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Exhibit 99.1
[GRAPHIC OMITTED][GRAPHIC OMITTED]
BALDWIN & LYONS, INC.
PROTECTIVE INSURANCE COMPANY
SAGAMORE INSURANCE COMPANY
B & L INSURANCE, LTD. (BERMUDA)
[OBJECT OMITTED]1099 North Meridian Street
Indianapolis, IN 46204
(317) 636-9800
Subj: Baldwin & Lyons, Inc. October 24, 2005
Unaudited Third Quarter Press Contact: G. Patrick Corydon
(317) 636-9800
corydon@baldwinandlyons.com
FOR IMMEDIATE RELEASE
INDIANAPOLIS, INDIANA, OCTOBER 24, 2005--Baldwin & Lyons, Inc. (NASD:
BWINA, BWINB) today announced a third quarter operating loss caused by losses
incurred due to hurricanes Katrina and Rita. Defined as net loss before capital
gains or losses, the operating loss was $.8 million, or $.05 per share, compared
to operating income of $3.4 million, or $.23 per share, reported in 2004.
Capital gains of $1.9 million, or $.13 per share, were realized during the
current quarter and compare to negligible capital gains in the prior year
quarter. Including capital gains, third quarter net income was $1.2 million, or
$.08 per share, compared to $3.5 million, or $.23 per share, for the third
quarter of 2004. Hurricane losses reduced underwriting income by approximately
$13 million pretax, or $.57 per share after tax. Net income for the third
quarter of 2004 was also reduced by hurricane losses equal to $3.2 million, or
$.22 per share after tax.
For the nine months ended September 30, 2005, operating income totaled $13.5
million, or $.91 per share, compared to $17.9 million, or $1.21 per share,
reported a year earlier. Capital gains of $5.5 million, or $.37 per share, were
realized in the 2005 period compared to capital gains of $5.3 million a year
earlier. Including capital gains, net income for the current year-to-date
totaled $19.0 million, or $1.28 per share, compared to $23.2 million, or $1.57
per share, for the first nine months of 2004.
Net premiums earned by the Company's insurance subsidiaries during the third
quarter totaled $49.8 million, an increase of 12% from the $44.4 million
reported for the third quarter of 2004. For the year-to-date, 2005 premiums
earned increased 11% to $140.0 million resulting primarily from a 24% increase
in fleet trucking premium reflecting Protective's increased net exposure under
its reinsurance agreements. Direct and assumed premiums written for the quarter
declined 11% to $55.8 million due to reductions in fleet trucking premiums
caused by competitive market conditions and the discontinuance of the small
business workers compensation product. For the nine months, direct and assumed
premiums written of $170.4 million compares to $190.1 million in 2004.
Pre-tax investment income increased 26% from the 2004 quarter due to increases
in yields on bonds and short-term investments in the 2005 quarter coupled with a
5% increase in average funds invested. Overall after-tax yields were also higher
than the prior year quarter providing for a 20% increase in after-tax investment
income. For the year-to-date, pre-tax and after-tax investment income increased
16% and 14%, respectively.
The third quarter consolidated combined ratio of 114.0% produced an underwriting
loss of $7.0 million compared to a combined ratio of 106.4% and an underwriting
loss of $2.8 million for the third quarter of 2004. The combined ratios for the
2005 and 2004 third quarters were adversely impacted by pre-tax hurricane losses
of $13.0 million (27.2 points) and $5.0 million (11.3 points), respectively.
Without hurricane losses, the consolidated combined ratios were 87.5% and 95.1%,
respectively. Year-to-date, the consolidated combined ratio for 2005 was 98.0%
compared to 97.7% for the first nine months of 2004, each inclusive of hurricane
losses.
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Shareholders' equity increased $13.6 million (4.2%) from December 31, 2004 after
dividend payouts for the year-to-date of $10.3 million, or $.70 per share, and
including a $3.3 million increase in unrealized gains on investments. The book
value per share of the Company's stock rose by 83 cents from year end to $22.87
on September 30, 2005.
CONFERENCE CALL INFORMATION:
Baldwin & Lyons, Inc. has scheduled a conference call for October 25, 2005 at
11:00 AM (New York time) to discuss results for the third quarter ended
September 30, 2005. To gain access to the webcast of this call, please log on to
http://viavid.net/dce.aspx?sid=00002924 at least 15 minutes prior to the call to
register and to download the necessary audio software. The webcast will be
archived on the site until January 24, 2006. You may also access the webcast
through a link on our investor relations page at www.baldwinandlyons.com.
To participate via teleconference, investors may dial 800-665-0430 (U.S./Canada)
or 913-312-1300 (International or local) at least five minutes prior to the
beginning of the call. A replay of the call will be available through November
1, 2005 by calling 888-203-1112 or 719-457-0820 and referencing passcode
3143731.
Also available on our investor relations page are complete interim financial
statements, information regarding our business segments, and copies of our
filings with the Securities and Exchange Commission.
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FINANCIAL HIGHLIGHTS (UNAUDITED)
Baldwin & Lyons, Inc. and Subsidiaries
(In thousands, except per share data) THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
--------------------------- --------------------------
2005 2004 2005 2004
----------- ------------ ----------- -----------
Operating revenue $55,227 $49,094 $155,853 $140,883
Realized gains 2,962 27 8,430 8,135
----------- ------------ ----------- -----------
TOTAL REVENUE $58,189 $49,121 $164,283 $149,018
=========== ============ =========== ===========
Income (loss) before realized capital
transactions ($ 773) $ 3,442 $13,492 $17,935
Realized net gains on investments,
net of federal income taxes 1,925 18 5,479 5,288
----------- ------------ ----------- -----------
NET INCOME $ 1,152 $ 3,460 $18,971 $23,223
=========== ============ =========== ===========
Per share data - diluted:
Average number of shares 14,873 14,785 14,854 14,795
Income (loss) before realized capital
transactions ($ .05) $ .23 $ .91 $ 1.21
Realized net gains on investments .13 - .37 .36
----------- ------------ ----------- -----------
NET INCOME $ .08 $ .23 $ 1.28 $ 1.57
=========== ============ =========== ===========
Dividends paid to shareholders $ .35 $ .15 $ .70 $ 1.05
Annualized return on average shareholders' equity:
Operating income (loss) (1.1%) 4.8% 6.3% 8.4%
Net income 1.6% 4.8% 8.8% 10.9%
Consolidated combined ratio of
insurance subsidiaries (GAAP basis) 114.0% 106.4% 98.0% 97.7%
[OBJECT OMITTED]
FORWARD-LOOKING STATEMENTS IN THIS REPORT ARE MADE PURSUANT TO THE SAFE HARBOR
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. INVESTORS
ARE CAUTIONED THAT SUCH FORWARD-LOOKING STATEMENTS INVOLVE INHERENT RISKS AND
UNCERTAINTIES. READERS ARE ENCOURAGED TO REVIEW THE COMPANY'S ANNUAL REPORT FOR
ITS FULL STATEMENT REGARDING FORWARD-LOOKING INFORMATION.