<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO _________
AMERICAN BANKERS INSURANCE GROUP, INC.
11222 QUAIL ROOST DRIVE
MIAMI, FLORIDA 33157
(305) 253-2244
Commission File Number: 0-9633
State of Incorporation: Florida
I.R.S. Employer Identification Number: 59-1985922
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 report), and (2) has been subject to such
filing requirements for the past 90 days. YES X NO
--- ---
Common Stock - Par Value $1.00
20,849,597 Shares Outstanding on August 5, 1997
1
<PAGE> 2
Form 10-Q
Company or group of companies for which report is filed:
AMERICAN BANKERS INSURANCE GROUP, INC.
This quarterly report, filed pursuant to Rule 13A-13 of the General Rules and
Regulations under the Securities Exchange Act of 1934, consists of the following
information as specified in Form 10-Q.
PART I - FINANCIAL INFORMATION
- ------------------------------
ITEM 1 - Financial Statements
1. Consolidated Balance Sheets at June 30, 1997 and December 31,
1996.
2. Consolidated Statements of Income for the three months ended June
30, 1997 and 1996.
3. Consolidated Statements of Income for the six months ended June
30, 1997 and 1996.
4. Consolidated Statements of Cash Flows for the six months ended
June 30, 1997 and 1996.
5. Notes to Consolidated Financial Statements.
ITEM 2 - Management's Discussion and Analysis of Financial Condition
and Results of Operations.
PART II - OTHER INFORMATION
- ---------------------------
ITEM 1 - Legal Proceedings
ITEM 4 - Submission of matters to a vote of security holders
ITEM 6 - Exhibits and Reports
a. Exhibits.
The following exhibits are included herein:
(11) Statement re: computation of earnings per share
(27) Financial Data Schedule
b. Report on Form 8-K.
None
2
<PAGE> 3
Form 10-Q
SIGNATURE
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.
AMERICAN BANKERS
INSURANCE GROUP, INC.
August 13, 1997
Date
/s/ Robert Hill
-----------------------------
Robert Hill
Principal Accounting Officer
3
<PAGE> 4
PART I
FINANCIAL INFORMATION
4
<PAGE> 5
AMERICAN BANKERS INSURANCE GROUP, INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1997 AND DECEMBER 31, 1996
(in thousands)
<TABLE>
<CAPTION>
1997 1996
------------ -----------
ASSETS (unaudited)
<S> <C> <C>
Investments
Held-to-Maturity securities, at amortized cost $ 853,541 $ 851,146
Available-for-Sale securities, at approximate market value 871,493 805,124
Trading securities, at fair value -- 9,038
Equity securities, at approximate market value 110,378 112,895
Mortgage loans on real estate 9,848 10,236
Policy loans 8,759 8,290
Short-term and other investments 200,575 171,674
----------- -----------
Total investments 2,054,594 1,968,403
----------- -----------
Cash 7,579 30,434
Accounts receivable, net of allowance for doubtful
accounts of $3,932 in 1997 and $4,526 in 1996 114,307 128,963
Reinsurance receivable 217,317 202,626
Accrued investment income 25,328 24,296
Deferred policy acquisition costs 416,615 387,993
Prepaid reinsurance premiums 450,367 507,077
Other assets 213,291 219,711
----------- -----------
Total assets $ 3,499,398 $ 3,469,503
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Policy liabilities $ 297,309 $ 291,756
Unearned premiums 1,304,650 1,291,142
Claim liabilities 513,867 487,596
----------- -----------
2,115,826 2,070,494
Other policyholders' funds 5,822 6,795
Notes payable 241,811 222,490
Deferred income taxes 40,032 40,795
Accrued commissions and other expenses 123,575 156,896
Other liabilities 214,735 261,826
----------- -----------
Total liabilities 2,741,801 2,759,296
----------- -----------
Commitments and Contingencies (Note 4)
STOCKHOLDERS' EQUITY
Preferred Stock. $3.125 Series B Cumulative Convertible Preferred Stock
Authorized 3,500 shares. Issued and Outstanding: 2,300 shares in 1997 and 1996 $ 115,000 $ 115,000
Common stock of $1 par value. Authorized 100,000 shares.
