AmerUs Life Holdings Reports Second-Quarter 1998 Results; Record Operating Earnings & EPS.DES MOINES Des Moines, city, United States Des Moines (dĭ moin`), city (1990 pop. 193,187), state capital and seat of Polk co., S central Iowa, at the junction of the Des Moines and Raccoon rivers; inc. , Iowa--(BUSINESS WIRE)--Aug. 11, 1998--AmerUs Life Holdings, Inc. (NYSE NYSE See: New York Stock Exchange :AMH AMH Abington Memorial Hospital (Abington, PA) AMH Anti-Müllerian Hormone AMH Australian Medicines Handbook AMH Automated Material Handling AMH Aviation Structural Mechanic (Hydraulics) US Navy Rating ) today announced that second-quarter 1998 operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before were a record $.57 per 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. share, up from $.53 per diluted share in the second quarter of 1997. Operating earnings for the first six months of 1998 were $1.13 per diluted share, also a record, compared with $1.03 per diluted share in the comparable period of 1997. Per-share results for both 1998 periods reflect an approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. 50 percent increase in shares outstanding as the result of the acquisition of AmVestors Financial Corporation in the fourth quarter of 1997. Operating earnings for the 1998 second quarter were $20.0 million, up from $12.2 million in 1997, and six-month operating earnings were $39.5 million, compared with $23.8 million in 1997. The results for both 1998 periods are records. The 1998 second-quarter and six-months results include the contributions of AmVestors Financial Corporation and Delta Life Corporation,which were acquired in the last quarter of 1997. "We are pleased with second quarter and six month results, which were right on track with our expectations," said Roger K. Brooks Brooks , Gwendolyn Elizabeth 1917-2000. American poet known for her verse detailing the dreams and struggles of African Americans. An early volume of poems, Annie Allen (1949), was awarded a Pulitzer Prize. Noun 1. , chairman, president and chief executive officer of AmerUs Life Holdings, Inc. "The gains in operating earnings were driven by the contributions of Delta Life Corporation and AmVestors Financial Corporation, as well as by favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. mortality results." Net income, which includes all gains and losses from sales of investments, was $20.9 million, or $0.60 per share on a diluted basis, for the 1998 second quarter, compared with $14.4 million, or $0.62 per diluted share, in the second quarter of 1997. Net income for the first half of 1998 was $42.6 million, or $1.22 per diluted share, compared with $29.0 million, or $1.25 per diluted share, a year ago. "We're we're Contraction of we are. we're we are beginning to see the benefits of the new marketing and distribution strategies we initiated late in 1997," Brooks said. "Sales of life insurance products for the first six months are up over 13 percent, led by strong gains in term life sales, reflecting the introduction of several attractive new term life products." "We anticipate our sales growth will continue as our marketing initiatives generate momentum with our sales force. Our new product introductions are generating a great deal of interest from all of our distribution systems." Reflecting the impact of the AmVestors and Delta acquisitions, total annuity annuity: see insurance. annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. sales increased substantially, to $215.0 million in the second quarter of 1998 from $13.1 million in the comparable quarter of 1997, and to $389.7 million in the first six months of 1998 from $25.6 million in the prior year. On a proforma Proforma A financial projection based on assumptions. basis, including AmVestors' and Delta's 1997 results, annuity sales for the quarter and six months were relatively flat, with substantial increases at AmVestors' and AmerUs' variable products joint venture offset by lower sales at Delta. Total revenues from premium and product charges for the quarter and year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. , excluding the closed block, increased 57.3 percent and 64.6 percent, respectively, from the comparable periods in 1997, primarily reflecting the contributions of AmVestors and Delta. Brooks noted that AmerUs Life Holdings recently completed several elements of a financial restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). designed to increase shareholder value and reduce financial leverage. In the second quarter, the company issued $125 million of seven-year senior notes maturing in 2005, and, in July July: see month. , it completed a $130 million offering of mandatorily Adv. 1. mandatorily - in a manner that cannot be evaded; "the ministry considers that contributions to such a fund should be met from voluntary donations rather than from rates compulsorily levied." compulsorily, obligatorily convertible unit securities. The proceeds of the two offerings are being used to retire retire v. 1) to stop working at one's occupation. 2) to pay off a promissory note, and thus "retire" the loan. 3) for a jury to go into the jury room to decide on a verdict after all evidence, argument and jury instructions have been completed. bank debt, repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. up to $75 million in AmerUs common stock and for general corporate purposes. AmerUs Life Holdings, Inc. is an Iowa corporation located in Des Moines, Iowa “Des Moines” redirects here. For other uses, see Des Moines (disambiguation). Des Moines (pronounced /dɪˈmɔɪn/ in English, , engaged through its subsidiaries in the business of marketing, 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. and distributing individual life insurance and annuity products in 49 states, the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). and the U.S. Virgin Islands. Its wholly-owned subsidiaries include AmerUs Life Insurance Company, Delta Life Corporation, and its operating subsidiary An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. , Delta Life and Annuity Company, and AmVestors Financial Corporation, located in Topeka, Kansas This article is about the state capital of Kansas. For other uses, see Topeka (disambiguation). Topeka is the capital of the U.S. state of Kansas and the county seat of Shawnee County, which is named after the Shawnee Indians. , with two wholly-owned operating subsidiaries -- American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Investors Life Insurance Company and Financial Benefit Life Insurance Company. As of June June: see month. 30, 1998, AmerUs Life Holdings' total assets were $10.5 billion and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. totaled $960.9 million, including FAS 115. Certain statements made by the company which are not historical facts may be considered 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. , including, without limitation, statements as to trends, management's beliefs, expectations and opinions, which are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate. Such forward-looking statements are subject to risks and uncertainties and may be affected by various factors which may cause actual results to differ materially from those in the forward-looking statements. For further information which could cause actual results to differ from the company's expectations as well as other factors which could affect the company's financial statements, please refer to the company's reports filed with the Securities and Exchange Commission. -0-
AMERUS LIFE HOLDINGS, INC.
