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MERCURY GENERAL CORP. REPORTS RECORD 1992 RESULTS; DIVIDEND INCREASED 20 PERCENT

 LOS ANGELES, Feb. 10 /PRNewswire/ -- Mercury General Corp. (NASDAQ: MRCY), a major California automobile insurer, reported today that net income in 1992 was $83.3 million, or $3.06 per share, compared with $65.5 million, or $2.42 per share, in 1991. Realized capital gains contributed $.13 per share to 1992 results, compared with $.03 per share in 1991. Per share results are based on 27.2 million average shares outstanding (27.1 million in 1991), adjusted for a two-for-one stock split effective in September 1992.
 Net income in the fourth quarter was $24.9 million, or $.91 per share, a 49 percent increase over 1991 fourth quarter results of $.61 per share. Capital gains contributed $.02 per share to fourth quarter results in 1992 and less than $.01 per share in 1991.
 Full-year results include an $18.6 million charge, equal to $.45 per share after taxes, all of which was recorded in the first half, reflecting the final settlement in May 1992 of the company's Proposition 103 rate rollback liability. Refund checks totaling $43.1 million were disbursed in July and August 1991, fully extinguishing the company's Proposition 103 rollback liability. The California Department of Insurance (DOI) had sought a rollback amount in excess of $70.0 million.
 Underwriting results throughout 1992 were outstanding, reflecting unusually favorable loss experience. The combined ratio of losses and expenses to premiums earned (GAAP basis, exclusive of rollback refund provisions) was 85.1 percent for the year and 83.7 percent in the fourth quarter, compared with 93.7 percent and 93.8 percent, respectively, in 1991. The loss ratio of 57.6 percent for the fourth quarter and 60.6 percent for the full year, compared with 69.6 percent and 69.4 percent, respectively. The underwriting expense ratio was 24.5 percent in 1992 and 24.3 percent in 1991.
 Investment income in 1992 was $53.0 million, a decrease of 1.3 percent from 1991, reflecting, principally, the disbursement of $43.1 million in rollback refunds in the third quarter, as well as generally lower longer term interest rates. The average after-tax yield in 1992 was 7.15 percent, compared with 7.32 percent in 1991.
 Premium volume in 1992 was $455.7 million, a 2.5 percent decrease from 1991. In July 1992, following the negotiated settlement of the rollback liability, the DOI approved certain rate revisions which have improved the company's competitive position.
 In accordance with the company's negotiated rollback settlement agreement, which included approval of all rates charged subsequent to the end of the rollback period, Nov. 8, 1989, the company expects to file further rate revisions to become effective after June 1, 1993.
 During the last half of 1992, Mercury licensed more than 100 former agents of the Ohio Casualty Co. following that company's announcement earlier in the year that it was withdrawing entirely from the California market effective Dec. 31, 1992. Those appointments, together with others undertaken following resolution of the Proposition 103 rollback uncertainty, have enlarged the company's California agency force by about 30 percent. The new agents are now beginning to produce new business. In the last three weeks of January, the California application count for private passenger auto increased 40 percent compared to the weekly average in the fourth quarter of 1992. Renewal business, which accounts for the principal part of the company's premium volume, continues to exceed 90 percent of all California policies.
 In January 1993, the DOI approved Mercury's new package plan of automobile, homeowners and liability umbrella coverage which had been filed in the fall of 1992. Rates under the plan will be highly competitive. The company commenced accepting applications under this plan on Feb. 1, 1993.
 On Feb. 5, 1993, the board of directors declared a quarterly dividend of $.15 per share payable on March 31, 1993, to holders of record on March 16, 1993. The new rate of $.60 annually represents a 20 percent increase over the previous $.50 rate and is the ninth increase in the quarterly rate since the company's initial public offering in November 1985.
 MERCURY GENERAL CORP.
 Summary of Operating Results (000)
 Twelve Months Ended Quarter Ended
 Dec. 31, Dec. 31,
 1992 1991 1992 1991
 Net premiums
 written $455,684 $467,523 $109,953 $113,055
 Net premiums earned 455,508 473,532 113,318 116,580
 Net investment
 income 52,994 53,670 13,006 13,651
 Net operating
 income (a) 79,911 64,763 24,442 16,744
 Capital gains,
 net of tax 3,415 730 411 (92)
 Net income $83,326 $65,493 $24,853 $16,652
 Average shares
 outstanding 27,241,581 27,136,176 27,298,935 27,195,800
 Per Share Data
 Net operating
 income (a) $2.93 $2.39 $0.90 $0.61
 Capital gains,
 net of tax $0.13 $0.03 $0.02 $0.00
 Earnings per share $3.06 $2.42 $0.91 $0.61
 Operating Ratios -- GAAP Basis (b)
 Loss ratio 60.6 pct. 69.4 pct. 57.6 pct. 69.6 pct.
 Expense ratio 24.5 pct. 24.3 pct. 26.1 pct. 24.2 pct.
 Combined
 ratio (c) 85.1 pct. 93.7 pct. 83.7 pct. 93.8 pct.
 (a) Net income excluding realized gains net of tax.
 (b) Generally Accepted Accounting Principles
 (c) Excludes provision for rate refund.
 -0- 2/10/93
 /CONTACT: Keith L. Parker, CFO of Mercury General, 213-937-1060/
 (MRCY)


CO: Mercury General Corp. ST: California IN: INS SU: ERN

KJ-JB -- LA005 -- 5020 02/10/93 09:15 EST
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Date:Feb 10, 1993
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