ADDISON, Texas, Mar 31, 2014 (GLOBE NEWSWIRE through COMTEX) — Affirmative Insurance Holdings, Inc. /quotes/zigman/10303976/delayed/estimates/nls/affm AFFM +7.45% , a top supplier of non-regular personalized automobile insurance policies, reported consolidated economic results for the 4th quarter and total year ended December 31, 2013.
3 Months Ended December 31, Yr Ended December 31, (In millions, except per share information) 2013 2012 2013 2012 Gross written premium managed $ 79.5 $ 64.6 $ 340.5 $ 237. Revenue 56.2 fifty 5.4 246.1 209.8 Working loss (8.6) (3.2) (8.5) (8.2) Net earnings (loss) (twelve.1) (8.3) 30.6 (51.9) Net earnings (reduction) per diluted share (.76) (.54) one.97 (3.37)
Michael McClure, Chief Executive Officer, stated, “The quarter was disappointing due to the strengthening of loss reserves for bodily injury claim severities for prior many years and the initial half of 2013. As previously stated, we have created a lot of enhancements from an operational standpoint, but we even now have several locations and opportunities to handle. We are determined to carry on to increase the profitability of the organization. We continue to see either very great or enhancing industry conditions in a quantity of our states. We have been drastically rising our charges given that the starting of 2013 in all of our largest states and took considerable actions to terminate unprofitable independent agency relationships. We think our actions, along with the enhanced working atmosphere, will continue to boost our working results as we move forward.”
— Gross written premiums managed for the 4th quarter of 2013 elevated $ 14.9 million, or 23.one%, compared with the 4th quarter of 2012. Gross written premiums managed signify the gross written premiums on policies we control by way of affiliated and unaffiliated underwriting companies. Our insurance coverage organizations may possibly not underwrite a portion of gross written premiums managed. The increase was primarily in California, Texas and Louisiana. For the 2 California and Texas, the increase was mostly due to a substantial enhance in renewal policies as well as charge increases. New policy counts enhanced 12% for the quarter in California compared with 2012 and declined about 12% in Texas. Renewal policy counts for the quarter considerably exceeded new policy counts in both states. Historically, our new company policy reduction ratio has frequently been at least 15 to twenty factors higher than our renewal company loss ratio. The growth in Louisiana was primarily due to development in independent agent business other than organization from the retail stores we sold in September 2013. However, in December 2013, we started out to terminate a significant amount of these Louisiana independent agent relationships due to ongoing profitability issues.
— Total revenues for the 4th quarter of 2013 enhanced $ .8 million, or 1.5%, in contrast with the 4th quarter of 2012. The improve was due to the development in gross premiums managed discussed over, which was partially offset by the reduction in commission and fee earnings due to the sale of our retail business in September 2013.
— Net losses and reduction adjustment bills for the 4th quarter elevated $ 10.2 million, or thirty.%, in contrast with the 4th quarter of 2012. The percentage of net losses and reduction adjustment cost to net premiums earned (the net reduction ratio) was 100.9% in the present quarter compared with a loss ratio of 86.6% in the 4th quarter of 2012. The 14.3 level boost in the reduction ratio for the 4th quarter of 2013 was mainly due to prior period adverse improvement, which represented twelve.1 points of the enhance, and the affect of quota-share reinsurance. The use of quota-share reinsurance overstates the net reduction ratio. Loss adjustment costs include all of the business subject to the quota-share treaties with ceding commission earnings booked as an offset to selling, general and administrative expenses. As this kind of, the quota-share treaties’; impact on the reduction ratio was an boost of 8. points for 4th quarter in 2013 and 4.3 factors for 4th quarter in 2012. The prior time period adverse improvement was mostly due to bodily damage claims. In addition, we strengthened in the 4th quarter of 2013 the reserves associated to bodily damage claims from accidents happening throughout the very first half of 2013 as severities had been larger than anticipated.
— Selling, general and administrative expenses (SG&A) decreased $ 2.5 million, or eleven.6%, in the 4th quarter of 2013, compared with the 4th quarter of 2012. This decrease was primarily due to value reductions resulting from the sale of the retail company distribution business. Excluding the direct fees for the retail organization from the 4th quarter of 2012, SG&A increased $ 1.4 million or 7.8%. This boost was due to the boost in policy acquisition expenses primarily due to the growth in written premiums partially offset by lower professional fees as a outcome of the termination of the info technological innovation outsourcing agreement and no longer incurring incremental phrase loan advisor charges.
Affirmative Insurance Holdings, Inc. is a supplier of non-normal private car insurance coverage policies for individual customers in targeted geographic markets. Non-normal private car insurance coverage policies supply coverage to drivers who locate it tough to obtain insurance coverage from common automobile insurance coverage companies due to their lack of prior insurance coverage, age, driving record, limited monetary sources or other aspects. Non-common private car insurance policies typically require increased premiums than common automobile insurance coverage policies.
This press release contains forward-hunting statements created pursuant to the protected harbor provisions of the Personal Securities Litigation Reform Act of 1995. Forward-hunting statements may possibly be identified by, amid other items, the use of forward-searching terms such as “likely,” “normally,” “could,” “intends,” “expects,” “believes,” “anticipates,” “estimates,” “projects,” “targets,” “forecasts,” “seeks,” “prospective,” or “attempts” or the damaging of this kind of terms or other variations on this kind of terms or comparable terminology. By their nature, these statements are topic to hazards, uncertainties and other factors, which could result in actual future results to differ materially from these final results expressed or implied by such forward-seeking statements.
Do not unduly depend on forward-searching statements. They give the Company’;s expectations about the future and are not ensures. Forward-hunting statements communicate only as of the date they are manufactured, and, except as needed by law, the Organization does not intend to update them to reflect alterations that arise after that date. For a discussion of factors that could lead to real benefits to differ from expectations, refer to the Company’;s filings with the Securities and Exchange Commission, like its Annual Report on Kind 10-K for the 12 months ended December 31, 2013. Any aspect described in this press release or in any document referred to in this press release could, by itself or together with one or much more other aspects, adversely influence the Company’;s company, earnings and/or economic condition.
AFFIRMATIVE Insurance HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in 1000's, except per share data) 3 Months Ended 12 months Ended December 31, December 31, 2013 2012 2013 2012 Revenues Net premiums earned $ 43,891 $ 39,359 $ 165,683 $ 143,736 Commission income, fees and managing common agent revenue eleven,543 15,504 77,534 61,495 Net investment cash flow 756 533 2,721 3,105 Net recognized gains 24 1 61 922 Other cash flow 2 (one) 125 503 Complete revenues 56,216 55,396 246,124 209,761 Expenses Net losses and reduction adjustment expenses 44,287 34,072 147,818 111,858 Marketing, standard and administrative expenses 19,007 21,526 99,735 96,055 Depreciation and amortization 1,517 3,018 6,079 10,062 Complete expenditures 64,811 58,616 254,632 217,975 Working loss (8,595) (3,220) (8,508) (8,214) Gain on sale of retail enterprise (354) -- 64,971 -- Reduction on extinguishment of debt -- -- (4,193) -- Interest cost (3,514) (5,175) (20,663) (19,743) Goodwill and other intangible assets impairment -- -- -- (23,692) Earnings (loss) just before revenue tax cost (twelve,463) (8,395) 31,607 (51,649) Revenue tax expense (advantage) (329) (115) 889 264 Net income (loss) $ (12,134) $ (8,280) $ 30,718 $ (51,913) Fundamental revenue (loss) per common share: Net revenue (reduction) $ (.79) $ (.54) $ 1.99 $ (3.37) Diluted revenue (loss) per typical share: Net income (reduction) $ (.76) $ (.54) $ one.97 $ (3.37) Weighted common common shares exceptional: Standard 15,408 15,408 15,408 15,408 Diluted 15,941 15,408 15,622 15,408
AFFIRMATIVE Insurance HOLDINGS, INC. AND SUBSIDIARIES GROSS WRITTEN PREMIUMS MANAGED (in 1000's) 3 Months Ended Yr Ended December 31, December 31, 2013 2012 2013 2012 Louisiana $ 27,777 $ 23,806 $ 119,828 $ 106,841 Texas 22,110 18,028 93,573 54,009 California 18,966 8,963 73,741 17,706 Alabama 4,207 4,534 25,272 21,270 Illinois 4,360 5,721 18,359 23,887 Indiana 1,442 2,132 6,846 8,092 Missouri 636 1,026 2,799 3,084 South Carolina -- 365 -- 2,127 Other 20 19 49 6 Total written premium managed 79,518 64,594 340,467 237,022 Much less Texas written premium not underwritten 7,432 -- 48,272 -- Gross underwritten premiums $ 72,086 $ 64,594 $ 292,195 $ 237,022
Speak to: Earl R. Fonville Executive Vice President and Chief Economic Officer (972) 728-6458 email@example.com
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March 28, 2014 2:01p