Erie Indemnity (ERIE) 8-K Erie Indemnity Reports Full Year and Fourth Quarter 2018 Results

Exhibit 99.2

Erie Indemnity Company

Statements of Operations

(dollars in thousands, except per share data)

	Three months ended December 31,						Twelve months ended December 31,
	2018			2017			2018			2017
	(Unaudited)
Operating revenue
Management fee revenue - policy issuance and renewal services, net	$	407,656		$	394,034		$	1,719,567		$	1,662,625
Management fee revenue - administrative services, net	13,738			—			53,632			—
Administrative services reimbursement revenue	147,694			—			580,336			—
Service agreement revenue	7,380			7,368			28,677			29,149
Total operating revenue	576,468			401,402			2,382,212			1,691,774
Operating expenses
Cost of operations - policy issuance and renewal services	354,016			342,777			1,457,533			1,401,522
Cost of operations - administrative services	147,694			—			580,336			—
Total operating expenses	501,710			342,777			2,037,869			1,401,522
Operating income	74,758			58,625			344,343			290,252
Investment income
Net investment income	8,626			6,437			30,209			24,639
Net realized investment (losses) gains	(1,513		)	(205		)	(2,010		)	1,334
Net impairment losses recognized in earnings	(935		)	0			(1,581		)	(182		)
Equity in (losses) earnings of limited partnerships	(1,183		)	902			(822		)	2,801
Total investment income	4,995			7,134			25,796			28,592
Interest expense, net	596			438			2,460			1,238
Other income (expense)	3,485			(680		)	3,641			(1,911		)
Income before income taxes	82,642			64,641			371,320			315,695
Income tax expense	20,328			32,588			83,096			118,696
Net income	$	62,314		$	32,053		$	288,224		$	196,999
Earnings Per Share
Net income per share
Class A common stock – basic	$	1.34		$	0.69		$	6.19		$	4.23
Class A common stock – diluted	$	1.19		$	0.61		$	5.51		$	3.76
Class B common stock – basic	$	201		$	103		$	928		$	635
Class B common stock – diluted	$	201		$	103		$	928		$	634
Weighted average shares outstanding – Basic
Class A common stock	46,188,978			46,188,972			46,188,637			46,186,831
Class B common stock	2,542			2,542			2,542			2,542
Weighted average shares outstanding – Diluted
Class A common stock	52,319,918			52,322,478			52,315,213			52,337,463
Class B common stock	2,542			2,542			2,542			2,542
Dividends declared per share
Class A common stock	$	0.9000		$	0.8400		$	3.4200		$	3.1875
Class B common stock	$	135.000		$	126.000		$	513.000		$	478.125

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Erie Indemnity Company

Statements of Financial Position

(in thousands)

	December 31, 2018		December 31, 2017
Assets
Current assets:
Cash and cash equivalents	$	266,417	$	215,721
Available-for-sale securities	402,339		71,190
Receivables from Erie Insurance Exchange and affiliates	449,873		418,328
Prepaid expenses and other current assets	36,892		34,890
Federal income taxes recoverable	8,162		29,900
Note receivable from Erie Family Life Insurance Company	—		25,000
Accrued investment income	5,263		6,853
Total current assets	1,168,946		801,882
Available-for-sale securities	346,184		687,523
Equity securities	11,853		—
Limited partnership investments	34,821		45,122
Fixed assets, net	130,832		83,149
Deferred income taxes, net	24,101		19,390
Other assets	61,590		28,793
Total assets	$	1,778,327	$	1,665,859
Liabilities and shareholders' equity
Current liabilities:
Commissions payable	$	241,573	$	228,124
Agent bonuses	103,462		122,528
Accounts payable and accrued liabilities	111,291		104,533
Dividends payable	41,910		39,116
Contract liability	33,854		—
Deferred executive compensation	13,107		15,605
Current portion of long-term borrowings	1,870		—
Total current liabilities	547,067		509,906
Defined benefit pension plan	116,866		207,530
Contract liability	17,873		—
Deferred executive compensation	13,075		14,452
Long-term borrowings	97,860		74,728
Other long-term liabilities	11,914		1,899
Total liabilities	804,655		808,515
Shareholders' equity	973,672		857,344
Total liabilities and shareholders' equity	$	1,778,327	$	1,665,859

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