Atlantic American Corporation announces its second quarter

ATLANTA, Aug. 10, 2021 (GLOBE NEWSWIRE) – Atlantic American Corporation (Nasdaq-AAME) today reported net income for the three-month period ended June 30, 2021 of $ 3.0 million, or 0 , $ 14 per diluted share, compared to net earnings of $ 6.5 million, or $ 0.30 per diluted share, for the comparable period in 2020. For the six-month period ended June 30, 2021, the Company reported net income of $ 2.5 million, or $ 0.11 per diluted share, compared to net loss of $ 1.6 million, or $ 0.09 per diluted share, for the comparable period of 2020. The decrease in net income in the second quarter of 2021 is primarily due to a $ 4.5 million increase in life and health insurance benefits and losses incurred. This increase was largely the result of higher use of policy benefits compared to the unusually low levels recorded in 2020 during the COVID-19 restrictions in place imposed on our policyholders. The increase in net income for the six-month period ended June 30, 2021 is mainly attributable to $ 4.7 million of unrealized net gains on equity securities, compared to $ 7.1 million of unrealized losses on equity securities during the comparable period in 2020. Changes in unrealized gains and losses on equity securities for the applicable periods result primarily from fluctuations in the market value of the Company’s equity investments.

Operating profit (as defined below) decreased by $ 7.2 million during the three-month period ended June 30, 2021 compared to the three-month period ended June 30, 2020. For For the six-month period ended June 30, 2021, operating income decreased by $ 6.6 million compared to the period in 2020. The decrease in operating income for the three and six month periods is mainly due a less favorable loss experience in life and health operations, resulting from a significant increase in the number of claims incurred within the Medicare supplements business line, as mentioned above.

Commenting on the results, Hilton H. Howell, Jr., Chairman, President and CEO, said, “We are extremely pleased with the new premium growth this year in our P&C business. Despite the challenges faced over the past year related to the COVID-19 pandemic, this business has thrived extremely well. We continue to refine our Medicare supplements business underwriting and have made targeted investments in life and health operations to better meet the needs of our customers. The second half of the year is when the majority of listing periods begin in both the individual and group markets, which we believe are well positioned to serve. We expect a good end for the rest of this year. “

Atlantic American Corporation is an insurance holding company active, through its subsidiaries, in the specialty markets of the life, health and P&C insurance sectors. Its main 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 generally accepted accounting principles (GAAP) in the United States. However, from time to time, the Company may present, in its public statements, press releases and documents filed with the Securities and Exchange Commission, non-GAAP financial measures such as operating profit (loss). Management believes that operating profit (loss) is a useful measure for investors, potential investors, securities analysts and others, as it isolates the “core” operating results of the company prior to consider certain items that are beyond management’s control (such as income tax which is subject to schedule, regulatory and tariff changes depending on the schedule of associated income and expenses) or should not have to ” regular impact on the Company’s operating results (such as realized and unrealized investment gains (losses), which are not part of the Company’s core business and are, to a limited extent, subject to the discretion in terms of implementation schedule). The accompanying financial data includes a reconciliation of operating profit (loss) and net profit (loss), the most comparable GAAP financial measure. The Company’s definition of operating profit (loss) may differ from the financial measures of the same name used by others. This non-GAAP financial measure should be viewed as a supplement and not a substitute for financial information prepared in accordance with GAAP.

Note regarding the Private Securities Litigation Reform Act: With the exception of historical information contained in this document, this press release contains forward-looking statements which involve a number of risks and uncertainties. Actual results could differ materially from those indicated by these forward-looking statements due to a number of factors and risks detailed from time to time in the statements and reports that the Atlantic American Corporation files with the Securities and Exchange Commission.

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