Amerus Life Holdings Annnounces Record Fourth Quarter Operating Earnings of $0.54 Per Diluted Share.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)--Feb. 10, 1999--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 fourth 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 $16.7 million, compared with $12.3 million in the fourth quarter of 1997. For the full year, operating earnings increased 41 percent to $68.9 million from $49.0 million in 1997. Fourth-quarter operating earnings per share were $0.54 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, compared with $0.50 per diluted share in the comparable period of 1997. For the full year, operating earnings per share were $2.04, compared with $2.08 in 1997. Per-share results for both 1998 periods reflect an increase in shares outstanding as the result of the acquisition of AmVestors Financial Corporation in the fourth quarter of 1997. "We are very pleased with the financial and operational results we have achieved in the fourth quarter," 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. "Improved investment results as well as our continued focus on internal growth initiatives during 1998, including new products, new distribution channels, new markets and increased agent recruitment recruitment /re·cruit·ment/ (re-krldbomact´ment) 1. the gradual increase to a maximum in a reflex when a stimulus of unaltered intensity is prolonged. 2. has translated into solid earnings performance." Net investment income improved during the fourth quarter as a result of the 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). of the company's alternative investment portfolio. During the third quarter, this portfolio incurred a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta loss of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $9.4 million. After restructuring the alternative investments in the fourth quarter, this restructured asset class contributed approximately $3.7 million to net investment income. Net income, which includes all gains and losses from sales of investments, was $13.3 million, or $0.43 per diluted share, for the 1998 fourth quarter, compared with $12.6 million, or $0.51 per diluted share, in the fourth quarter of 1997. Net income for 1998 was $62.8 million, or $1.86 per diluted share, compared with $58.1 million, or $2.46 per diluted share, a year ago. The company also reported strong life insurance sales results at a time when industry sales continue to trend downward. Repetitive life production increased from $30.5 million in 1997 to $34.1 million in 1998, a 12 percent increase. 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 33 percent and 60 percent, respectively, from the comparable periods in 1997. 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 during the year, from $166.1 million in 1997 to $893.5 million in 1998. The increase is a result of the acquisitions of Delta Life Corporation and AmVestors Financial Corporation during the fourth quarter of 1997. On a comparative basis including the acquisitions, total annuity sales decreased 2 percent during the year, from $908.7 million in 1997 to $893.5 million in 1998. "1998 was a very difficult year for fixed annuity Fixed Annuity An insurance contract in which the insurance company makes fixed dollar payments to the annuitant for the term of the contract, usually until the annuitant dies. The insurance company guarantees both earnings and principal. sales across the industry. We feel very good about our production achievements this year in light of the fact the overall industry was down significantly," said Brooks. During the fourth quarter, the company repurchased 105,000 shares of common stock and 451,000 units of adjustable-rate equity securities ("ACES") at a cost of $2.1 million and $10.3 million, respectively, under a previously announced $30 million 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. program. The Company is also sponsoring an executive stock purchase plan that permits approximately 70 members of management to purchase up to $25 million of a combination of the company's common stock or ACES units. This voluntary program provides for each individual to take out a full-recourse loan from a financial institution to purchase shares in their own account. 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 December December: see month. 31, 1998, AmerUs Life Holdings' total assets were $10.4 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 $850.2 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 that 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 10K and 10Q reports filed with the Securities and Exchange Commission. -0-
AMERUS LIFE HOLDINGS, INC
Operating Earnings
For the Twelve For the Three
Months Ended Months Ended
December 31, December 31,
1998 1997 1998 1997
---- ---- ---- ----
(In thousands, except per share amounts)
Net income $62,829 $58,059 $13,347 $12,562
Net realized (gains)
losses on investments (A) 72 (9,431) 1,626 (124)
Core realized gains or
(losses)(B) 6,110 - 976 -
Deferred Policy Acquisition
Cost (DPAC Impact)(C) (129) 423 784 (172)
-------- -------- -------- --------
Operating Earnings $68,882 $49,051 $16,733 $12,266
======= ======= ======= =======
Operating Earnings per
common share (D):
Basic $2.06 $2.08 $0.54 $0.50
Diluted $2.04 $2.08 $0.54 $0.50
(A) Represents realized gains or losses on investments 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) Represents gains on convertible debt or convertible preferred
stock portfolio, net of income taxes.