Issued and outstanding: 1997-20,816 shares; 1996-20,530 shares 20,816 20,530
Additional paid-in capital 226,441 217,939
Net unrealized investment and foreign exchange gains 3,521 7,437
Retained earnings 402,311 359,359
Less:
Treasury stock, at cost - 93 shares in 1997 and 93 shares in 1996 (1,426) (1,426)
Unamortized restricted stock (5,878) (4,382)
Collateralization of loan to Leveraged Employee
Stock Ownership Plan (3,188) (4,250)
----------- -----------
Total stockholders' equity 757,597 710,207
----------- -----------
Total liabilities and stockholders' equity $ 3,499,398 $ 3,469,503
=========== ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
5
<PAGE> 6
AMERICAN BANKERS INSURANCE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR THREE MONTHS ENDED JUNE 30, 1997 AND 1996
(in thousands except per common share data)
(unaudited)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Gross collected premiums $666,605 $601,382
======== ========
Premiums and other revenues:
Net premiums earned $365,011 $346,777
Net investment income 33,342 28,765
Realized investment gains 3,104 4,992
Other income 4,583 5,454
-------- --------
Total premiums and other revenues 406,040 385,988
-------- --------
Benefits and expenses:
Net benefits, claims, losses and settlement expenses 134,038 132,159
Commissions 148,862 144,939
Operating expense 78,907 69,210
Interest expense 4,062 4,425
-------- --------
Total benefits and expenses 365,869 350,733
-------- --------
Income before taxes 40,171 35,255
-------- --------
Income tax expense:
Current 14,074 12,383
Deferred (2,521) (2,188)
-------- --------
11,553 10,195
-------- ---------
Net Income $ 28,618 $ 25,060
======== ========
PER COMMON SHARE AND COMMON EQUIVALENT SHARE DATA
Primary:
Net Income $ 1.27 $ 1.19
======== ========
Weighted average number of shares outstanding 21,051 20,972
======== ========
Fully diluted:
Net Income $ 1.22 $ 1.19
======== ========
Weighted average number of shares outstanding 23,506 21,047
======== ========
Dividends per common share $ 0.21 $ 0.20
======== ========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6
<PAGE> 7
AMERICAN BANKERS INSURANCE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
FOR SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(in thousands except per common share data)
(unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
Gross collected premiums $ 1,303,731 $ 1,206,031
=========== ===========
Premiums and other revenues:
Net premiums earned $ 728,786 $ 688,631
Net investment income 65,448 56,204
Realized investment gains 5,034 6,021
Other income 11,653 10,829
----------- -----------
Total premiums and other revenues 810,921 761,685
----------- -----------
Benefits and expenses:
Net benefits, claims, losses and settlement expenses 272,928 279,517
Commissions 300,499 272,633
Operating expense 151,990 134,867
Interest expense 8,019 8,526
----------- -----------
Total benefits and expenses 733,436 695,543
----------- -----------
Income before taxes 77,485 66,142
----------- -----------
Income tax expense:
Current 23,578 19,682
Deferred (1,130) 764
----------- -----------
22,448 20,446
----------- -----------
Net Income $ 55,037 $ 45,696
=========== ===========
PER COMMON SHARE AND COMMON EQUIVALENT SHARE DATA
Primary:
Net Income $ 2.45 $ 2.18
=========== ===========
Weighted average number of shares outstanding 20,971 20,949
=========== ===========
Fully diluted:
Net Income $ 2.35 $ 2.18
=========== ===========
Weighted average number of shares outstanding 23,427 21,028
=========== ===========
Dividends per common share $ 0.41 $ 0.39
=========== ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
7
<PAGE> 8
AMERICAN BANKERS INSURANCE GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(in thousands)
(unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 55,037 $ 45,696
Adjustments to reconcile net income to net cash provided
by operating activities:
Change in policy liabilities, unearned premiums, claim
liabilities, reinsurance receivable and prepaid
reinsurance premiums 77,599 106,755
Change in other assets and other liabilities (27,235) (53,155)
Decrease in accounts receivable 14,656 8,292
Increase in accrued investment income (1,032) (1,016)
(Decrease) increase in accrued commission and expenses (33,321) 34,664
