Erie Indemnity (ERIE) 8-K Erie Indemnity Reports Second Quarter 2018 Results

Exhibit 99.2

Erie Indemnity Company

Statements of Operations

(dollars in thousands, except per share data)

	Three months ended June 30,						Six months ended June 30,
	2018			2017			2018			2017
	(Unaudited)						(Unaudited)
Operating revenue
Management fee revenue - policy issuance and renewal services, net	$	454,572		$	441,319		$	860,550		$	833,377
Management fee revenue - administrative services, net	13,299			—			26,373			—
Administrative services reimbursement revenue	146,507			—			292,470			—
Service agreement revenue	7,080			7,245			14,225			14,503
Total operating revenue	621,458			448,564			1,193,618			847,880
Operating expenses
Cost of operations - policy issuance and renewal services	379,628			365,116			728,258			697,492
Cost of operations - administrative services	146,507			—			292,470			—
Total operating expenses	526,135			365,116			1,020,728			697,492
Operating income	95,323			83,448			172,890			150,388
Investment income
Net investment income	7,104			6,239			13,924			12,220
Net realized investment (losses) gains	(32		)	124			(497		)	640
Net impairment losses recognized in earnings	(646		)	(61		)	(646		)	(182		)
Equity in (losses) earnings of limited partnerships	(219		)	149			(411		)	362
Total investment income	6,207			6,451			12,370			13,040
Interest expense, net	602			257			1,155			423
Other income (expense)	58			(407		)	102			(816		)
Income before income taxes	100,986			89,235			184,207			162,189
Income tax expense	21,280			30,708			38,743			55,786
Net income	$	79,706		$	58,527		$	145,464		$	106,403
Net income per share
Class A common stock – basic	$	1.71		$	1.26		$	3.12		$	2.28
Class A common stock – diluted	$	1.52		$	1.12		$	2.78		$	2.03
Class B common stock – basic	$	257		$	189		$	469		$	343
Class B common stock – diluted	$	257		$	188		$	468		$	343
Weighted average shares outstanding – Basic
Class A common stock	46,188,705			46,180,852			46,188,309			46,184,666
Class B common stock	2,542			2,542			2,542			2,542
Weighted average shares outstanding – Diluted
Class A common stock	52,312,849			52,299,395			52,311,741			52,355,214
Class B common stock	2,542			2,542			2,542			2,542
Dividends declared per share
Class A common stock	$	0.8400		$	0.7825		$	1.6800		$	1.5650
Class B common stock	$	126.000		$	117.375		$	252.000		$	234.750

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Erie Indemnity Company

Statements of Financial Position

(in thousands)

	June 30, 2018		December 31, 2017
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	198,412	$	215,721
Available-for-sale securities	107,369		71,190
Receivables from Erie Insurance Exchange and affiliates	445,211		418,328
Prepaid expenses and other current assets	45,426		34,890
Federal income taxes recoverable	0		29,900
Note receivable from Erie Family Life Insurance Company	25,000		25,000
Accrued investment income	6,647		6,853
Total current assets	828,065		801,882
Available-for-sale securities	598,059		687,523
Equity securities	12,488		—
Limited partnership investments	39,651		45,122
Fixed assets, net	94,651		83,149
Deferred income taxes, net	31,527		19,390
Other assets	47,834		28,793
Total assets	$	1,652,275	$	1,665,859
Liabilities and shareholders' equity
Current liabilities:
Commissions payable	$	253,328	$	228,124
Agent bonuses	56,482		122,528
Accounts payable and accrued liabilities	97,139		104,533
Dividends payable	39,119		39,116
Contract liability	33,137		—
Deferred executive compensation	8,801		15,605
Federal income taxes payable	8,933		0
Current portion of long-term borrowings	925		0
Total current liabilities	497,864		509,906
Defined benefit pension plans	145,667		207,530
Employee benefit obligations	194		423
Contract liability	17,452		—
Deferred executive compensation	11,688		14,452
Long-term borrowings	98,800		74,728
Other long-term liabilities	422		1,476
Total liabilities	772,087		808,515
Shareholders’ equity	880,188		857,344
Total liabilities and shareholders’ equity	$	1,652,275	$	1,665,859

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