(C) Represents amortization of deferred policy acquisition costs due
to realized gains or losses being included in product margins
adjusted for income taxes on such amounts.
(D) Basic operating earnings per common share for the twelve months
ended and three months ended December 31, 1998 is calculated
using 33.5 million and 30.7 million weighted average shares
outstanding; diluted operating earnings per share for the twelve
months and three months ended December 31, 1998 is calculated
using 33.7 million shares and 30.7 million shares, respectively;
diluted operating earnings per common share for the twelve months
and three months ended December 31, 1997 is calculated using
23.6 and 24.8 million weighted average shares outstanding,
respectively.
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
December 31, December 31,
1998 1997
------------ ------------
Assets:
Investments:
Securities available-for-sale
at fair value
Fixed maturity securities $ 6,710,246 $ 6,851,427
Equity securities 68,483 61,480
Short - term investments 22,428 12,595
Securities held for trading
purposes at fair value
Fixed maturity securities - 22,955
Mortgage loans on real estate 566,403 462,473
Real estate 633 8,670
Policy loans 110,786 117,865
Other investments 205,790 158,073
------------ ------------
Total investments 7,684,769 7,695,538
Cash 60,090 58,081
Accrued investment income 79,921 84,713
Premiums and fees receivable 4,385 3,445
Reinsurance receivables 6,174 6,203
Deferred policy acquisition
costs 237,488 118,896
Value of business acquired 233,083 266,014
Investment in unconsolidated
subsidiaries 29,602 26,849
Goodwill 220,511 220,250
Property and equipment 23,249 22,863
Other assets 401,239 359,308
Closed block assets 1,453,305 1,391,848
------------ ------------
Total assets $ 10,433,816 $ 10,254,008
============ ============
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
December 31, December 31,
1998 1997
------------ ------------
Liabilities and Stockholders'
Equity:
Liabilities:
Policy reserves and
policyowner funds:
Future life and annuity
policy benefits $ 7,185,417 $ 7,074,444
Policyowner funds 95,974 89,641
------------ ------------
Total 7,281,391 7,164,085
Accrued expenses 41,323 39,095
Dividends payable to
policyowners 1,168 1,575
Policy and contract claims 13,433 4,548
Income taxes payable 9,574 12,753
Deferred income taxes 16,404 16,914
Other liabilities 159,350 111,180
Debt 141,051 266,435
Closed block liabilities 1,703,195 1,623,432
------------ ------------
Total Liabilities 9,366,889 9,240,017
Company-obligated mandatorily-
redeemable preferred capital
securities of subsidiary trust
holding solely junior subordinated
debentures of the Company 216,729 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 1998; 75,000,000
shares authorized 1997;
25,425,983 shares issued and
outstanding in 1998; 29,734,918
shares issued and outstanding
in 1997 25,426 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 290,091 383,686
Accumulated other comprehensive
income 26,711 55,747
Unearned compensation (240) -
Retained earnings 503,210 453,823
------------ ------------
Total stockholders' equity 850,198 927,991
------------ ------------
Total liabilities and stockholders'
equity $ 10,433,816 $ 10,254,008
============ ============
AMERUS LIFE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except for per share data)
(Unaudited)
Twelve Months Ended Three Months Ended
December 31, December 31,
------------------- -------------------
1998 1997 1998 1997
-------- -------- -------- --------
Revenues
Insurance premiums $81,197 $48,127 $19,829 $14,604
Universal life and
annuity product
charges 71,104 47,306 16,817 12,974
Net investment income 506,949 224,431 130,958 74,656
