Atlantic American Corporation Reports Fourth Quarter and Year End Results for 2023; Declares Annual Dividend
April 01, 2024 at 04:13 pm EDT
Share
ATLANTA, April 01, 2024 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq- AAME) today reported net loss for the three month period ended December 31, 2023 of $2.2 million, or ($0.11) per diluted share, as compared to net income of $1.0 million, or $0.05 per diluted share, for the comparable period in 2022. For the year ended December 31, 2023, the Company reported net loss of $0.2 million, or ($0.03) per diluted share, as compared to net income of $1.5 million, or $0.06 per diluted share, for the year ended December 31, 2022. The decrease in net income for the fourth quarter of 2023 was primarily due to an increase in insurance benefits and losses incurred partially offset by an increase in unrealized gains in equity securities. The decrease in net income for the year ended December 31, 2023 was primarily due to a decrease in earned premiums, as well as an increase in insurance benefits and losses as a percentage of premiums. Also contributing to the decrease in net income is an increase in debt service costs due to rising interest rates. Partially offsetting this decrease was a decline in unrealized losses on equity securities.
Operating income (loss), as defined below, decreased to a $4.3 million operating loss in the three month period ended December 31, 2023, as compared to $3.5 million operating income for the three month period ended December 31, 2022. For the year ended December 31, 2023, the Company reported operating income of $1.5 million compared to operating income of $9.6 million for the year ended December 31, 2022. The decrease in operating income for the three and twelve month periods was primarily due to an increase in insurance benefits and losses incurred as a percentage of premiums.
Commenting on the results, Hilton H. Howell, Jr., Chairman, President and Chief Executive Officer, stated, “The Company has made significant investments in both human talent and information technology within our Life and Health segment that we expect will lead to improved top line results and profitability of our business. While we have experienced some inflationary pressures in our Property and Casualty segment, their disciplined underwriting approach delivered another profitable year. In recognition of our enthusiasm for 2024, the Board of Directors recently approved the Company’s annual dividend of $0.02 per share, which is payable on April 26, 2024 to shareholders of record on April 12, 2024.”
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, 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
Twelve Months Ended
December 31,
December 31,
(Unaudited; In thousands, except per share data)
2023
2022
2023
2022
Insurance premiums
Life and health
$
26,138
$
28,391
$
110,382
$
115,164
Property and casualty
16,781
16,523
68,443
70,276
Insurance premiums, net
42,919
44,914
178,825
185,440
Net investment income
2,633
2,422
10,058
9,932
Realized investment gains, net
-
1
70
30
Unrealized gains (losses) on equity securities, net
1,190
(2,106
)
(2,177
)
(7,562
)
Other income
3
-
17
11
Total revenue
46,745
45,231
186,793
187,851
Insurance benefits and losses incurred
Life and health
22,931
18,278
71,485
76,281
Property and casualty
12,926
10,626
51,015
47,175
Commissions and underwriting expenses
9,294
10,819
46,124
46,713
Interest expense
862
661
3,269
1,952
Other expense
3,834
3,483
15,465
13,634
Total benefits and expenses
49,847
43,867
187,358
185,755
Income (loss) before income taxes
(3,102
)
1,364
(565
)
2,096
Income tax expense (benefit)
(874
)
318
(394
)
571
Net income (loss)
$
(2,228
)
$
1,046
$
(171
)
$
1,525
Earnings (loss) per common share (basic and diluted)
$
(0.11
)
$
0.05
$
(0.03
)
$
0.06
Reconciliation of non-GAAP financial measure
Net income (loss)
$
(2,228
)
$
1,046
$
(171
)
$
1,525
Income tax expense (expense)
(874
)
318
(394
)
571
Realized investment gains, net
-
(1
)
(70
)
(30
)
Unrealized (gains) losses on equity securities, net
Atlantic American Corporation is an insurance holding company, which operates in specialty markets within the life and health and property and casualty insurance industries. The Company conducts its operations primarily through its insurance subsidiaries: American Southern Insurance Company and American Safety Insurance Company (collectively American Southern); and Bankers Fidelity Life Insurance Company, Bankers Fidelity Assurance Company, and Atlantic Capital Life Assurance Company (collectively Bankers Fidelity). American Southern operates in the property and casualty insurance market. Bankers Fidelity operates in the life and health insurance markets. American Southern's product lines include business automobile insurance policies, general liability insurance policies, property insurance policies, and surety bonds. Products offered by Bankers Fidelity include life insurance, Medicare supplements, and other accident and health insurance products.