Financial Performance - For the three-month period ended March 31, 2023, net income was a loss of $1.446 million, or $(0.08) per diluted share, compared to net income of $2.842 million, or $0.13 per diluted share for the same period in 2022[111]. - Total revenue for the three-month period ended March 31, 2023, was $46.269 million, a decrease of $5.339 million, or 10.4%, from $51.608 million in the comparable period in 2022[109]. - Operating income decreased by $1.1 million for the three-month period ended March 31, 2023, primarily due to unfavorable loss experience in property and casualty operations[112]. - The Parent's insurance subsidiaries reported statutory net income of $1.1 million for the three months ended March 31, 2023, compared to $1.3 million in the same period in 2022[134]. Insurance Premiums and Losses - Insurance premiums, net, decreased by $981,000, or 2.1%, to $46.1 million for the three-month period ended March 31, 2023, down from $47.1 million in the same period in 2022[111]. - American Southern's gross written premiums decreased by $2.1 million, or 18.4%, during the three-month period ended March 31, 2023, compared to the same period in 2022[114]. - Bankers Fidelity's gross earned premiums decreased to $43.098 million for the three-month period ended March 31, 2023, down from $45.461 million in the comparable period in 2022[122]. - Insurance benefits and losses incurred at American Southern increased by $2.2 million, or 20.8%, during the three-month period ended March 31, 2023, compared to the same period in 2022[119]. - Gross earned premiums from the Medicare supplement line decreased by $3.7 million, or 9.8%, primarily due to non-renewals exceeding new business writings[125]. - Insurance benefits and losses incurred decreased by $2.9 million, or 14.0%, with a loss ratio of 61.6% for the three months ended March 31, 2023, down from 69.6% in the same period in 2022[126]. Expenses and Ratios - The combined ratio for American Southern was 97.9% for the three-month period ended March 31, 2023, compared to 94.7% for the same period in 2022, indicating an underwriting loss[114]. - The loss ratio for Bankers Fidelity was 61.6% for the three-month period ended March 31, 2023, compared to 69.6% for the same period in 2022[123]. - Commissions and underwriting expenses for Bankers Fidelity increased to $10.720 million for the three-month period ended March 31, 2023, compared to $8.746 million in the same period in 2022[122]. - Commissions and underwriting expenses increased by $2.0 million, or 22.6%, with underwriting expenses as a percentage of earned premiums rising to 37.1%[127]. Investment and Cash Flow - Investment income increased by $0.2 million, or 8.6%, attributed to a rising interest rate environment[128]. - The Company recognized net unrealized losses on equity securities of $2.4 million for the three months ended March 31, 2023[129]. - Interest expense increased by $0.4 million, or 111.9%, primarily due to changes in the London Interbank Offered Rate (LIBOR)[130]. - Cash and cash equivalents decreased from $28.9 million at December 31, 2022, to $13.5 million at March 31, 2023, primarily due to net cash used in operating activities of $11.6 million[144]. Borrowings - At March 31, 2023, the Company had outstanding borrowings of $3.0 million under a revolving credit agreement[143].
Atlantic American(AAME) - 2023 Q1 - Quarterly Report