Symons International Group, Inc. to Discuss Q3 1998 Results
9 October 1998
Symons International Group, Inc. to Discuss Third Quarter 1998 Results
INDIANAPOLIS, Ind.--Oct. 8, 1998--Symons International Group, Inc. , a leading provider of crop and non-standard automobile insurance, will conduct a conference call Monday, October 12, 1998, at 4:00 p.m. EDT to discuss its Third Quarter 1998 results.
Symons International Group, Inc. ("SIGC" or the "Company") will host a conference call on Monday, October 12, 1998 at 4:00 p.m. EDT to discuss its results for the Third Quarter of 1998. This call was initially announced by the Company on October 7, 1998.
In its October 7, 1998 Release, the Company stated that it anticipated lower-than-expected earnings for the Third Quarter of 1998, primarily due to the effects of Hurricanes Bonnie and Georges and other weather-related events. The purpose of today's announcement (as was stated in the October 7, 1998 Release) is to expand the discussion of the Company's Third Quarter 1998 results and to facilitate the conference call on Monday, October 12. As was also stated in the Company's October 7, 1998 Release, the financial information released today is the Company's estimate (based on information known as of the close of business on October 7, 1998) of its Third Quarter 1998 results. The Company will issue a formal earnings release, in accordance with its normal practice, during the first week of November.
CROP OPERATIONS
The Company estimates that its crop business, IGF Insurance Company, has break-even pre-tax operating earnings for the Nine Months ended September 30, 1998. The crop business recorded an approximate $12,200,000 pre-tax operating earnings during the first six months of 1998, and will incur an estimated pre-tax operating loss of approximately $12,200,000 for the Third Quarter of 1998. This compares to operating income of $17,500,000 for the nine months ended September 30, 1997, and $4,400,000 for the Third Quarter of 1997.
The Third Quarter 1998 crop operating loss is due primarily to crop-hail losses related to Hurricanes Bonnie and Georges, and other weather-related events. Higher than expected commission expenses, primarily resulting from the integration of the crop business acquired from CNA, added to the Quarter's loss. In accordance with the Company's stated policy, these estimates and any related gains or losses will be adjusted in the Fourth Quarter as final harvest results are known.
Estimated MPCI underwriting gain is at 12% of Gross Written Premiums, despite severe drought in certain sections of the United States. This is due primarily to the Company's effective geographic spread of its MPCI business.
NON-STANDARD AUTO OPERATIONS
The Company estimates that its non-standard auto business has earned an approximate $12,500,000 operating profit for the Nine Months ended September 30, 1998, while earning an approximate $2,500,000 operating profit for the Third Quarter of 1998. This compares to operating income of $11,100,000 for the Nine Months ended September 30, 1997, and $5,100,000 for the Third Quarter of 1997. While it is estimated that year-to-date non-standard auto operating profit is ahead of the same period last year, Third Quarter non-standard auto premium volume did not keep pace with premium volumes for the first six months of 1998 due to product changes in Florida and California. The Company feels that it has successfully addressed these issues and anticipates that non-standard auto premium volume from its core states will return to former levels. Also, the Company has recently entered the state of Arizona and initial indications of premium volume in that state are strong. Further, the Company has now launched its Spanish language policy in the state of Florida, the first insurance company to do so.
CORPORATE EARNINGS
The Company estimates that its consolidated net operating profit after debt service and taxes will approximate break-even for the Nine Months ended September 30, 1998, while incurring an estimated consolidated net operating loss approximating $9,200,000 for the Third Quarter of 1998. This compares to a consolidated operating profit of $13,800,000 for the Nine Months ended September 30, 1997, and a consolidated net operating profit of $4,800,000 for the Third Quarter of 1997. Net earnings, including realized gains, will approximate $1,100,000 for the Nine Months ended September 30, 1998.
The Company estimates that its operating loss per share for the Nine Months ended September 30, 1998 will approximate $<0.04> and that its estimated operating loss per share for the Third Quarter of 1998 will approximate $<0.85>. This compares to operating earnings per share of $1.29 for the Nine Months ended September 30, 1997 and $0.44 for the Third Quarter of 1997. Net earnings per share, including realized gains, is estimated to be an approximate $0.10 per share for the Nine Months ended September 30, 1998.
The Board of Directors of Goran Capital Inc. ("Goran"), the 66% owner of the Company, has today authorized the reinstating of the share buyback program announced earlier this year. Pursuant to this previously announced program, Goran is authorized to repurchase up to 5% of the outstanding shares of Goran at market prices. Goran has also announced today that it intends to purchase Goran shares at market prices beginning Wednesday, October 14, 1998.
Conference Call: There will be a conference call to discuss the Company's results of operations for the third quarter at 4:00 p.m. Eastern Daylight Time on Monday, October 12, 1998; dial 1-800-275-3210 and ask for the "SIG Conference Call." A digital replay of this call will be available immediately after the call and anyone who misses the call can call 1-800-951-9642 and listen to the replay. The replay will be available until midnight, October 16, 1998.
Forward Looking Statements: All statements, trend analysis, and other information contained in this Release and elsewhere (such as in other filings by the Company or its Affiliates with the Securities and Exchange Commission, press releases, presentations by the Company or its management or oral statements) relative to markets for the Company's products and/or trends in the Company's operations or financial results, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend" and other similar expressions, constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may cause actual results to be materially different from those contemplated by the forward-looking statements. Such factors include, among other things: (i) general economic conditions, including prevailing interest rate levels and stock market performance; (ii) factors affecting the Company's crop operations such as weather related events, final harvest results, commodity price levels and commission levels paid to agents; and (iii) factors affecting the Company's non-standard automobile operations such as premium volume, levels of operating expenses as compared to premium volume, ultimate development of loss reserves and implementation of the Company's operating system.
Symons International Group, Inc. is the 10th largest nonstandard automobile insurer in the USA and its IGF crop subsidiary is the 4th largest insurer of crops. IGF Insurance Company writes business in 39 states plus Canada. Symons' subsidiary Pafco General Insurance Company and Superior Insurance Company write nonstandard auto insurance in 22 states.
Anyone wishing further information may contact:
Alan G. Symons
Chief Executive Officer
Indianapolis (317) 259-6302
Websites: SIG www.sigins.com