(Decrease) increase in policyholders' funds (973) 33
Increase in policy loans (469) (302)
Amortization of deferred policy acquisition costs 272,162 95,398
Amortization of cost of insurance acquired 759 958
Policy acquisition costs deferred (300,786) (135,630)
Provision for amortization and depreciation 6,205 4,109
Provision for deferred income taxes (354) 764
Net gain on sale of investments (5,034) (6,021)
Compensation and tax effect on stock option shares 1,091 2,108
Net cash flow from purchases and sales of trading
securities 8,880 (2,794)
---------- ----------
Net cash provided by operating activities 67,185 99,859
---------- ----------
INVESTING ACTIVITIES:
Purchase of investments
Held-to-maturity securities (51,457) (171,972)
Available-for-sale securities (809,411) (108,026)
Proceeds from sale of investments
Available-for-sale securities 728,472 55,875
Mortgage loans 395 1,045
Real Estate 18 1,412
Proceeds from maturities of investments
Held-to-maturity securities 36,734 38,025
Available-for-sale securities 34,465 25,563
Increase in short-term investments (29,502) (36,391)
Transactions related to capital assets
Capital expenditures (10,306) (6,027)
Sales of capital assets 58 326
---------- ----------
Net cash used in investing activities (100,534) (200,170)
---------- ----------
FINANCING ACTIVITIES:
Proceeds from issuance of debt 20,384 138,147
Repayment of debt -- (37,000)
Dividends paid to shareholders (12,050) (7,867)
Proceeds from issuance of stock 2,080 773
Purchase of treasury stock -- (175)
---------- ----------
Net cash provided by financing activities 10,414 93,878
---------- ----------
Net decrease in cash (22,935) (6,433)
Cash at beginning of period 30,434 23,257
Rate change effect on cash flow 80 6
---------- ----------
Cash at end of period $ 7,579 $ 16,830
========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest $ 5,577 $ 9,239
Income taxes $ 21,222 $ 15,736
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
8
<PAGE> 9
AMERICAN BANKERS INSURANCE GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)
1. Financial Statements
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the period ended June 30, 1997 are not necessarily
indicative of the results that may be expected for the year ending
December 31, 1997. These statements should be read in conjunction with the
financial statements and notes thereto included in the Company's Annual
Report Form 10-K for the year ended December 31, 1996. Certain items have
been reclassed to conform with 1997 presentation.
2. Translation of Foreign Currencies
Unrealized foreign exchange losses, totaling $13,114,000 and $9,688,000 as
of June 30, 1997 and December 31, 1996 respectively, are included in
Stockholders' Equity under the caption "Net unrealized investment and
foreign exchange gains."
3. Reinsurance
The Company accounts for reinsurance contracts under Financial Accounting
Standards Board's Statement 113. The Company recognizes the income on
reinsurance contracts principally on a pro-rata basis over the life of the
policies covered under the reinsurance agreements. Reinsurance
Recoverables on Unpaid Losses are included as an asset in the Balance
Sheet under the caption "Reinsurance Receivable." Ceded Unearned Premiums
are included as an asset in the Balance Sheet under the caption "Prepaid
Reinsurance Premiums."
The effect of reinsurance on premiums earned is as follows for the six
months and three months ended June 30, 1997 and 1996:
(in thousands)
Six Months Ended
JUNE 30, 1997 JUNE 30, 1996
------------- -------------
Direct premiums $1,221,413 $1,091,700
Reinsurance assumed 80,862 58,881
Reinsurance ceded (573,489) (461,950)
---------- ----------
Net premiums earned $ 728,786 $ 688,631
========== ==========
(in thousands)
Three Months Ended
JUNE 30, 1997 JUNE 30, 1996
------------- -------------
Direct premiums $ 624,806 $ 553,796
Reinsurance assumed 45,791 39,446
Reinsurance ceded (305,586) (246,465)
--------- ---------
Net premiums earned $ 365,011 $ 346,777
========= =========
Reinsurance ceded incurred losses for the six months ended June 30, 1997
and 1996, were $233,632,000 and $154,843,000 respectively.
9
<PAGE> 10
4. Commitments and Contingencies
For a comprehensive description of the Company's litigation, see Item III
of the Company's 1996 Form 10-K.
