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CONTINUING OPERATIONS OF NWNL COMPANIES POST INCREASE IN FIRST QUARTER INCOME; RESTRUCTURING CHARGES TAKEN

CONTINUING OPERATIONS OF NWNL COMPANIES POST INCREASE IN FIRST QUARTER
 INCOME; RESTRUCTURING CHARGES TAKEN
 MINNEAPOLIS, May 11 /PRNewswire/ -- Income from continuing operations of The NWNL Companies (NYSE: NWN) totaled $11.8 million after investment gains and losses in the first quarter of 1992, an increase compared with $11.5 million for the same period last year. The increase was achieved in spite of a restructuring charge in 1992 from a strategic initiative to reduce expenses.
 Net income for the quarter was down, however, because first quarter 1991 results included operating income for Chartwell Reinsurance Co. that was absent from first quarter 1992 results due to the sale of that subsidiary. First quarter 1992 net income was $11.8 million, or 79 cents per common share primary (75 cents fully diluted). The comparable total for the first quarter of 1991 was $12.9 million, or $1.00 per common share primary (93 cents fully diluted).
 Per share comparisons are affected by dividends paid on the $63 million of preferred stock issued in July 1991.
 Major factors affecting first quarter results included:
 -- Costs of approximately $2.6 million arising from a strategic initiative to reduce expenses.
 -- A positive impact of $4.5 million on earnings in the individual insurance segment due to the repricing of some life insurance policies as a result of increased federal income taxes passed in 1990. The positive effect of this repricing is likely to continue in future quarters, but in lesser amounts.
 -- The sale of Chartwell Reinsurance Co., NWNL's former property/casualty reinsurance subsidiary.
 Chartwell was reported as a discontinued operation in the fourth quarter of 1991 and sold in March 1992. The anticipated effects of the sale, including estimated first quarter 1992 results of operations for Chartwell, were recorded at year-end 1991, resulting in a decrease of $1.4 million in first quarter net income compared with the same period in 1991.
 With the exception of the pension segment, NWNL's business operations performed well during the first quarter. The pension segment was unfavorable compared with the first quarter of 1991.
 Sales were strong in the employee benefits and life and health reinsurance segments in the first quarter of 1992. In the individual insurance segment, sales were down overall, but variable universal life insurance and variable annuity sales increased sharply.
 "We are very pleased with the strong showing that all operations except pension demonstrated in the first quarter, and we believe that results will continue to improve," said NWNL President and Chief Executive Officer John G. Turner. "Second quarter results should begin to reflect the benefits of our expense reduction initiative, which is off to a good start. So far, we have identified $17 million of savings toward our goal of $30 million. We are confident that the ultimate impact on earnings will be very positive."
 Turner also noted that the sale of Chartwell advances NWNL's strategy of narrowing its business focus. "This divestiture enables us to devote our attention to our strongest businesses, which are life and health insurance and annuities," he said.
 Net income for the first quarter reflected realized investment losses, which were roughly equivalent to the first quarter of 1991. First quarter 1992 write-offs and provisions for problem investments were lower than they have been in each of the three most recent quarters.
 Turner noted that the quality of NWNL's investment portfolio continued to improve during the first quarter.
 "Below investment grade bond holdings decreased. The size of the commercial mortgage loan portfolio decreased. Problem mortgages have been a stable percentage of total mortgages, and the percentage of problem mortgages is now well below the industry level as of year-end 1991, the most current information available," he said. "This represents continued progress in improving the quality and liquidity of our balance sheet."
 Book value per common share rose to $44.84 on March 31, 1992, compared with $44.41 at the end of 1991 and $42.73 at the end of the first quarter of 1991.
 Insurance in force rose to $104 billion on March 31, 1992, compared with $99 billion a year earlier. Assets stood at $8.7 billion at the end of the first quarter of 1992.
 The NWNL Companies is a Minneapolis-based holding company specializing in the life and health insurance and annuity businesses.
 THE NWNL COMPANIES, INC.
 FINANCIAL HIGHLIGHTS
 (Unaudited)
 (In thousands, except per-share data)
 Three Months Ended
 3/31/92 3/31/91
 Premium revenues $150,298 $134,095
 Total revenue 344,058 330,889
 Income from continuing operations:
 Income excluding realized investment
 gains (losses) (a) 17,110 16,644
 Realized investment gains (losses)
 (after tax) (a) (5,297) (5,197)
 Income from continuing operations 11,813 11,447
 Income from discontinued operations --- 1,405
 Net income $11,813 $12,852
 Per common share:
 Primary:
 Income from continuing operations:
 Income excluding realized investment
 gains (losses) (a) $1.23 $1.31
 Realized investment gains (losses)
 (after tax) (a) (.44) (.43)
 Income from continuing operations .79 .88
 Income from discontinued operations --- .12
 Net income $.79 $1.00
 Fully diluted:
 Income from continuing operations:
 Income excluding realized investment
 gains (losses) (a) $1.15 $1.21
 Realized investment gains (losses)
 (after tax) (a) (.40) (.38)
 Income from continuing operations .75 .83
 Income from discontinued operations --- .10
 Net income $.75 $.93
 Average common shares outstanding:
 Primary 11,983 12,201
 Fully diluted 13,339 13,550
 (a) Income excluding realized investment gains (losses) and after- tax realized investment gains (losses) are not presented on the statement of operations, however they are shown here for analysis purposes.
 -0- 5/11/92
 /CONTACT: Jan Pedersen of The NWNL Companies, 612-372-5623/
 (NWNL) CO: The NWNL Companies ST: Minnesota IN: INS SU: ERN


DS -- MN001 -- 8567 05/11/92 11:10 EDT
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Publication:PR Newswire
Date:May 11, 1992
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