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EMPLOYEE BENEFIT PLANS, INC. ANNOUNCES FIRST QUARTER RESULTS

 MINNEAPOLIS, May 13 /PRNewswire/ -- Employee Benefit Plans, Inc. (NYSE: EBP) (EBP) today reported financial results for its first quarter ended March 31, 1993. Revenues for the three month period were $64.9 million, compared to $58.3 million for the comparable three month period ended March 31, 1992, or an increase of 11.4 percent. Operating earnings increased 19.0 percent to $2.4 million. The company's net earnings increased 69.3 percent to $596,000 during the first quarter, compared to $352,000 for the comparable year earlier period. Earnings per share increased from $.04 to $.07.
 The loss ratio (incurred claims to net premiums earned) for the three month period was 61.2 percent, compared to 64.3 percent in the year-earlier period and 61.5 percent for the year ended Dec. 31, 1992. "Although the loss ratio was higher than the 58.7 percent loss ratio reported for the seven month transition period ended Dec. 31,1992, it was consistent with our previously announced expectation of an annual loss ratio in the low to mid-60s," said Earl Milbrath, executive vice president and chief financial officer.
 EBP's customer base was 2,733 employers with 573,000 eligible employees at March 31, 1993, down from 2,756 employers with 604,800 eligible employees at Dec. 31, 1992. The company attributed the decrease primarily to attrition of certain unprofitable customers of claims administration companies that were acquired by EBP in early 1992 and the termination of the one large low-revenue-producing client in January. The company anticipates that its customer base will remain relatively stable for the remainder of 1993.
 EBP, headquartered in Minneapolis, is a leader in providing products and services to companies throughout the United States who self-fund their employee benefit programs. The company's common stock is traded on the New York Stock Exchange under the symbol "EBP."
 SELECTED FINANCIAL INFORMATION
 (In thousands, except per share amounts)
 Selected Operating Results: Three Months Ended
 (Unaudited) 3/31/93 3/31/92
 Revenues:
 Insurance premiums $41,744 $34,530
 Managed health care fees 21,206 21,454
 Investment income 1,724 1,804
 Realized gains on investments 246 494
 -- 64,920 58,282
 Operating expenses:
 Loss and loss adjustment expenses 25,566 22,200
 Commissions and policy acquisition costs 14,462 13,715
 Salaries and benefits 13,233 11,287
 General and administrative 8,676 8,548
 Amortization expense 561 497
 -- 62,498 56,247
 Earnings from operations 2,422 2,035
 Interest expense 1,332 1,440
 Earnings before provision for income taxes 1,090 595
 Provision for income taxes 494 243
 Net earnings $596 $352
 Net earnings per common and common
 equivalent share $0.07 $0.04
 Weighted average common and common
 equivalent shares outstanding 8,401 8,231
 Selected Balance Sheet Data
 (Unaudited)
 3/31/93 12/31/92
 Invested assets (including cash
 and cash equivalents) $128,166 $116,478
 Total assets 218,452 214,783
 Long-term debt, including current
 portion 79,726 80,146
 Shareholders' equity 72,701 69,215
 Customer Base and Eligible Employees
 12/91 3/92 6/92 9/92 12/92 3/93
 Total
 Customers 2,248 2,624 2,747 2,736 2,756 2,733
 Eligible employees 518,600 602,800 618,800 608,600 604,800 573,000
 Insurance segment
 Customers 1,938 2,050 2,075 2,095 2,131 2,116
 Eligible employees 351,900 372,800 366,800 366,400 376,500 361,800
 Managed care segment
 Customers 1,301 1,719 1,824 1,822 1,828 1,823
 Eligible employees 346,900 436,300 451,800 452,300 436,300 416,700
 EMPLOYEE BENEFIT PLANS, INC. SELECTED FINANCIAL INFORMATION
 (Unaudited) (In thousands, except per share amounts)
 Effective Dec. 31, 1992, the company changed its fiscal year ending May 31 to a calendar year ending Dec. 31. For purposes of comparison with 1993 results, the following table shows results of operations by calendar quarter for the entire year ended Dec. 31, 1992.
 Selected operating results:
 Three Months Ended
 Calendar
 3/31/92 6/30/92 9/30/92 12/31/92 1992
 Revenues:
 Insurance premiums $34,530 $35,026 $36,373 $36,623 $142,552
 Managed health
 care fees 21,454 21,486 22,347 20,837 86,124
 Investment income 1,804 2,097 2,186 1,527 7,614
 Realized gains on
 investments 494 511 1,988 788 3,781
 -- 58,282 59,120 62,894 59,775 240,071
 Operating expenses:
 Loss and loss
 adjustment expenses22,200 24,356 19,660 21,423 87,639
 Commission and
 policy acquisition
 costs 13,715 15,432 13,486 14,515 57,148
 Salaries and
 benefits 11,287 12,144 13,321 13,553 50,305
 General and
 administrative 8,548 10,375 8,864 8,853 36,640
 Amortization
 expense 497 738 538 554 2,327
 Legal charges 0 11,304 0 5,700 17,004
 -- 56,247 74,349 55,869 64,598 251,063
 Earnings (loss)
 from operations 2,035 (15,229) 7,025 (4,823) (10,992)
 Interest expense 1,440 1,430 1,575 1,423 5,868
 Earnings (loss)
 before provision for
 income taxes, extra-
 ordinary item and
 cumulative effect of
 change in accounting 595 (16,659) 5,450 (6,246) (16,860)
 Provision (benefit)
 for income taxes 243 (5,598) 2,158 (2,207) (5,404)
 Earnings (loss) before
 extraordinary item and
 cumulative effect of
 change in accounting 352 (11,061) 3,292 (4,039) (11,456)
 Extraordinary item -
 net gain on
 extinguishment of
 debt 0 0 0 1,278 1,278
 Cumulative effect of
 change in accounting
 for income taxes 0 (393) 0 0 (393)
 Net earnings (loss) $352 $(11,454) $3,292 $(2,761)$(10,571)
 Earnings per common
 and common equivalent
 share:
 Earnings (loss) before
 extraordinary item and
 cumulative effect of
 change in accounting $.04 $(1.34) $.40 $(0.48) $(1.38)
 Extraordinary item .00 .00 .00 .15 .15
 Cumulative effect of
 change in accounting
 for income taxes .00 (.05) .00 .00 (.05)
 Net earnings (loss) $.04 $(1.39) $.40 $(.33) $(1.28)
 Weighted average
 common and common
 equivalent shares
 outstanding 8,231 8,236 8,282 8,340 8,272
 -0- 5/13/93
 /CONTACT: Earl Milbrath of EBP, 612-546-4353/
 (EBP)


CO: Employee Benefit Plans, Inc. ST: Minnesota IN: INS SU: ERN

AL -- MN015 -- 8378 05/13/93 18:24 EDT
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Date:May 13, 1993
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