UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
< X > Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1995
Commission File Number: 0-2616
CONSUMERS FINANCIAL CORPORATION
1200 CAMP HILL BY-PASS
CAMP HILL, PA 17011
PENNSYLVANIA 23-1666392
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
filing such requirements for the past 90 days.
Yes XX No
Indicate the number of shares outstanding of each of the issuer s classes
of common stock, as of the latest practicable date.
Outstanding at
Class of Common Stock October 31, 1995
$.01 Stated Value 2,619,015 shares
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
INDEX
Page
Part 1. Financial Information Number
Item 1. Financial Statements:
Consolidated Balance Sheets - 3
September 30, 1995 and December 31, 1994
Consolidated Statements of Operations - 4 - 5
Nine and Three Months ended September 30, 1995 and 1994
Consolidated Statements of Cash Flows - 6
Nine Months Ended September 30, 1995 and 1994<PAGE>
Notes to Consolidated Financial Statements 7 - 10
Item 2. Management s Discussion and Analysis of Results of 10 - 14
Operations and Financial Condition
Part 2. Other Information
Item 1. Legal Proceedings 15
Item 2. Changes in Securities 15
Item 3. Defaults upon Senior Securities 15
Item 4. Submission of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION> September 30, 1995 December 31, 1994
(in thousands) (Unaudited)
<S> <C> <C>
Assets
Investments:
Fixed maturities $33,644 $28,180
Mortgage loans on real estate 7,122 9,938
Investment real estate 1,121 1,144
Policy loans 452 351
Other invested assets 1,902 1,791
Short-term investments 3,059 5,627
Total investments 47,300 47,031
Cash 1,251 1,254
Accrued investment income 758 835
Receivables 27,409 26,931
Prepaid reinsurance premiums 19,353 19,183
Deferred policy acquisition costs 22,269 21,655
Property and equipment 4,153 4,178
Other real estate 2,994 1,271
Other assets 2,429 2,938
$127,916 $125,276
Liabilities, Redeemable Preferred Stock and
Shareholders Equity
Liabilities:
Future policy benefits $38,739 $38,609
Unearned premiums 59,093 56,551
Other policy claims and benefits 2,772 2,848
Other liablities 6,763 6,405
Income taxes:
Current 244 876
Deferred 1,396 1,372
Notes payable 2,702 3,389
111,709 110,050
Redeemable preferred stock:
Series A, 8 1/2% cumulative convertible,
net of treasury stock 4,648 4,621
Shareholders equity:
Common Stock 31 31
Capital in excess of stated value 8,129 8,129<PAGE>
Net unrealized appreciation
of debt and equity securities 244 (1,952)
Retained earnings 4,701 5,734
Treasury stock (1,546) (1,337)
11,559 10,605
$127,916 $125,276
</TABLE>
<PAGE
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION> Nine Months Ended Three Months Ended
(in thousands, except per share data) September 30, September 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Revenues:
Premiums written and policy charges $30,603 $32,090 $10,686 $11,085
Increase in unearned premiums (2,543) (3,128) (1,387) (1,387)
Gross premium income and policy charges 28,060 28,962 9,299 9,698
Less reinsurance ceded (11,590) (11,211) (3,656) (3,431)
Net premium income and policy charges 16,470 17,751 5,688 6,267
Net investment income 2,207 3,814 734 1,102
Net realized investment losses (36) (35) (13) (15)
Fees and other income 3,709 3,591 1,331 1,298
22,350 25,121 7,740 8,652
Benefits and expenses:
Death and other benefits 5,179 8,282 459 2,749
Increase in future policy benefits 3,690 1,338 2,739 626
Amortization of deferred policy
acquisition costs 8,029 8,919 2,714 3,086
Operating expenses 6,138 7,693 2,060 2,654
23,036 26,232 7,972 9,115
Loss before income taxes (686) (1,111) (232) (463)
Income tax expense (benefit) 13 221 (19) 158
Loss before cumulative effect of change
in accounting principle (699) (1,332) (213) (621)
Cumulative effect of change in accounting
principle 299
Net loss ($699) ($1,033) ($213) ($621)
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (continued)
(Unaudited)
<TABLE>
<CAPTION> Nine Months Ended Three Months Ended
(in thousands, except per share data) September 30, September 30,<PAGE>
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Income (loss) per common and common equivalent
share:
Loss before cumulative effect of
in accounting principle ($0.39) ($0.62) ($0.12) ($0.27)
Cumulative effect of change in
principle 0.11
($0.39) ($0.51) ($0.12) ($0.27)
Loss per common share - assuming full dilution * * * *
* Anti-dilutive
Cash dividends declared per common share None $0.05 None None
