EXHIBIT 99
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THE MIDLAND COMPANY
7000 MIDLAND BOULEVARD
(513) 943-7100
MAILING ADDRESS
P.O. BOX 1256
CINCINNATI, OHIO 45201
FOR IMMEDIATE RELEASE APRIL 8, 2004
CONTACT:
John I. Von Lehman, Executive Vice President and CFO
(513) 943-7100
THE MIDLAND COMPANY EXPECTS RECORD FIRST QUARTER
- ANTICIPATES RECORD NET INCOME AT 85 TO 90 CENTS PER SHARE
- RECORD RESULTS FUELED BY IMPROVED UNDERWRITING RESULTS
CINCINNATI, APRIL 8, 2004 -- THE MIDLAND COMPANY (NASDAQ: MLAN), a highly
focused provider of specialty insurance products and services, today indicated
that it anticipates record results for its first quarter ended March 31, 2004.
Based on preliminary data, the company believes that net income per share will
be in the range of 85 to 90 cents, including approximately 15 cents in realized
capital gains. That would compare with the prior record of 56 cents in last
year's first quarter, which included 7 cents in realized capital losses. (All
per share amounts are on an after-tax diluted basis.)
John W. Hayden, president and chief executive officer, noted, "We're
anticipating net income before realized capital gains and losses in the range of
70 to 75 cents, which would put us in the range of 15 percent ahead of the prior
record of 63 cents (comparable basis) that we reported in last year's first
quarter. The company believes this measure of net income before realized capital
gains and losses provides a better measure of the ongoing performance of the
company's core insurance operations.
"In addition to record earnings, the company experienced near double-digit
percentage growth in property and casualty direct and assumed written premiums,
in line with our previously announced expectations. The growth in the premium
volume includes growth in our core manufactured housing and site built lines. As
anticipated, we experienced a decrease in the premiums from our motorcycle lines
as we implemented corrective underwriting and rate actions."
Hayden said that the first quarter combined ratio - losses and expenses as a
percent of earned premium - is expected to be in the range of 94 to 95 percent,
compared with 96.2 percent in last year's first quarter. A combined ratio under
100 indicates that an insurance company has generated profits from its
underwriting activities. "We continue to be pleased by the strong underwriting
results in our manufactured housing line of business. We are also encouraged by
the improved underwriting results in several of our other specialty lines such
as motorcycle, site built dwelling and recreational vehicle.
"We remain confident in our 2004 outlook that we discussed in February," Hayden
said. "Our full-year target of 96 to 98 percent for the property and casualty
combined ratio allows for the traditional second and third quarter up tick in
claims due to weather patterns and seasonal products. This would translate to an
earnings per share, exclusive of capital gains and losses, of $2.00 to $2.20 per
share. At the same time, we expect to approach double-digit premium growth with
rate increases and continued growth in most of our specialty insurance product
lines.
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MIDLAND EXPECTS RECORD FIRST QUARTER
APRIL 8, 2004
"We are committed to maintaining American Modern's position as one of the best
specialty property and casualty insurance companies in the country," Hayden
continued. "While weather and other unpredictable events can impact our
short-term performance, we believe that our disciplined approach to underwriting
and maintaining rate adequacy positions us to achieve our long-term financial
objectives."
RECONCILIATION OF NON-GAAP INFORMATION (UNAUDITED)
ESTIMATED
RANGE ACTUAL
1ST QTR 2004 1ST QTR 2003
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Per Share Amounts (Diluted):
Net Income Before Capital Gains (Losses) $0.70 $0.75 $0.63
Net Capital Gains (Losses) 0.15 0.15 (0.07)
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Net Income $0.85 $0.90 $0.56
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ABOUT THE COMPANY
Midland, which is headquartered in Cincinnati, Ohio, is a provider of specialty
insurance products and services through its wholly owned subsidiary, American
Modern Insurance Group, which accounts for approximately 96 percent of Midland's
consolidated revenue. American Modern specializes in writing physical damage
insurance and related coverages on manufactured housing and has expanded to
other specialty insurance products including coverage for site-built homes,
motorcycles, watercraft, snowmobiles, recreational vehicles, physical damage on
long-haul trucks, extended service contracts, credit life and related products
as well as collateral protection and mortgage fire products sold to financial
institutions and their customers. Midland also owns a niche transportation
business, M/G Transport Group, which operates a fleet of dry cargo barges for
the movement of dry bulk commodities on the inland waterways. Midland's common
stock is traded on the Nasdaq National Market under the symbol MLAN. Additional
information on the company can be found on the Internet at
www.midlandcompany.com.
FORWARD LOOKING STATEMENTS DISCLOSURE
Certain statements made in this press release are forward-looking and are made
pursuant to the safe harbor provisions of the Securities Litigation Reform Act
of 1995. These statements include certain discussions relating to underwriting,
premium and investment income volume, business strategies, profitability and
business relationships, as well as any other statements concerning the year 2004
and beyond. The forward-looking statements involve risks, uncertainties and
other factors that may cause results to differ materially from those anticipated
in those statements. Factors that might cause results to differ from those
anticipated include, without limitation, adverse weather conditions, changes in
underwriting results affected by adverse economic conditions, fluctuations in
the investment markets, changes in the retail marketplace, changes in the laws
or regulations affecting the operations of the company or its subsidiaries,
changes in the business tactics or strategies of the company, its subsidiaries
or its current or anticipated business partners, the financial condition of the
company's business partners, acquisitions or divestitures, changes in market
forces, litigation and the other risk factors that have been identified in the
company's filings with the SEC, any one of which might materially affect the
operations of the company or its subsidiaries. Any forward-looking statements
speak only as of the date made. We undertake no obligation to update any
forward-looking statements to reflect events or circumstances arising after the
date on which they are made.
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