income (loss), the most comparable GAAP financial measure. The Company’s definition of operating income (loss) may differ from similarly titled financial measures used by others. This non-GAAP financial measure should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP.
Note regarding forward-looking statements: 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, including the Company’s ability to remediate the identified material weakness in its internal control over financial reporting as described in the Company’s most recent Annual Report on Form 10-K and those other risks and uncertainties detailed in statements and reports that the Company files from time to time 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 Six Months Ended June 30, June 30, (Unaudited; In thousands, except per share data) 2024 2023 2024 2023 Insurance premiums Life and health $ 27,449 $ 28,180 $ 54,123 $ 57,069 Property and casualty 17,544 17,880 35,422 35,091 Insurance premiums, net 44,993 46,060 89,545 92,160 Net investment income 2,416 2,559 4,972 5,100 Realized investment gains, net 13 70 13 70 Unrealized gains (losses) on equity securities, net 243 494 129 (1,881 ) Other income 3 5 6 8 Total revenue 47,668 49,188 94,665 95,457 Insurance benefits and losses incurred Life and health 17,579 15,817 36,691 33,617 Property and casualty 14,228 13,548 27,041 26,208 Commissions and underwriting expenses 11,584 12,848 24,250 25,766 Interest expense 867 807 1,722 1,557 Other expense 4,259 3,951 8,316 7,910 Total benefits and expenses 48,517 46,971 98,020 95,058 Income (loss) before income taxes (849 ) 2,217 (3,355 ) 399 Income tax expense (benefit) (165 ) 473 (673 ) 101 Net income (loss) $ (684 ) $ 1,744 $ (2,682 ) $ 298 Earnings (loss) per common share (basic & diluted) $ (0.04 ) $ 0.08 $ (0.14 ) $ - Reconciliation of non-GAAP financial measure Net income (loss) $ (684 ) $ 1,744 $ (2,682 ) $ 298 Income tax expense (benefit) (165 ) 473 (673 ) 101 Realized investment gains, net (13 ) (70 ) (13 ) (70 ) Unrealized (gains) losses on equity securities, net (243 ) (494 ) (129 ) 1,881 Non-GAAP operating income (loss) $ (1,105 ) $ 1,653 $ (3,497 ) $ 2,210 June 30, December 31, Selected balance sheet data 2024 2023 Total cash and investments $ 256,525 $ 265,368 Insurance subsidiaries 248,857 259,253 Parent and other 7,668 6,115 Total assets 386,007 381,265 Insurance reserves and policyholder funds 225,252 212,422 Debt 37,762 36,757 Total shareholders' equity 100,672 107,275 Book value per common share 4.67 4.99 Statutory capital and surplus Life and health 32,689 38,299 Property and casualty 51,967 51,774