National Western Life Announces First Quarter 2005 Earnings
06 Maggio 2005 - 7:40PM
PR Newswire (US)
National Western Life Announces First Quarter 2005 Earnings AUSTIN,
Texas, May 6 /PRNewswire-FirstCall/ -- Ross R. Moody, President of
National Western Life Insurance Company (NASDAQ:NWLIA), announced
today consolidated net earnings of $16.2 million, or $4.47 per
diluted share, for the quarter ended March 31, 2005. For the
quarter ended March 31, 2004, the Company previously reported
consolidated net earnings of $69.3 million, or $19.27 per diluted
share. The first quarter of 2004 results include the effect of a
required change in accounting principle for certain of the
Company's annuity contracts in force which increased reported net
earnings by $54.7 million, or $15.21 per diluted share. The
Company's book value per share at March 31, 2005 increased to
$227.13 from $225.62 per share at December 31, 2004. Earnings from
operations, excluding net realized gains and losses on
investments(1), totaled $15.6 million, or $4.30 per diluted share,
for the quarter ended March 31, 2005, compared with $13.7 million,
or $3.80 per diluted share, for the quarter ended March 31, 2004.
Mr. Moody indicated that the increase in operating earnings
reflects a larger block of business generated from record sales
levels the past few years. "Our life products are long duration
contracts from which profits are earned as policyholders pay their
premiums year after year. The rapid sales growth of the past few
years has created a life book of business in force which has grown
from $10 billion to nearly $14 billion in just over three years,"
Mr. Moody noted. Commenting on operating performance, Mr. Moody
observed that mortality experience was noticeably higher in the
first quarter of 2005. "Policy benefit expenses increased from
$10.0 million in the first quarter of last year to $12.2 million
this year mainly due to higher reported death claims. However,
there is no systematic pattern to death claims and quarterly
fluctuations are typical," Mr. Moody stated. Other operating
expenses increased from $10.4 million in the first quarter of 2004
to $11.0 million in the first quarter of 2005 reflecting the costs
associated with complying with the new internal controls
requirements under the Sarbanes-Oxley Act of 2002. "While we were
pleased to receive a clean opinion from our auditors regarding the
audit of our internal controls over financial reporting, the
incremental auditor fees associated with this new requirement were
approximately a half- million dollars," Mr. Moody indicated.
Investment performance continued to show gains as investment
income, excluding index options(2), totaled $76.7 million in the
first quarter of 2005 compared to $71.1 million in the first
quarter of 2004. Mr. Moody noted that the Company's investment
portfolio quality was better now than before the credit market
downturn of the past few years. "The overall quality of our
investment portfolio is much stronger today and there are no
current impairment issues." At March 31, 2005, the Company
maintained total assets of $6.1 billion, stockholders' equity of
$816 million, and life insurance in force of approximately $13.9
billion. (1) The Company views earnings from operations, a non-GAAP
financial measure, as an important indicator of financial
performance. Presented in conjunction with net earnings, the
combined presentation can enhance an investor's understanding of
the Company's underlying profitability and results from ongoing
operations. The definition of earnings from operations, as
presented in this press release, excludes net realized investment
gains and losses after tax. A reconciliation of earnings from
operations to net earnings has been included as part of this press
release. (2) The Company considers net investment income, excluding
derivative income (loss), a useful measurement of the Company's
underlying investment portfolio performance by removing the
volatility from changes in fair values of derivative instruments.
As net investment income, excluding derivative income (loss), is
considered a non-GAAP financial measure, the following
reconciliation is provided. ($'s in millions) Three Months Ended
March 31, 2005 2004 Net investment income $62.8 72.5 Derivative
income (loss) (13.9) 1.4 Net investment income excluding derivative
income (loss) $76.7 71.1 Summary of Consolidated Operating Results
(In thousands except per share data) Three Months Ended March 31,
2005 2004 Revenues: Revenues, excluding realized investment gains
and derivative income (loss) $106,330 97,619 Derivative income
(loss) (13,922) 1,386 Realized gains on investments 968 1,459 Total
revenues $93,376 100,464 Earnings: Earnings from operations $15,573
13,668 Net realized gains on investments 629 948 Cumulative effect
of a change in accounting principle --- 54,697 Net earnings $16,202
69,313 Basic Earnings Per Share: Earnings from operations $4.34
3.84 Net realized gains on investments 0.17 0.27 Cumulative effect
of a change in accounting principle --- 15.39 Net earnings $4.51
19.50 Basic Weighted Average Shares 3,591 3,554 Diluted Earnings
Per Share: Earnings from operations $4.30 3.80 Net realized gains
on investments 0.17 0.26 Cumulative effect of a change in
accounting principle --- 15.21 Net earnings $4.47 19.27 Diluted
Weighted Average Shares 3,625 3,597 Investor Relations Contact:
Brian M. Pribyl Senior Vice President Chief Financial &
Administrative Officer (512) 719-2493 DATASOURCE: National Western
Life Insurance Company CONTACT: investor relations, Brian M.
Pribyl, Senior Vice President, Chief Financial & Administrative
Officer of National Western Life Insurance Company,
+1-512-719-2493, or Web site: http://www.nationalwesternlife.com/
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