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USF&G CORPORATION REPORTS 1992 FOURTH QUARTER AND 12-MONTH RESULTS

 BALTIMORE, Feb. 3 /PRNewswire/ -- USF&G Corporation (NYSE: FG) today reported consolidated net income of $13 million for the fourth quarter of 1992, compared with a consolidated net loss of $40 million for the same period in 1991. For the 12 months of 1992, consolidated net income totaled $28 million, compared with a net loss of $176 million for the year 1991. After accounting for preferred stock dividends, these results equate to a 1992 fourth quarter net income of 1 cent per common share compared with a net loss of 62 cents per common share for the fourth quarter of 1991. Results for the 12 months of 1992 were a net loss of 24 cents per common share compared with a loss of $2.53 per common share for the 12 months of 1991.
 Norman P. Blake, Jr., chairman, president and chief executive officer, described the results as follows: "It is important to note that this quarter produced the first positive per common share net income after nine quarters of net per share losses. The profitable fourth quarter is a result of our ongoing strategic repositioning initiatives to focus on our key business segment, property/casualty insurance. The full year net income of $28 million, compared with a loss of $176 million in 1991, was realized despite the worst year for catastrophe losses in the industry's history, the continuation of the soft market and our ongoing withdrawals from unattractive markets and unprofitable lines of business. We believe that our continuing cost reduction efforts, market repositioning, positive loss trends and strong surplus position should provide the platform for future growth and profitability."
 The 1992 12-month results include the third quarter $80 million net loss from Hurricane Andrew and restructuring charges of $51 million provided for the implementation of the company's regionalization strategy. Both of these charges were more than offset by $142 million of realized gains taken in the third quarter.
 ADDITIONAL CONSOLIDATED DATA
 Consolidated income from continuing operations before realized gains was $14 million, or 1 cent per common share, for the fourth quarter of 1992. This compares with losses from continuing operations before realized gains and restructuring charges of $7 million, or 23 cents per share, for the same period in 1991. Consolidated results from continuing operations before realized gains and restructuring charges for the full year 1992 were a loss of $61 million, or $1.31 per common share, compared with losses of $122 million, or $1.88 per share, for 1991.
 Net realized gains on investments for the 12 months of 1992 totaled $148 million, compared with net realized gains of $38 million for the same period in 1991.
 Consolidated revenues, which include realized gains, for the 12 months of 1992 totaled $3.7 billion, compared with $4.2 billion in 1991 and are in line with expectations as the company continues to focus on profitable lines of business in specific states.
 Assets were $13.1 billion as of Dec. 31, 1992, and stockholders' equity totaled $1.3 billion, or $8.87 per common share.
 PROPERTY/CASUALTY INSURANCE
 Property/casualty net income totaled $58 million for the fourth quarter of 1992, compared with net income of $9 million for the fourth quarter of 1991. Net income for the 12 months of 1992 totaled $193 million, compared with a net loss of $40 million for the 12 months of 1991. Income before realized gains was $39 million for the fourth quarter of 1992, compared with income before realized gains and restructuring charges of $17 million for the same period in 1991. Income before realized gains and restructuring charges for the 12 months of 1992 totaled $43 million, compared with losses of $32 million for the same period in 1991.
 The improvement this year in property/casualty operations can be attributed to improving loss experience and lower operating expenses accomplished through the restructuring initiatives undertaken over the last two years. This strategy, which necessitated withdrawals from selected states and lines of business during 1991 and 1992, has been successful despite record catastrophe losses of $140 million during the year. A more profitable core book of business along with an improved surplus position should provide a strong foundation for future growth.
 LIFE INSURANCE
 The life insurance segment experienced a net loss of $4 million for the fourth quarter of 1992, compared with net income of $17 million for the same 1991 period. Net loss for the 12 months of 1992 totaled $5 million, compared with net income of $31 million for the year 1991. Income before realized gains was $2 million in the fourth quarter of 1992, compared with a loss before realized gains and restructuring charges of $1 million for the same period in 1991. Results before realized gains and restructuring charges for the 12 months of 1992 were a loss of $1 million, compared with income of $6 million for the 12 months of 1991.
 The life insurance operations were repositioned in the third quarter. The fourth quarter results for this segment reflect the transition to more traditional life insurance products wholesaled through independent agents as well as tax-sheltered annuities and structured settlements sold through new brokerage arrangements.
 PARENT AND NON-INSURANCE OPERATIONS
 Parent and non-insurance operations had a net loss of $41 million for the fourth quarter of 1992, compared with a net loss of $66 million for the same 1991 quarter. Net loss for the 12 months of 1992 totaled $160 million compared with a net loss of $167 million for the same period in 1991. Parent and non-insurance operations include corporate interest expense, losses from non-insurance operations and provisions for impaired investments.
 Baltimore-based USF&G Corporation, with assets of $13.1 billion, is composed of property/casualty and life insurance subsidiaries. The corporation's principal subsidiary is United States Fidelity and Guaranty Company, one of the nation's largest insurers, founded in 1896.
 USF&G CORPORATION
 CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
 (Unaudited -- dollars in millions except per share data)
 Three Months Ended
 Dec. 31,
 1992 1991
 REVENUES:
 Premiums earned $ 602 $ 781
 Net investment income 190 222
 Other 10 17
 Revenues before realized gains 802 1,020
 Realized gains on investments -- 16
 Total revenues 802 1,036
 EXPENSES:
 Losses, loss expenses
 and policy benefits 524 705
 Underwriting, acquisition
 and operating expenses 257 311
 Interest expense 9 10
 Restructuring charges -- 26
 Total expenses 790 1,052
 Pretax income (loss)
 from continuing operations 12 (16)
 Provision for income taxes (benefit) (1) --
 Income (loss) from continuing
 operations 13 (16)
 Loss from discontinued
 operations -- (24)
 Net income (loss) $ 13 $ (40)
 EARNINGS PER COMMON SHARE(A)
 Income (loss) from
 continuing operations $ .01 $ (.34)
 Loss from discontinued
 operations -- (.28)
 Net income (loss) $ .01 $ (.62)
 Weighted average common
 shares outstanding (000s) 84,489 84,273
 Twelve Months Ended
 Dec. 31,
 1992 1991
 REVENUES:
 Premiums earned $ 2,637 $ 3,187
 Net investment income 817 877
 Other 58 70
 Revenues before realized gains 3,512 4,134
 Realized gains on investments 148 38
 Total revenues 3,660 4,172
 EXPENSES:
 Losses, loss expenses
 and policy benefits 2,465 2,982
 Underwriting, acquisition
 and operating expenses 1,069 1,225
 Interest expense 40 46
 Restructuring charges 51 60
 Total expenses 3,625 4,313
 Pretax income (loss)
 from continuing operations 35 (141)
 Provision for income taxes (benefit) -- 3
 Income (loss) from continuing
 operations 35 (144)
 Loss from discontinued
 operations (7) (32)
 Net income (loss) $ 28 $ (176)
 EARNINGS PER COMMON SHARE(A)
 Income (loss) from
 continuing operations $ (.16) $ (2.15)
 Loss from discontinued
 operations (.08) (.38)
 Net income (loss) $ (.24) $ (2.53)
 Weighted average common
 shares outstanding (000s) 84,355 84,169
 (A) Earnings per common share amounts are based on income after deduction of preferred stock dividends.
 -0- 2/3/93
 /CONTACT: Kerrie Burch-DeLuca of USF&G, 410-547-3573/
 (FG)


CO: USF&G Corporation ST: Maryland IN: INS SU: ERN

MH -- DC005 -- 2267 02/03/93 09:44 EST
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