EXHIBIT 99.1
ATLANTIC AMERICAN CORPORATION ANNOUNCES THIRD QUARTER RESULTS
ATLANTA, Georgia, November 13, 2007 - Atlantic American Corporation (Nasdaq- AAME) today reported net income of $1.8 million, or $0.06 per diluted share, for the third quarter ended September 30, 2007 compared to net income of $2.7 million, or $0.10 per diluted share, for the third quarter ended September 30, 2006. The Company further reported net income of $3.1 million, or $0.08 per diluted share, for the nine months ended September 30, 2007 compared to net income of $6.0 million, or $0.22 per diluted share, for the nine months ended September 30, 2006. Premium revenue for the quarter ended September 30, 2007 decreased $3.6 million, or 9.6%, to $33.9 million and, for the nine months ended September 30, 2007 decreased 11.7% to $102.9 million from the comparable prior year periods. The decrease in premiums for the three month and nine month periods ended September 30, 2007 was primarily attributable to a combination of increased competition from new products and market competition as well as reduced pricing in a soft market for the Company’s property and casualty products. Realized investment gains in both the three month and nine month periods ended September 30, 2007 were $2.4 million compared to $1.4 million and $5.4 million for the three month period and nine month period ended September 30, 2006, respectively.
Commenting on the quarter, Hilton H. Howell, Jr., president and chief executive officer, stated, “Disappointed with the quarter, the challenges in our markets are requiring us to change. While we are seeing improvement in certain portions of our business, the decline in overall premiums has required that we implement cost saving initiatives to restore our core operations to profitability. While smaller initiatives have been ongoing as our premiums have declined, we have recently intensified efforts to tighten up our operations during this soft market.”
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
September 30, | | Nine Months Ended
September 30, |
| (Unaudited; In thousands, except per share data) | 2007
| 2006
| | 2007
| 2006
|
| Insurance premiums | $ 33,891 | | $ 37,498 | | $ 102,872 | | $ 116,492 |
| Investment income | 4,504 | | 4,481 | | 13,527 | | 13,739 |
| Realized investment gains, net | 2,371 | | 1,400 | | 2,388 | | 5,370 |
| Other income | 206
| | 196
| | 618
| | 637
|
| Total revenue | 40,972
| | 43,575
| | 119,405
| | 136,238
|
| Insurance benefits and losses incurred | 22,954 | | 22,371 | | 67,687 | | 69,806 |
| Commissions and underwriting expenses | 11,361 | | 13,297 | | 33,908 | | 43,809 |
| Interest expense | 1,049 | | 1,202 | | 3,115 | | 3,393 |
| Other | 3,409
| | 3,756
| | 10,335
| | 11,481
|
| Total benefits and expenses | 38,773
| | 40,626
| | 115,045
| | 128,489
|
| Income before income tax expense | 2,199 | | 2,949 | | 4,360 | | 7,749 |
| Income tax expense | 393
| | 212
| | 1,269
| | 1,777
|
| Net income | $ 1,806
| | $ 2,737
| | $ 3,091
| | $ 5,972
|
| Net income per common share: | |
| Basic | $ 0.06
| | $ 0.11
| | $ 0.08
| | $ 0.24
|
| Diluted | $ 0.06
| | $ 0.10
| | $ 0.08
| | $ 0.22
|
| | | | | |
Selected Balance Sheet Data | September 30,
2007
| December 31,
2006
| |
| Total investments | $ 302,041 | | $ 298,775 | |
| Total assets | 450,056 | | 458,632 | |
| Insurance reserves and policy funds | 264,352 | | 267,507 | |
| Debt | 53,988 | | 53,988 | |
| Total shareholders' equity | 93,061 | | 94,188 | |
| Book value per common share | 3.35 | | 3.43 | |
