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KEMPER CORP. REPORTS HIGHER FIRST-QUARTER EARNINGS; ANNOUNCES SALE OF PREFERRED STOCK TOTALING $230 MILLION

 LONG GROVE, Ill., May 6 /PRNewswire/ -- Kemper Corp. (NYSE: KEM) today reported operating earnings from continuing operations of $22.4 million, or $.41 per share, for the quarter ended March 31, compared with $20.0 million, or $.41 per share, for the same period in 1992, before the cumulative impact of changes in accounting principles in both periods.
 "With operating earnings from our asset management business that were consistent with our expectations and stronger profitability in the securities brokerage and life insurance operations, we believe that we are on the right course in focusing on Kemper's core businesses to improve operating performance," said David B. Mathis, chairman and chief executive officer of Kemper Corp.
 Net income (including discontinued operations and the cumulative impact of the accounting changes) for the first three months of 1993 totaled $12.3 million, or $.21 per share, compared with $2.1 million, or $.04 per share, in the first quarter of 1992.
 Including the cumulative impact of accounting changes, continuing operations reported a net loss of $16.8 million, or $.38 per share, in first-quarter 1993, compared with a net loss of $4.6 million, or $.10 per share, in the year-ago period. The first-quarter 1993 results reflect charges of $11.9 million related to the company's adoption of new accounting rules for deferred income taxes (SFAS 109). First- quarter 1992 results include charges of $14.5 million related to the company's adoption of new accounting rules for retiree health benefits (SFAS 106).
 Included in the first-quarter 1993 net loss from continuing operations are after-tax realized investment losses of $27.3 million, or $.55 per share, compared with after-tax realized investment losses of $10.1 million, or $.21 per share, in the first quarter of 1992. The realized investment results reflect after-tax charges of $17.8 million attributable to an increase in the company's provision for real estate related losses in the first quarter of 1993, compared with $3.9 million in the same period of 1992. The realized investment results also include after-tax charges to write down certain below investment-grade securities of $14.2 million in the first quarter of 1993, compared with $1.8 million in the year-ago period.
 Revenue from continuing operations for the first quarter of 1993 totaled $438.8 million, compared with $485.7 million in the same period last year.
 Kemper Completes Private Placement of $230 Million
 of Convertible Preferred Stock
 Kemper Corp. also announced that it has completed a private placement of convertible preferred stock totaling $230 million. The preferred stock accrues dividends at an annual rate of 5-3/4 percent and is convertible by investors into approximately 4.8 million shares of common stock in the aggregate at a conversion price of $48.36 per share.
 Net proceeds of approximately $224.3 million from the placement will be used for general corporate purposes, which may include capital contributions to strengthen the company's continuing operations, continued purchases of certain real estate-related investments from the company's regulated insurance subsidiaries and repayments of short-term debt.
 "This issuance of convertible preferred stock strengthens our equity capital base and is consistent with the company's previously announced intent to privately place equity capital. We believe this action builds value for all of our security holders," Mathis said.
 KEMPER CORP.
 Asset Management
 Financial Highlights
 (In millions, except per share data and assets under management)
 Three months ended 3/31/93 3/31/92
 Operating earnings $ 21.1 $ 19.3
 Per share .43 .39
 Revenue 148.9 149.5
 Assets under
 management at 3/31/93 12/31/92 3/31/92
 (in billions) $71.3 $69.3 $67.0
 Kemper's asset management operations reported first-quarter 1993 operating earnings of $21.1 million, or $.43 per share, compared with $19.3 million, or $.39 per share, in the first quarter of 1992. The first-quarter 1993 results reflect a benefit of $0.9 million related to the company's adoption of SFAS 109. The first-quarter 1992 results reflect charges of $2.0 million related to the company's adoption of SFAS 106.
 Before the cumulative impact of changes in accounting principles, earnings for the first quarter of 1993 were down, compared with the year-ago period, partly due to expenses related to the conversion of the transfer agent function to an internal system. This conversion is expected to be completed by the end of the second quarter.
 Revenue declined slightly in the first three months of 1993 from the year-ago period, primarily due to lower commissions earned. In first- quarter 1992, the asset management operations earned record commissions.
 Life Insurance
 Financial Highlights
 (in millions, except per share data)
 Three months ended 3/31/93 3/31/92
 Operating earnings $ 17.9 $ 8.0
 Per share .36 .16
 Net income (loss) 2.3 (2.9)
 Per share .05 (.06)
 Revenue 161.2 178.8
 Sales 228.7 270.1
 The life insurance segment reported first-quarter 1993 operating earnings of $17.9 million, or $.36 per share, up from $8.0 million, or $.16 per share, for the same period of 1992. The increase reflects continued expense reductions and improvements in spread income on fixed-rate annuities. It also reflects a benefit of $2.7 million resulting from the adoption of SFAS 109. First-quarter 1992 results reflect a charge of $1.3 million resulting from the adoption of SFAS 106. The life insurance segment continued its ongoing strategy to shift its business mix toward variable annuity products.
