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PIEDMONT MANAGEMENT COMPANY, INC. REPORTS THIRD QUARTER RESULTS

 PIEDMONT MANAGEMENT COMPANY, INC. REPORTS THIRD QUARTER RESULTS
 NEW YORK, Nov. 5 /PRNewswire/ -- Piedmont Management Company, Inc. (NASDAQ-NMS: PMAN) today reported 1992 third quarter and nine month results. Details follow:
 -- Results on a consolidated basis were significantly impacted by reinsurance losses from Hurricanes Andrew and Iniki, which were estimated to cost the company $5.4 million, $1.10 per share on an after- tax basis, for the third quarter and nine month period. The overall consolidated net loss in the third quarter was $8.6 million, $1.75 per share, in comparison to net income of $2.5 million, $0.47 per share, for the third quarter of 1991. For nine months, the overall consolidated net loss was $7.4 million, $1.52 per share, compared to net income of $3.5 million, $0.65 per share, in 1991. The per share results for 1992 include deductions to provide for preferred dividends.
 -- Excluding the after-tax effects of net realized capital gains and losses on sales of securities in each period, a $2.01 loss per share was recorded in the third quarter and a $1.95 loss per share was recorded for the nine months compared to income of $0.53 and $0.46 per share for the third quarter and nine months of 1991, respectively.
 -- Reinsurance operating results were impaired all year long by a frequency of weather related catastrophe losses, surpassed in late August by Hurricane Andrew, the nation's costliest storm on record. This was followed only 18 days later by Hurricane Iniki, another major storm. The combined ratios for the third quarter and nine month period on a GAAP accounting basis were 148.1 percent and 129.0 percent, respectively. These ratios were increased by 22.1 percent and 7.7 percent, respectively, as a result of the two hurricanes.
 In addition to the major losses reported above, the company has had to contend with long-running adverse market conditions for reinsurers, including excess capacity and inadequate pricing. The outcome has been generally poor experience in both property and casualty lines of business. In an effort to counter the prevailing state of the market, the company has shifted its emphasis to specialized classes of reinsurance and the underwriting of primary insurance business for its growth. Thus far, this strategy has proven effective and accounts in large part for the increase in premium volume over the prior year. It is anticipated that this course of action will generate improved underwriting results.
 The combination of shortening average maturities in the company's bond portfolio and a declining interest rate environment caused net investment income to fall behind year earlier levels. Net investment income was $4.0 million in the third quarter and $14.2 million for the nine months, compared to $5.9 million and $17.3 million for the third quarter and nine months of 1991, respectively.
 -- Investment advisory pre-tax income was $361,000 in the third quarter and $974,000 for the nine months of 1992. These results fell short of the comparable periods in 1991 due to a lack of new business growth for the investment counseling segment as well as increased spending to support the growth and development of an expanding mutual fund division.
 -- Consolidated assets were $478.4 million and stockholders' equity was $109.5 million on Sept. 30, 1992. Book value per share, including unrealized appreciation of $3.7 million, was $20.59.
 Piedmont Management Company Inc. is a financial services company whose principal subsidiaries include The Reinsurance Corporation of New York (RECO), a property and casualty reinsurer, and Lexington Management Corporation, an investment advisory and mutual fund management company.
 PIEDMONT MANAGEMENT COMPANY INC.
 Comparative Results, unaudited
 Third Quarter Results For 1992
 Period ended Three months Nine months
 9/30/92 9/30/91 9/30/92 9/30/91
 Reinsurance Operations:
 Net premiums
 earned $30,816,788 $21,612,769 $88,603,805 $65,422,189
 Net investment
 income 3,976,381 5,886,081 14,189,894 17,316,066
 34,793,169 27,498,850 102,793,699 82,738,255
 Realized capital
 gains (losses) 1,658,144 (398,797) 2,815,973 1,254,218
 Losses and loss adjustment
 expenses 34,496,902 16,700,245 80,292,711 55,777,585
 Acquisition and
 other expenses 11,136,674 8,609,523 34,010,689 25,778,854
 45,633,576 25,309,768 114,303,400 81,556,439
 Reinsurance operating
 income (loss) (9,182,263) 1,790,285 (8,693,728) 2,436,034
 Investment Advisory Operations:
 Fees earned and
 other income 3,980,662 3,848,081 11,916,294 11,728,534
 Service and marketing
 costs 3,619,288 3,469,705 10,942,088 10,544,221
 Investment advisory
 operating income 361,374 378,376 974,206 1,184,313
 Parent Company:
 Investment and
 other income 92,061 137,478 345,436 432,413
 Realized capital gains -- -- 4,724 4,948
 Interest expense 150,993 299,722 537,313 946,972
 Other corporate
 expenses 365,064 677,202 1,277,300 2,000,484
 Parent company
 operating loss (423,996) (839,446) (1,464,453) (2,510,095)
 Equity in net earnings
 of investees 244,559 434,893 1,515,373 1,477,372
 Income tax credit 443,893 733,719 317,500 893,017
 Net income (loss) (8,556,433) 2,497,827 (7,351,102) 3,480,641
 Average shares
 for period(A) 4,922,437 5,334,084 4,922,437 5,334,084
 Net income (loss)
 per share(A) (1.75) .47 (1.52) .65
 (A) Computations of earnings (loss) per share for each quarter or
 period are independent. In 1992 to include common stock equivalents
 would be anti-dilutive and accordingly weighted average shares were
 used in the computation of earnings (loss) per share.
 Supplementary Data Per Share:
 Income (loss) excluding
 realized capital
 gains (losses) (2.01) .53 (1.95) .46
 Realized capital
 gains (losses)
 net of tax .27 (.06) .46 .19
 Deduction for preferred
 dividends (.01) -- (.03) --
 Net income (loss) (1.75) .47 (1.52) .65
 -0- 11/5/92
 /CONTACT: Peter Palenzona, chief financial officer of Piedmont Management Company, Inc., 212-363-4650/
 (PMAN) CO: Piedmont Management Company Inc. ST: New York IN: FIN SU: ERN


AH-OS -- NY113 -- 7888 11/05/92 16:07 EST
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