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EMPLOYEE BENEFIT PLANS ANNOUNCES SEVEN MONTH TRANSITION PERIOD RESULTS

 MINNEAPOLIS, March 29 /PRNewswire/ -- Employee Benefit Plans, Inc. (NYSE: EBP) (EBP) today reported financial results for the month of December and the seven month transition period ended Dec. 31, 1992, reflecting the previously announced conversion of its fiscal year from May 31.
 Revenues for the seven month period were $142.7 million, compared with $121.3 million for the seven month period ended Dec. 31, 1991, or an increase of 17.6 percent.
 The company reported net earnings for the month of December of $482,000, or $.06 per share, including $336,000 of after-tax extraordinary gains from retirement of debentures, or $.04 per share.
 For the seven month transition period, the company reported a net loss of $418,000, or $.05 per share, compared to net earnings of $6.4 million, or $.78 per share, for the seven month period ended Dec. 31, 1991. Included in the transition period are the previously announced settlement of securities litigation against the company for a pre-tax charge to operations of $5.4 million and related extraordinary gains from retirement of $6.5 million of the company's subordinated debentures, for a net after-tax charge of $2.3 million. Also, the results for the transition period were reduced by a one-time charge of $.4 million, or $.05 per share, for the cumulative effect of adopting the provisions of Statement of Financial Accounting Standards No. 109 with respect to deferred taxes. Net earnings before these charges were approximately $2.3 million, or $.28 per share.
 The loss ratio (incurred claims to net premiums earned) for the seven month transition period was 58.7 percent, compared to 59.1 percent for the 12 month period ended May 31, 1992. "Although the loss ratio for the seven months was lower than for the prior year, we continue to anticipate that our annual loss ratio will be in the low to mid-60s in 1993," said Earl Milbrath, executive vice president and chief financial officer.
 EBP's customer base was 2,783 customers with 615,300 eligible employees at Dec. 31, 1992, compared to 2,772 customers and 626,300 eligible employees at May 31, 1992. The reduction in eligible employees was due to attrition of customers in claims administration companies that were acquired by EBP in early 1992.
 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.
 EMPLOYEE BENEFIT PLANS, INC.
 SELECTED FINANCIAL INFORMATION
 (In thousands, except per share amounts)
 Selected Operating Results:
 Seven Mos. Ended Years Ended
 12/31/92 5/31/92 5/31/91 5/31/90
 Revenues:
 Insurance premiums $84,762 $133,857 $102,083 $56,055
 Managed health care fees 50,334 76,158 59,663 39,892
 Investment income 4,552 7,712 3,920 1,866
 Realized gains
 on investments 3,011 921 -- --
 -- 142,659 218,648 165,666 97,813
 Operating expenses:
 Loss and loss adjustment
 expenses 49,713 79,176 50,668 38,993
 Commissions and policy
 acquisition costs 32,537 52,499 40,948 23,475
 Salaries and benefits 30,987 40,459 29,597 19,582
 General and administrative 20,414 32,288 22,519 15,305
 Amortization expense 1,282 2,073 1,491 1,440
 Legal charges 5,700 11,304 -- --
 -- 140,633 217,799 145,223 98,795
 Earnings (loss) from
 operations 2,026 849 20,443 (982)
 Interest expense 3,451 5,570 1,383 1,967
 Earnings (loss) before
 provision (benefit) for
 income taxes, extraordinary
 items and cumulative effect
 of change in accounting (1,425) (4,721) 19,060 (2,949)
 Provision (benefit) for
 income taxes (122) (1,000) 7,624 146
 Earnings (loss) before
 extraordinary items and
 cumulative effect of change
 in accounting (1,303) (3,721) 11,436 (3,095)
 Extraordinary items:
 Tax benefit resulting from
 utilization of loss
 carryforward -- -- 3,520 --
 Net gain on extinguishment
 of debt 1,278 -- -- 626
 Cumulative effect of change
 in accounting for income
 taxes (393) -- -- --
 Net earnings (loss) $(418) $(3,721) $14,956 $(2,469)
 Earnings (loss) per common
 and common equivalent share:
 Earnings (loss) before
 extraordinary items and
 cumulative effect of
 change in accounting $(.15) $(.45) $1.52 $(.54)
 Extraordinary items .15 -- .47 .11
 Cumulative effect of
 change in accounting
 for income taxes (.05) -- -- --
 Net earnings (loss) $(.05) $(.45) $1.99 $(.43)
 Weighted average common and
 common equivalent shares
 outstanding 8,295 8,261 7,512 5,693
 Selected balance sheet data:
 Working capital $31,107 $38,281 $41,772 $8,934
 Invested assets (including
 cash and cash
 equivalents) 116,478 133,275 129,422 24,248
 Total assets 214,783 224,127 189,996 66,910
 Long-term debt, including
 current portion 80,146 81,328 76,901 7,775
 Shareholders' equity 69,215 68,583 68,910 33,745
 EMPLOYEE BENEFIT PLANS, INC.
 Selected Financial Information
 Unaudited Quarterly Financial Information
 Seven Months Ended Dec. 31, 1992
 (In thousands, except per share amounts)
 Quarter Ended Month of
 August November December (a)
 (as adjusted)
 Total revenues $62,795 $60,862 $19,002
 Earnings (loss) from operations 4,393 (2,938)(b) 571
 Provision (benefit) for
 income taxes 1,229 (1,334) (17)
 Earnings (loss) before
 extraordinary item and
 cumulative effect of
 change in accounting 1,628 (3,077) 146
 Extraordinary item - net gain
 on extinguishment of debt -- 942 336
 Cumulative effect of
 change in accounting
 for income taxes (393)(c) -- --
 Net earnings (loss) $1,235 $(2,135) $482
 Earnings (loss) per common
 and common equivalent share:
 Earnings (loss) before
 extraordinary item and
 cumulative effect of
 change in accounting $0.20 $(0.37) $0.02
 Extraordinary item -- 0.11 0.04
 Cumulative effect of change
 in accounting for income
 taxes (0.05)(c) -- --
 Net earnings (loss) $0.15 $(0.26) $0.06
 Weighted average common
 and common equivalent
 shares outstanding 8,282 8,340 8,373
 (a) The one-month period ended Dec. 31, 1992 may not be indicative of operating results that may be expected for an entire quarter or an entire fiscal year.
 (b) Earnings (loss) from operations for the quarter ended Nov. 30, 1992 included a $5.4 million charge for settlement of the company's securities litigation.
 (c) In December 1992, the company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" effective June 1, 1992. The previously reported three-month period ended Aug. 31, 1992 has been adjusted to reflect the cumulative effect of the change in accounting for income taxes of $393,000, or $.05 per share. Previously reported net earnings for the three-month period were $1.6 million, or $.20 per share. Prior year financial information has not been restated to reflect the change in accounting.
 CUSTOMER BASE AND ELIGIBLE EMPLOYEES:
 12/91 2/92 5/92 8/92 11/92 12/92
 Total
 Customers 2,248 2,525 2,772 2,778 2,778 2,783
 Eligible employees 518,600 568,200 626,300 626,600 614,800 615,300
 Insurance segment
 Customers 2,029 2,028 2,070 2,102 2,121 2,131
 Eligible employees 351,900 371,000 366,300 368,900 373,200 376,500
 Managed care segment
 Customers 1,301 1,629 1,851 1,852 1,854 1,855
 Eligible employees 346,900 401,900 460,900 464,000 448,600 446,800
 -0- 3/29/93
 /CONTACT: Earl Milbrath of EBP, 612-546-4353/
 (EBP)


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

KH -- MN008 -- 0738 03/29/93 17:28 EST
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