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AMERICAN GENERAL REPORTS SECOND QUARTER RESULTS; NET INCOME TOTALS $127 MILLION OR $1.17 PER SHARE; OPERATING EARNINGS PER SHARE UP 7 PERCENT

AMERICAN GENERAL REPORTS SECOND QUARTER RESULTS; NET INCOME TOTALS $127 MILLION OR $1.17 PER SHARE; OPERATING EARNINGS PER SHARE UP 7 PERCENT
 HOUSTON, July 21 /PRNewswire/ -- American General Corporation (NYSE: AGC) today reported 1992 second quarter net income of $127 million, compared to $126 million in the 1991 period. On a per share basis, net income increased 6 percent to $1.17, compared to $1.10 for the 1991 second quarter. Operating income, which excludes realized investment gains, was $128 million, compared to $125 million in the 1991 period. On a per share basis, operating earnings increased 7 percent to $1.17, compared to $1.09 in the second quarter of 1991.
 Average shares outstanding were 109.0 million during the second quarter 1992, compared to 114.5 million for the 1991 period, reflecting the effect of share repurchases.
 Second quarter 1992 results include:
 -- A 17 percent improvement in retirement annuities segment earnings; and
 -- An 11 percent increase in consumer finance segment earnings.
 In commenting on these results, Harold S. Hook, chairman and chief executive officer, said, "Net income (after-tax) totaled $496 million for the last 12 months; and retirement annuities and consumer finance continued to lead the way in earnings growth, moving from 36 percent of segment earnings in 1989 to 47 percent for the current year. In short, this report reflects good news and no surprises."
 Year-to-date Results: Net Income Per Share Up 13 percent.
 Net income for the first six months of 1992 was $261 million, compared to $245 million for the first half of 1991. On a per share basis, net income for the first six months increased 13 percent to $2.39, compared to $2.11 for the 1991 period. Year-to-date operating earnings were $258 million, compared to $244 million for the 1991 period. On a per share basis, operating earnings for the six months ended June 30, 1992 were $2.36, compared to $2.10 for the year-ago period.
 Other Financial Highlights
 Compared to a year ago:
 -- Revenues and deposits for the quarter increased 8 percent to $1.8 billion.
 -- Assets increased 9 percent to $38 billion.
 -- Shareholders' equity increased 6 percent to $4.5 billion.
 -- Book value per share increased 7 percent to $41.11.
 For the last 12 months, total return on book value, which includes the increase in book value plus dividends paid, was 12 percent.
 Retirement Annuities: Earnings Up 17 Percent
 Retirement annuities segment earnings increased 17 percent to $35 million for the second quarter 1992, compared to the second quarter 1991. This reflects continued growth in assets and a stable net interest margin. On June 30, 1992, segment assets were $16 billion, compared to $14 billion a year ago. Deposits for the second quarter were $470 million, up 14 percent compared to the 1991 second quarter.
 Consumer Finance: Earnings Up 11 Percent
 Consumer finance segment earnings increased 11 percent to $36 million in the second quarter 1992. This reflects continued favorable borrowing costs and stable yields on receivables. Net finance receivables totaled $5.7 billion at June 30, 1992, essentially unchanged from a year earlier. Credit quality continues to be favorable -- loan delinquencies improved to 2.4 percent of receivables from 2.5 percent at June 30, 1991, while loans charged off during the quarter were unchanged at 2.2 percent of average receivables.
 Insurance - Special Markets: Revenues and Deposits Up 21 Percent
 Special markets reported second quarter 1992 segment earnings of $19 million, essentially unchanged from the 1991 period. The 1991 results included earnings of $1.5 million from Hawaiian Life Insurance Company, which was sold in June 1991. Revenues and deposits for the quarter were up 21 percent to $330 million. The 1992 second quarter reflects growth of annuity deposits and a reduction in deferred state taxes.
 Insurance - Home Service: Sales Increase 15 Percent
 Home service segment earnings were $63 million in the second quarter, compared to $65 million in the 1991 period. Second quarter 1992 earnings reflect improved sales and persistency, offset by higher life and health claims and by lower investment yields. Second quarter 1992 sales, as measured by annualized premiums, increased 15 percent, and policy terminations decreased by 28 percent.
 Corporate
 Corporate operations include interest expense on corporate debt, earnings on corporate assets and expenses not allocated to the business segments, and net realized investment gains. Corporate operations for the second quarter of 1992 resulted in a net after-tax charge of $26 million, compared to $19 million in the 1991 period. Corporate operations in the 1992 second quarter include an after-tax charge of $3 million for expenses related to the early retirement of a debt issue. In 1991, corporate operations included a gain of $3 million from the sale of Hawaiian Life Insurance Company and net realized investment gains of $1 million.
 Invested Assets: Quality Remains High
 Total invested assets were $27 billion at June 30, 1992, up 12 percent from $24 billion a year ago.
 The market value of the $20 billion bond portfolio on June 30, 1992 was 5.8 percent or $1.1 billion greater than book value. Below- Investment-grade bonds of $761 million had a market value of 101 percent of book value and represented 3.9 percent of the total bond portfolio, down from 4.7 percent a year ago. At June 30, 1992, non-performing bonds totaled $92 million or 0.5 percent of the bond portfolio.
