Alfa Corporation Reports 1998 Results; Announces Management Changes.MONTGOMERY Montgomery, city, United States Montgomery, city (1990 pop. 187,106), state capital and seat of Montgomery co., E central Ala., near the head of navigation on the Alabama River just below the confluence of the Coosa and Tallapoosa rivers, and in the rich , Ala ALA aminolevulinic acid. Ala alanine. ala (a´lah) pl. a´lae [L.] a winglike process. .--(BUSINESS WIRE)--Feb. 9, 1999--Alfa Corporation (Nasdaq/NM:ALFA) today announced results for the year ended December December: see month. 31, 1998. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for 1998, which excludes net realized investment gains, increased 6.4% to a record $53,857,295, or $1.31 per share, compared with operating income of $50,612,083, or $1.24 per share for 1997. Net income, including net realized investment gains, was $56,715,691, or $1.38 per share compared with $52,793,633, or $1.29 per share, a year ago. Premium revenue for 1998 increased 5.6% to $391,838,282. Operating income for the fourth quarter of 1998 decreased 6.1% to $13,325,623, or $0.32 per share, compared with $14,187,940, or $0.35 per share, for the fourth quarter of 1997. After net realized investment gains and losses, net income for the fourth quarter of 1998 increased 10.1% to $13,649,816, or $0.33 per share, compared with $12,393,443, or $0.30 per share a year ago. Premium revenue for the fourth quarter of 1998 increased 5.0% to $99,019,753. All per share amounts shown above are on a diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis. Alfa's Chairman, President and Chief Executive Officer, Jerry Jer·ry n. pl. Jer·ries Chiefly British Slang A German, especially a German soldier. [Alteration of German. A. Newby, said, "We are pleased to have achieved record results for 1998 in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite increased storm losses during the year and increased expenses. The results are primarily due to our property and casualty operations, which ended the year with a 90.4% combined ratio following a 91.5% combined ratio in 1997. These were two of the best years for underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. results in our history. The fourth quarter results in 1998 remained good, however, increased legal expenses and increased costs of investments in technology resulted in unfavorable earnings comparisons for the three month period. "We expect another solid year in 1999, but continued investments in new technology to better serve our customers, together with a very competitive rate environment -- particularly in personal automobile insurance -- will likely slow overall earnings for the year. Although the investments we are making in systems and support capabilities will increase costs in the short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. , we are confident they will serve to help us achieve our long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. strategic objectives and our vision of being the provider of choice for personal lines insurance needs." Alfa also announced today that C. Lee Ellis ELLIS - EuLisp LInda System. An object-oriented Linda system written for EuLisp. "Using Object-Oriented Mechanisms to Describe Linda", P. Broadbery <pab@maths.bath.ac.uk> et al, in Linda-Like Systems and Their Implementation, G. Wilson ed, U Edinburgh TR 91-13, 1991. is now serving as Executive Vice President of Operations. Ellis, who was Executive Vice President of Investments, joined the Alfa Companies in 1975 and has managed the Company's investments since that time. "We are excited about the future of these companies with Lee's leadership," said Jerry Newby, Alfa President. "Alfa has experienced tremendous growth over the past several years. Lee has been very involved in the success of these companies over the years. With his expanded role and responsibilities as Executive Vice President of Operations, we anticipate even greater accomplishments," Newby said. Ellis, 47, serves on the board of First Liberty Bank of Macon Macon (mā`kən, mā`kŏn), city (1990 pop. 106,612), seat of Bibb co., central Ga., at the head of navigation on the Ocmulgee River; inc. 1823. , Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. , the YMCA YMCA in full Young Men's Christian Association Nonsectarian, nonpolitical Christian lay movement that aims to develop high standards of Christian character among its members. Metro Board, the Montgomery Area Committee of 100, the Riverfront riv·er·front n. The land or property along a river. Development Steering Committee steer·ing committee n. A committee that sets agendas and schedules of business, as for a legislative body or other