Printer Friendly

NWNL COMPANIES REPORTS INCREASES IN NET AND OPERATING INCOME; FINANCIAL PERFORMANCE REFLECTS KEY INITIATIVES

 NWNL COMPANIES REPORTS INCREASES IN NET AND OPERATING INCOME;
 FINANCIAL PERFORMANCE REFLECTS KEY INITIATIVES
 -- Third quarter net income increases 39 percent to $16.5 million
 -- Third quarter income excluding realized investment gains and
 losses increases 27 percent
 -- Problem investments decline 8 percent during third quarter
 -- October stock offering generates $50 million in new capital
 -- Expense reduction program reduces third quarter expenses by
 $5 million
 MINNEAPOLIS, Nov. 6 /PRNewswire/ -- Third quarter net income for The NWNL Companies (NYSE: NWN) rose 39 percent to $16.5 million compared with $11.9 million in the third quarter of 1991.
 On a per common share basis, third quarter net income was $1.17 primary and $1.09 fully diluted. Comparable totals for the same period last year were 82 cents primary and 77 cents fully diluted.
 Income from continuing operations excluding realized investment gains and losses reached $22.9 million in the third quarter of this year, a gain of 27 percent over third quarter 1991.
 Net income for the first nine months of 1992 rose 22 percent to $41.7 million, or $2.88 per common share primary and $2.71 fully diluted. In 1991, nine-month net income was $34.1 million, or $2.52 per common share primary and $2.37 fully diluted.
 In income excluding realized investment gains and losses, there was a 12 percent increase in the nine-month total for 1992, which was $60.1 million compared with $53.6 million for the same period of 1991.
 "This is the highest level of quarterly net income that NWNL has reached since the company demutualized in 1989," said president and chief executive officer John G. Turner. "We've taken major steps over the past two years to increase capital, reduce expenses, improve asset quality, and narrow our business focus. I believe that these initiatives have been major factors in the steady improvement of our financial performance this year, and I am very pleased with our achievements."
 Recent developments in NWNL's key initiatives include:
 -- Capital for Core Businesses. NWNL has narrowed its business focus to its strongest operations, and it recently sold 1.4 million shares of common stock to take advantage of opportunities for growth in those core businesses. The offering raised net proceeds of $50.4 million, which the company has invested in its life insurance subsidiaries.
 Third quarter financial results do not reflect the stock offering because the shares were not sold until October.
 -- Expense Reduction. Within its core businesses, NWNL is seeking to increase efficiency and eliminate expenses that do not add value to its products and services. The company announced earlier this year that it had begun to implement changes which would result in more than $34 million of annualized expense reductions.
 NWNL has taken restructuring charges in connection with this initiative in all three quarters of this year. Expense reduction changes that the company has implemented resulted in expensesavings of approximately $5 million, which is net of $1 million of restructuring charges, in the third quarter of 1992.
 The company expects to realize most of the financial benefits from expense reduction in 1993, with the full impact taking effect in 1994.
 -- Asset Quality. NWNL has taken major steps in the past two years to improve the quality of its assets. These actions, aided by the stabilization of the economy, have resulted in improvement in the levels of write-offs and allowances for problem investments and in the level of new problem loans.
 However, these levels will vary from quarter to quarter. In the third quarter, write-offs and allowances for problem investments were higher than in the second quarter but lower than in the first quarter.
 In a year-to-year comparison, improvement in write-offs and allowances for problem investments is significant. For the first nine months of 1992, after-tax write-offs and allowances for problem investments totaled $21.5 million compared with $29.8 million for the same period in 1991.
 As of Sept. 30, 1992, the net carrying value of NWNL's problem investments was $310 million. Problem investments were $339 million on June 30, 1992, and $389 million on Sept. 30, 1991.
 Regarding the performance of NWNL's business operations, Turner said, "On balance, results for the nine-month period were strong. Operating income in the individual insurance segment through Sept. 30 was up 43 percent compared with the same nine month period last year. For the first nine months of 1992, the employee benefit segment had a 15 percent increase in operating income excluding restructuring charges in 1992 of $2.3 million, and the life and health reinsurance segment also had a very solid performance.
 "In the pension segment, we continued to experience a net loss as a result of losses from investment allocated to that operation," he said. "We stopped writing new Guaranteed Investments Contract (GIC) business last year, and we expect losses to continue as the GIC business runs off the books."
 Sales of individual life insurance for the first nine months of 1992 were down 28 percent compared with the same period last year, and annuity sales declined 37 percent. Many of NWNL's individual products are interest-sensitive and reflect the low interest rate environment. However, sales of variable universal life insurance and variable annuities continued to increase, as they have in the two previous quarters.
 In the employee benefit segment, sales for the nine months ended Sept. 30, 1992 rose 29 percent over the comparable period last year. The life and health reinsurance segment reported a 10 percent gain in nine-month sales for 1992 compared with 1991.
 Insurance in force increased to $106.4 billion as of Sept. 30, 1992, up from $103.8 billion at the end of 1991. Total assets at Sept. 30, 1992 stood at $8.8 billion.
 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
 (In thousands, except per share data)
 (Unaudited)
 Three Months Ended Nine Months Ended
 9/30/92 9/30/91 9/30/92 9/30/91
 Premium revenues $146,950 $138,708 $437,991 $410,097
 Total revenue 344,134 338,318 1,024,860 1,003,650
 Income from continuing
 operations:
 Income excluding realized
 investment gains
 (losses)(a) 22,890 17,985 60,106 53,587
 Realized investment gains
 (losses)(after tax)(a) (6,366) (6,567) (17,123) (18,887)
 Income from continuing
 operations before
 extraordinary charge 16,524 11,418 42,983 34,700
 Income (loss) from
 discontinued operations
 (net of tax) -- 505 -- (569)
 Extraordinary charge on
 early extinguishment of
 debt (net of tax) -- -- (1,251) --
 Net income $16,524 $11,923 $41,732 $34,131
 Per common share:
 Primary:
 Income from continuing
 operations:
 Income excluding realized
 investment gains
 (losses)(a) $1.69 $1.33 $4.40 $4.13
 Realized investment gains
 (losses)(after tax)(a) (0.52) (0.55) (1.42) (1.56)
 Income from continuing
 operations before
 extraordinary charge 1.17 0.78 2.98 2.57
 Income (loss) from
 discontinued operations
 (net of tax) -- 0.04 -- (0.05)
 Extraordinary charge on
 early extinguishment
 of debt (net of tax) -- -- (0.10) --
 Net income $1.17 $0.82 $2.88 $2.52
 Fully diluted:
 Income from continuing
 operations:
 Income excluding realized
 investment gains
 (losses)(a) $1.56 $1.23 $4.07 $3.82
 Realized investment gains
 (losses)(after tax)(a) (0.47) (0.50) (1.27) (1.41)
 Income from continuing
 operations before
 extraordinary charge 1.09 0.73 2.80 2.41
 Income (loss) from
 discontinued operations
 (net of tax) -- 0.04 -- (0.04)
 Extraordinary charge on
 early extinguishment
 of debt (net of tax) -- -- (0.09) --
 Net income $1.09 $0.77 $2.71 $2.37
 Net income available
 to common shareholders $14,213 $9,748 $34,794 $30,507
 Average common and common
 equivalent shares (primary) 12,181 11,924 12,076 12,086
 Average common shares
 assuming maximum dilution
 (fully diluted) 13,515 13,270 13,467 13,432
 New premiums:
 Individual life $14,547 $19,982 $45,881 $63,824
 Individual annuity 77,181 96,565 229,228 366,298
 Group annuity 11,307 5,472 21,710 232,275
 Group life 9,188 4,192 22,797 17,722
 Group health &
 premium equivalents 43,174 34,324 175,525 136,107
 Reinsurance 7,954 4,907 23,038 21,044
 Total $163,351 $165,442 $518,179 $837,270
 (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- 11/9/92
 /CONTACT: Jan Pedersen of The NWNL Companies, 612-372-5623/
 (NWN) CO: The NWNL Companies ST: Minnesota IN: INS SU: ERN