</TABLE>
<PAGE>
SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
CONSUMERS FINANCIAL CORPORATION
STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
<TABLE>
<CAPTION>(in thousands) 1995 1994
Restated
<S> <C> <C>
Cash flows from operating activities:
Net loss ($699) ($1,033)
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating
Deferred policy acquisition costs (8,644) (8,222)
Amortization of deferred policy 8,029 8,957
Change in future policy benefits 3,357 991
Change in unearned premiums 2,543 3,765
Amounts due reinsurers 441 2,228
Income taxes (644) (713)
Change in accounts receivable (639) (4,706)
Change in other liabilities (51) 99
Cumulative effect of change in accounting (299)
Other 1,246 (2,280)
Total adjustments 5,638 (180)
Net cash provided by (used in) operating activities 4,939 (1,213)
Cash flows from investing activities:
Purchase of investments (6,647) (9,935)
Maturity of investments 5,557 9,377
Sale of investments 881 5,122
Purchase of property and equipment (304) (1,016)
Net cash provided by (used in) investing activities (513) 3,548
Cash flows from financing activities:
Principal payments on debt (687) (1,130)
Receipts from universal life and investment products 3,936 5,580
Withdrawals on universal life and investment products (7,162) (6,081)
Purchase of treasury stock (209) (264)
Cash dividends to shareholders (307) (444)
Net cash used in financing activities (4,429) (2,339)
Net decrease in cash (3) (4)
Cash at beginning of period 1,254 983<PAGE>
Cash at end of period $1,251 $979
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
1. General:
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting only of normal
recurring items) necessary to present fairly the Company's consolidated
financial position as of September 30, 1995, the consolidated results of its
operations for the nine months ended September 30, 1995 and 1994 and the
consolidated changes in its cash flows for the nine months ended September
30, 1995 and 1994. Certain prior year amounts have been reclassified to
conform with classifications used for 1995. Such reclassifications had no
impact on operating results.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. These financial statements
should be read in conjunction with the financial statements and notes
thereto included in the Company's 1994 Annual Report to shareholders.
The results of operations for the nine months ended September 30, 1995 are
not necessarily indicative of the results to be expected for the full year.
2. Income Taxes:
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.
Significant components of the Company's deferred tax liabilities and assets
are as follows (in 000's):
<TABLE>
<CAPTION> Sep 30, Dec 31,
1995 1994
<S> <C> <C>
Deferred tax liabilities:
Fixed maturities $101
Deferred policy acquisition costs 7,553 $7,361
Other 458 349
8,112 7,710
Deferred tax assets:
Fixed maturities 684
Future policy benefits and financial
reinsurance 5,917 5,677
Net operating loss carryforwards 1,847 1,502
Other 176 383
7,940 8,246
Valuation allowance for deferred tax assest (1,224) (1,908)
6,716 6,338
Net deferred tax liability $1,396 $1,372
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
2. Income Taxes (continued):<PAGE>
Significant components of the provision for income taxes are as follows (in
000's):
<TABLE>
<CAPTION> Nine Months Three Months
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Current:
Federal ($8) $10 ($14) ($15)
State 100 132 45 59
Total current 92 142 31 44
Deferred (79) 79 (50) 114
Income taxes (benefit) $13 $221 ($19) $158
</TABLE>
The reconciliation of the provision for income taxes and the amount which
would have been provided at statutory rates is as follows (in 000's):
<TABLE>
<CAPTION> 1995 1994
<S> <C> <C>
Loss before income taxes ($686) ($1,111)
Income tax benefits at 34% statutory rate on
Pre-tax loss (233) (378)
Special life insurance company deductions 8
Adjustments of prior years income tax expense 85 388
Dividends received deduction (10) (13)
Change in negative proxy DAC 31
State income taxes 58 87
Items not includable for tax purposes 10 11
Other, net 72 118
Actual income tax expense $13 $221
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
3. Contingencies:
Reinsured risks would give rise to liability to the insurance subsidiaries
only in the event that the reinsuring company might be unable to meet its
obligations under the reinsurance agreements in force.
