2009-10-28 22:07:02 -
PENNINGTON, NJ -- (Marketwire) -- 10/28/09 -- Mercer Insurance Group, Inc. (NASDAQ: MIGP) reported today its operating results for the nine months and quarter ended September 30, 2009.
3rd Quarter highlights:
-- Net income of $0.56 per diluted share versus $0.28 per diluted share
in the prior year's quarter,
-- Operating income of $0.51 per diluted share, which was the same as the
prior year's quarter,
-- A GAAP combined ratio of 98.2% versus 97.9% in the prior year's
quarter,
-- Book value per share of $25.49.
Andrew R. Speaker, President and CEO, commented, "We are happy to have generated an operating profit that is consistent with third quarter earnings in past years. In an environment in which we are challenged by both a slow economy and continued competitive insurance pricing, it is pleasing to see that our disciplined underwriting has lead to profitable operations."
Speaker noted, "We are also delighted that our strategy of maintaining a prudent investment portfolio while also seeking a fair return has continued to protect and enhance our capital position. Our conservatively positioned portfolio, along with our disciplined underwriting performance, has helped increase book value per share to its highest ever level."
"We expect the challenging conditions from the economy and competitive pricing to persist. We will maintain our underwriting and investment discipline, continue to exercise careful expense management and work on building out the new products we've introduced in the past few years. This focus should help us to continue to generate operating profits while protecting our shareholders' capital."
Financial Summary (in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
(unaudited) (unaudited)
-------------------- --------------------
2009 2008 2009 2008
--------- --------- --------- ---------
Total revenue $ 39,274 $ 39,593 $ 117,996 $ 124,374
Net premiums written 33,355 37,575 105,537 115,863
Net premiums earned 34,681 37,869 105,215 115,590
Net investment income 3,605 3,469 10,833 10,173
Net realized gains (losses) on
investments 472 (2,281) 393 (2,944)
Net income, after tax 3,554 1,780 10,195 7,605
Earnings per share - Basic $ 0.57 $ 0.29 $ 1.64 $ 1.22
Earnings per share - Diluted $ 0.56 $ 0.28 $ 1.61 $ 1.19
Combined ratio 98.2% 97.9% 98.0% 98.0%
Book value per share $ 25.49 $ 21.39
Reconciliation of non-GAAP
financial measures:
Net income $ 3,554 $ 1,780 $ 10,195 $ 7,605
Net realized gains (losses) on
investments, net of tax (311) 1,482 (260) 1,913
Net operating income 3,243 3,262 9,935 9,518
Operating earnings per share -
Basic $ 0.52 $ 0.52 $ 1.60 $ 1.53
Operating earnings per share -
Diluted $ 0.51 $ 0.51 $ 1.57 $ 1.49
In the quarter ended September 30, 2009, the Company reported GAAP net income under U.S. generally accepted accounting principles (GAAP) of $3.6 million, or $0.56 per diluted share. This result compares to net income of $1.8 million, or $0.28 per diluted share, for the same quarter in the previous year. Operating income of $3.24 million approximated the $3.26 million reported in the prior year's quarter.
In the nine months ended September 30, 2009, the Company reported GAAP net income of $10.2 million, or $1.61 per diluted share. This result compares to net income of $7.6 million, or $1.19 per diluted share, for the same period in the previous year. Operating income increased to $9.9 million from $9.5 million in the prior year.
The Company also announced that its Board of Directors has approved a dividend of $0.075 per share, to be paid on December 28, 2009 to shareholders of record on December 11, 2009.
Operating income and operating income per share are non-GAAP financial measures that we present because we believe they enhance an investor's understanding of the Company's core operating performance. Operating income and operating income per share consist of net earnings adjusted for after-tax net realized investment gains and losses.
Mercer Insurance Group, Inc. offers commercial and personal lines of insurance to businesses and individuals principally in seven states through its insurance subsidiaries: Mercer Insurance Company, Mercer Insurance Company of New Jersey, Inc., Financial Pacific Insurance Company and Franklin Insurance Company.
Certain of the statements in this press release (other than statements of historical facts) are forward-looking statements. Such forward-looking statements include estimates and assumptions related to economic, competitive and legislative developments. These forward-looking statements are subject to change and uncertainty that are, in many instances, beyond the Company's control and have been made based upon management's expectations and beliefs concerning future developments and their potential effect on Mercer Insurance Group, Inc. There can be no assurance that future developments will be in accordance with management's expectations so that the effect of future developments on Mercer Insurance Group, Inc. will be those anticipated by management. Actual financial results including premium growth and underwriting results could differ materially from those anticipated by Mercer Insurance Group, Inc. depending on the outcome of certain factors, which may include changes in property and casualty loss trends and reserves; catastrophe losses; the insurance product pricing environment; changes in applicable law; government regulation and changes therein that may impede the ability to charge adequate rates; changes in accounting principles; performance of the financial markets; fluctuations in interest rates; availability and price of reinsurance; and the status of the labor markets in which the Company operates.
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Company Contacts:
Andrew R. Speaker
President & CEO
Mercer Insurance Group, Inc.
(609) 737-0426
David B. Merclean
Senior Vice President & CFO
Mercer Insurance Group, Inc.
(609) 737-0426