Alabama and Related Litigation:
Certain of ABIG's subsidiaries, including ABIC, ABLAC and Voyager, are
presently parties to a number of individual consumer and class action
lawsuits pending in Alabama involving premium rate, marketing, disclosure,
and policy coverage issues. While a number of similar suits have been
filed in other jurisdictions, the insurance and finance industries have
been targeted in Alabama by plaintiffs' lawyers who enjoy a favorable
judicial climate. The Company typically has been named as a co-defendant
with one or several retailer or finance companies who have sold the
Company's product to a consumer. Other insurers are also joined as
co-defendants in some of the suits.
Although the Alabama lawsuits and similar suits pending in other
jurisdictions generally involve relatively small amounts of actual or
compensatory damages, they typically assert claims requesting substantial
punitive awards or purport to represent a large class of policyholders.
The Company denies any wrongdoing in any of these suits and believes that
it has not engaged in any conduct that would warrant an award of punitive
damages or that the class allegations have merit. The Company has been
advised by legal counsel that it has meritorious defenses to all claims
being asserted against it.
While no one individual lawsuit is necessarily significant in terms of
financial risk to the Company, the judicial climate in Alabama is such
that the outcome of these cases is extremely unpredictable. Moreover,
class action lawsuits to which the Company is a party do not lend
themselves to potential damage calculation. Without admitting any
wrongdoing, the Company has settled a number of these suits, but there are
still a significant number of cases pending, and it is expected that more
suits alleging essentially the same causes of action are likely to
continue to be filed during 1997. The Company intends to continue to
defend itself vigorously against all such suits and believes, based on
information currently available, that any liabilities that could result
are not expected to have a material adverse effect on the Company's
financial position.
The Company is involved with a number of cases in the ordinary course of
business relating to insurance matters, or more infrequently, certain
corporate matters. Generally, the Company's liability is limited to
specific amounts relating to insurance or policy coverage for which
provision has been made in the financial statements. Other cases involve
general corporate matters which generally do not represent significant
contingencies for the Company.
10
<PAGE> 11
5. Segment Information
Gross collected premiums, net premiums earned and income (loss) before
federal income taxes are summarized as follows
<TABLE>
<CAPTION>
(in thousands)
Six Months Ended
June 30,
1997 1996
----------- -----------
<S> <C> <C>
GROSS COLLECTED PREMIUMS:
Life $ 399,746 $ 367,374
Property and Casualty 903,985 838,657
----------- -----------
Total $ 1,303,731 $ 1,206,031
=========== ===========
NET PREMIUMS EARNED:
Life $ 193,028 $ 197,861
Property and Casualty 535,758 490,770
----------- -----------
Total $ 728,786 $ 688,631
=========== ===========
INCOME (LOSS) BEFORE INCOME TAXES:
Life $ 31,160 $ 35,317
Property and Casualty 60,946 44,118
Other (6,602) (4,767)
----------- -----------
85,504 74,668
Interest Expense 8,019 8,526
----------- -----------
Total Income before Income Taxes $ 77,485 $ 66,142
=========== ===========
</TABLE>
6. Accounting for Investments
The Company accounts for its investments according to the Financial
Accounting Standards Board's Statement 115 Accounting for Certain
Investments in Debt and Equity Securities.
This Statement addresses the accounting and reporting for investments in
equity securities that have readily determinable fair values and for all
investments in debt securities. Those investments are to be classified in
three categories and accounted for as follows:
HELD-TO-MATURITY - Securities for which the enterprise has the positive
intent and ability to hold to maturity. These securities are carried at
amortized cost.
TRADING SECURITIES - Securities that are bought and held principally for
the purpose of selling them in the near term. These securities are carried
at market value with the unrealized holding gain or loss included in
earnings.
AVAILABLE-FOR-SALE - Securities not classified as trading or
held-to-maturity. These securities are carried at market value with the
unrealized holding gain or loss reported as a separate component of
equity, net of the income tax effect.
11
<PAGE> 12
The detail of Cost and Statement Value for the Fixed Maturities and Equity
Securities held at June 30, 1997 is as follows:
(in thousands)
Amortized Statement
Cost Value
---------- ----------
FIXED MATURITIES
----------------
Held-to-Maturity Securities $ 853,541 $ 853,541
Available-for-Sale Securities 860,424 871,493
Trading Securities -- --
---------- ----------
Total Fixed Maturities $1,713,965 $1,725,034
========== ==========
Net unrealized gain $ 11,069
==========
Market
Cost Value
-------- --------
EQUITY SECURITIES
-----------------
Held-to-Maturity Securities $ -- $ --
Available-for-Sale Securities 95,949 110,378
Trading Securities -- --
-------- --------
Total Equity Securities $ 95,949 $110,378
======== ========
Net unrealized gain $ 14,429
========
The net unrealized gain for "Available-for-Sale Securities" decreased by
$493,000 (net of $153,000 in deferred income taxes) from December 31, 1996
to June 30, 1997. There were no unrealized gains and losses from transfers
of Held-to- Maturity Securities.