Realized gains (losses)
on investments (112) 13,791 (2,502) (719)
Contribution from the
Closed Block 31,478 31,044 7,442 9,393
------- ------- ------- -------
690,616 364,699 172,544 110,908
Benefits and expenses
Policyowner benefits 430,755 195,976 96,165 66,259
Underwriting,
acquisition and
insurance expenses 117,551 53,211 40,848 16,782
Amortization of
deferred policy
acquisition costs 24,080 20,564 5,755 4,712
Dividends to
policyowners 2,558 1,587 939 752
------- ------- ------- -------
574,944 271,338 143,707 88,505
Income from operations 115,672 93,361 28,837 22,403
Interest expense 27,075 14,980 7,458 6,039
------- ------- ------- -------
Income before income tax
expense and equity in
earnings of unconsolidated
subsidiary 88,597 78,381 21,379 16,364
Income tax expense 28,422 22,022 9,150 4,328
------- ------- ------- -------
Income before equity in
earnings of unconsolidated
subsidiary 60,175 56,359 12,229 12,036
Equity in earnings of
unconsolidated subsidiary 2,654 1,700 1,118 526
------- ------- ------- -------
Net income $62,829 $58,059 $13,347 $12,562
======= ======= ======= =======
Earnings per common share:
Basic $1.88 $2.47 $0.44 $0.51
======= ======= ======= =======
Diluted $1.86 $2.46 $0.43 $0.51
======= ======= ======= =======
Weighted average common
shares outstanding:
Basic 33,458,140 23,536,666 30,680,339 24,666,284
========== ========== ========== ==========
Diluted 33,695,752 23,572,259 30,712,432 24,774,973
========== ========== ========== ==========
AMERUS LIFE HOLDINGS, INC.
Consolidated Statements of Stockholder's Equity
Common Stock Additional
Class Class Preferred Paid-in
A B Stock Capital
------------------------------------
Balance at December 31, 1996 $14,500 $5,000 -- --
1997:
Net income -- -- -- --
Net unrealized appreciation -- -- -- --
Issuance of common stock 15,235 -- -- 383,686
Issuance of Preferred
Stock -- -- -- --
Dividends declared on
common stock -- -- -- --
------------------------------------
Balance at December 31, 1997 $29,735 $5,000 -- $383,686
1998:
Net income -- -- -- --
Net unrealized appreciation -- -- -- --
Purchase of treasury stock (4,325) -- -- (97,810)
Issuance of treasury stock 2 -- -- 661
Retirement of Aces Debt -- -- -- 2,919
Minimum pension liability
adjustment -- -- -- --
Stock issued under various
incentive plans, net of
forfeitures 14 -- -- 468
Dividends declared on -- -- -- --
common stock
Other -- -- -- 167
------------------------------------
Balance at December 31, 1998 $25,426 $5,000 -- $290,091
====================================
AMERUS LIFE HOLDINGS, INC.
Consolidated Statements of Stockholder's Equity
Accumulated
other Total
Comprehensive Unearned Retained Shareholders
Income Compensation Earnings Equity
-------------------------------------------------
Balance at December
31, 1996 $35,300 -- $402,710 $457,510
1997:
Net income -- -- 58,059 58,059
Net unrealized
appreciation 20,447 -- -- 20,447
Issuance of common
stock -- -- -- 398,921
Issuance of
Preferred Stock -- -- -- --
Dividends declared
on common stock -- -- (6,946) (6,946)
------------------------------------------------
Balance at December
31, 1997 $55,747 -- $453,823 $927,991
1998:
Net income -- -- 62,829 62,829
Net unrealized
appreciation (28,076) -- -- (28,076)
Purchase of
treasury stock -- -- -- (102,135)
Issuance of
treasury stock -- -- -- 663
Retirement of Aces
Debt -- -- -- 2,919
Minimum pension
liability
adjustment (960) -- -- (960)
Stock issued under
various incentive
plans, net of
forfeitures -- (240) -- 242
Dividends declared
on common stock -- -- (13,442) (13,442)
Other -- -- -- 167
------------------------------------------------
Balance at December
31, 1998 $26,711 ($240) $503,210 $850,198
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