Mercury General Corporation Announces Third Quarter Results; Gabriel Tirador Named President and Chief Operating Officer
Mercury General Corporation (NYSE: MCY), a major California automobile insurer with operations in a number of other states, reported today that net operating earnings in the third quarter of 2001 were $30.2 million, or $.56 per share (diluted), compared with $27.0 million, or $.50 per share (diluted) in 2000. For the full nine months, net operating earnings were $78.6 million, or $1.45 per share (diluted), compared with $81.6 million, or $1.50 per share (diluted) in 2000. Per share net income (diluted), including net realized investment gains, was $.59 for the third quarter and $1.53 for the full nine months, compared with $.51 and $1.54 respectively, in 2000.
Company-wide premiums written in the third quarter were $373.7 million, a 16.6% increase over 2000. California premiums written in the quarter were $325.7 million, a 14.9% increase over 2000.
The loss ratio (GAAP basis) was 71.3% in the third quarter and 72.5% for the full nine months, compared to 71.9% and 71.3%, respectively, in 2000.
The expense ratio (GAAP basis) was 26.2% in the third quarter and 26.5% for the full nine months, compared to 26.2% and 26.8%, respectively, in 2000.
Investment income in the quarter increased 8.1% to $29.0 million. After taxes, at an effective rate of 14.3% versus 10.4% in 2000, per share (diluted) investment income was $.46 in the third quarter, compared with $.44 in 2000. The after-tax yield on average investments of $1.8 billion (fixed maturities and equities at cost) was approximately 5.38% for the quarter, compared with 5.56% for all of 2000.
On October 26, 2001, the Board of Directors appointed Gabriel Tirador to the position of President and Chief Operating Officer. George Joseph, the Company's Chairman and CEO has also been the Company's President since October of 2000. Mr. Tirador is 37 years old and has served as the Company's Vice President and Chief Financial Officer since February of 1998. In October of 2000, Mr. Tirador's operational duties were expanded to include responsibility over Company systems, claims and underwriting operations. Theodore Stalick, the Company's Chief Accounting Officer, was appointed Vice President and Chief Financial Officer.
The Board of Directors declared a third quarter dividend of $.265 per share to be paid on December 27, 2001 to holders of record on December 14, 2001. The Company's book value per share at September 30, 2001 was $19.92 per share.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release are forward-looking statements based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the Company) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the demand for the Company's insurance products, and in general economic conditions; the possibility actual loss experience may vary adversely from the actuarial estimates made to determine the Company's loss reserves; legislation adverse to the automobile insurance industry or business generally may be enacted in California or other states; the presence of competitors with greater financial resources and the impact of competitive pricing and marketing efforts; and various legal, regulatory and litigation risks. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see the Company's filings with the Securities and Exchange Commission.
MERCURY GENERAL CORPORATION SUMMARY OF OPERATING RESULTS (000) Quarter Ended September 30, 2001 2000 Net Premiums Written $373,718 $320,516 Net Premiums Earned 351,896 315,108 Paid Losses and Loss Adjustment Expenses 234,778 209,173 Incurred Losses 250,939 226,706 Net Investment Income 29,043 26,865 Net Operating Income (A) 30,245 27,015 Capital Gains, net of tax 1,810 406 Net Income $32,055 $27,421 Basic Average Shares Outstanding 54,182,065 54,074,298 Diluted Average Shares Outstanding 54,385,345 54,223,764 Basic Per Share Data Earnings Per Share $0.59 $0.51 Diluted Per Share Data Net Operating Income $0.56 $0.50 Capital Gains, net of tax $0.03 $0.01 Earnings Per Share $0.59 $0.51 Operating Ratios--GAAP Basis (B) Loss Ratio 71.3% 71.9% Expense Ratio 26.2% 26.2% Combined Ratio 97.5% 98.1% Nine months Ended September 30, 2001 2000 Net Premiums Written $1,067,675 $956,111 Net Premiums Earned 1,013,839 931,950 Paid Losses and Loss Adjustment Expenses 706,002 634,132 Incurred Losses 734,577 664,609 Net Investment Income 85,003 78,536 Net Operating Income (A) 78,628 81,551 Capital Gains, net of tax 4,600 1,810 Net Income $83,228 $83,361 Basic Average Shares Outstanding 54,167,910 54,098,916 Diluted Average Shares Outstanding 54,363,277 54,230,720 Basic Per Share Data Earnings Per Share $1.54 $1.54 Diluted Per Share Data © Net Operating Income $1.45 $1.50 Capital Gains, net of tax $0.08 $0.03 Earnings Per Share $1.53 $1.54 Operating Ratios--GAAP Basis (B) © Loss Ratio 72.5% 71.3% Expense Ratio 26.5% 26.8% Combined Ratio 99.0% 98.1% (A) Net Income, excluding capital gains, net of tax. (B) Generally Accepted Accounting Principles © Some numbers may not sum due to rounding
SOURCE: Mercury General Corporation
Contact: Mercury General Corporation Investor Relations Department,
Company News On-Call: http://www.prnewswire.com/comp/554587.html