 The life insurance segment's investment income declined in the first quarter of 1993, compared with the year-ago period, due to several factors, including foregone investment income, lower investment yields and the transfer of fixed annuity liabilities and related assets in a reinsurance transaction effected in the fourth quarter of 1992. Meanwhile, spreads continued to widen due to further reductions in crediting rates.
 The segment's first-quarter 1993 net income includes after-tax realized investment losses of $15.6 million, or $.31 per share, compared with losses of $10.8 million, or $.22 per share, in the first quarter of 1992. The first-quarter 1993 realized investment losses include after-tax charges of $6.2 million related to increases in the provision for real estate-related losses and $14.2 million for write-downs and restructurings of certain below investment-grade securities. The first- quarter 1992 realized investment losses include after-tax charges of $4.6 million for real estate-related losses and $1.8 million for write-downs of certain below investment-grade securities. In the first quarter of 1993, the life insurance segment sold an additional $47.4 million of real estate-related assets to the real estate segment.
 Securities Brokerage
 Financial Highlights
 (in millions, except per share data)
 Three months ended 3/31/93 3/31/92
 Operating earnings (loss) $ 1.4 $ (7.0)
 Per share .03 (.14)
 Revenue 176.3 185.7
 The securities brokerage operations recorded first-quarter 1993 operating earnings of $1.4 million, or $.03 per share, compared with operating losses of $7.0 million, or $.14 per share, in the same period of 1992. Expense reductions were primarily responsible for the earnings improvement. The first-quarter results include charges of $5.5 million related to SFAS 109 in 1993 and $10.0 million related to SFAS 106 in 1992.
 Revenue for the first three months of 1993 declined from the year- ago period, but exceeded revenue for each of the other three quarters in 1992.
 The securities brokerage business continues to focus on controlling expenses, developing sources of fee revenue and capitalizing on its retail strength.
 Real Estate
 Financial Highlights
 (in millions, except per share data)
 Three months ended 3/31/93 3/31/92
 Operating loss $(19.2) $(4.3)
 Real estate reserves
 and write-downs (11.6) .7
 Net loss (30.8) (3.6)
 Per share (.63) (.07)
 Revenue (31.4) (5.0)
 The subsidiaries comprising the real estate segment were formerly part of the other operations and corporate category. The real estate subsidiaries, as equity owners in most of the company's joint ventures, reported higher operating losses for the first quarter of 1993 over first-quarter 1992, due to a combination of factors, including the company's decision to recognize 100 percent of the operating results of certain joint ventures. The first-quarter 1993 operating loss includes charges of $5.7 million related to SFAS 109.
 Higher reserves in first-quarter 1993, compared with the year-ago period, primarily reflect the company's fourth-quarter 1992 decision to reserve for its estimates of the entire current deficiency, based on net realizable values, on its loans, without regard to credit available from the values of other projects, collateral or guarantees. The segment also realized a greater portion of the company's increases in its provision for real estate-related losses because of the real estate subsidiaries' holdings of subordinated loans and recourse obligations.
 Other Operations and Corporate
 The other operations and corporate category includes the holding company income and expenses of both Kemper Corp. and Kemper Financial Companies, Inc. This category reported an operating loss of $10.8 million, or $.26 per share, for the first quarter of 1993, compared with an operating loss of $10.5 million, or $.22 per share, for the year-ago period. The first-quarter results include charges of $4.3 million related to SFAS 109 in 1993 and $1.2 million related to SFAS 106 in 1992.
 KEMPER CORP.
 Discontinued Operations
 Financial Highlights
 (in millions, except per share data)
 Three months ended March 31 1993 1992
 Net income (loss) by category
 Risk management $ 2.2 $ 2.3
 Reinsurance 10.7 6.4
 Property-casualty 14.1 (1.4)
 Other 2.1 (.6)
 Total net income 29.1 6.7
 Per share .59 .14
 The first-quarter 1993 results for the reinsurance and property- casualty operations reflect benefits of $10.0 million and $4.4 million, respectively, related to the company's adoption of SFAS 109. In the first quarter of 1992, adoption of SFAS 106 resulted in charges of $0.7 million for the risk management operations, $0.9 million for the reinsurance operations and $10.9 million for the property-casualty operations.
 Kemper Corp. is a nonoperating holding company with principal subsidiaries in asset management, life insurance and securities brokerage.
 NOTE: Operating earnings/loss denotes net income/loss excluding realized investment results. There are no realized investment results for the asset management and securities brokerage segments.)
 -0- 5/6/93
 /CONTACT: Janice Kalmar, 708-540-4465, or Ira Nathanson, 708-540-4463, both of Kemper Corp. Communications/
 (KEM)


CO: Kemper Corp. ST: Illinois IN: INS SU: ERN

TS -- NY075 -- 5449 05/06/93 12:35 EDT
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Date:May 6, 1993
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