ANALYSTS PREDICT LOWER ZENITH NATIONAL EARNINGS.Byline: Chris Sieroty Staff Writer
With their acquisition of a Florida insurance company still a drain on its revenues, Zenith zenith, in astronomy, the point in the sky directly overhead; more precisely, it is the point at which the celestial sphere is intersected by an upward extension of a plumb line from the observer's location. National Insurance Corp. is expected today to report third-quarter earnings 32 cents lower than the year-ago period.
A poll of three analysts by First Call predicts the Woodland Hills-based workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. insurer An individual or company who, through a contractual agreement, undertakes to compensate specified losses, liability, or damages incurred by another individual.
An insurer is frequently an insurance company and is also known as an underwriter. will report a loss of 20 cents for the 1999 third-quarter compared to a profit of 12 cents a share for the same period a year ago.
Zenith National attributed the loss to a $32.5 million cut in third-quarter net income reserves that were needed to cover claims on policies sold by Sarasota-based insurer Riscorp, which the company purchased in April 1998.
``Riscorp wasn't as good of a deal as Zenith originally thought,'' said Gary Ransom ransom, price of redemption demanded by the captor of a person, vessel, or city. In ancient times cities frequently paid ransom to prevent their plundering by captors. The custom of ransoming was formerly sanctioned by law. , an analyst with Conning & Co. in Hartford, Conn.
``There will be a gradual turnaround Turnaround
A situation where a company that has had poor performance for an extended period of time experiences a positive reversal.
A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. , but it will be difficult and won't happen for the next couple of quarters,'' Ransom said.
Zenith National warned nearly three weeks ago of a third-quarter loss due to continued softness in workers' compensation insurance market where competition has led to price cuts.
``It's a difficult market in California,'' said Ransom. ``Premiums have declined, squeezing the margins.'' Seventy-eight percent of Zenith's workers' compensation policies are written in California.
The third-quarter charge, which amounts to $1.89 a share, will be offset in the next four years as the company recognizes $16.5 million a year from reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. , the company said in a statement.
Shares of Zenith closed down 18.75 cents Wednesday at $22.25.