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Atlantic American Corporation Reports Third Quarter Results for 2022

Atlantic American Corporation
Atlantic American Corporation

ATLANTA, Nov. 08, 2022 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq- AAME) today reported net loss for the three month period ended September 30, 2022 of $0.7 million, or $0.04 per diluted share, as compared to net loss of $0.9 million, or $0.05 per diluted share, for the comparable period in 2021. For the nine month period ended September 30, 2022, the Company reported net income of $0.5 million, or $0.01 per diluted share, as compared to net income of $1.6 million, or $0.06 per diluted share, for the comparable period in 2021.   The decrease in net loss for the three month period ended September 30, 2022 was primarily attributable to more favorable loss experience in the life and health operations, partially offset by a decrease in unrealized gains of $3.5 million, from the comparable period in 2021. The decrease in net income for the nine month period ended September 30, 2022 was primarily attributable to the decrease in unrealized gains of $10.9 million from the comparable period in 2021, partially offset by more favorable loss experience in the life and health operations.

Operating income (as defined below) increased $4.1 million in the three month period ended September 30, 2022 from the three month period ended September 30, 2021. For the nine month period ended September 30, 2022, operating income increased $10.2 million from the comparable period in 2021. The increase in operating income was primarily due to favorable loss experience in the life and health operations, resulting from an increase in earned premium within the group lines of business coupled with a decrease in the number of claims incurred in the Medicare supplement line of business.
   
Commenting on the results, Hilton H. Howell, Jr., Chairman, President and Chief Executive Officer, stated, “We are quite pleased to report an over $10 million improvement in operating income for the first nine months of 2022 as compared to 2021. The life and health operations have done a phenomenal job in diversifying the business through its competitive group products, as well as carefully managing the Medicare supplement line back to profitability. Additionally, our property and casualty operations continue to perform exceptionally well, maintaining profitability coupled with top line growth. Finally, it is with great enthusiasm that we announce our newly formed subsidiary, Atlantic Capital Life Assurance Company, which recently obtained its certificate of authority in our state of domicile.”

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 and Bankers Fidelity 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, 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 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, including those detailed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and subsequent statements and reports that Atlantic American Corporation 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

 

Nine Months Ended

 

September 30,

 

September 30,

(Unaudited; In thousands, except per share data)

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Insurance premiums

 

 

 

 

 

 

 

Life and health

$

28,739

 

 

$

28,772

 

 

$

86,773

 

 

$

87,018

 

Property and casualty

 

17,641

 

 

 

17,320

 

 

 

53,753

 

 

 

50,297

 

Insurance premiums, net

 

46,380

 

 

 

46,092

 

 

 

140,526

 

 

 

137,315

 

 

 

 

 

 

 

 

 

Net investment income

 

2,641

 

 

 

2,137

 

 

 

7,510

 

 

 

6,516

 

Realized investment gains, net

 

101

 

 

 

349

 

 

 

29

 

 

 

520

 

Unrealized gains (losses) on equity securities, net

 

(2,783

)

 

 

711

 

 

 

(5,456

)

 

 

5,458

 

Other income

 

4

 

 

 

1

 

 

 

11

 

 

 

13

 

 

 

 

 

 

 

 

 

Total revenue

 

46,343

 

 

 

49,290

 

 

 

142,620

 

 

 

149,822

 

 

 

 

 

 

 

 

 

Insurance benefits and losses incurred

 

 

 

 

 

 

 

Life and health

 

18,599

 

 

 

23,394

 

 

 

58,003

 

 

 

66,463

 

Property and casualty

 

12,031

 

 

 

11,651

 

 

 

36,549

 

 

 

33,557

 

Commissions and underwriting expenses

 

12,843

 

 

 

11,927

 

 

 

35,894

 

 

 

36,670

 

Interest expense

 

523

 

 

 

347

 

 

 

1,291

 

 

 

1,040

 

Other expense

 

3,296

 

 

 

3,264

 

 

 

10,151

 

 

 

10,178

 

 

 

 

 

 

 

 

 

Total benefits and expenses

 

47,292

 

 

 

50,583

 

 

 

141,888

 

 

 

147,908

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(949

)

 

 

(1,293

)

 

 

732

 

 

 

1,914

 

Income tax expense (benefit)

 

(265

)

 

 

(378

)

 

 

253

 

 

 

298

 

 

 

 

 

 

 

 

 

Net income (loss)

$

(684

)

 

$

(915

)

 

$

479

 

 

$

1,616

 

 

 

 

 

 

 

 

 

Earnings (loss) per common share (basic and diluted)

$

(0.04

)

 

$

(0.05

)

 

$

0.01

 

 

$

0.06

 

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measure

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

(684

)

 

$

(915

)

 

$

479

 

 

$

1,616

 

Income tax expense (benefit)

 

(265

)

 

 

(378

)

 

 

253

 

 

 

298

 

Realized investment gains, net

 

(101

)

 

 

(349

)

 

 

(29

)

 

 

(520

)

Unrealized (gains) losses on equity securities, net

 

2,783

 

 

 

(711

)

 

 

5,456

 

 

 

(5,458

)

 

 

 

 

 

 

 

 

Non-GAAP Operating income (loss)

$

1,733

 

 

$

(2,353

)

 

$

6,159

 

 

$

(4,064

)

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

December 31,

 

 

 

 

Selected Balance Sheet Data

 

2022

 

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

Total cash and investments

$

246,340

 

 

$

308,195

 

 

 

 

 

Insurance subsidiaries

 

240,860

 

 

 

302,302

 

 

 

 

 

Parent and other

 

5,480

 

 

 

5,893

 

 

 

 

 

Total assets

 

360,349

 

 

 

402,286

 

 

 

 

 

Insurance reserves and policyholder funds

 

204,289

 

 

 

201,797

 

 

 

 

 

Debt

 

34,738

 

 

 

33,738

 

 

 

 

 

Total shareholders' equity

 

97,911

 

 

 

141,286

 

 

 

 

 

Book value per common share

 

4.54

 

 

 

6.66

 

 

 

 

 

Statutory capital and surplus

 

 

 

 

 

 

 

Life and health

 

35,325

 

 

 

38,625

 

 

 

 

 

Property and casualty

 

52,981

 

 

 

52,724

 

 

 

 

 

 

 

 

 

 

 

 

 


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