American Eagle Group, Inc. Reports Second Quarter 1996 Results.DALLAS--(BUSINESS WIRE)--Aug. 5, 1996--American Eagle Group, Inc. reported a net loss of $0.6 million in the second quarter of 1996 compared to net income of $1.8 million in the second quarter of 1995 and a net loss of $2.8 million in the first quarter of 1996. 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. (loss), which excludes realized investment gains or losses, was approximately equal to net income (loss) as there were no significant realized investment gains or losses in the second quarter and first six months of 1996 or 1995. Earned premiums Earned premium is the portion of an insurance written premium which is considered "earned" by the insurer, based on the part of the policy period that the insurance has been in effect, and during which the insurer has been exposed to loss. , net of 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. , increased 36 percent to $33.5 million in the second quarter of 1996 from $24.6 million in the second quarter of 1995. Gross premiums produced declined 16 percent to $41.3 million in the second quarter of 1996 from $49.1 million in the second quarter of 1995. The second quarter combined ratio was 104.0 percent in 1996, up 9.7 points over the 94.3 percent in the same period of 1995. The net loss available for common stockholders was ($0.08) per share for the second quarter of 1996 compared to net income of $0.26 per share in the second quarter of 1995. For the first six months of 1996 the company reported a net loss of $3.3 million compared to net income of $2.8 million in the comparable period of 1995. Earned premiums, net of reinsurance, for the six-month period ended June June: see month. 30, 1996, increased 47 percent to $66.3 million from $45.2 million in 1995. Gross premiums produced declined 8 percent to $83.7 million for the six-month period ended June 30, 1996 from 90.7 million in 1995. The first six months combined ratio was 110.3 percent in 1996, up 13.6 points from 96.7 percent in 1995 as a result of an 8.8 point increase in the loss ratio and a 4.8 point increase in the expense ratio. Net book value per common share Book Value Per Common Share A measure used by owners of common shares in a firm to determine the level of safety associated with each individual share after all debts are paid accordingly. Formula: at June 30, 1996 is $6.84. M. Philip Philip, tetrarch of Ituraea Philip, d. A.D. 34, tetrarch of Ituraea, son of Herod the Great. He was perhaps the ablest of the Herod dynasty. He is mentioned in the Gospel of St. Luke. Guthrie Guth·rie , Woodrow Wilson Known as "Woody." 1912-1967. American folk singer and composer of numerous songs about hardship and social injustice, including "This Land Is Your Land" (1940). Noun 1. , chairman and chief executive officer stated, "Total company results for the second quarter reflect marked improvement over the results of the first quarter of 1996, although the overall results continue to be unacceptable. The Aviation Division, our core business, continued to reflect improvement and perform at overall acceptable levels. "The Aviation Division combined ratio remains in line with historical levels, with second quarter at 99.0 percent and 98.2 percent in 1996 and 1995, respectively. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. aviation combined ratios were 101.4 percent and 100.0 percent in 1996 and 1995, respectively. "These results, we believe, continue to confirm the trend we saw in the first quarter of 1996 of previous 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. actions in the under-performing segments of the commercial aviation line of business generating improved results. "Although the Property and Casualty Division's performance in the second quarter improved materially over the first quarter of 1996, these results continue to be at unacceptable levels as a result of the transportation portion of the division. This segment of the Property and Casualty Division continues to be the primary source of the company's overall underwriting losses. "We have instituted a number of underwriting actions to enhance risk selection, pricing, and underwriting control in those segments of the transportation book that have been unprofitable. These actions have reduced the book of business by approximately one-third from its peak in gross premiums produced during 1995 to a current size of approximately $20 million. "For the second quarter and the first six months of 1996, gross premiums produced have declined approximately $7 million primarily as a result of the actions we have taken to eliminate unprofitable segments of our operations. "We are pleased to report that our principal subsidiary, 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 Eagle Insurance Company, reported statutory net income after tax of $1.0 million for the second quarter." The common stock of American Eagle Group, Inc. trades on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol "FLI FLI - Flash Lights Impressively. ." American Eagle Group is an insurance holding company that, through its subsidiaries, markets and underwrites specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. property and casualty coverages in selected niche markets A niche market also known as a target market is a focused, targetable portion (subset) of a market sector. By definition, then, a business that focuses on a niche market is addressing a need for a product or service that is not being addressed by mainstream providers. . These markets include general aviation, local and intermediate haul trucking, selected artisan contractors, and yachts. The company's business is organized in three divisions, the Aviation Division, headquartered in Dallas, Texas “Dallas” redirects here. For other uses, see Dallas (disambiguation). The City of Dallas (pronounced [ˈdæl.əs] or [ˈdæl. ; the Property & Casualty Division, headquartered in Sacramento, Calif.; and the Marine Division, headquartered in Baltimore Baltimore, city (1990 pop. 736,014), N central Md., surrounded by but politically independent of Baltimore co., on the Patapsco River estuary, an arm of Chesapeake Bay; inc. 1745. , Md. -0-
American Eagle Group, Inc.
1996 Financial Results
(In thousands, except per share data)
Three Months ended Six Months ended
June 30 June 30
1996 1995 1996 1995
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Gross premiums produced $ 41,339 $ 49,113 $ 83,705 $ 90,695 Earned premiums 33,497 $ 24,595 $ 66,331 $ 45,244 Operating income (loss) $ (520) $ 1,856 $ (3,373) $ 2,839 Net realized investment gains (losses), after federal income tax (AFIT) $ (36) $ 0 $ 65 $ 4 Net income (loss) $ (556) $ 1,856 $ (3,308) $ 2,843 Preferred stock dividends $ 24 $ 25 $ 48 $ 49 Net income (loss) available for common stockholders $ (580) $ 1,831 $ (3,356) $ 2,794 Per share data: -------------- Operating income (loss) $ (0.07) $ 0.26 $ (0.48) $ 0.40 Net income (loss) $ (0.08) $ 0.26 $ (0.47) $ 0.40 Net income (loss) available for common stockholders $ (0.08) $ 0.26 $ (0.48) $ 0.40 Weighted average shares 7,050 7,054 7,050 7,054 Underwriting ratios (GAAP) -------------------------- Losses and LAE ratio 63.1% 63.6% 73.4% 64.6%
Expense ratio 40.9 30.7 36.9 32.1
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Combined ratio 104.0% 94.3% 110.3% 96.7%
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CONTACT: American Eagle Group, Inc. M. Philip Guthrie, chairman/CEO, 214/448-1460 or Richard M. Kurz, senior VP/CFO, 214/448-1477 |
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