American Independence Corp. Announces 2012 Fourth-Quarter and Annual Results NEW YORK, March 7, 2013 (GLOBE NEWSWIRE) -- American Independence Corp. (Nasdaq:AMIC) today reported 2012 fourth-quarter and annual results. This press release contains both GAAP and non-GAAP financial information for which reconciliations can be found at the end of this release. Financial Results Net income attributable to AMIC increased to $7.2 million ($.87 per share, diluted), for the three months ended December 31, 2012, compared to $0.5 million ($.06 per share, diluted), for the three months ended December 31, 2011. Due to our profitability in 2012 and projected continuing profitable results, AMIC's net income and operating income for the fourth quarter and year ended December 31, 2012 were positively impacted by an increase of $5.9 million in the deferred tax asset related to our federal net operating loss carryforwards ("NOLs"). Revenues increased to $29.4 million for the three months ended December 31, 2012, compared to revenues of $21.4 million for the three months ended December 31, 2011, primarily due to an increase in premiums. Net income attributable to AMIC increased to $9.6 million ($1.16 per share, diluted), for the year ended December 31, 2012, compared to $2.5 million ($.29 per share, diluted), for the year ended December 31, 2011. Revenues increased to $101.9 million for the year ended December 31, 2012, compared to revenues of $88.0 million for the year ended December 31, 2011, primarily due to an increase in premiums. The Company's operating income^1 for the three months ended December 31, 2012 was $1.5 million ($.19 per share, diluted), as compared to $0.7 million ($.08 per share, diluted) for the three months ended December 31, 2011. Operating income was $5.3 million ($.64 per share, diluted), for the year ended December 31, 2012, as compared to $3.5 million ($.41 per share, diluted) for the year ended December 31, 2011. ^1 Operating income is a non-GAAP measure and is defined as net income attributable to AMIC excluding non-cash charges related to the amortization of certain intangible assets recorded in purchase accounting, net realized investment gains and losses, and the federal income tax charge and reduction of valuation allowance related to deferred tax asset. The Company believes that the presentation of operating income may offer a better understanding of the core operating results of the Company. A reconciliation of income from continuing operations to operating income is included in this press release. Chief Executive Officer's Comments Roy Thung, Chief Executive Officer, commented, "We continue to experience growth and improved loss ratio results in our stop-loss line from business underwritten by IHC Risk Solutions. We are excited by the growth and returns on our pet line of business and our expansion into new lines of business, including non-subscriber occupational accident and international insurance, and our new direct-to-consumer tools and distribution platforms. Our financial condition and balance sheet remain strong.We have no debt and have grown our book value to $12.59 per share at December 31, 2012 from $11.36 per share at December 31, 2011." Valuation Allowance Relating to the Deferred Tax Asset In the fourth quarter of 2012, the Company further reduced the valuation allowance relating to the deferred tax asset, which caused a corresponding increase in such deferred tax asset.The valuation allowance relates to the likelihood that AMIC might not be able to fully utilize its prior tax year federal NOLs.AMIC reviews the valuation allowance on a quarterly basis to determine the reasonableness of the amount.Based upon AMIC's profitability in 2012 and projections of future profitable results, it was appropriate to further reduce the valuation allowance in the fourth quarter of 2012 in the amount of $5.9 million, which resulted in an increase in net income. Non-GAAP Financial Measures The Company provides non-GAAP financial measures to complement its consolidated financial statements presented in accordance with GAAP: (i) Operating income is net income attributable to AMIC excluding non-cash charges related to the amortization of intangible assets recorded in purchase accounting, net realized investment gains (losses), and the federal income tax charge related to deferred taxes due to its federal net operating loss carryforwards, and (ii) Operating income per share is operating income (loss) on a per share basis. These non-GAAP financial measures are intended to supplement the user's overall understanding of the Company's current financial performance and its prospects for the future.Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by identifying certain expenses that, when excluded from the GAAP results, may provide additional understanding of the Company's core operating results or business performance.However, these non-GAAP financial measures are not intended to supersede or replace the Company's GAAP results.A reconciliation of the non-GAAP results to the GAAP results is provided in the "Reconciliation of GAAP Income from Continuing Operations to Non-GAAP Income from Continuing Operations" schedule below. About American Independence Corp. AMIC, through Independence American Insurance Company and its other subsidiaries, offers major medical for individuals and families, medical stop-loss, small group major medical, short-term medical, various supplemental products, pet insurance, and non-subscriber occupational accident and international coverages.AMIC provides to the individual and self-employed markets health insurance and related products, which are distributed through its subsidiaries, IPA Family, LLC, healthinsurance.org, LLC, and IHC Specialty Benefits, Inc.AMIC markets medical stop-loss through its marketing and administrative company IHC Risk Solutions, LLC. Certain statements in this news release may be considered forward-looking statements, such as statements relating to management's views with respect to future events and financial performance.Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements.Potential risks and uncertainties include, but are not limited to, economic conditions in the markets in which AMIC operates, new federal or state governmental regulation, AMIC's ability to effectively operate, integrate and leverage any past or future strategic acquisition, and other factors which can be found in AMIC's other news releases and filings with the Securities and Exchange Commission.AMIC expressly disclaims any duty to update its forward-looking statements or earnings guidance, and does not undertake to provide any such guidance in the future. AMERICAN INDEPENDENCE CORP. FOURTH QUARTER REPORT December 31, 2012 (In thousands except per share data) Three Months Ended Year Ended December 31, December 31, 2012 2011 2012 2011 Premiums earned $23,706 $17,875 $83,778 $72,448 Fee and agency income 4,692 2,842 15,441 12,647 Net investment income 544 459 2,126 2,189 Net realized investment gains 403 197 603 520 Net impairment losses recognized in -- (69) (189) (89) earnings Other income 26 73 126 323 Revenues 29,371 21,377 101,885 88,038 Insurance benefits, claims and reserves 15,911 11,652 56,849 47,768 Selling, general and administrative 10,988 8,577 37,875 34,924 expenses Amortization and depreciation 237 210 509 855 Expenses 27,136 20,439 95,233 83,547 Income before income tax 2,235 938 6,652 4,491 State income tax (43) (39) (81) (49) Federal income tax – current and deferred (672) (259) (1,929) (1,258) Federal income tax – reduction of 5,900 -- 5,900 -- valuation allowance Net income 7,420 640 10,542 3,184 Less: Net income attributable to the (262) (133) (950) (690) non-controlling interest Net income attributable to American $7,158 $507 $9,592 $2,494 Independence Corp. Basic income per common share: Net income attributable to American Independence Corp. common $.87 $.06 $1.16 $.29 stockholders Weighted-average shares outstanding 8,272 8,434 8,272 8,497 Diluted income per common share: Net income attributable to American Independence Corp. common $.87 $.06 $1.16 $.29 stockholders Weighted-average diluted shares 8,272 8,434 8,272 8,497 outstanding As of December 31, 2012 there were 8,272,332 common shares outstanding, net of treasury shares. AMERICAN INDEPENDENCE CORP. RECONCILIATION OF GAAP INCOME FROM CONTINUING OPERATIONS TO NON-GAAP INCOME FROM CONTINUING OPERATIONS (In thousands except per share data) Three Months Ended Year Ended December 31, December 31, 2012 2011 2012 2011 Net income attributable to AMIC $7,158 $507 $9,592 $2,494 Amortization of intangible assets related 30 34 124 135 to purchase accounting Net realized investment gains (403) (197) (603) (520) Net impairment losses recognized in -- 69 189 89 earnings Federal income tax charge related to 647 291 1,868 1,258 deferred taxes for operating income Reduction of valuation allowancerelated (5,900) -- (5,900) -- to deferred tax asset Operating Income from continuing $ 1,532 $ 704 $ 5,270 $ 3,456 operations Non - GAAP Basic Income Per Common Share: $ .19 $ .08 $ .64 $ .41 Non - GAAP Diluted Income Per Common $.19 $.08 $.64 $.41 Share: CONTACT: DAVID T. KETTIG (212) 355-4141 Ext. 3047 www.americanindependencecorp.com
American Independence Corp. Announces 2012 Fourth-Quarter and Annual Results
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