ULLICO Inc. Continues Revenue Momentum; Increase In Continuing Lines of 22% Over Prior Year
ULLICO Inc. ("the Company"), the labor owned multi-line holding company offering insurance and financial products and services, today reported a pre-tax operating loss of $2.5 million for the current quarter ended March 31, 2009, compared to pre-tax operating income of $4.1 million in the prior year's quarter. The net loss for the current quarter was $1.7 million, compared to net income of $2.6 million in the prior year's quarter.
Washington, DC (PRWEB) May 19, 2009 -- ULLICO Inc. ("the Company"), the labor owned multi-line holding company offering insurance and financial products and services, today reported a pre-tax operating loss of $2.5 million for the current quarter ended March 31, 2009, compared to pre-tax operating income of $4.1 million in the prior year's quarter. The net loss for the current quarter was $1.7 million, compared to net income of $2.6 million in the prior year's quarter.
Highlights for the quarter:
-The Life and Health business unit contributed pre-tax earnings of $1.7 million from continuing operations, compared to $2.1 million for the same period last year. Earnings in the quarter were impacted by $0.8 million in start up expenses related to the launch of a new product line, partially offset by favorable Direct Marketing results. Revenue from continuing lines was $36.7 million, an increase of 10% over the same quarter in 2008, led by the core Medical Stop Loss line of business.
-The Property and Casualty business unit contributed pre-tax earnings of $1.7 million, compared to $1.4 million for the same period last year. Revenue from continuing lines was $20.7 million, an increase of 74% over the same quarter in 2008. The increase was a result of continued strong sales in Fiduciary, Union Liability, and Workers' Compensation business and continued successful expansion of the Commercial and Surety lines of business.
-The Retirement Services business unit contributed pre-tax earnings of $0.6 million, compared to $5.7 million for the same period last year. In the current quarter, limited partnership investments generated a loss of $1.8 million, compared to a gain of $0.7 million for the same period last year. In addition, the results were impacted by a decrease in assets under management, which decreased from $5.4 billion at March 31, 2008 to $5.1 billion at March 31, 2009. However, assets under management within the Company's flagship Separate Account J (J for Jobs Fund) grew from $3.5 billion at March 31, 2008 to $3.6 billion at March 31, 2009.
The Company's net investment income, which affects each of the Company's business unit results, was $3.2 million compared to $7.0 million last year due primarily to the results of the limited partnership investments discussed above, as well as the low interest rate environment that currently exists.
Corporate expenses were $7.2 million and $6.6 million in the first quarter of 2009 and 2008, respectively, and are reflected in the operating results for each of the quarters.
Total premium and fee revenue for the quarter was $69.0 million compared to $64.5 million in the prior year's quarter. Core revenue of the Company's continuing lines was $67.0 million compared to $55.0 million last year, an increase of 22%. Revenue from exited lines decreased to $2.1 million from $9.6 million due to the continued run-off of the Company's fully insured group health business following the decision in late 2006 to no longer actively market these products.
Recent Developments:
Mark Singleton, CEO, is leaving the Company. Mr. Edward J. McElroy who is currently serving on the Board of Directors and has served as Chairman of the Audit Committee will serve as Interim CEO. As Chairman of the Audit Committee, Ed is well versed in the business and joins an experienced management team that will continue to move the business forward.
Edward McElroy, Interim ULLICO CEO, stated, "The strong revenue growth in our core lines of business is very encouraging, especially considering the overall soft market. Our strategy to broaden our product portfolio and expand our markets is clearly paying dividends. Each of our business units was profitable in the quarter and we expect our continued sales growth and underwriting discipline to generate improved operating results for the balance of the year."
Chairman Joseph Hunt stated, "Although our first quarter earnings results were below expectations, I'm pleased with our continued sales momentum despite challenges in our various markets. We appreciate all who actively support ULLICO by continuing to invest in the products and services we provide to organized labor."
For a breakdown of "Quarterly Financial Results at a Glance," please refer to attached document.
About ULLICO Inc.
ULLICO Inc. is a $5.1 billion holding company whose subsidiary companies include The Union Labor Life Insurance Company, ULLICO Investment Advisors, Inc., Ullico Casualty Company and ULLICO Casualty Group, Inc. The ULLICO Inc. family of companies offers insurance and financial products and services. For additional information, visit http://www.ullico.com.
Forward-Looking Statements
This press release may contain certain "forward-looking statements." In particular, statements regarding growth in our business are forward-looking statements as are discussions of our product pipeline and expected performance. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of ULLICO Inc. or its subsidiary companies, or the industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements.
ULLICO's forward-looking statements speak only as of the date of this press release or as of the date they are made, and ULLICO undertakes no obligation to update its forward-looking statements.
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