Amwest Insurance Group Issues Correction Regarding November 3, 1999 News Release.CALABASAS, Calif.--(BUSINESS WIRE)--Nov. 3, 1999-- Amwest Insurance Group, Inc. (AMEX AMEX See: American Stock Exchange :AMW AMW America's Most Wanted (TV show) AMW Air Mobility Wing AMW Amphibious Warfare AMW Ask Me Why (Beatles song) AMW Angewandte Medienwissenschaft (German: Applied Media Studies) ) (PCX (1) A bitmapped graphics file format that handles monochrome, 2-bit, 4-bit, 8-bit and 24-bit color and uses RLE to achieve compression ratios of approximately 1.1:1 to 1.5:1. Images with large blocks of solid colors compress best under the RLE method. See PC Paintbrush. :AMW) announced that the table titled "Summary of Premiums and Losses by Product Line" included as a part of its news release of today was inadvertently included in the text of said release. The table and information contained therein should not be deemed to be a part of the original news release. The complete, corrected release follows: CALABASAS, Calif.--(BUSINESS WIRE)--Nov. 3, 1999--Amwest Insurance Group, Inc. (AMEX:AMW) (PCX:AMW) today reported a net loss of $2,746,000, or $0.64 per share, for the third quarter ended September 30, 1999, as compared with net income of $2,098,000, or $0.48 per share, for the corresponding prior-year period. 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. , which excludes net realized investment gains, showed a loss of $2,754,000, or $0.64 per share for the three months ended September 30, 1999, compared with operating income of $844,000, or $0.19 per share, for the corresponding 1998 period. For the nine months ended September 30, 1999, net income decreased 74% to $1,359,000, or $0.31 per share, from $5,129,000, or $1.19 per share, for the corresponding 1998 period. Operating income decreased to $8,000 from $2,630,000, or $0.61 per share, a year ago. "The third quarter results reflect significant losses in our contract surety An individual who undertakes an obligation to pay a sum of money or to perform some duty or promise for another in the event that person fails to act. surety n. product line," said John E. Savage, president and chief executive officer. "Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. results from our commercial and court surety products remain strong and we will continue to expand these lines as a percent of the surety portfolio. "Since 1995, we have increased non-contract surety writings from 23% to 41% of total surety writings, with the largest growth coming from commercial surety. Our P&C Division's core commercial transportation and specialty business continue to demonstrate improved results," continued Savage. "However, the division's discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). and Arizona Arizona (âr'əzō`nə), state in the southwestern United States. It is bordered by Utah (N), New Mexico (E), Mexico (S), and, across the Colorado R., Nevada and California (W). private passenger automobile programs are running off more adversely than originally anticipated. When coupled with an increased expense ratio due to the decline in writings attributable to the discontinued programs, the P&C Division has been unprofitable for the nine months ended September 30, 1999. "We believe the current contract surety market conditions and the high expense ratio of the P&C Division will adversely affect earnings for the fourth quarter," Savage said. "We remain focused on achieving a better balance of surety writings and concentrating our P&C Division on its core commercial trucking and specialty business which we believe are likely to improve long-term profitability for Amwest." On June 17, 1999, the company announced a program to 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 $1,500,000 of its common stock, as market conditions warrant. To date, 16,600 shares have been repurchased at an aggregate cost of $171,000. Amwest is a Calabasas-based insurance holding company 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. surety and property and casualty insurance through Amwest Surety Insurance Company, Condor Insurance Company and Far West Insurance Company. Certain statements contained in this news release regard matters which are not historical facts and are 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. . Because such forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to: the ineffectiveness in·ef·fec·tive adj. 1. Not producing an intended effect; ineffectual: an ineffective plea. 2. Inadequate; incompetent: an ineffective teacher. of the recently modified commercial transportation products, a deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in premiums written or losses incurred in the company's surety and other specialty businesses, the ability to achieve increased percentage writings of commercial surety and court products, a reduction in the investment yield earned on the company's investment portfolio, or a general economic decline. The company undertakes no obligation to release publicly the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" to reflect the occurrence of unanticipated events. -0-
Amwest Insurance Group, Inc. and Subsidiaries
(Amounts in thousands, except per share data)
(unaudited)
Consolidated Statements of Operations
Three Months ended Nine Months ended
September 30, September 30,
1999 1998 1999 1998
Premiums written $ 35,969 $ 34,687 $104,146 $ 99,073
Net premiums earned $ 27,732 $ 25,633 $ 81,711 $ 80,005
Net investment income 1,595 1,733 5,069 4,870
Net realized investment
gains 10 1,901 2,047 3,786
Commissions and fees 323 674 1,452 1,402
Total revenue 29,660 29,941 90,279 90,063
Net losses and
loss adjustment expenses 14,330 9,951 33,419 30,047
Policy acquisition costs 15,543 12,678 41,466 40,578
General operating costs 3,285 3,892 11,782 10,617
Interest expense 593 475 1,640 1,386
Total expenses 33,751 26,996 88,307 82,628
Income (loss) before
income taxes (4,091) 2,945 1,972 7,435
Provision (benefit)
for income taxes (1,345) 847 613 2,306
Net income (loss) $ (2,746) $ 2,098 $ 1,359 $ 5,129
Net earnings (loss) per
common share(a):
Basic $ (0.64) $ 0.49 $ 0.31 $ 1.21
Diluted $ (0.64) $ 0.48 $ 0.31 $ 1.19
Operating earnings (loss)
per common share(a):
Basic $ (0.64) $ 0.20 $ 0.00 $ 0.62
Diluted $ (0.64) $ 0.19 $ 0.00 $ 0.61
Consolidated Balance Sheet Information
September 30, 1999 December 31, 1998
Total assets $228,430 $216,292
Total liabilities 169,482 154,390
Total stockholders' equity 58,948 61,902
Book value per share $ 13.66 $ 14.36
(a) 1999 and 1998 basic and diluted earnings per share have been
calculated in accordance with SFAS No. 128.
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