In March 1994, the Company received a notice of proposed adjustment from the
Internal Revenue Service as a result of a recently completed tax examination
for the years ended December 31, 1989 and 1990. The Company is currently
seeking to have the adjustment rescinded. Based on the current status of
this matter the Company does not believe it is likely that a material amount
of additional taxes will be due.
The Company is currently a defendant in a lawsuit in an Alabama state
court originally filed as a class action lawsuit in 1994. The plaintiff
subsequently dismissed the count to his complaint seeking class
certification and no longer seeks to assert claims on behalf of the
class. The plaintiff alleges that the Company overcharged him for credit
life insurance by writing insurance coverage on the gross amount of debt,
rather than on the amount of the unpaid indebtedness, and seeks monetary
and punitive damages of less than $50,000. The plaintiff, however, is
not bound by his claim of damages of less than $50,000. At this time,
there are at least 100 other insurers involved in class action lawsuits
in Alabama state courts alleging similar causes of action. The Company
ceased writing credit insurance in the state of Alabama in 1990 and has
responded to the lawsuit by answering the plaintiff's compliant asserting
a number of defenses, including a statute of limitations defense. In
the opinion of the Company and its legal counsel, neither the ultimate
outcome of nor the damages from this lawsuit can be presently determined.
4. Reinsurance:
The effect of reinsurance on premiums written and earned for the periods
ended September 30, 1995 and 1994 was as follows:
<TABLE>
<CAPTION> 1995 1994
(in 000's) Written Earned Written Earned
<S> <C> <C> <C> <C>
Direct $28,285 $25,706 $28,945 $25,149
Assumed 2,318 2,354 3,145 3,839
Ceded (11,759) (11,590)) (14,765)) (11,057)
Net $18,844 $16,470 $17,325 $17,931
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
Ceded benefits incurred through September 30, 1995 and 1994 are $9,116,516
and $5,117,001, respectively. These losses were deducted in arriving at
death and other benefits and the increase in future policy benefits in the
Consolidated Statements of Operations.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
OVERVIEW
The Company's third quarter net loss was $213,000 ($.12 per share) compared to a
$621,000 loss ($.27 per share) in the same period of 1994. On a year-to-date
basis, operating results improved from a $1 million loss ($.51 per share) in
1994 to a $699,000 loss ($.39 per share) in the current year. The 1994 results
include income of $299,000 from the cumulative effect of an accounting change.
Excluding that non-recurring item, after-tax operating results in 1995 improved
by $633,000. The reduced losses are attributable to some improvement in the
performance of the Company's core Automotive Resource Division, although that
Division continues to operate unprofitably, and to a significant increase in
earnings from the Auto Auction Division.
The table below compares revenues and operating results in 1995 with those in
1994.
<TABLE>
<CAPTION> Nine Months Third Quarter
(in thousands, except per share amounts) 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Total revenues by source:
Premiums written and policy charges $30,603 $32,091 $10,686 $11,086<PAGE>
Net investment income 2,207 3,814 734 1,102
Realized investment losses (36) (35) (13) (15)
Fees and other income 3,709 3,590 1,331 1,298
$36,483 $39,460 $12,738 $13,471
Pre-tax income (loss):
Automotive Resource Division ($1,075) ($1,303) ($500) ($512)
Individual Life Insurance Division (98) 26 (28) (126)
Auto Auction Division 754 482 364 221
Other (231) (281) (55) (31)
(650) (1,076) (219) (448)
Realized investment losses (36) (35) (13) (15)
Pre-tax loss (686) (1,111) (232) (463)
Income tax expense (benefit) 13 221 (19) 158
Loss before cumulative effect of change in
accounting principle (699) (1,332) (213) (621)
Cumulative effect of change in accounting
principle 299
Net loss ($699) ($1,033) ($213) ($621)
Income (loss) per common share:
Loss before cumulative effect of change
in accounting principle ($0.39) ($0.62) ($0.12) ($0.27)
Cumulative effect of change in
accounting principle 0.11
Net loss ($0.39) ($0.51) ($0.12) ($0.27)
</TABLE>
<PAGE>
RESULTS OF OPERATIONS
A discussion of the most significant factors which affected the 1995 operating
performance of each of the Company's three Divisions is presented below.
Information relating to 1994 is also presented for comparative purposes.
