EMC Insurance Group Inc. Announces Earnings.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)--July 30, 1998--EMC Insurance Group Inc. (Nasdaq/NM:EMCI EMCI Envirofacts Master Chemical Integrator EMCI External Memory Control Interface ) today released second-quarter and midyear mid·year n. 1. The middle of the calendar or academic year. 2. a. An examination given in the middle of a school year. b. midyears A series of such examinations. earnings results for the period ended June 30, 1998. Second-quarter operating results fell to a loss of $.24 per share from a profit of $.15 per share for the same quarter in 1997. Operating results for the first six months of 1998 amounted to $.15 per share, compared to $.31 per share in 1997. Operating results for the second-quarter of 1998 were severely impacted by a series of severe storms that battered bat·ter 1 v. bat·tered, bat·ter·ing, bat·ters v.tr. 1. To hit heavily and repeatedly with violent blows. 2. To subject to repeated beatings or physical abuse. 3. the Midwestern, Southern and Northeastern United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . These storms produced the highest second-quarter losses for the insurance industry since 1949, when these statistics were first recorded. Second-quarter catastrophe and storm losses totaled $8.6 million before tax, or $.50 per share after tax. This compares to catastrophe and storm losses of $2.1 million, or $.13 per share, in the second-quarter of 1997. Premium income increased 5.5% for the second-quarter and 6.5% for the first six months of 1998. These increases primarily reflect growth within the existing branch structure and are the result of competitive rates, value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. services and the strong working relationship the Company has with its agency force. Excluding the effect of catastrophe and storm losses, loss experience associated with current accident year events deteriorated in both the second-quarter and the first six months of 1998. This deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. is attributable to an increase in both the frequency and severity of losses, as well as a general decline in overall rate adequacy. While there has been some indication of rate stabilization in the personal lines market, the commercial lines marketplace continues to experience intense rate competition. The deterioration in the current accident year loss experience was partially offset by an increase in the amount of benefit realized from the actual settlement of claims and changes in reserves associated with prior year losses. The Company's GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). combined ratio was 124.2% in the second-quarter of 1998 compared to 109.1% in the same quarter in 1997. On a year to date basis, the GAAP combined ratio was 112.7% compared to 109.0% for the first six months of 1997. Net book value of the Company's stock as of June 30, 1998 was $14.36 per share, an increase from $14.30 per share as of December 31, 1997. EMC (1) (EMC Corporation, Hopkinton, MA, www.emc.com) The leading supplier of storage products for midrange computers and mainframes. Founded in 1979 by Richard J. Egan and Roger Marino, EMC has developed advanced storage and retrieval technologies for the world's largest companies. Insurance Group Inc. is a publicly held insurance holding company headquartered in Des Moines, Iowa “Des Moines” redirects here. For other uses, see Des Moines (disambiguation). Des Moines (pronounced /dɪˈmɔɪn/ in English, . It owns subsidiaries in property and casualty insurance, 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. and an excess and surplus lines insurance agency. -0-
EMC Insurance Group Inc.
Summary of Consolidated Financial Data
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
Premiums earned $46,573,702 $44,143,379 $92,261,925 $86,601,722
Net investment
income 6,419,872 5,895,256 12,697,145 11,639,992
Realized investment
gains (losses) (5,706) 9,417 83,459 66,722
Other income 43,806 56,226 90,718 115,911
Total revenues 53,031,674 50,104,278 105,133,247 98,424,347
Losses and
expenses 57,856,474 48,181,374 103,944,720 94,430,891
Income (loss) before income
taxes (benefit) (4,824,800) 1,922,904 1,188,527 3,993,456
Income taxes
(benefit) (2,058,639) 231,301 (523,946) 553,954
Net income (loss) $(2,766,161) $1,691,603 $1,712,473 $3,439,502
Operating Income (loss)per share
-basic & diluted ($0.24) $0.15 $0.15 $0.31
Dividend per share $0.15 $0.15 $0.30 $0.30
Average number of
shares outstanding
-basic & diluted 11,425,177 11,156,307 11,390,779 11,125,519
CONTACT: EMC Insurance Group Inc., Des Moines
Mark Reese, 515-280-2902
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