Results of Operations for the Year Ended December 31, 2022 - American Overseas Group Limited Announces Net Loss Of $1.5 Million For the Year Ended December 31, 2022
April 28, 2023 at 04:02 pm EDT
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HAMILTON, Bermuda, April 28, 2023 (GLOBE NEWSWIRE) -- American Overseas Group Limited BSX: AORE.BH) (Pink Sheets: AOREF.PK) (“AOG” or the “Company”) today reported consolidated net loss available to common shareholders of $1.5 million, or $31.42 per diluted share, for the year ended December 31, 2022. This compares to consolidated net loss available to common shareholders of $5.5 million, or $117.07 per diluted share, for the year ended December 31, 2021. Book value per weighted share at December 31, 2022 was $758.44, a decline from the book value per weighted share of $916.83 at December 31, 2021.
For the three months ended December 31, 2022, net earned property and casualty premiums increased $0.2 million from $4.9 million a year ago to $5.1 million. For the year ended December 31, 2022, net earned property and casualty premiums decreased $0.7 million from $20.8 million to $20.1 million.
Quarter to Date fee income increased $0.4 million from $2.6 million to $3.0 million and gross written premiums increased $16.6 million, moving from $101.5 million to $118.1 million. Quarter to Date direct written premiums were positively impacted by continued expansion of new programs, rate increases, and overall economic recovery. Quarter to Date Loss and loss adjustment expenses as a percentage of earned premium decreased from 84.8% to 82.2%.
For the year ended December 31, 2022, fee income increased $0.5 million from $11.2 million a year ago to $11.7 million and gross written premiums increased $32.6 million, moving from $420.5 million to $453.1 million. Year to date direct written premiums were positively impacted by continued expansion of new programs, rate increases, and overall economic recovery. Year to Date Loss and loss adjustment expenses as a percentage of earned premium increased from 69.1% to 72.1%.
For the three months ended December 31, 2022, operating expenses decreased $0.2 million from $3.2 million to $3.0 million. For the year ended December 31, 2022, operating expenses decreased $2.7 million from $14.2 million to $11.5 million largely due to a one-time recognition in the amount of $1.2 million in 2021 of items previously held as a receivable against a personal guarantee contract and a $1.5 million decrease in taxes, licenses and fees largely related to increased Louisiana taxes in 2021.
As part of its ongoing capital management efforts, the Company will continue to redirect excess capital within the group to debt reduction unless other compelling opportunities present themselves.
Forward-Looking Statements
This release contains statements that may be considered "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, without limitation, the Company's expectations respecting the volatility of its insured portfolio, losses, loss reserves and loss development, the adequacy and availability of its liquidity and capital resources, its current run off strategy, its strategy for writing other reinsurance businesses and its expense reduction measures. These statements are based on current expectations and the current views of the economic and operating environment and are not guarantees of future performance. A number of risks and uncertainties, including economic competitive conditions, could cause actual results to differ materially from those projected in forward-looking statements. The Company's actual results could differ materially from those expressed or implied in the forward-looking statements.
Information About the Company
American Overseas Group Limited is an insurance holding company incorporated in Bermuda and a tax resident of the United Kingdom. Its operating subsidiaries provide specialty property/casualty insurance, reinsurance and insurance management services. More information can be found at www.aoreltd.com.