Operating Earnings
For the Six For the Three
Months Ended Months Ended
June 30, June 30,
1998 1997 1998 1997
----- ------ ------ ------
(In thousands, except per share amounts)
Net income $42,621 $29,022 $20,864 $14,442
Net realized (gains)
losses on investments(A) (3,147) (5,188) (882) (2,207)
------- ------- ------- -------
Adjusted operating income $39,474 $23,834 $19,982 $12,235
======= ======= ======= =======
Adjusted operating income
per common share(B):
Basic $1.14 $1.03 $0.58 $0.53
Diluted $1.13 $1.03 $0.57 $0.53
(A) Represents non-core realized gains or losses on investments less
that portion of the amortization of deferred policy acquisition
costs adjusted for income taxes on such amounts. Realized gains
may vary widely between periods. Such amounts are determined by
management's timing of individual transactions and do not
necessarily correspond to the underlying operating trends.
(B) Basic adjusted operating income per common share for the six
months ended and three months ended June 30, 1998 is calculated
using 34.73 million weighted average shares of common stock
outstanding. Diluted adjusted operating income per common share
for the six months ended June 30, 1998 is calculated using 35.09
million weighted average shares outstanding. Diluted adjusted
operating income per common share for the three months ended June
30, 1998 is calculated using 35.02 million weighted average
shares of common stock outstanding. The basic and diluted
adjusted operating income per common share for the six months and
three months ended June 30, 1997 is calculated using 23.16
million shares of common stock outstanding.
-0-
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
June 30, December 31,
1998 1997
---------- ------------
(Unaudited)
Assets:
Investments:
Securities available-for-sale
at fair value
Fixed maturity securities $6,745,359 $6,851,427
Equity securities 82,340 61,480
Short - term investments 31,120 12,595
Securities held for trading
purposes at fair value
Fixed maturity securities 894 22,955
Equity securities 449 -
Mortgage loans on real estate 512,717 462,473
Real estate 3,766 8,670
Policy loans 111,593 117,865
Other investments 220,844 158,073
--------- ---------
Total investments 7,709,082 7,695,538
Cash 160,061 58,081
Accrued investment income 81,801 84,713
Premiums and fees receivable 2,712 3,445
Reinsurance receivables 5,033 6,203
Deferred policy acquisition costs 166,945 118,896
Value of business acquired 252,903 266,014
Investment in unconsolidated
subsidiaries 27,940 26,849
Goodwill 216,677 220,250
Property and equipment 23,548 22,863
Other assets 344,698 359,308
Closed block assets 1,478,152 1,391,848
----------- -----------
Total assets $10,469,552 $10,254,008
=========== ===========
-0-
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
June 30, December 31,
1998 1997
----------- -----------
(Unaudited)
Liabilities and Stockholders' Equity:
Liabilities:
Policy reserves and policyowner
funds:
Future life and annuity policy
benefits $7,091,756 $7,074,444
Policyowner funds 92,569 89,641
---------- ----------
Total 7,184,325 7,164,085
Accrued expenses 37,999 39,095
Dividends payable to policyowners 585 1,575
Policy and contract claims 6,416 4,548
Income taxes payable 27,614 12,753
Deferred income taxes 7,686 16,914
Other liabilities 164,944 111,180
Debt 275,856 266,435
Closed block liabilities 1,717,216 1,623,432
---------- -----------
Total Liabilities 9,422,641 9,240,017
Company-obligated manditorily-
redeemable preferred capital
securities of subsidiary trust
holding solely junior subordinated
debentures of the Company 86,000 86,000
Stockholders' equity:
Preferred stock, no par value 20,000,000
shares authorized, none issued - -
Common Stock, Class A, no par value
180,000,000 shares authorized in 1998,
75,000,000 shares authorized in 1997;
29,734,919 shares issued and
outstanding 29,735 29,735
Common Stock, Class B, no par value
50,000,000 shares authorized; 5,000,000
shares issued and outstanding 5,000 5,000
Paid in capital 383,686 383,686
Accumulated other comprehensive income 54,614 55,747
Retained earnings 489,498 453,823
Cost of treasury stock (1,622) -
------- -------
Total stockholders' equity 960,911 927,991
------- -------
Total liabilities and stockholders'
equity $10,469,552 $10,254,008
