Chicago-based Unitrin Inc. reported net income of $22.7 million (34 cents per common share) for the second quarter, compared to net income of $4.4 million (6 cents per common share) for the same period in 2002. Profit was up thanks to the acquisition of Kemper’s personal lines business and higher realized investment gains.
Premiums for the second quarter increased by $193.6 million, compared to the same period in 2002, due primarily to $147.6 million in premiums in the Kemper Auto and Home segment, a $28.4 million increase in premiums in the Unitrin direct sales segment, including $21.8 million from Kemper Direct, and a $21.9 million increase in premiums in the Specialty Lines Insurance segment.
On June 28, 2002, Unitrin closed its acquisition of the personal lines property and casualty insurance business (“Kemper Auto and Home”) of the Kemper Insurance Companies (“KIC”) and the purchase of the stock of KIC’s direct distribution personal lines subsidiaries (“Kemper Direct”). The results of the purchased businesses are included in the Company’s results of operations from the date of acquisition.
Consumer finance revenues increased by $6.4 million for the three months ended June 30, 2003, compared to the same period in 2002, due primarily to a higher level of loans outstanding.
Net investment income increased by $0.4 million for the three months ended June 30, 2003, compared to the same period in 2002, due to higher levels of investments, partially offset by lower yields on investments. Other income increased by $4.6 million due primarily to administration fees earned from KIC to administer certain run-off business.
Net realized investment gains (losses) were gains of $10.8 million for the three months ended June 30, 2003, compared to losses of $1.6 million for the three months ended June 30, 2002. Net realized investment gains (losses) in the second quarter of 2003 included pre-tax gains of $13.4 million from dispositions of investments, pre-tax losses of $0.4 million from dispositions of investments, a pre-tax loss of $1.8 million to write-down one investment in real estate and a pre-tax loss of $0.4 million to recognize other than temporary declines in market values of investments in one issuer.
Net realized investment gains (losses) in the second quarter of 2002 included a pre-tax gain of $2.4 million on the disposition of investment real estate, pre-tax gains of $0.8 million on the disposition of other investments, pre-tax losses of $0.9 million on dispositions of investments and pre-tax losses of $3.9 million to recognize other than temporary declines in market values of investments in one issuer. The Company cannot anticipate when or if investment gains or losses may occur in the future.
Topics Profit Loss
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