AL -- MN001 -- 8539 11/09/92 09:12 EST
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Nov 9, 1992
Words:1456
Previous Article:ARAMED REPORTS 1992 THIRD QUARTER RESULTS
Next Article:MOTOROLA WINS OVERWHELMING THIRD-PARTY SUPPORT FOR INTEGRATED DEVELOPMENT PLATFORM BOARD
Topics:


Related Articles
NWNL COMPANIES STRENGTHENS BALANCE SHEET IN THIRD QUARTER AND OPERATIONS REMAIN STRONG; NET INCOME IS $11.9 MILLION
NWNL COMPANIES 1991 NET INCOME IS $47 MILLION; ASSET QUALITY AND LIQUIDITY IMPROVEMENTS TOP YEAR'S ACHIEVEMENTS
CONTINUING OPERATIONS OF NWNL COMPANIES POST INCREASE IN FIRST QUARTER INCOME; RESTRUCTURING CHARGES TAKEN
NWNL COMPANIES' NET INCOME RISES 43 PERCENT IN SECOND QUARTER; FILING FOR COMMON STOCK OFFERING ANNOUNCED
NWNL COMPANIES' ANNUAL AND QUARTERLY NET INCOME HIT HIGHEST LEVELS SINCE 1989 DEMUTUALIZATION
NWNL REPORTS RECORD NET INCOME BEFORE ACCOUNTING CHARGE
NWNL REPORTS RECORD NET INCOME IN SECOND QUARTER
NWNL REPORTS PRETAX OPERATING EARNINGS INCREASE OF 24 PERCENT IN THE THIRD QUARTER
NWNL SETS NEW EARNINGS RECORDS IN FIRST QUARTER
NWNL REPORTS RECORD 1994 EARNINGS Fourth Quarter and Full-Year Highlights

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters