Exhibit 99.1
ASSURANCEAMERICA CORPORATION REPORTS IMPROVED NET INCOME RESULTS FOR THE FIRST QUARTER ENDED MARCH 31, 2010
ATLANTA-(BUSINESSWIRE-April 19, 2010-Atlanta-based ASSURANCEAMERICA CORPORATION (OTC BB: ASAM) today announced its unaudited financial results for the three months ended March 31, 2010.
| | | | | | | | | |
| | | Three Months Ended March 31, | |
| | | (in thousand, except per ratios) | |
| | | 2010 | | 2009 | | Change | |
Total revenue | | $ | 18,176 | | $ | 17,774 | | 2 | % |
Income before taxes | | $ | 1,399 | | $ | 1,346 | | 4 | % |
Net income | | $ | 839 | | $ | 817 | | 3 | % |
Revenues for the three month period ended March 31, 2010 increased 2% to $18.2 million, compared to $17.8 million in 2009 as a result of increased premiums earned and improved investment income results within the Carrier/MGA wholesale division.
The Company’s income before taxes for the three month period ending March 31, 2010 were $1.4 million compared to $1.3 million in 2009. The Company’s net income was $839 thousand for the three month period ended March 31, 2010 compared to $817 thousand in 2009.
Gross premiums produced, which includes gross written premium in the Carrier/MGA wholesale division and premiums for policies sold in the retail division, decreased 3% to $44.8 million for the three months ended March 31, 2010 compared to $46.0 million for the same period of 2009. The decrease in gross premiums produced was primarily driven by lower production within the Carrier/MGA and the retail division due to soft market conditions. Gross Premiums Produced, a non-GAAP financial measure, is used by management as the primary measure of the underlying growth of the Company’s revenue streams from period to period.
Joseph J. Skruck, President, stated “Given the continued challenging market conditions, I am pleased with our results this quarter, which reflect our focus on maintaining strong underwriting discipline”.
AssuranceAmerica focuses on the non-standard automobile insurance marketplace, primarily in Alabama, Arizona, Florida, Georgia, Indiana, Louisiana, Mississippi, South Carolina, Texas and Virginia. Its principal operating subsidiaries are TrustWay Insurance Agencies, LLC (“Agency”), which sells personal automobile insurance policies through its 43 retail agencies, AssuranceAmerica Managing General Agency, LLC (“MGA”), and AssuranceAmerica Insurance Company (“Carrier”).
Forward-Looking Statements
This press release, contains certain statements that may be deemed to be “forward-looking statements”. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in this press release not dealing with historical results or current facts are forward-looking and are based on estimates, assumptions, and projections. Statements that include the words “assumes”, “believes,” “seeks,” “expects,” “may,” “should,” “intends,” “likely,” “targets,” “plans,” “anticipates,” “estimates” or the negative version of those words and similar statements of a future or forward-looking nature identify forward-looking statements.
The primary events or circumstances that could cause actual results to differ materially from those expected by AssuranceAmerica Corporation include determinations with respect to reserve adequacy, realized gains or losses on the investment portfolio including other-than-temporary impairments for credit losses, rising loss cost trends, actions of competitors and natural disasters. AssuranceCorpoation undertakes no obligation to publicly update or revise any of the forward-looking statements. For a more detailed discussion of some of the foregoing risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see AssuranceAmerican Corporation filings with the Securities and Exchange Commission.
Contact:
AssuranceAmerica Corporation, Atlanta
John Mongelli, Senior Vice President and Chief Financial Officer
(770) 952-0200 Ext. 6212
Mark Hain, General Counsel, Secretary, Executive Vice President
(770) 952-0200 Ext. 6259
ASSURANCEAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(000’S OMITTED)
| | | | | | | |
| | | For the Three Months Ended March 31, | |
| | | 2010 | | | 2009 | |
Revenue: | | | | | | | |
Gross premiums written | | $ | 32,380 | | | 33,600 | |
Ceded premiums written | | | (22,026 | ) | | (22,769 | ) |
| | | | | | | |
Net premiums written | | | 10,354 | | | 10,831 | |
Change in unearned premiums | | | (1,922 | ) | | (2,544 | ) |
| | | | | | | |
Net premiums earned | | | 8,432 | | | 8,287 | |
Commission income | | | 6,390 | | | 6,681 | |
Managing general agent fees | | | 3,122 | | | 2,793 | |
Net investment income | | | 132 | | | 145 | |
Net investment gains (losses) on securities | | | 11 | | | (239 | ) |
Other fee income | | | 89 | | | 107 | |
| | | | | | | |
Total revenue | | | 18,176 | | | 17,774 | |
| | | | | | | |
Expenses: | | | | | | | |
Losses and loss adjustment expenses | | | 5,957 | | | 5,760 | |
Selling, general, and administrative | | | 10,354 | | | 10,154 | |
Stock option expense | | | 89 | | | 79 | |
Depreciation and amortization expense | | | 279 | | | 300 | |
Interest expense | | | 98 | | | 135 | |
| | | | | | | |
Total operating expenses | | | 16,777 | | | 16,428 | |
| | | | | | | |
Income before income taxes | | | 1,399 | | | 1,346 | |
Income tax provision | | | 560 | | | 529 | |
| | | | | | | |
Net income | | $ | 839 | | | 817 | |
| | | | | | | |
Earnings per common share: | | | | | | | |
Basic | | $ | 0.013 | | | 0.013 | |
Diluted | | $ | 0.013 | | | 0.013 | |
Weighted average shares outstanding-basis | | | 65,385,468 | | | 65,047,708 | |
Weighted average shares outstanding-diluted | | | 65,948,319 | | | 64,147,708 | |
