Atlantic American Reports Third Quarter and Year to Date Net Income and Announces a New Share Repurchase Authorization

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| Source: Atlantic American Corporation
  • Life and health premiums increased 10.8% and 6.3%, respectively, during the three month and nine month periods ended September 30, 2016 as compared to the comparable periods in 2015.
  • Loss ratio in the property and casualty operation decreased in the nine month period ended September 30, 2016 as compared to the comparable period in 2015.

ATLANTA, Nov. 14, 2016 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq:AAME) today reported net income of $0.1 million, or nil per diluted share, for the three month period ended September 30, 2016, compared to net income of $0.2 million, or $0.01 per diluted share, for the three month period ended September 30, 2015.  For the nine month period ended September 30, 2016, net income was $1.3 million, or $0.05 per diluted share, compared to net income of $4.3 million, or $0.19 per diluted share, for the comparable period in 2015.  Realized investment gains for the three month and nine month periods ended September 30, 2016 were $0.5 million and $1.4 million, respectively, as compared to $7,000 and $5.1 million in the comparable three month and nine month periods of 2015.  Operating income (income before income taxes and realized investment gains, net) for the three month period ended September 30, 2016 was a loss of $0.2 million, as compared to income of $0.4 million for the three month period ended September 30, 2015.  For the nine month period ended September 30, 2016, operating income was $0.6 million as compared to the $0.5 million for the comparable nine month period of 2015.

Total revenues for the three month period ended September 30, 2016 were $42.4 million, increasing 5.2% from $40.4 million for the three month period ended September 30, 2015.  Insurance premiums during this three month period increased $1.6 million from the comparable 2015 premiums.  While life and health premiums increased 10.8%; property and casualty premiums decreased 7.2%.  For the nine month period ended September 30, 2016, total revenues were $126.0 million, consistent with the comparable 2015 period.  Premiums earned from the Company’s life and health operation increased 6.3% for the nine month period ended September 30, 2016 while decreasing 2.1% in the property and casualty operation during the comparable period.

Additionally, the Company announced that the Board of Directors has terminated the Company’s existing stock repurchase plan and approved a new repurchase plan that allows for the repurchase of up to 750,000 shares of the Company’s common stock from time to time in accordance with applicable securities laws and other requirements.

Commenting, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, “Throughout the year we have been making significant investments in our life and health product line and distribution network.  It is now obvious that such investments are being realized in our increasing premium volumes. With life and health premiums up over 10% in the third quarter of 2016, we are poised to continue on our growth trajectory.  And even though our property and casualty premiums declined slightly, the selective underwriting, which is the hallmark of American Southern, continued to produce strong profits in that operation.”

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 subsidiaries consist of 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 Nine months ended
  September 30, September 30,
(Unaudited; In thousands, except per share data) 2016 2015 2016 2015
         
Insurance premiums        
Life and health $26,548  $23,971  $76,636  $72,100 
Property and casualty  12,884   13,888   40,376   41,249 
Investment income  2,453   2,456   7,523   7,547 
Realized investment gains, net  527   7   1,411   5,106 
Other income  35   37   102   78 
         
Total revenue  42,447   40,359   126,048   126,080 
         
Insurance benefits and losses incurred        
Life and health  18,448   16,311   53,464   50,055 
Property and casualty  8,507   8,326   25,238   26,206 
Commissions and underwriting expenses  11,558   11,816   34,339   33,024 
Interest expense  396   361   1,154   1,064 
Other expense  3,221   3,180   9,803   10,167 
         
Total benefits and expenses  42,130   39,994   123,998   120,516 
         
Income before income taxes  317   365   2,050   5,564 
         
Income tax expense  168   127   762   1,290 
         
Net income  $  149  $  238  $  1,288  $  4,274 
         
Earnings per common share (basic and diluted) $   -   $  0.01  $  0.05  $  0.19 
         
Reconciliation of Non-GAAP Financial Measure        
         
Net income $149  $238  $1,288  $4,274 
Income tax expense  168   127   762   1,290 
Realized investment gains, net  (527)  (7)  (1,411)  (5,106)
         
Operating income (loss) $  (210) $  358  $   639  $   458 
         
         
  September 30, December 31,   
Selected Balance Sheet Data 2016 2015    
         
Total cash and investments $260,815  $254,007     
Insurance subsidiaries  238,518   229,092     
Parent and other  22,297   24,915     
Total assets  321,503   314,603     
Insurance reserves and policyholder funds  161,600   163,345     
Debt  33,738   33,738     
Total shareholders' equity  108,951   102,492     
Book value per common share  5.06   4.75     
Statutory capital and surplus        
Life and health  32,959   35,322     
Property and casualty  40,920   38,308     
             
For further information contact:
John G. Sample, Jr.
Senior Vice President and Chief Financial Officer
Atlantic American Corporation
404-266-5501

Hilton H. Howell, Jr.
Chairman, President & CEO
Atlantic American Corporation
404-266-5505