assemblage. steering committee Noun and The Administrative Board A comprehensive phrase that can refer to any Administrative Agency but usually means a public agency that holds hearings. An administrative board is usually obligated to represent the public interest; courts, in contrast, must remain impartial between the two parties of First United Methodist Church First United Methodist Church is a common name for the first United Methodist church established in a particular locality. Many First United Methodist Churches exist around the world. . He also serves as Chairman of the Investment Committee of the National Association of Independent Insurers. Ellis received his B.A. degree from the University of North Carolina at Chapel Hill The University of North Carolina at Chapel Hill is a public, coeducational, research university located in Chapel Hill, North Carolina, United States. Also known as The University of North Carolina, Carolina, North Carolina, or simply UNC . He is married to the former Nancy Hill and they have two sons, John, 17, and David, 14. Alfa Corporation is engaged in insurance and financial activities through its subsidiaries. The common stock of Alfa Corporation is traded on Nasdaq Stock Market's National Market under the symbol ALFA. Statements included in this news release that are not historical in nature are forward-looking within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements are based on assumptions and opinions concerning a variety of known and unknown risks and uncertainties that may cause actual future results to differ materially from those contemplated, projected, estimated or budgeted in such forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . A discussion of these risks and uncertainties is included in the periodic reports filed by Alfa Corporation with the Securities and Exchange Commission. -0-
ALFA CORPORATION
FINANCIAL HIGHLIGHTS
(Unaudited)
Year Ended
December 31,
------------------------------------
1998 1997 % Change
------------ ------------ ---------
Premiums and Policy Charges $391,838,282 $370,965,046 5.63%
Net Investment Income 62,511,658 57,528,669 8.66%
Realized Investment Gains/(Losses) 4,397,533 3,356,231 31.03%
Other Income 2,238,096 2,159,683 3.63%
------------ ------------ ---------
Total Revenues 460,985,569 434,009,629 6.22%
------------ ------------ ---------
Total Expenses 377,720,651 357,210,007 5.74%
------------ ------------ ---------
Income Before Provision
for Income Taxes 83,264,918 76,799,622 8.42%
Provision for Income Taxes 26,549,227 24,005,989 10.59%
------------ ------------ ---------
Net Income $ 56,715,691 $ 52,793,633 7.43%
============ ============ =========
Net Income Per Share
Basic $1.39 $1.29 7.30%
Diluted $1.38 $1.29 6.86%
----------------------------------------------------------------------
Operating Income(a) $ 53,857,295 $ 50,612,083 6.41%
============ ============ =========
Operating Income Per Share
Basic $1.32 $1.24 6.29%
Diluted $1.31 $1.24 5.85%
----------------------------------------------------------------------
Average Shares Outstanding
Basic 40,834,232 40,787,047
============ ===========
Diluted 41,148,258 40,930,894
============ ===========
(a) Operating income excludes realized investment gains and losses
and related taxes.
Three Months Ended
December 31,
------------------------------------
1998 1997 % Change
------------ ------------ ---------
Premiums and Policy Charges $ 99,019,753 $ 94,321,517 4.98%
Net Investment Income 15,442,318 15,096,640 2.29%
Realized Investment Gains/(Losses) 498,759 (2,760,765) 118.07%
Other Income 585,816 598,393 (2.10%)
------------ ------------ ---------
Total Revenues 115,546,646 107,255,785 7.73%
------------ ------------ ---------
Total Expenses 94,963,688 89,402,562 6.22%
------------ ------------ ---------
Income Before Provision
for Income Taxes 20,582,958 17,853,223 15.29%
Provision for Income Taxes 6,933,142 5,459,780 26.99%
------------ ------------ ---------
Net Income $ 13,649,816 $ 12,393,443 10.14%
============ ============ =========
Net Income Per Share
Basic $0.33 $0.30 10.05%
Diluted $0.33 $0.30 9.70%
----------------------------------------------------------------------
Operating Income(a) $ 13,325,623 $ 14,187,940 (6.08%)
============ ============ =========
Operating Income Per Share
Basic $0.33 $0.35 (6.16%)
Diluted $0.32 $0.35 (6.45%)
----------------------------------------------------------------------
Average Shares Outstanding
Basic 40,822,140 40,788,042
============ ===========
Diluted 41,187,366 41,021,963
============ ===========
(a) Operating income excludes realized investment gains and losses
and related taxes.
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