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USLICO REPORTS HIGHER EARNINGS, DECLARES CASH DIVIDEND

 USLICO REPORTS HIGHER EARNINGS, DECLARES CASH DIVIDEND
 ARLINGTON, Va., July 27 /PRNewswire/ -- USLICO Corporation (NYSE: USC) today announced second quarter earnings of $6.3 million, or 59 cents per share, up dramatically from second quarter 1991 earnings of $1.2 million, or 11 cents on a per share basis. Year-to- date 1992 earnings through the first six months were $9 million, or 84 cents per share, compared to first half 1991 earnings of $7.5 million, or 69 cents per share, an increase of 22 percent. The higher earnings resulted from realized investment gains, the elimination of losses on a block of group health business, and the absence of losses on the property-casualty subsidiaries sold in July 1991.
 The following tables summarize the major components of earnings this year compared to 1991:
 USLICO CORPORATION
 Three Months Ended June 30,
 1992 1991 + (-)
 (In thousands)
 Income from Continuing
 Operations
 Life insurance $6,450 $ 4,762 $ 1,688
 Interest and other (1,380) (1,805) 425
 Federal income tax (1,582) ( 656) (926)
 Operating Income 3,488 2,301 1,187
 Realized gains (after tax) 2,798 657 2,141
 Net Income from Continuing
 Operations 6,286 2,958 3,328
 Discontinued P&C Operations -0- (1,720) 1,720
 Net Income $ 6,286 $ 1,238 $ 5,048
 Year-to-Date
 1992 1991 + (-)
 (In thousands)
 Income from Continuing
 Operations
 Life insurance 9,955 $13,796 $(3,841)
 Interest and other (2,546) (3,332) 786
 Federal income tax (2,008) (3,024) 1,016
 Operating Income 5,401 7,440 (2,039)
 Realized gains (after tax) 3,620 966 2,654
 Net Income from Continuing
 Operations 9,021 8,406 615
 Discontinued P&C Operations -0- (916) 916
 Net Income $ 9,021 $ 7,490 $ 1,531
 Life insurance earnings for the second quarter of 1992 improved substantially from both the first quarter of 1992 and in comparison to the second quarter of 1991. The improvement in life insurance earnings compared to this year's first quarter resulted primarily from a decrease in death claims of $3.5 million. The improvement compared to the second quarter of 1991 was caused by elimination of the $2.3 million loss incurred last year on a block of group health business. As reported previously, this business has been canceled, and the company reported that its experience through June 30, 1992, indicates that earnings should not be impacted by further losses.
 The low interest rates of the first six months of 1992 have caused many bond issuers to call securities that carry high rates. Primarily as a result of these calls, USLICO's life companies recognized realized gains on bonds of $4.2 million ($2.8 million after tax) for the first six months and $2.5 million ($1.7 million after tax) for the second quarter. Gains realized on many of these bonds represented accelerated recognition of future interest income, which caused an increase in the amortization of deferred acquisition costs related to certain policies. This extra expense of $1.7 million (pre-tax) for the six-month period reduced reported life insurance operating income.
 Sales results announced for the quarter and year-to-date are shown in the following table:
 ANNUALIZED PREMIUM SALES
 (in thousands)
 2nd Quarter Year-to-Date
 1992 1991 1992 1991
 Individual Life $ 3,993 $ 5,116 $ 7,875 $10,584
 Payroll Deduction 2,964 2,867 4,897 4,865
 Group Life 508 10,190 878 11,094
 Annuities 39,956 76,166 75,851 150,876
 Total $47,421 $94,339 $89,501 $177,419
 USLICO attributed the continued sluggishness in individual life sales primarily to disruption caused by the relocation of underwriting and issue functions from a service center in Bismarck, N.D., and their consolidation into the Arlington home office. The company also has reorganized the structure and management of its individual life sales force. This reorganization is expected to strengthen long-term marketing performance, but has caused short-term problems in maintaining new business production during the first six months of 1992.
 Annuity sales are reported on target for 1992, though at a substantially lower level than 1991. As reported earlier, lower annuity production was planned to stabilize the growth of this line.
 Group life sales were exceptionally high in 1991 due to one large case, the company reported. Sales are low for 1992 because a large group life case was not written in the first half of this year.
 Asset Quality. USLICO announced that its life insurance subsidiaries continued to maintain exceptionally strong asset quality during 1992. As of June 30, bonds rated below investment grade represented only 2.5 percent of the bond portfolio, and all of those bonds were current as to interest and principal payments. The consolidated 60-day mortgage delinquency rate was only 1.33 percent on a dollar percentage basis compared to the most recently published life insurance industry average of 6.23 percent.
 Quarterly Dividend. USLICO announced that its board of directors has voted a quarterly dividend of 25 cents per share of common stock. The dividend will be paid on Sept. 14 to shareholders of record on Sept. 2.
 SUMMARIZED FINANCIAL INFORMATION
 (In millions, except per share data)
 Second Quarter Year-to Date
 1992 1991 1992 1991
 Revenue $97.8 $101.3 $194.9 $193.6
 Net Income 6.3 1.2 9.0 7.5
 Net Income from Continuing
 Operations 6.3 3.0 9.0 8.4
 Net Capital Gains (after taxes) 2.8 0.7 3.6 1.0
 Earnings Per Share:
 Primary
 Net Income .59 .11 .84 .69
 Net Income from Continuing
 Operations .59 .27 .84 .78
 Net Income Excluding Capital
 Gains .33 .05 .50 .60
 Fully Diluted
 Net Income .57 .18 .82 .71
 Net Income from Continuing
 Operations .57 .30 .82 .78
 Net Income Excluding Capital
 Gains .33 .05 .50 .60
 Weighted Average Shares Outstanding:
 1992 10,755,734
 1991 10,786,022
 USLICO Corporation is an insurance holding company headquartered in Arlington. Its three life insurance subsidiaries focus on selected market niches, including individual life, annuity and payroll deduction sales.
 -0- 7/27/92
 /CONTACT: Charles V. Giuffra, chairman and chief executive officer, USLICO, 703-875-3414/
 (USC) CO: USLICO Corporation ST: Virginia IN: INS SU: ERN


DC -- DC002 -- 3330 07/27/92 08:09 EDT
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Date:Jul 27, 1992
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