Attached files
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| 8-K - FORM 8-K - ASSURANCEAMERICA CORP | d8k.htm |
Exhibit 99.1
ASSURANCEAMERICA CORPORATION REPORTS RESULTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2011.
ATLANTA-(BUSINESSWIRE)-May 17, 2011-Atlanta-based ASSURANCEAMERICA CORPORATION (OTC BB: ASAM) today announced its unaudited financial results for the three-month period ended March 31, 2011.
Revenue for the three-month period of 2011 decreased 5% to $17.2 million, compared to $18.2 million for the same period in 2010. The Company had a pre-tax loss of $82 thousand for the three-month period ending March 31, 2011 as compared to pre-tax earnings of $1.4 million for the same period in 2010. The Company’s net loss for the three-month period ending March 31, 2011 was $75 thousand as compared to net income of $0.8 million in 2010. The year-over-year decline in earnings resulted from lower written premium volume and an increase in loss and loss adjustment expense associated with prior year reserve development.
AssuranceAmerica focuses on the non-standard automobile insurance marketplace, primarily in Alabama, Arizona, Florida, Georgia, Indiana, Louisiana, Mississippi, South Carolina, Texas and Virginia. Its principal operating subsidiaries are TrustWay Insurance Agencies, LLC (“Agency”), which sells personal automobile insurance policies through its 50 retail agencies, AssuranceAmerica Managing General Agency, LLC (“MGA”), and AssuranceAmerica Insurance Company (“Carrier”).
Forward-Looking Statements
This press release contains certain statements that may be deemed to be “forward-looking statements”. All statements in this press release not dealing with historical results or current facts are forward-looking and are based on estimates, assumptions, and projections. Statements that include the words “assumes”, “believes,” “seeks,” “expects,” “may,” “should,” “intends,” “likely,” “targets,” “plans,” “anticipates,” “estimates” or the negative version of those words and similar statements of a future or forward-looking nature identify forward-looking statements.
The primary events or circumstances that could cause actual results to differ materially from those expected by AssuranceAmerica Corporation include determinations with respect to reserve adequacy, realized gains or losses on the investment portfolio including other-than-temporary impairments for credit losses, rising loss cost trends, actions of competitors and natural disasters. AssuranceAmerica Corporation undertakes no obligation to publicly update or revise any of the forward-looking statements. For a more detailed discussion of some of the foregoing risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see AssuranceAmerican Corporation filings with the Securities and Exchange Commission.
Contact:
AssuranceAmerica Corporation, Atlanta
Sheree S. Williams, Senior Vice President and Chief Financial Officer
(770) 952-0200 Ext. 6212
Mark Hain, General Counsel, Secretary, Executive Vice President
(770) 952-0200 Ext. 6259
ASSURANCEAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(000’S OMITTED)
| For the Three Months Ended March 31, | ||||||||
|
2011 |
2010 |
|||||||
| Revenue: |
||||||||
| Gross premiums written |
$ | 30,234 | $ | 32,380 | ||||
| Ceded premiums written |
(17,066) | (22,026) | ||||||
| Net premiums written |
13,168 | 10,354 | ||||||
| Change in unearned premiums |
(4,139) | (1,922) | ||||||
| Net premiums earned |
9,029 | 8,432 | ||||||
| Commission income |
5,038 | 6,480 | ||||||
| Managing general agent fees |
2,956 | 2,983 | ||||||
| Net investment income |
70 | 132 | ||||||
| Net investment losses on securities |
30 | 11 | ||||||
| Other fee income |
126 | 138 | ||||||
| Total revenue |
17,249 | 18,176 | ||||||
| Expenses: |
||||||||
| Losses and loss adjustment expenses |
6,955 | 5,957 | ||||||
| Selling, general, and administrative |
9,985 | 10,355 | ||||||
| Stock option expense |
91 | 90 | ||||||
| Depreciation and amortization expense |
297 | 278 | ||||||
| Interest expense |
3 | 97 | ||||||
| Total operating expenses |
17,331 | 16,777 | ||||||
| Income (loss) before income taxes |
(82) | 1,399 | ||||||
| Income tax (benefit) expense |
(7) | 560 | ||||||
| Net income (loss) |
$ | (75) | $ | 839 | ||||
| Earnings (loss) per common share: |
||||||||
| Basic |
($0.001) | $0.013 | ||||||
| Diluted |
($0.001) | $0.013 | ||||||
| Weighted average shares outstanding-basis |
65,556,121 | 65,385,468 | ||||||
| Weighted average shares outstanding-diluted |
65,556,121 | 65,948,319 | ||||||
AssuranceAmerica Corporation also makes available an investor supplement on our website. To access the supplemental financial information, go to www.assuranceamerica.com.
ASSURANCEAMERICA CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(000’S OMITTED)
| (Unaudited) March 31, 2011 |
December 31, 2010 |
|||||||
| ASSETS | ||||||||
| Cash and cash equivalents |
$ | 10,770 | $ | 8,379 | ||||
| Cash restricted |
1,804 | 1,803 | ||||||
| Short-term investments |
145 | 145 | ||||||
| Long-term investments, at fair value (amortized cost $8,023 and $8,561) |
8,121 | 8,631 | ||||||
| Marketable equity securities, at fair value (cost $2,000 and $1,978) |
2,361 | 2,243 | ||||||
| Other long-term investments |
704 | 727 | ||||||
| Investment income due and accrued |
122 | 180 | ||||||
| Receivable from insureds |
36,730 | 33,120 | ||||||
| Reinsurance recoverable (including $17,654 and $10,603 on paid losses) |
41,727 | 34,013 | ||||||
| Prepaid reinsurance premiums |
24,064 | 23,644 | ||||||
| Deferred acquisition costs |
3,229 | 2,286 | ||||||
| Property and equipment (net of accumulated depreciation of $5,304 and $5,136) |
2,190 | 2,153 | ||||||
| Other receivables |
1,423 | 1,776 | ||||||
| Prepaid expenses |
596 | 660 | ||||||
| Intangibles (net of accumulated amortization of $3,525 and $3,429) |
5,873 | 5,969 | ||||||
| Security deposits |
110 | 110 | ||||||
| Prepaid income tax |
106 | 107 | ||||||
| Deferred tax assets |
1,823 | 1,838 | ||||||
| Total assets |
$ | 141,898 | $ | 127,784 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Accounts payable and accrued expenses |
$ | 9,209 | $ | 8,798 | ||||
| Unearned premium |
38,776 | 34,217 | ||||||
| Unpaid losses and loss adjustment expenses |
34,674 | 33,311 | ||||||
| Reinsurance payable |
36,503 | 29,427 | ||||||
| Provisional commission reserve |
3,835 | 3,289 | ||||||
| Funds withheld from reinsurers |
1,875 | 1,875 | ||||||
| Revolving line of credit |
1,500 | 1,500 | ||||||
| Notes and interest payable |
161 | 175 | ||||||
| Total liabilities |
126,533 | 112,592 | ||||||
| Commitments and Contingencies |
||||||||
| Common stock, $.01 par value (authorized 120,000 and outstanding 65,759 and 65,494) |
658 | 655 | ||||||
| Surplus-paid in |
18,043 | 17,876 | ||||||
| Accumulated deficit |
(3,623) | (3,548) | ||||||
| Accumulated other comprehensive gains: |
||||||||
| Net unrealized gains on investment securities, net of taxes |
287 | 209 | ||||||
| Total stockholders’ equity |
15,365 | 15,192 | ||||||
| Total liabilities and stockholders’ equity |
$ | 141,898 | $ | 127,784 | ||||