An analysis of the realized gains and losses of the Company for the six
months ended June 30, 1997, is as follows:
<TABLE>
<CAPTION>
(in thousands)
--------------
<S> <C>
Gross realized gains from sales of Available-for-Sale Securities $ 13,942
Gross realized losses from sales of Available-for-Sale Securities (8,337)
Gross realized gains from sales of Trading Securities 241
Gross realized losses from sales of Trading Securities (622)
--------
Net realized gain from investment activity 5,224
Net realized loss from other investment activity (190)
--------
Total realized gain $ 5,034
========
</TABLE>
The Company uses the specific identification method to determine cost for
computing the realized gains and losses.
12
<PAGE> 13
AMERICAN BANKERS INSURANCE GROUP, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Gross collected premiums increased $65.2 million or 11% to $666.6 million for
the three months ended June 30, 1997, from $601.4 million for the same period of
1996. Approximately 31% or $20.5 million of the increase came from the Company's
largest product lines - Credit Unemployment and Credit A&H.
During the three months ended June 30, 1997, total premiums and other revenues
were $406.0 million, an increase of $20.0 million over total premiums and other
revenues of $386.0 million for the same period in 1996. The increase includes an
$18.2 million increase in net premiums earned. The overall growth in invested
assets generated an additional $4.6 million of investment income for the second
quarter of 1997 as compared to the same period of 1996.
The benefits and claims ratio improved to 37% for the three months ended June
30, 1997, compared to 38% for the same period of 1996. Additionally, the
commissions ratio improved to 41% for the three months ended June 30, 1997, from
42% for the same period of 1996.
FINANCIAL CONDITION
Stockholders' Equity increased $47.4 million from $710.2 million at December 31,
1996, to $757.6 million at June 30, 1997. The contribution of net income of
$55.0 million was the primary cause for the increase.
LIQUIDITY AND CAPITAL RESOURCES
On June 30, 1997, $2.1 billion of securities, short-term investments and cash
comprised 59% of the Company's total assets. The securities were principally
readily marketable and did not include any significant concentration in private
placements.
The Company does not hold significant investments in equity securities;
consequently, market changes in the equity securities markets do not
significantly affect the investment portfolio.
At the May 1997 Annual Stockholders meeting, shareholders approved an increase
to the Company's authorized shares of Common Stock from 35,000,000 to
100,000,000.
In July 1997, the Company transferred the listing of its common and preferred
stock from the Nasdaq National Market to the New York Stock Exchange (NYSE). The
Company believes that the NYSE listing will increase the potential investor
base.
The Company expects to continue its policy of paying regular cash dividends;
however, future dividends are dependent on the Company's future earnings,
capital requirements and financial condition. In addition, the payment of
dividends is subject to the restrictions described in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996.
13
<PAGE> 14
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 - SAFE HARBOR CAUTIONARY
STATEMENT
Except for the historical information contained herein, certain of the matters
discussed in this quarterly report are "forward-looking statements" as defined
in the Private Securities Litigation Reform Act of 1995, which involve certain
risks and uncertainties, including but not limited to, changes in general
economic conditions, interest rates, consumer confidence, competition,
environmental factors, and governmental regulations affecting the Company's
operations. See the Company's Annual Report Form on 10-K for the year ended
December 31, 1996, for a further discussion of these and other risks and
uncertainties applicable to the Company's business.
14
<PAGE> 15
PART II
OTHER INFORMATION
15
<PAGE> 16
ITEM 1 - LEGAL PROCEEDINGS
Commitments and Contingencies information which appears on page 10 elsewhere in
this report is incorporated by reference in this item. Additional information
regarding litigation can be found in the Company's 1996 Annual Report on Form
10-K.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Stockholders meeting was held on May 23, 1997 at the Company's
Headquarters. Proxies for the meeting were solicited pursuant to Regulation 14
under the Securities Act of 1934. The following matters were submitted to a vote
by the shareholders:
<TABLE>
<CAPTION>
Total Votes
---------------------------------------
<S> <C> <C> <C>
For Withheld Abstain
1. Amendment to the Third Amended and Restated 11,549,018 6,434,532 27,743
Articles of Incorporation of the Company to
increase the authorized capital stock of the
Company.
