Results of Operations for the Year Ended December 31, 2023 - American Overseas Group Limited Announces Net Income Of $5.3 Million For the Year Ended December 31, 2023

Rhea-AI Summary

American Overseas Group reported a consolidated net income of $5.3 million for the year ended December 31, 2023, with an earnings per diluted share of $113.56, compared to a net loss in the previous year. The book value per weighted share also increased. Net earned property and casualty premiums saw significant increases for both the quarter and the year, along with fee income and gross written premiums. Operating expenses slightly rose, and the Company aims to reduce debt through capital management.

Positive

• Strong increase in net income for the year ended December 31, 2023
• Significant growth in net earned property and casualty premiums for the quarter and the year
• Positive impact on direct written premiums from new programs, rate increases, and organic growth
• Efforts towards debt reduction through capital management

Negative

• Increased Loss and loss adjustment expenses as a percentage of earned premium for the quarter
• Slight increase in operating expenses for the quarter and the year

HAMILTON, Bermuda, April 30, 2024 (GLOBE NEWSWIRE) -- American Overseas Group Limited (BSX: AORE.BH) (Pink Sheets: AOREF.PK) (“AOG” or the “Company”) today reported consolidated net income available to common shareholders of $5.3 million, or $113.56 per diluted share, for the year ended December 31, 2023. This compares to consolidated net loss available to common shareholders of $1.5 million, or $31.42 per diluted share, for the year ended December 31, 2022. Book value per weighted share at December 31, 2023 was $772.67, an increase from the book value per weighted share of $758.44 at December 31, 2022.

For the three months ended December 31, 2023, net earned property and casualty premiums increased $4.1 million from $5.1 million a year ago to $9.2 million. For the year ended December 31, 2023, net earned property and casualty premiums increased $9.3 million from $20.1 million to $29.4 million.

Quarter to Date fee income increased $1.7 million from $3.0 million to $4.7 million and gross written premiums increased $77.5 million, moving from $118.1 million to $195.6 million. Quarter to Date Loss and loss adjustment expenses as a percentage of earned premium increased from 82.2% to 85.4%.  

For the year ended December 31, 2023, fee income increased $4.8 million from $11.7 million a year ago to $16.5 million and gross written premiums increased $213.5 million, moving from $453.1 million to $666.6 million. For both the quarter and the year, direct written premiums were positively impacted by continued expansion of new programs, rate increases, and organic growth in existing programs. Year to Date Loss and loss adjustment expenses as a percentage of earned premium decreased from 72.1% to 69.2%.  

For the three months ended December 31, 2023, operating expenses increased $0.8 million from $3.0 million to $3.8 million. For the year ended December 31, 2023, operating expenses increased $0.6 million from $11.5 million to $12.1 million.  

As part of its ongoing capital management efforts, the Company will continue to redirect excess capital within the group to debt reduction unless other compelling opportunities present themselves.

Forward-Looking Statements

This release contains statements that may be considered "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, without limitation, the Company's expectations respecting the volatility of its insured portfolio, losses, loss reserves and loss development, the adequacy and availability of its liquidity and capital resources, its current run off strategy, its strategy for writing other reinsurance businesses and its expense reduction measures. These statements are based on current expectations and the current views of the economic and operating environment and are not guarantees of future performance. A number of risks and uncertainties, including economic competitive conditions, could cause actual results to differ materially from those projected in forward-looking statements. The Company's actual results could differ materially from those expressed or implied in the forward-looking statements.

Information About the Company

American Overseas Group Limited is an insurance holding company incorporated in Bermuda and a tax resident of the United Kingdom. Its operating subsidiaries provide specialty property/casualty insurance, reinsurance and insurance management services. More information can be found at www.aoreltd.com.

American Overseas Group Limited

info@aoreltd.com

American Overseas Group Limited
Consolidated Balance Sheets
(unaudited)
As at December 31, 2023 and December 31, 2022
(dollars in thousands)
				December 31, 2023				December 31, 2022
Assets
		Investments:
			Fixed-maturity securities held as available for sale, at fair value	$	132,600			$	97,646
			Equity investments held as available for sale, at fair value		-				2,708
		Cash and cash equivalents			56,854				32,212
		Restricted cash			964				3,968
		Accrued investment income			972				455
		Premiums receivable			174,350				94,704
		Deferred insurance premiums			219,828				132,602
		Reinsurance balances receivable, net			348,930				248,234
		Deferred policy acquisition costs			9,152				4,029
		Intangible assets			4,800				4,800
		Goodwill			33,050				33,050
		Other assets			3,720				3,978
			Total Assets	$	985,220			$	658,386
Liabilities and Equity
	Liabilities:
		Loss and loss expense reserve		$	332,573			$	253,886
		Deferred commission income			6,878				2,661
		Unearned premiums			230,123				137,929
		Ceded premium payable			183,969				88,117
		Payable to general agents			10,885				5,469
		Funds withheld			136,471				99,409
		Accounts payable and accrued liabilities			25,725				16,499
		Notes payable			20,771				18,021
		Non-owned interest in VIE			300				300
		Interest payable			578				464
		Deferred tax liability			648				-
			Total Liabilities		948,921				622,755
	Shareholders' Equity:
		Common shares			4,698				4,698
		Additional paid-in capital			189,179				189,179
		Accumulated other comprehensive (loss)			(3,454	)			(4,240	)
		Retained deficit			(154,124	)			(159,459	)
			Total Shareholders' Equity		36,299				30,178
		Non-controlling interest of preferred shares of subsidiaries			-				5,453
		Total Equity			36,299				35,631
			Total Liabilities and Equity	$	985,220			$	658,386
		See Notes to December 31, 2023 Consolidated Financial Statements available on American Overseas Group Ltd. Website at www.aoreltd.com

American Overseas Group Limited
Consolidated Statements of Operations
(unaudited)
(dollars in thousands, except share and per share amounts)
				Three months ended December 31,								Twelve Months ended December 31,
				2023				2022				2023				2022
	Revenues
		Net premiums earned		$	9,248			$	5,101			$	29,351			$	20,126
		Fee income			4,693				3,007				16,540				11,693
		Net investment income			273				122				829				263
		Net realized (losses) gains on investments			(53	)			-				2,809				237
		Other income			23				20				87				936
			Total revenues		14,184				8,250				49,616				33,255
	Expenses
		Losses and loss adjustment expenses			7,899				4,191				20,315				14,506
		Acquisition expenses			2,560				1,573				8,939				6,342
		Operating expenses			3,790				2,940				12,142				11,540
		Interest expense			585				464				2,237				1,816
			Total expenses		14,834				9,168				43,633				34,204
Pre-tax net profit / (loss)				$	(650	)		$	(918	)		$	5,983			$	(949	)
		Income tax (expense)			(648	)			-				(648	)			-
Net profit / (loss) before dividends					(1,298	)			(918	)			5,335				(949	)
		Dividends on preference shares of subsidiary			-				(527	)			-				(527	)
Net profit / (loss) available to common shareholders				$	(1,298	)		$	(1,445	)		$	5,335			$	(1,476	)
	Net profit / (loss) per common share:
	Basic			$	(27.63	)		$	(30.76	)		$	113.56			$	(31.42	)
	Diluted				(27.63	)			(30.76	)			113.56				(31.42	)
	Weighted-average number of common shares outstanding:
	Basic				46,979				46,979				46,979				46,979
	Diluted				46,979				46,979				46,979				46,979
See Notes to December 31, 2023 Consolidated Financial Statements available on American Overseas Group Ltd. Website at www.aoreltd.com