Automotive Resource Division
Credit insurance premium production continues to be slightly below the 1994
level, following a flat third quarter. Premium production for the year totaled
$26.3 million compared to $27.1 million through the first nine months of 1994.
Because of the lack of growth in written premiums, earned premiums continue to
be about level with 1994.
The decline in written premiums and the resulting reduction in earned premiums
which occurred during the early 1990's due to the economic recession continues
to adversely impact the Company's core credit insurance business, which depends
heavily on the level of automobile sales. Lower earned premiums have resulted
in a substantial increase in operating expense ratios since 1989, resulting in
the unprofitable results this Division has experienced in recent years.
The Automotive Resource Division reported a $1.1 million pre-tax loss for the
first nine months of 1995 compared to a $1.3 million loss in 1994. A $320,000
reduction in expenses, which resulted in a one percentage point drop in the
expense ratio, produced the small improvement in operating results. In order to
return to profitability, the Division must build its premium revenue base
significantly by expanding its marketing territory and increasing its market
share in existing territories as well as through acquisitions of existing blocks
of credit insurance business and marketing organizations. The increased revenue
base will result in a lower expense ratio and an improved profit margin.
The Company is actively seeking opportunities to acquire blocks of in-force
credit insurance business and marketing organizations which produce new credit
business. During the third quarter, the Company signed a letter of intent to
purchase the existing credit insurance business, the marketing organization and
the charter and state licenses of Acceleration Life Insurance Company, an Ohio
insurer. The transaction is subject to agreement by the parties with respect to
the final terms, regulatory approval of the Ohio and Delaware Insurance
Departments and approval of the shareholders of Acceleration Life's parent,
ACCEL International Corporation. In connection with the transaction, the<PAGE>
Company also signed a letter of intent with another insurer to provide the
majority of the financing for the acquisition. Acceleration Life produces about
$43 million of credit insurance premiums annually, $8 million of which are
assumed from the Company pursuant to an existing joint venture between the
parties. Its inforce block consists of approximately $73 million of unearned
premiums.
<PAGE>
Individual Life Insurance Division
Operations in the Individual Life Insurance Division are now limited to one
closed block of assumed universal life business, following the sale of the
Division's direct UL business at the end of 1994. The Division reported a
$98,000 pre-tax loss in 1995 compared to a $26,000 profit through the first
three quarters of 1994. Higher than expected claims costs in the second quarter
have negatively impacted the 1995 results from this book of business. The
Company is continuing to review a proposal from the direct writer of the UL
policies to recapture the business and would consider selling it for a fair
price.
Auto Auction Division
Auto Auction Division results in 1994 include operations from a small auction
facility in Ohio which was terminated at the end of 1994. During the first nine
months of 1994, the Ohio auction produced revenues of $437,000 and a pre-tax
loss of $82,000. Excluding the 1994 revenues from the Ohio facility, the
revenues at Interstate Auto Auction increased 11% in 1995 to $2.3 million. An
increase in the volume of vehicles processed accounts for the majority of the
growth in revenues, although a portion of the increase is due to the transfer of
the bank repossession auction from the Ohio facility to Interstate.
Pre-tax profits in the Division increased from $482,000 in the first three
quarters of 1994 to $754,000 in 1995. The increased revenues, the elimination
of the Ohio losses and a non-recurring gain of $138,000 (representing the excess
of fire insurance proceeds received over the book value of the property damaged
in a February fire) all contributed to the rise in profits.
FINANCIAL CONDITION
<TABLE>
<CAPTION> September 30, December 31,
(in thousands, except per share amounts) 1995 1994
<S> <C> <C>
Invested assets $47,300 $47,031
Total assets $127,916 $125,276
Total debt $2,702 $3,389
Total shareholders' equity and redeemable
preferred stock $16,207 $15,226
Debt as a percent of total capital 14.3% 18.2%
Shareholders' equity per common share $4.41 $3.96
</TABLE>
<PAGE>
Invested Assets
The Company's invested assets at September 30 totaled $47.3 million compared to
$47 million at the end of 1994. Although invested assets have remained about
level for the year, two items have had significant but offsetting effects on the
invested asset base during 1995. The first is the foreclosure on a $2.2 million
construction loan during the second quarter and the reclassification of this<PAGE>
loan to non-investment real estate. The Company is in the process of finishing
and selling the units in this town home development. As a result of sales of
six units, the carrying value of this real estate was $1,707,000 at September
30. Sales of two additional units closed in October. The second item is a $2.2
million increase in the carrying value of the Company's bond portfolio, which
resulted from the substantial recovery in the bond market during both the first
and second quarters of the year. At September 30, the market value of the
portfolio exceeded its amortized cost by $313,000.
