ATLANTA, May 11, 2020 (GLOBE NEWSWIRE) — Atlantic American Corporation (Nasdaq- AAME) today reported net loss of $8.1 million, or $0.40 per diluted share, in the first quarter of 2020 compared to net income of $4.2 million, or $0.19 per diluted share, in the first quarter of 2019. The increase in net loss is primarily the result of unrealized losses on equity securities of $8.5 million in the current quarter compared to unrealized gains on equity securities of $6.5 million in the prior year quarter. The market value of the Company’s investment portfolio was significantly impacted by the material declines in the capital markets related to the COVID-19 pandemic and related economic developments. Excluding the effects of realized or unrealized gains or losses and taxes, operating loss (as defined below) improved to $2.0 million in the current year quarter from $2.6 million in the prior year quarter, primarily as a result of favorable loss experience in the Medicare supplement line of business in the Company’s life and health operations. Total insurance premiums increased 1.7% to $45.6 million in the current year quarter compared to $44.8 million in the prior year quarter.  The increase in insurance premiums is primarily the result of an 8.1% increase in the Company’s property and casualty operations somewhat offset by a marginal decline in the life and health operations.
Commenting on the results, Hilton H. Howell, Jr., chairman, president and chief executive officer, stated, “I couldn’t be more proud of our employees’ efforts during these trying times of the COVID-19 pandemic.  In an unprecedented move, we quickly shifted to a work from home environment with no interruptions in servicing the needs of our policyholders and agents.  Although results for the quarter were overshadowed by recent disruption in the financial markets, I’m encouraged by the improvement in operating results over prior year.”Atlantic American Corporation 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 non-GAAP financial measure: Atlantic American Corporation presents its consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP).  However, from time to time, the Company may present, in its public statements, press releases and filings with the Securities and Exchange Commission, non-GAAP financial measures such as operating income (loss). Management believes operating income (loss) is a useful metric for investors, potential investors, securities analysts and others because it isolates the “core” operating results of the Company before considering certain items that are either beyond the control of management (such as income tax expense, which is subject to timing, regulatory and rate changes depending on the timing of the associated revenues and expenses) or are not expected to regularly impact the Company’s operating results (such as any realized and unrealized investment gains (losses), which are not a part of the Company’s primary operations and are, to a limited extent, subject to discretion in terms of timing of realization).  The financial data attached includes a reconciliation of operating income (loss) to net income (loss), the most comparable GAAP financial measure.  The Company’s definition of operating income (loss) may differ from similarly titled financial measures used by others.  This non-GAAP financial measure should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP.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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