Affirmative Insurance Holdings Inc., an Addison, Texas-based provider of personal non-standard automobile insurance, reported that the third quarter ending Sept. 30, 2004, was a good one for the company.
Affirmative’s net income increased 62.9 percent over the same period in 2003, and revenues from agency operations increased 21.9 percent and the pre-tax margin was 16.5 percent, an improvement of 5.6 percentage points from year-ago levels. Additionally, revenues from insurance company operations increased to $58.1 million from $2.5 million in the prior year and the combined ratio was 94.4 percent. Available cash was used to retire $5.8 million in notes payable, rendering the balance sheet debt free.
Third quarter 2004 net income was $6.0 million or $0.37 per diluted share, a year-over-year increase of $2.3 million or 62.9 percent, compared to $3.7 million or $0.36 per diluted share for the same period in 2003. Weighted average shares for the third quarter were 16.2 million compared to 10.1 million for the same period of 2003.
Revenues for the three months ended Sept.30 were $72.6 million, an increase of $48.5 million compared to $24.1 million for the same period in 2003. The increase in revenues was principally due to Affirmative’s increased retention of gross premiums written by its insurance companies as a result of the increased capitalization of the insurance companies following Affirmative’s initial public offering.
For the nine months ended Sept. 30, net income was $18.7 million or $1.42 per diluted share, compared to net income of $12.7 million or $1.26 per diluted share in the same period of 2003. Revenues for the first nine months of 2004 were $212.0 million compared to $75.2 million during the same period of 2003.
Affirmative maintains a positive outlook for the fourth quarter of 2004 and has adjusted its earnings guidance for the full year to a range of $1.65 to $1.75 per diluted share from a range of $1.60 to $1.80 per diluted share. For 2005, the company projects earnings to be in the range of $1.85 to $2.05 per diluted share.
Affirmative currently offers products and services in 11 states, including Texas, Illinois, California and Florida.
Topics Profit Loss
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