Liquidity
The Company's operating subsidiaries have historically met most of their cash
requirements from funds generated from operations, although reduced credit
insurance revenues in particular and the recessionary economy in general during
the early 1990's have had an adverse impact on the insurance companies'
operating cash flows. The Company, however, has generally relied on its
operating subsidiaries to provide it with sufficient cash funds to maintain an
adequate liquidity position. In that regard, the life insurance subsidiaries
are also subject to restrictions imposed by law on their ability to transfer
cash to the Company in the form of dividends, loans or advances. Interstate
Auto Auction and Consumers Car Care Corporation provide the Company with sources
of cash which are not subject to insurance regulations that restrict their
ability to transfer cash. The net cash provided by or used in operating
activities for the nine months ended September 30, 1995 and 1994 is presented in
the Consolidated Statements of Cash Flows.
Capital Resources
The Company's total equity, which includes redeemable preferred stock, increased
by $981,000 since December 31, 1994. The increase is attributable to the $2.2
million increase (net of applicable income taxes) in the value of the Company's
bond portfolio, which is carried at fair value under FASB Statement 115. That
increase was offset by the current year operating loss of $699,000, $307,000 in
dividends to preferred shareholders and the purchase of $209,000 in treasury
shares.
The Company continues to reduce its bank debt and its ratio of debt to total
capital. Since the end of 1990, the Company's debt has declined from $10.4
million to $2.7 million at September 30, and its debt to total capital ratio has
decreased from 28% to 14.3%. The loans mature in January 1997.
The Company's insurance subsidiaries utilize reinsurance agreements to finance
their credit insurance operations and maintain adequate levels of statutory
capital and surplus. These agreements minimize reductions of statutory surplus
which result from new premium production. The insurance companies, however,
continue to gradually reduce the amount of financial reinsurance outstanding.
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Except for the matters discussed in Note 3 to the Notes to Consolidated
Financial Statements included elsewhere in this Form 10-Q, neither the
registrant nor its subsidiaries are involved in any pending legal
proceedings other than routine litigation incidental to the normal
conduct of its business nor have any such proceedings been terminated
during the nine months ended September 30, 1995.
Item 2. Changes in Securities
During the nine months ended September 30, 1995, there have been no
limitations or qualifications, through charter documents, loan
agreements or otherwise, placed upon the holders of the registrant's
common or preferred stock to receive dividends.<PAGE>
Item 3. Defaults upon Senior Securities
The registrant has not defaulted in the payment of principal, interest
or in any other manner on any indebtedness and is current with all its
accounts. There is no arrearage in the payment of dividends on the
registrant's preferred stock.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of the stockholders of the
registrant during the three months ended September 30, 1995.
