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CAPITAL HOLDING REPORTS FULL YEAR OPERATING EARNINGS AT $6.35, UP 10.1 PERCENT; FOURTH QUARTER OPERATING EARNINGS OF $1.76 PER SHARE

 LOUISVILLE, Ky., Feb. 10 /PRNewswire/ -- Capital Holding Corporation (NYSE: CPH) today reported fourth quarter operating earnings, which exclude realized gains and losses and related amortizations, of $90.3 million or $1.76 per share. This represents an 8.0 percent increase over the $1.63 per share, or $79.1 million, reported for last year's fourth quarter. Full year operating earnings were $326.0 million, bringing per share results to $6.35, up 10.1 percent for 1992.
 Net income for the fourth quarter, including realized gains and losses, was $1.76 per share, up 28.5 percent compared to the same period last year. Net income for the year was $6.28 per share, up 17.8 percent from the end of 1991. Full year net income of $322.5 million included $27.4 million in net realized investment and securities gains, offset by $20.9 million in mortgage loan writedowns and reserve additions.
 "Each of our business units produced solid performance in 1992. We have been able to more tightly focus on and add definition to our strategies. As we begin 1993, I believe we're well positioned for another good year," said Irving W. Bailey II, Capital Holding's chairman, president and chief executive officer.
 Revenues for the fourth quarter were $718.9 million, down 0.4 percent from last year. Quarterly premium income was down 6.7 percent from the prior year, largely due to the sale of credit business originally part of the Durham Corporation acquisition. Net investment income for the quarter was $364.0 million, down 5.1 percent from last year due to the lower interest rate environment.
 The company reported increased year over year earnings in each of its four operating units.
 Agency Group pretax earnings for the fourth quarter were $49.6 million, up 5.3 percent over the fourth quarter of 1991. Full year pretax earnings were $190.2 million, a 10.0 percent increase compared to last year. The increase reflects the full year inclusion of the Durham acquisition in 1991.
 Life sales were up 44.7 percent for 1992 reflecting the Durham acquisition, strong marketing partnership sales and continued favorable underlying persistency trends. Health sales for the year remained below last year's levels. Annualized policy termination rates for core business and partnerships, excluding Durham, were 15.7 percent in 1992 and 16.3 percent in 1991.
 The Direct Response Group (DRG) reported pretax earnings for the quarter of $26.0 million, up 21.4 percent from the same period last year. For the year, pretax earnings were $84.5 million, up 19.5 percent. Earnings growth was primarily a result of reduced expenses as well as favorable health claims experience. Property and casualty results also improved despite several major natural catastrophes, as reinsurance minimized the group's loss exposure.
 In January, DRG completed the acquisition of Academy Insurance Group, which will add $103 million in premiums, principally in agent- sold, active duty military business. Veterans Life Insurance, a DRG company, is a direct response marketer of insurance to military veterans nationwide and the addition of Academy business will increase the company's presence in the military market.
 Pretax earnings for the Accumulation and Investment Group in the fourth quarter were $29.8 million, up 5.2 percent, bringing full year earnings to $120.1 million, up 7.0 percent from 1991. Margins were even with last year, the result of the continuing favorable interest rate environment.
 Deposit volume increased in 1992 with retail spread product deposits up $518.3 million for the year, while fee-based retail business, primarily variable annuities, increased by $234.6 million in 1992. Institutional deposits grew $438.2 million for the year. Fee-based Trust GIC business reached the $1.5 billion level for the same period.
 First Deposit Corporation's pretax earnings were $24.1 million for the fourth quarter, up 14.0 percent over the same period a year earlier. Full year earnings were $93.5 million, up 27.7 percent over last year. Total loans under management were up 5.7 percent over last year. Home equity loan receivables grew by 43.5 percent to $217.3 million in 1992.
 Total portfolio annualized chargeoffs for 1992 were 5.7 percent, in line with expectations, versus 4.6 percent for 1991. Delinquent loan balances for the year stood at 2.6 percent, even with last year, and up slightly from mid-1992.
 First Deposit continues to expand its product line with a secured credit card and fee products including credit protection. In December, First Deposit acquired Commonwealth Premium Finance, a California automobile insurance premium finance business with $35.5 million in outstanding loans.
 Despite unfavorable economic conditions, First Deposit continued to grow and improve its margins by maintaining pricing in its core business, tightly controlling its operating costs and prudently managing the lower interest rate environment. FDC securitized $78 million in receivables in November, bringing total securitized assets to $1.8 billion.
 Capital Holding Corporation is one of the nation's largest shareholder-owned life insurance organizations, with $20.6 billion in assets and $56.8 billion of life insurance coverage in force.
 The corporation offers a broad range of financial services and products through agents, direct-marketing media, investment professionals and retail locations. Its common stock is listed on the New York and Pacific Stock Exchanges under the ticker symbol CPH; its preferred stock is listed on the New York Stock Exchange under the symbol CPHF.
 CAPITAL HOLDING CORPORATION
 THREE- AND TWELVE-MONTH FINANCIAL HIGHLIGHTS
 Percent
 Three Months Ended December 31 1992 1991 Increase
 Operations:
 Total revenues $ 718,864,000 $ 722,017,000 (.4)
 Operating earnings(A) 90,261,000 79,056,000 14.2
 Realized investment
 gain (loss),
 net of related
 amortization,
 net of tax 86,000 (12,409,000)
 Net income 90,347,000 66,647,000 35.6
 Per share:
 Operating earnings(A) 1.76 1.63 8.0
 Realized investment
 gain (loss),
 net of related
 amortization,
 net of tax -- (.26)
 Net income 1.76 1.37 28.5
 Percent
 Twelve Months Ended December 31 1992 1991 Increase
 Operations:
 Total revenues $2,853,292,000 $2,670,656,000 6.8
 Operating earnings(A) 325,958,000 270,311,000 20.6
 Realized investment
 gain (loss),
 net of related
 amortization,
 net of tax (3,462,000) (20,079,000)
 Net income 322,496,000 250,232,000 28.9
 Per share:
 Operating earnings(A) 6.35 5.77 10.1
 Realized investment
 gain (loss),
 net of related
 amortization,
 net of tax (.07) (.44)
 Net income 6.28 5.33 17.8
 (A) Excludes realized investment gains and losses, net of related amortization, net of tax.
 -0- 2/10/93
 /CONTACT: Michael Bateman, 502-560-2723 or Bonnie Otto, 502 560-3019, both of Capital Holding Corporation/
 (CPH)


CO: Capital Holding Corporation ST: Kentucky IN: INS SU: ERN

DF -- CH008 -- 5350 02/10/93 16:40 EST
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