UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Date of report (Date of earliest event reported)
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August 14, 2018
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ATLANTIC AMERICAN CORPORATION
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(Exact name of registrant as specified in its charter)
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Georgia
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0-3722
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58-1027114
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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4370 Peachtree Road, N.E., Atlanta, Georgia
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30319
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code
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(404) 266-5500
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N/A
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(Former name or former address, if changed since last report)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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☐
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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☐
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 2.02.
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Results of Operations and Financial Condition
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On August 14, 2018, Atlantic American Corporation (the “Registrant”) reported its results of operations for its second quarter ended June 30, 2018. A copy of the press release issued by the Registrant concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
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Item 9.01.
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Financial Statements and Exhibits
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(d)
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Exhibits
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Press release dated August 14, 2018
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The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing of the Registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference to such filing. The information in this report, including the exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
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ATLANTIC AMERICAN CORPORATION
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By:
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/s/ J. Ross Franklin
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J. Ross Franklin
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Vice President, Chief Financial Officer and Secretary
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Date: August 14, 2018
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Exhibit 99.1
ATLANTIC AMERICAN REPORTS SECOND QUARTER RESULTS
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Net income for the three month period ended June 30, 2018 increased to $3.2 million as compared to $1.5 million in the comparable period in 2017
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Insurance premiums increased to $42.8 million, or 6.8%, compared to $40.1 million for the three month periods ended June 30, 2018 and 2017, respectively
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ATLANTA, Georgia, August 14, 2018 - Atlantic American Corporation (Nasdaq- AAME) today reported net income for the three month period ended June 30, 2018 of $3.2 million, or $0.15 per share, as compared to $1.5 million, or $0.07 per share, for the comparable period of 2017. For the six month period ended June 30, 2018 the company reported a net loss of $1.8 million, or $0.10 per share, compared to net income of $1.2 million, or $0.05 per share, in the comparable period of 2017. The increase in net income during the second quarter of 2018 was primarily due to the impact of an accounting standard adopted January 1, 2018. This accounting standard requires changes in the fair value of investments in equity securities to be reported in net income on the statement of operations, which resulted in a $4.1 million impact in the 2018 period. Under previous accounting guidelines, and as reported for the 2017 periods, such changes were recognized in other comprehensive income on the balance sheet. The net loss for the six month period ended June 30, 2018 was primarily a result of operating losses in the life and health operation.
Total revenues for the three month period ended June 30, 2018 were $49.4 million as compared to $43.6 million for the three month period ended June 30, 2017. Unrealized gains on equity securities and an increase in insurance premiums were the most significant contributors to the increase in total revenues. Insurance premiums during the three month period ended June 30, 2018 increased $2.7 million, or 6.8%, from the comparable 2017 period, primarily the result of an increase in Medicare supplement premium in the Company’s life and health operation. For the six month period ended June 30, 2018, revenues were $90.0 million, increasing 2.8% from the comparable 2017 period revenues of $87.5 million, also primarily as a result of an increase in Medicare supplement premium revenues. Insurance premiums during the six month period ended June 30, 2018 of $85.0 million increased 5.1% from the comparable 2017 period amount of $80.9 million.
Commenting on the quarter, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, “Bankers Fidelity’s continued growth not only demonstrates elevated sales activity but serves as testament to the vital relationships and brand loyalty we have cultivated with our insurance producers. While we continue to enjoy net premium growth in the life and health operation our focus remains on judicious management of the quality of our business, further diversifying our product portfolio and improving operating results. The property and casualty operation continues to perform exceptionally well and we are pleased to report American Southern ended the first six months of 2018 with an increase in premium income over the comparable period of 2017.”
Atlantic American is an insurance holding company involved through its subsidiary companies in specialty markets of the life, health, and property and casualty insurance industries. Its principal insurance subsidiaries are American Southern Insurance Company, American Safety Insurance Company, Bankers Fidelity Life Insurance Company and Bankers Fidelity Assurance Company.
Note regarding Private Securities Litigation Reform Act: Except for historical information contained herein, this press release contains forward-looking statements that involve a number of risks and uncertainties. Actual results could differ materially from those indicated by such forward-looking statements due to a number of factors and risks detailed from time to time in statements and reports that Atlantic American Corporation files with the Securities and Exchange Commission.
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For further information contact:
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J. Ross Franklin
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Hilton H. Howell, Jr.
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Chief Financial Officer
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Chairman, President & CEO
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Atlantic American Corporation
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Atlantic American Corporation
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404-266-5580
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404-266-5505
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Atlantic American Corporation
Financial Data
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Three Months Ended
June 30,
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Six Months Ended
June 30,
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(Unaudited; In thousands, except per share data)
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2018
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2017
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2018
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2017
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Insurance premiums
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Life and health
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$
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29,303
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$
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26,989
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$
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58,798
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$
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54,680
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Property and casualty
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13,542
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13,131
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26,249
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26,222
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Investment income
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2,537
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2,085
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4,896
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4,244
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Realized investment gains (losses), net
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(57
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)
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1,396
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313
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2,279
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Unrealized gains (losses) on equity securities, net
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4,089
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-
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(330
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)
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-
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Other income
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29
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31
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57
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66
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Total revenue
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49,443
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43,632
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89,983
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87,491
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Insurance benefits and losses incurred
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Life and health
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23,524
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19,100
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47,519
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40,813
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Property and casualty
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8,695
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7,932
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17,872
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16,216
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Commissions and underwriting expenses
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9,715
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11,010
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19,734
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21,624
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Interest expense
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506
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424
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968
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833
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Other expense
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2,970
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2,981
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6,208
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6,167
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Total benefits and expenses
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45,410
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41,447
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92,301
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85,653
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Income (loss) before income taxes
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4,033
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2,185
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(2,318
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)
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1,838
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Income tax expense (benefit)
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848
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725
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(479
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)
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599
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Net income (loss)
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$
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3,185
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$
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1,460
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$
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(1,839
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)
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$
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1,239
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Earnings (loss) per common share (basic and diluted)
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$
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0.15
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$
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0.07
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$
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(0.10
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$
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0.05
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Reconciliation of Non-GAAP Financial Measure
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Net income (loss)
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$
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3,185
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$
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1,460
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$
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(1,839
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)
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$
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1,239
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Income tax expense (benefit)
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848
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725
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(479
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)
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599
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Realized investment gains (losses), net
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57
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(1,396
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)
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(313
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)
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(2,279
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)
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Unrealized gains (losses) on equity securities, net
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(4,089
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)
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-
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330
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-
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Operating income (loss)
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$
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1
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$
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789
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$
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(2,301
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)
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$
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(441
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)
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Selected Balance Sheet Data
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June 30,
2018
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December 31,
2017
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Total cash and investments
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$
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254,201
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$
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272,058
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Insurance subsidiaries
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235,055
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244,754
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Parent and other
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19,146
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27,304
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Total assets
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341,655
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343,239
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Insurance reserves and policyholder funds
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191,420
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173,583
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Debt
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33,738
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33,738
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Total shareholders' equity
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101,667
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112,983
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Book value per common share
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4.75
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5.26
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Statutory capital and surplus
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Life and health
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31,688
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34,135
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Property and casualty
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43,878
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43,348
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