Atlantic American Corporation Reports First Quarter Results for 2024
Atlantic American (Nasdaq: AAME) reported a net loss of $2.0 million for Q1 2024, translating to a loss of $0.10 per share. This is an increase from a net loss of $1.4 million, or $0.08 per share, in Q1 2023. The loss was mainly due to a 3.4% decrease in premium revenue in the life and health operations, totaling $44.6 million, down from $46.1 million the previous year. Additionally, the company experienced unfavorable loss experience in these operations, resulting in an operating loss of $2.4 million, compared to an operating income of $0.6 million in the same period last year.
Despite the decline in life and health premiums, the property and casualty division saw an increase in insurance premiums while keeping benefits and losses relatively flat. CEO Hilton H. Howell, Jr. cited new business initiatives and market expansions for Atlantic Capital Life Assurance Company as reasons for optimism.
- Property and casualty operations performed well, with increased premiums and stable benefits and losses.
- New business initiatives and market expansions in Atlantic Capital Life Assurance Company are expected to boost performance.
- Net loss increased to $2.0 million in Q1 2024, up from $1.4 million in Q1 2023.
- Earnings per share fell to a loss of $0.10, compared to a loss of $0.08 the previous year.
- Premium revenue in life and health operations decreased by 3.4%, totaling $44.6 million.
- Operating loss of $2.4 million reported, compared to an operating income of $0.6 million in Q1 2023.
Insights
Atlantic American Corporation’s first quarter 2024 results indicate a net loss of
Specifically, premium revenue dropped by 3.4% to
It's important to highlight that the company’s property and casualty operations performed well, with increased premiums and stable levels of benefits and losses incurred. This offers a mixed yet cautiously optimistic view of the company's different operational segments.
For retail investors, the consistent underperformance in life and health operations remains a concern and could indicate volatility. The increase in net loss despite efforts in new business initiatives may require a more in-depth assessment of the company’s strategic plans and their potential impact on financial stability.
The drop in premium revenue and the subsequent rise in net loss for Atlantic American Corporation highlight critical challenges in the life and health insurance sector. The reported 3.4% decline in premium revenue points to either a reduction in policyholder numbers, lower renewal rates, or less favorable premium pricing. This trend could be reflective of broader industry pressures or specific issues within the company’s product offerings.
The statement from the CEO mentioning enthusiasm about new business initiatives and market expansion may offer some hope for future growth. However, investors should remain cautious, as these initiatives are still in the early stages and have yet to demonstrate measurable impact on the company’s financials.
Moreover, the comparatively strong performance of their property and casualty operations contrasts with the weak results in life and health, suggesting a potential shift in focus or resource allocation might be necessary. Analyzing the competitive landscape and market share within these sectors is essential for understanding the potential future trajectory of Atlantic American Corporation.
ATLANTA, May 14, 2024 (GLOBE NEWSWIRE) -- Atlantic American Corporation (Nasdaq- AAME) today reported net loss of
The Company reported operating loss (as defined below) of
Commenting on the results, Hilton H. Howell, Jr., Chairman, President and Chief Executive Officer, stated, “During the first quarter of 2024 our property and casualty operations performed quite well, increasing insurance premiums over prior year while maintaining a relatively flat level of benefits and losses incurred. Although we did experience a decline in premiums in the life and health operations, we are enthusiastic about our new business initiatives and have recently launched sales activities in additional markets within our Atlantic Capital Life Assurance Company.”
Atlantic American Corporation is an insurance holding company involved through its subsidiary companies in specialty markets of the life, health, and property and casualty insurance industries. Its principal insurance subsidiaries are American Southern Insurance Company, American Safety Insurance Company, Bankers Fidelity Life Insurance Company, Bankers Fidelity Assurance Company and Atlantic Capital Life Assurance Company.