American Overseas Group Limited
info@aoreltd.com
American Overseas Group Limited
Consolidated Balance Sheets
(unaudited)
As at Decemeber 31, 2022 and December 31, 2021
(dollars in thousands)
December 31, 2022
December 31, 2021
Assets
Investments:
Fixed-maturity securities held as available for sale, at fair value
$
97,646
$
102,678
Equity investments held as available for sale, at fair value
2,708
3,781
Cash and cash equivalents
32,212
31,908
Restricted cash
3,968
4,440
Accrued investment income
455
553
Premiums receivable
94,704
76,626
Deferred insurance premiums
132,602
108,904
Reinsurance balances receivable, net
248,234
223,982
Deferred policy acquisition costs
4,029
4,588
Intangible assets
4,800
4,800
Goodwill
33,050
33,050
Other assets
3,978
3,166
Total Assets
$
658,386
$
598,476
Liabilities and Equity
Liabilities:
Loss and loss expense reserve
$
253,886
$
215,642
Deferred commission income
2,661
3,210
Unearned premiums
137,929
113,423
Ceded premium payable
88,117
82,059
Payable to general agents
5,469
7,121
Funds withheld
99,409
104,257
Accounts payable and accrued liabilities
16,499
12,420
Notes payable
18,021
16,521
Non-owned interest in VIE
300
300
Interest payable
464
451
Total Liabilities
622,755
555,404
Shareholders' Equity:
Common shares
4,698
4,698
Additional paid-in capital
189,179
189,179
Accumulated other comprehensive (loss) income
(4,240
)
1,124
Retained deficit
(159,459
)
(157,982
)
Total Shareholders' Equity
30,178
37,019
Non-controlling interest of preferred shares of subsidiaries
5,453
6,053
Total Equity
35,631
43,072
Total Liabilities and Equity
$
658,386
$
598,476
See Notes to December 31, 2022 Consolidated Financial Statements available on American Overseas Group Ltd. Website at www.aoreltd.com
American Overseas Group Limited
Consolidated Statements of Operations
(unaudited)
(dollars in thousands, except share and per share amounts)
Three months ended December 31,
Twelve Months ended December 31,
2022
2021
2022
2021
Revenues
Net premiums earned
$
5,101
$
4,905
$
20,126
$
20,840
Fee income
3,007
2,582
11,693
11,248
Net investment income
122
232
263
439
Net realized gains on investments
-
5
237
55
Other income
20
22
936
128
Total revenues
8,250
7,746
33,255
32,710
Expenses
Losses and loss adjustment expenses
4,191
4,161
14,506
14,392
Acquisition expenses
1,573
1,624
6,342
7,130
Operating expenses
2,940
3,200
11,540
14,238
Other expense
-
-
-
-
Interest expense
464
451
1,816
1,803
Total expenses
9,168
9,436
34,204
37,563
Pre-tax net profit / (loss)
$
(918
)
$
(1,690
)
$
(949
)
$
(4,853
)
Income tax (expense)
-
(36
)
-
(62
)
Net profit / (loss) before dividends
(918
)
(1,726
)
(949
)
(4,915
)
Dividends on preference shares of subsidiary
(527
)
-
(527
)
(585
)
Net profit / (loss) available to common shareholders
$
(1,445
)
$
(1,726
)
$
(1,476
)
$
(5,500
)
Net profit / (loss) per common share:
Basic
$
(30.76
)
$
(36.73
)
$
(31.42
)
$
(117.07
)
Diluted
(30.76
)
(36.73
)
(31.42
)
(117.07
)
Weighted-average number of common shares outstanding:
Basic
46,979
46,979
46,979
46,979
Diluted
46,979
46,979
46,979
46,979
See Notes to December 31, 2022 Consolidated Financial Statements available on American Overseas Group Ltd. Website at www.aoreltd.com
American Overseas Group Limited is a writer of non-standard auto insurance through its United States subsidiaries. The Company operates through two segments: property/casualty insurance/reinsurance and corporate/other. The property/casualty segment provides insurance and reinsurance related to United States short-tail personal lines. All product lines fall within these classifications. Its business group comprises categories, including the United States-based property and casualty insurance companies that provide non-standard auto insurance through specialty managing general agents (MGAs); Barbados-based affiliated reinsurance companies that assume and reinsure a small portion of the U.S.-sourced non-standard auto business; and the Unites States based management services company. The Company provides access to the United States property and casualty insurance underwriting capacity in the specialty niche of non-standard auto insurance through MGAs for a fee.
Results of Operations for the Year Ended December 31, 2022 - American Overseas Group Limited Announces Net Loss Of $1.5 Million For the Year Ended December 31, 2022