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required to be filed by Item 601 of Regulation S-K:
(11) Computation of Earnings per Common Share.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter ended
September 30, 1995.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CONSUMERS FINANCIAL CORPORATION
Registrant
Date November 14, 1995 By /S/ James C. Robertson
James C. Robertson, President
(Chief Executive Officer)
Date November 14, 1995 By /S/ R. Fredric Zullinger
R. Fredric Zullinger
Senior Vice President, Chief Financial
Officer and Treasurer<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
EXHIBIT 11
COMPUTATION OF EARNINGS PER COMMON SHARE
<TABLE>
<CAPTION> Nine Months Ended Sep 30, Three Months Ended Sep 30,
(in thousands, except per share amounts) 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Primary Earnings Per Share
Reconciliation of net income (loss) per Statements
of Operations to amoount used in primary
per share computation:
Net loss ($699) ($1,033) ($213) ($621)
Preferred dividend requirement (307) (314) (102) (104)
Accretion in carrying value of preferred (27) (27) (9) (9)
Net loss, as adjusted ($1,033) ($1,374) ($324) ($734)
Reconciliation of weighted average number of shares
outstanding to amount used in primary earnings
share computation:
Weighted average number of common shares
outstanding 2,648 2,723 2,620 2,700
Add weighted average number of shares
from assumed exercise of stock
Weighted average number of shares of
Stock and equivalents outstanding 2,648 2,723 2,620 2,700
Net loss per common and common equivalent share ($0.39) ($0.51) ($0.12) ($0.27)
</TABLE>
<PAGE>
CONSUMERS FINANCIAL CORPORATION AND SUBSIDIARIES
EXHIBIT 11
COMPUTATION OF EARNINGS PER COMMON SHARE
<TABLE>
<CAPTION> Nine Months Ended Sep 30, Three Months Ended Sep 30,
(in thousands, except per share amounts) 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Fully Diluted Earnings Per Share
Reconciliation of net income (loss) per Statements
of Operations to amount used in fully diluted
earnings per share computation:
Net loss ($699) ($1,033) ($213) ($621)
Reconciliation of weighted average number of shares
outstanding, as adjusted, per primary computation
on preceding page, to amount used in fully diluted
earnings per share computation:<PAGE>
Weighted average number of shares outstanding
as adjusted per primary computation
on preceding page 2,648 2,723 2,620 2,700
Add shares issuable from assumed conversion of
8 1/2 % cumulative convertible preferred
stock 713 715 713 713
Weighted average number of shares of common
stock and equivalents outstanding 3,361 3,438 3,333 3,413
Fully Diluted Earnings Per Share * * * *
* Anti-dilutive
/TABLE
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 7
<S> <C> <C> <C> <C>
<C>
<PERIOD-TYPE> 9-MOS 9-MOS 3-MOS 3-MOS
YEAR
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1994 DEC-31-1995 DEC-31-1994
DEC-31-1994
<PERIOD-END> SEP-30-1995 SEP-30-1994 SEP-30-1995 SEP-30-1994
DEC-31-1994
<DEBT-HELD-FOR-SALE> 33,643,882 0 0 0
28,180,436
<DEBT-CARRYING-VALUE> 0 0 0 0
0
<DEBT-MARKET-VALUE> 0 0 0 0
0
<EQUITIES> 231,475 0 0 0
74,305
<MORTGAGE> 7,122,263 0 0 0
9,938,267
<REAL-ESTATE> 1,120,930 0 0 0
1,144,246
<TOTAL-INVEST> 47,300,485 0 0 0
47,030,814
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1,253,620
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0
<DEFERRED-ACQUISITION> 22,269,361 0 0 0
21,654,591
<TOTAL-ASSETS> 127,916,051 0 0 0
125,275,584
<POLICY-LOSSES> 38739,254 0 0 0
38,608,986
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56,550,854
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2,848,180
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0
<NOTES-PAYABLE> 2,702,016 0 0 0
3,388,589
<COMMON> 30,608 0 0 0
30,608
0 0 0 0
0
4,647,650 0 0 0
4,620,674
<OTHER-SE> 11,528,381 0 0 0
10,574,688
<TOTAL-LIABILITY-AND-EQUITY> 127,916,051 0 0 0
125,275,584
16,470,179 17,751,789 5,688,105 6,267,130
0
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0
<INVESTMENT-GAINS> (35,809) (34,928) (12,653) (14,893)
0
<OTHER-INCOME> 3,708,623 3,590,529 1,331,024 1,297,854
0
<BENEFITS> 8,868,861 9,619,796 3,198,610 3,375,144
0
<UNDERWRITING-AMORTIZATION> 8,028,933 8,919,456 2,714,476 3,086,438
0
<UNDERWRITING-OTHER> 6,138,015 7,693,108 2,058,865 2,653,794
0
<INCOME-PRETAX> (685,793) (1,110,706) (231,700) (463,382)
0
<INCOME-TAX> 12,884 220,997 (19,205) 157,885
0
<INCOME-CONTINUING> 0 0 0 0
0
<DISCONTINUED> 0 0 0 0
0
<EXTRAORDINARY> 0 0 0 0
0
<CHANGES> 0 298,551 0 0
0
<NET-INCOME> (698,677) (1,033,152) (212,495) (621,267)
0
<EPS-PRIMARY> (.39) (.51) (.12) (.27)
0
<EPS-DILUTED> 0 0 0 0
0
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0
<PROVISION-CURRENT> 0 0 0 0
0
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0
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0
<PAYMENTS-PRIOR> 0 0 0 0
0
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0
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0
</TABLE>