2. Amendment to the 1994 Amended and Restated 17,802,389 382,735 49,309
Directors' Deferred Compensation Plan to
increase the number of shares of Common Stock
reserved for issuance thereunder from 100,000
to 200,000.
3. American Bankers Insurance Group, Inc. 1997 12,558,214 5,543,187 54,289
Equity Incentive Plan.
4. Votes for the election of Directors:
Gerald N. Gaston 19,104,262 71,991
Daryl L. Jones 19,099,021 77,232
Bernard P. Knoth 19,056,342 119,911
Albert H. Nahmad 19,099,838 76,415
George E. Williamson, II 19,099,557 76,696
</TABLE>
All matters submitted were approved by the requisite vote.
Continuing directors are: William H. Allen, Jr., Nicholas Buoniconti,
Armando M. Codina, Peter J. Dolara, James F. Jorden, Jack F. Kemp, R.
Kirk Landon, Malcolm G. MacNeill, Eugene M. Matalene, Jr., Robert C.
Strauss, and Nicholas J. St. George .
ITEM 6(a) - EXHIBITS
Exhibit 11 - Statement Re: Computation of Earnings Per Share
Exhibit 27 - Financial Data Schedule (for SEC use only)
ITEM 6(b) - REPORTS ON FORM 8-K
None
16
<PAGE> 1
ITEM 6(a) EXHIBITS
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
(in thousands except per common share data)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
----------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY: 1997 1996 1997 1996
---- ---- ---- ----
Weighted average shares outstanding 21,051 20,972 20,971 20,949
======= ======= ======= =======
Net Income $28,618 $25,060 $55,037 $45,696
Less convertible preferred stock dividends 1,797 -- 3,594 --
------- ------- ------- -------
Total $26,821 $25,060 $51,443 $45,696
======= ======= ======= =======
Net Income - per share $1.27 $1.19 $2.45 $2.18
======= ======= ======= =======
FULLY DILUTED:
Weighted average of shares outstanding 21,051 20,972 20,971 20,949
Assumed conversion of common stock equivalents 8 75 9 79
Assumed conversion of convertible securities 2,447 -- 2,447 --
------- ------- ------- -------
Total 23,506 21,047 23,427 21,028
======= ======= ======= =======
Net income $28,618 $25,060 $55,037 $45,696
Add convertible debenture interest, net
of federal income tax 58 61 114 123
------- ------- ------- -------
Total $28,676 $25,121 $55,151 $45,819
======= ======= ======= =======
Net income - per share $1.22 $1.19 $2.35 $2.18
======= ======= ======= =======
</TABLE>
17
<TABLE> <S> <C>
<ARTICLE> 7
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<DEBT-HELD-FOR-SALE> 871,493
<DEBT-CARRYING-VALUE> 853,541
<DEBT-MARKET-VALUE> 853,541
<EQUITIES> 110,378
<MORTGAGE> 9,848
<REAL-ESTATE> 0
<TOTAL-INVEST> 2,054,594
<CASH> 7,579
<RECOVER-REINSURE> 217,317
<DEFERRED-ACQUISITION> 416,615
<TOTAL-ASSETS> 3,499,398
<POLICY-LOSSES> 297,309
<UNEARNED-PREMIUMS> 1,304,650
<POLICY-OTHER> 513,867
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0
115,000
<COMMON> 20,816
<OTHER-SE> 621,781
<TOTAL-LIABILITY-AND-EQUITY> 3,499,398
728,786
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<OTHER-INCOME> 11,653
<BENEFITS> 272,928
<UNDERWRITING-AMORTIZATION> 0
<UNDERWRITING-OTHER> 0
<INCOME-PRETAX> 77,485
<INCOME-TAX> 22,448
<INCOME-CONTINUING> 55,037
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55,037
<EPS-PRIMARY> 2.45
<EPS-DILUTED> 2.35
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
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</TABLE>