Note regarding non-GAAP financial measure: Atlantic American Corporation presents its consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP). However, from time to time, the Company may present, in its public statements, press releases and filings with the Securities and Exchange Commission, non-GAAP financial measures such as operating income (loss). We define operating income (loss) as net income (loss) excluding: (i) income tax expense (benefit); (ii) realized investment (gains) losses, net; and (iii) unrealized (gains) losses on equity securities, net. Management believes operating income (loss) is a useful metric for investors, potential investors, securities analysts and others because it isolates the “core” operating results of the Company before considering certain items that are either beyond the control of management (such as income tax expense (benefit), which is subject to timing, regulatory and rate changes depending on the timing of the associated revenues and expenses) or are not expected to regularly impact the Company’s operating results (such as any realized and unrealized investment gains (losses), which are not a part of the Company’s primary operations and are, to a limited extent, subject to discretion in terms of timing of realization). The financial data attached includes a reconciliation of operating income (loss) to net income (loss), the most comparable GAAP financial measure. The Company’s definition of operating income (loss) may differ from similarly titled financial measures used by others. This non-GAAP financial measure should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP.
Note regarding forward-looking statements: Except for historical information contained herein, this press release contains forward-looking statements that involve a number of risks and uncertainties. Actual results could differ materially from those indicated by such forward-looking statements due to a number of factors and risks, including the Company’s ability to remediate the identified material weakness in its internal control over financial reporting as described in the Company’s most recent Annual Report on Form 10-K and those other risks and uncertainties detailed in statements and reports that the Company files from time to time with the Securities and Exchange Commission.
| For further information contact: | |
| J. Ross Franklin | Hilton H. Howell, Jr. |
| Chief Financial Officer | Chairman, President & CEO |
| Atlantic American Corporation | Atlantic American Corporation |
| 404-266-5580 | 404-266-5505 |
| Atlantic American Corporation | |||||||
| Financial Data | |||||||
| Three Months Ended | |||||||
| March 31, | |||||||
| (Unaudited; In thousands, except per share data) | 2024 | 2023 | |||||
| Insurance premiums | |||||||
| Life and health | $ | 26,674 | $ | 28,889 | |||
| Property and casualty | 17,878 | 17,211 | |||||
| Insurance premiums, net | 44,552 | 46,100 | |||||
| Net investment income | 2,556 | 2,541 | |||||
| Unrealized losses on equity securities, net | (114 | ) | (2,375 | ) | |||
| Other income | 3 | 3 | |||||
| Total revenue | 46,997 | 46,269 | |||||
| Insurance benefits and losses incurred | |||||||
| Life and health | 19,112 | 17,800 | |||||
| Property and casualty | 12,813 | 12,660 | |||||
| Commissions and underwriting expenses | 12,666 | 12,918 | |||||
| Interest expense | 855 | 750 | |||||
| Other expense | 4,057 | 3,959 | |||||
| Total benefits and expenses | 49,503 | 48,087 | |||||
| Loss before income taxes | (2,506 | ) | (1,818 | ) | |||
| Income tax benefit | (508 | ) | (372 | ) | |||
| Net loss | $ | (1,998 | ) | $ | (1,446 | ) | |
| Loss per common share (basic & diluted) | $ | (0.10 | ) | $ | (0.08 | ) | |
| Reconciliation of Non-GAAP financial measure | |||||||
| Net loss | $ | (1,998 | ) | $ | (1,446 | ) | |
| Income tax benefit | (508 | ) | (372 | ) | |||
| Unrealized losses on equity securities, net | 114 | 2,375 | |||||
| Non-GAAP operating income (loss) | $ | (2,392 | ) | $ | 557 | ||
| March 31, | December 31, | ||||||
| Selected balance sheet data | 2024 | 2023 | |||||
| Total cash and investments | $ | 258,276 | $ | 265,368 | |||
| Insurance subsidiaries | 251,014 | 259,253 | |||||
| Parent and other | 7,262 | 6,115 | |||||
| Total assets | 365,751 | 381,265 | |||||
| Insurance reserves and policyholder funds | 203,822 | 212,422 | |||||
| Debt | 37,762 | 36,757 | |||||
| Total shareholders' equity | 102,803 | 107,275 | |||||
| Book value per common share | 4.77 | 4.99 | |||||
| Statutory capital and surplus | |||||||
| Life and health | 32,638 | 38,299 | |||||
| Property and casualty | 52,376 | 51,774 | |||||
FAQ
What were Atlantic American 's Q1 2024 financial results?
How did Atlantic American 's Q1 2024 performance compare to Q1 2023?
What was the earnings per share (EPS) for Atlantic American in Q1 2024?
Why did Atlantic American 's premium revenue decrease in Q1 2024?
What positive developments did Atlantic American report for Q1 2024?