=========== ===========
-0-
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except for per share data)
(Unaudited)
Six Months Ended Three Months Ended
June 30, June 30,
---------------------- ------------------
1998 1997 1998 1997
--------------------- ------------------
Revenues
Insurance premiums $38,726 $20,928 $21,432 $12,752
Universal life and 34,252 23,411 17,871 12,229
annuity product charges
Net investment income 259,995 99,226 126,824 48,308
Realized gains on
investments 10,783 9,523 4,563 4,264
Contribution from the
Closed Block 16,836 13,410 7,861 4,137
------------------------------------------
360,592 166,498 178,551 81,690
Benefits and expenses
Policyowner benefits 219,286 86,999 111,930 41,479
Underwriting,
acquisition
and insurance
expenses 52,497 22,438 24,516 11,421
Amortization of
deferred
policy
acquisition costs 16,640 10,973 8,449 5,916
Dividends to
policyowners 710 173 395 52
------------------------------------------
289,133 120,583 145,290 58,868
Income from operations 71,459 45,915 33,261 22,822
Interest expense 12,610 5,961 5,928 3,014
------------------------------------------
Income before income
tax expense
and equity in
earnings
of unconsolidated
subsidiary 58,849 39,954 27,333 19,808
Income tax expense 17,319 11,586 7,142 5,847
------------------------------------------
Income before equity
in earnings of
unconsolidated
subsidiary 41,530 28,368 20,191 13,961
Equity in earnings of
unconsolidated
subsidiary 1,091 654 673 481
------------------------------------------
Net income $42,621 $29,022 $20,864 $14,442
==========================================
Earnings per
common share:
Basic $1.23 $1.25 $0.60 $0.62
==========================================
Diluted $1.22 $1.25 $0.60 $0.62
==========================================
Weighted
average common
shares outstanding:
Basic 34,733,710 23,155,989 34,732,514 23,155,989
===========================================
Diluted 35,086,382 23,155,989 35,021,958 23,155,989
===========================================
-0-
AMERUS LIFE HOLDINGS, INC.
Consolidated Statements of Shareholders' Equity
(In Thousands)
Additional
Common Stock Treasury Paid-in
Class A Class B Stock Capital
--------- --------- --------- ------------
Balance at December 31, 1996 $ 14,500 $ 5,000 -- --
Net income -- -- -- --
Net unrealized depreciation -- -- -- --
Dividends declared on common
stock -- -- -- --
Issuance of common stock 3,656 -- -- 51,371
------------------------------------------
Balance at June 30, 1997 $ 18,156 $ 5,000 -- $ 51,371
Net income -- -- -- --
Net unrealized depreciation -- -- -- --
Dividends declared on
common stock -- -- -- --
Issuance of common stock 11,579 -- -- 332,315
------------------------------------------
Balance at December 31, 1997 $ 29,735 $ 5,000 -- $383,686
Net income -- -- -- --
Net unrealized depreciation -- -- -- --
Dividends declared on -- -- -- --
common stock
Purchase of treasury stock -- -- (1,622) --
Issuance of common stock -- -- -- --
------------------------------------------
Balance at June 30, 1998 $ 29,735 $ 5,000 ($ 1,622) $383,686
==========================================
Unrealized
Appreciation
(Depreciation)
of Available
for Sale Retained Total
Securities Earnings Shareholders'
------------- ---------- --------------
Balance at December 31, 1996 $ 35,300 $ 402,710 $ 457,510
Net income -- 29,022 29,022
Net unrealized depreciation (4,257) -- (4,257)
Dividends declared on common -- (2,316) (2,316)
stock
Issuance of common stock -- -- 55,027
------------------------------------
Balance at June 30, 1997 $ 31,043 $ 429,416 $ 534,986
Net income -- 29,037 29,037
Net unrealized depreciation 24,704 -- 24,704
Dividends declared on common -- (4,630) (4,630)
stock
Issuance of common stock -- -- 343,894
------------------------------------
Balance at December 31, 1997 $ 55,747 $ 453,823 $ 927,991
Net income -- 42,621 42,621
Net unrealized depreciation (1,133) -- (1,133)
Dividends declared on common -- (6,946) (6,946)
stock
Purchase of treasury stock -- -- (1,622)
Issuance of common stock -- -- --
------------------------------------
Balance at June 30, 1998 $ 54,614 $ 489,498 $ 960,911
====================================
CONTACT: AmerUs Life Holdings, Inc., Des Moines
Marty Ketelaar, 515/362-3693
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