 American General's commercial mortgage loan portfolio was $3.6 billion at June 30, 1992, down from $3.8 billion a year ago. Commercial mortgage loans delinquent 60 days or more totaled $116 million or 3.2 percent at quarter end, compared to $82 million or 2.1 percent at June 30, 1991. This compares to the latest published life insurance industry average of 6.4 percent at March 31, 1992. Non- performing commercial mortgage loans, which include both modified and delinquent loans, were 4.9 percent of the mortgage loan portfolio at June 30, 1992, compared to 3.7 percent a year ago. This compares to the life insurance industry average of 12.0 percent at March 31, 1992.
 Highest Ratings Received
 On June 29, 1992, A.M. Best Company announced that it assigned its highest rating, A++ (Superior), to American General's three largest life insurance subsidiaries.
 The A++ rating applies to The Variable Annuity Life Insurance Company (VALIC), American General Life Insurance Company, and American General Life and Accident Insurance Company. This claims-paying rating reflects A.M. Best's new rating structure and the rating agency's continued assignment of the highest rating for these companies.
 American General is one of the nation's largest consumer financial services organizations. Headquartered in Houston, it is a leading provider of retirement annuities, consumer loans, and life insurance. American General Corporation (AGC) common stock is listed on the New York, Pacific, London and Swiss stock exchanges.
 AMERICAN GENERAL CORPORATION
 Comparative Results
 (in thousands, except per share data -- unaudited)
 Periods ended Six Months
 June 30, 1992 1991
 Revenues & Deposits $ 3,565,019 $ 3,305,974
 Business Segment Earnings:
 Retirement Annuities $ 70,820 $ 60,355
 Consumer Finance 72,174 64,017
 Insurance - Special
 Markets 33,848 35,770
 Insurance - Home Service 126,149 127,798
 Total Business Segment
 Earnings 302,991 287,940
 Corporate Operations:
 Interest on Corporate Debt (41,903) (42,255)
 Expenses Not Allocated to
 Segments (14,854) (17,213)
 Earnings on Corporate
 Assets 11,717 15,241
 Realized Investment Gains 2,998 1,387
 Total Corporate Operations (42,042) (42,840)
 Net Income $ 260,949 $ 245,100
 Net Income Per Share $ 2.39 $ 2.11
 Average Shares Outstanding 109,075 116,028
 Operating Earnings(A) $ 257,951 $ 243,713
 Operating Earnings Per
 Share(A) $ 2.36 $ 2.10
 (in millions, except per share data)
 As of June 30,
 1992 1991
 Assets $ 37,911 $ 34,882
 Shareholders' Equity 4,471 4,223
 Book Value Per Share 41.11 38.46
 Market Price Per Share 49.00 37.88
 Income Reporting. In order to facilitate meaningful period-to- period comparisons of business segment results, the following reporting methods have been used: (a) Business segment earnings include earnings from business operations and earnings on that equity considered necessary to support the business. (b) Earnings on equity not allocated to the business segments are included in earnings on corporate assets. (c) Realized investment gains on an after-tax basis are shown separately in Corporate Operations.
 (A) Operating Earnings. Under generally accepted accounting principles, operating earnings, which exclude after-tax realized investment gains, are not separately presented. They are presented here as supplemental information.
 AMERICAN GENERAL CORPORATION
 Comparative Results
 (in thousands, except per share data - unaudited)
 Quarter Ended June 30,
 1992 1991
 Revenues and Deposits $1,809,778 $1,672,864
 Business Segment Earnings:
 Retirement Annuities $ 34,606 $ 29,482
 Consumer Finance 36,760 32,981
 Insurance-Special Markets 18,575 17,873
 Insurance-Home Service 63,063 65,128
 Total Business Segment Earnings 153,004 145,464
 Corporate Operations:
 Interest on Corporate Debt (20,697) (20,816)
 Expenses Not Allocated to Segments (9,519) (8,673)
 Earnings on Corporate Assets 4,976 8,495
 Realized Investment Gains (335) 1,945
 Total Corporate Operations (25,575) (19,049)
 Net Income $ 127,429 $ 126,415
 Net Income Per Share $ 1.17 $ 1.10
 Average Shares Outstanding 108,988 114,542
 Operating Earnings(A) $ 127,764 $ 124,470
 Operating Earnings Per Share(A) $ 1.17 $ 1.09
 (in millions, except per share data)
 As of June 30,
 1992 1991
 Assets $37,911 $34,882
 Shareholders' Equity 4,471 4,223
 Book Value Per Share 41.11 38.46
 Market Price Per Share 49.00 37.88
 Income Reporting. In order to facilitate meaningful period-to- period comparisons of business segment results, the following reporting methods have been used; (a) Business segment earnings include earnings from business operations and earnings on that equity considered necessary to support the business. (b) Earnings on equity not allocated to the business segments are included in earnings on corporate assets. (c) Realized investment gains on an after-tax basis are shown separately in Corporate Operations.
 (A) Operating Earnings. Under generally accepted accounting principles, operating earnings, which exclude after-tax realized investment gains, are not separately presented. They are presented here as supplemental information.
 -0- 7/21/92
 /CONTACT: James S. D'Agostino Jr., senior vice president- administration, 713-831-1224, or Robert D. Mrlik, 713-831-1137, both of American General/
 (AGC) CO: American General Corporation ST: Texas IN: FIN SU: ERN


SH -- NY055 -- 1306 07/21/92 11:54 EDT
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Date:Jul 21, 1992
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