Reports Third Quarter 2009 Operating Profit of $3.3 Million and Net Income of $2.2 Million
(Washington D.C.) (November 19, 2009) --ULLICO Inc. (“the Company”), the labor owned multi-line holding company offering insurance and financial products and services, today reported pre-tax operating income of $3.3 million for the current quarter ended September 30, 2009, compared to pre-tax operating income of $4.6 million in the prior year's quarter. The net income for the current quarter was $2.2 million, compared to net income of $2.1 million in the prior year’s quarter.
Highlights for the quarter:
• The Property and Casualty business unit contributed pre-tax earnings of $3.2 million, compared to $2.9 million for the same period last year. Revenue was $26.9 million, an increase of 94% over the same quarter in 2008. Both the earnings and revenue growth were primarily attributable to the successful expansion of the Workers’ Compensation, Commercial and Surety lines of business. As announced in our October 7, 2009 press release, by the end of the second quarter, ULLICO Casualty Company surpassed $100 million in gross written in-force premium.
• The Life and Health business unit contributed pre-tax earnings of $3.0 million, compared to pre-tax earnings of $2.6 million for the same period last year. Earnings in the quarter were driven primarily by positive claim experience in the Medical Stop Loss line of business, partially offset by higher claim activity in our Direct Marketing lines of business as well as $0.6 million in additional expenses related to product development activities. Revenue was $38.4 million, an increase of 4% over the same quarter in 2008.
• The Investment Services business unit contributed pre-tax earnings of $4.1 million compared to $7.0 million for the same period last year. The results were primarily driven by lower net investment income, and to a lesser degree, lower investment management fees. During the third quarter of 2008, net investment income was impacted by an extraordinary gain in a residual limited partnership holding.
Total premium and fee revenue for the quarter was $74.3 million compared to $61.3 million in the prior year’s quarter, an increase of 21%.
Year-to-Date Consolidated Results
The year-to-date consolidated operating loss was $2.7 million compared to operating income of $12.4 million in the prior year. The year-to-date variance resulted from lower fee income due to a decrease in our assets under management, additional expenses related to product development activities and lower net investment income. The lower net investment income, which affected each of the Company’s business unit’s results, was primarily due to the negative results of our limited partnership investments as well as the lower interest rate environment that currently exists.
The year-to-date consolidated net loss was $3.5 million compared to net income of $7.1 million in the prior year.
Premium and fee revenue for the first nine months was $214.1 million compared to $190.6 million in 2008, an increase of 12%.
Ed McElroy, ULLICO CEO, stated, “Our strategy of diversifying our product portfolio and expanding our markets is clearly paying dividends as each of our business units generated positive earnings and we continued to generate strong revenue growth.”
Chairman Joseph Hunt stated, “After a slow start to the year, ULLICO reported solid operating results for the third quarter. I am pleased with ULLICO’s sales momentum despite the challenges that face us in our various markets. We appreciate all who actively support ULLICO by continuing to invest in the products and services we provide to unions and union employers.”
Quarterly Financials Results at a Glance
| (In Millions) | 3rd Quarter 2009 | 3rd Quarter 2008 | Variance |
| Total Income | $81.1 | $69.1 | $12.0 |
| Total Benefits & Expenses | 77.8 | 64.5 | (13.3) |
| Pre-Tax Operating Income/(Loss) before Non-Recurring Transactions | $3.3 | $4.6 | ($1.3) |
| Non-Recurring Transactions | (0.4) | (1.3) | 0.9 |
| Pre-Tax Operating Income/(Loss) after Non-Recurring Transactions | $2.9 | $3.3 | ($0.4) |
| Tax Expense/(Benefit) | 0.7 | 1.2 | 0.5 |
| Net Income/(Loss) | $2.2 | $2.1 | $0.1 |
2009 Year-To-Date Results at a Glance
| (In Millions) | As of September 30, 2009 YTD | As of September 30, 2008 YTD | Variance |
| Total Income | $231.9 | $213.5 | $18.4 |
| Total Benefits & Expenses | 234.6 | 201.1 | (33.5) |
| Pre-Tax Operating Income/(Loss) before Non-Recurring Transactions | ($2.7) | $12.4 | ($15.1) |
| Non-Recurring Transactions | (2.9) | (1.3) | (1.6) |
| Pre-Tax Operating Income/(Loss) after Non-Recurring Transactions | ($5.6) | $11.1 | ($16.7) |
| Tax Expense/(Benefit) | (2.1) | 4.0 | 6.1 |
| Net Income/(Loss) | ($3.5) | $7.1 | $10.6 |
About ULLICO
ULLICO Inc., with $5.4 billion in total assets under management, is an insurance and financial services holding company. ULLICO's subsidiary companies include The Union Labor Life Insurance Company; ULLICO Investment Advisors, Inc.; ULLICO Investment Company; ULLICO Casualty Company; and ULLICO Casualty Group, Inc. Since 1927, the ULLICO Family of Companies has offered quality insurance and investment products and services to its single most important client, the American labor movement. For additional information, visit www.ullico.com [1].
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.
CONTACT:
Bina Handa
Manager
Communications & PR 202.682.6611
bhanda@ullico.com [2]
Links:
[1] http://www.ullico.com
[2] mailto:bhanda@ullico.com