EXHIBIT 99.1
ATLANTIC AMERICAN CORPORATION REPORTS INCREASED SECOND QUARTER
EARNINGS
ATLANTA, Georgia, August 11, 2003 - Atlantic American Corporation (Nasdaq- AAME) today announced second quarter net income of $1.2 million, or $0.04 per diluted share, compared to net income of $0.9 million, or $0.03 per diluted share, in the second quarter of 2002. Current year to date net income was $1.9 million, or $0.06 per diluted share, compared to a year to date loss of $13.4 million, or $0.65 per diluted share, in 2002. In 2002, the Company reported a $15.8 million charge, or $0.73 per diluted share, attributable to the cumulative effect of a change in accounting principle for goodwill.
Total revenues for the second quarter were $43.5 million, increasing 1% over 2002 second quarter revenues of $43.1 million. For the six-month year to date period, revenues were $87.5 million, increasing 5% over the 2002 six-month year to date revenues of $83.1 million. Revenue growth in 2003 was enhanced by significant second quarter realized investment gains and increased investment earnings from a larger investment portfolio. Although earned premium during the second quarter declined 3%; for the six-month year to date period, earned premium reflected an increase of 3%.
Commenting on the quarter, Hilton H. Howell, Jr., president and chief executive officer, stated, “While pleased with our results for the second quarter, there continues to be substantial future opportunity. Our life and health as well as our specialty lines property and casualty companies continue to perform extremely well. And while our regional property and casualty companies continue to make progress with their operating performance, there is still opportunity for further enhancement. We will however continue with our rigorous and disciplined underwriting standards in order to ensure that the quality of our property and casualty business is not sacrificed.”
Atlantic American is an insurance holding company involved through its subsidiary companies in specialty markets of the life, health, property and casualty insurance industries. Its principal subsidiaries include American Southern Insurance Company, American Safety Insurance Company, Bankers Fidelity Life Insurance Company, Georgia Casualty & Surety Company, Association Risk Management General Agency, Association Casualty Insurance Company and Self-Insurance Administrators, Inc.
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 has filed with the Securities and Exchange Commission.
For further information contact:
John G. Sample, Jr.
Senior Vice President and Chief Financial Officer
Atlantic American Corporation
404-266-5501
Atlantic American Corporation
Financial Data
| | | | | |
| | Three Months Ended
June 30,
| Six Months Ended
June 30,
|
| (Unaudited; In thousands, except per share data) | 2003
| 2002
| 2003
| 2002
|
| Insurance premiums | $ 38,069 | $ 39,396 | $ 77,755 | $ 75,532 |
| Investment income | 3,931 | 3,539 | 7,870 | 6,911 |
| Realized investment gains (losses), net | 1,333 | (29) | 1,335 | 102 |
| Other income | 131
| 173
| 522
| 603
|
| Total revenue | 43,464
| 43,079
| 87,482
| 83,148
|
| Insurance benefits and losses incurred | 26,197 | 27,891 | 55,315 | 53,507 |
| Commissions and underwriting expenses | 11,084 | 10,346 | 21,190 | 19,100 |
| Interest expense | 764 | 643 | 1,468 | 1,249 |
| Other | 3,707
| 2,778
| 6,933
| 5,607
|
| Total benefits and expenses | 41,752
| 41,658
| 84,906
| 79,463
|
Income before income tax expense and cumulative
effect of change in accounting principle | 1,712 | 1,421 | 2,576 | 3,685 |
| Income tax expense | 501
| 479
| 669
| 1,238
|
Income before cumulative effect of change in
accounting principle | 1,211 | 942 | 1,907 | 2,447 |
| Cumulative effect of change in accounting principle | -
| -
| -
| (15,816)
|
| Net income (loss) | 1,211
| 942
| 1,907
| (13,369)
|
| Basic income (loss) per common share: | |
Income before cumulative effect of
change in accounting principle | $ .04 | $ .03 | $ .06 | $ .08 |
| Cumulative effect of change in accounting principle | -
| -
| -
| (.74)
|
| Net income (loss) | $ .04
| $ .03
| $ .06
| $ (.66)
|
| Diluted income (loss) per common share: | |
Income before cumulative effect of
change in accounting principle | $ .04 | $ .03 | $ .06 | $ .08 |
| Cumulative effect of change in accounting principle | -
| -
| -
| (.73)
|
| Net income (loss) | $ .04
| $ .03
| $ .06
| $ (.65)
|
| | | |
Selected Balance Sheet Data | June 30,
2003
| December 31,
2002
|
| Total investments | $ 289,212 | $ 249,842 |
| Total assets | 460,223 | 423,493 |
| Insurance reserves and policy funds | 261,395 | 256,646 |
| Debt | 55,000 | 49,500 |
| Total shareholders' equity | 81,627 | 78,540 |
| Book value per common share | 3.13 | 2.93 |
