UNITED STATES
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended______________September 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________________________
Commission file number______________________________1-6026______________________
___________________________The Midland Company__________________________________
(Exact name of registrant as specified in its charter)
________Incorporated in Ohio_________________ __________31-0742526_____________
(State or other jurisdiction of incorporation (I.R.S. Employer Identification
or organization) No.)
7000 Midland Boulevard, Amelia, Ohio 45102-2607
(Address of principal executive offices)
(Zip Code)
(513) 943-7100
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last
report)
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, and (2) has been subject to such filing
requirements for the past 90 days. Yes___X___. No_______.
The number of common shares outstanding as of September 30, 1997 was
3,105,719.
<PAGE>
PART I. FINANCIAL INFORMATION
THE MIDLAND COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
(Unaudited)
Sept. 30, Dec. 31,
ASSETS 1997 1996
-------------- --------------
CASH $ 5,625,000 $ 3,342,000
-------------- --------------
MARKETABLE SECURITIES:
Fixed income (cost, $351,445,000 at September 30,
1997 and $333,259,000 at December 31, 1996) 356,388,000 335,675,000
Equity (cost, $33,863,000 at September 30, 1997
and $30,931,000 at December 31, 1996) 85,543,000 64,787,000
-------------- --------------
Total 441,931,000 400,462,000
-------------- --------------
RECEIVABLES:
Accounts receivable 69,778,000 54,674,000
Less allowance for losses 799,000 799,000
-------------- --------------
Net 68,979,000 53,875,000
-------------- --------------
REINSURANCE RECOVERABLES AND
PREPAID REINSURANCE PREMIUMS 56,668,000 52,805,000
-------------- --------------
PROPERTY, PLANT AND EQUIPMENT - AT COST 131,144,000 118,327,000
Less accumulated depreciation and amortization 43,183,000 39,004,000
-------------- --------------
Property, Plant and Equipment - Net 87,961,000 79,323,000
-------------- --------------
DEFERRED INSURANCE POLICY ACQUISITION COSTS 45,804,000 45,342,000
-------------- --------------
NET ASSETS OF DISCONTINUED OPERATIONS - 16,518,000
-------------- --------------
OTHER ASSETS 4,206,000 4,313,000
-------------- --------------
TOTAL ASSETS $ 711,174,000 $ 655,980,000
============== ==============
See notes to the consolidated financial statements.
<PAGE>
THE MIDLAND COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
(Unaudited)
Sept. 30, Dec. 31,
LIABILITIES AND SHAREHOLDERS' EQUITY 1997 1996
-------------- --------------
NOTES PAYABLE WITHIN ONE YEAR:
Banks $ 12,000,000 $ 28,000,000
Commercial paper 6,512,000 4,700,000
-------------- --------------
Total 18,512,000 32,700,000
-------------- --------------
INSURANCE COMMISSIONS PAYABLE 16,368,000 13,821,000
-------------- --------------
OTHER PAYABLES AND ACCRUALS 46,150,000 39,260,000
-------------- --------------
FUNDS HELD UNDER REINSURANCE AGREEMENTS
AND REINSURANCE PAYABLES 26,621,000 26,949,000
-------------- --------------
UNEARNED INSURANCE PREMIUMS 225,406,000 208,417,000
-------------- --------------
INSURANCE LOSS RESERVES 111,453,000 95,830,000
-------------- --------------
DEFERRED FEDERAL INCOME TAX 23,686,000 16,845,000
-------------- --------------
LONG-TERM DEBT 62,199,000 62,470,000
-------------- --------------
SHAREHOLDERS' EQUITY:
Common stock (issued and outstanding: 3,106,000
shares at September 30, 1997 and 3,042,000
shares at December 31, 1996 after deducting
treasury stock of 537,000 shares and 601,000
shares, respectively) 911,000 911,000
Additional paid-in capital 15,355,000 14,846,000
Retained earnings 145,398,000 138,423,000
Net unrealized gain on marketable securities 36,772,000 23,587,000
Treasury stock - at cost (14,870,000) (16,621,000)
Unvested restricted stock awards (2,787,000) (1,458,000)
-------------- --------------
Total 180,779,000 159,688,000
-------------- --------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 711,174,000 $ 655,980,000
============== ==============
See notes to the consolidated financial statements.
<PAGE>
THE MIDLAND COMPANY
AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME (Unaudited)
FOR THE NINE AND THREE-MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
Nine-Mos. Ended Sept. 30, Three-Mos. Ended Sept. 30,
----------------------------- ---------------------------
1997 1996 1997 1996
-------------- -------------- ------------- -------------
REVENUES:
Insurance $ 251,012,000 $ 224,543,000 $ 84,207,000 $ 75,731,000
Transportation 24,504,000 25,706,000 8,616,000 9,485,000
Other 243,000 413,000 126,000 109,000
-------------- -------------- ------------- -------------
Total 275,759,000 250,662,000 92,949,000 85,325,000
-------------- -------------- ------------- -------------
COSTS AND EXPENSES:
Insurance:
Losses and loss
adjustment
expenses 127,746,000 133,735,000 44,409,000 45,984,000
Commissions and
other policy
acquisition costs 61,479,000 61,771,000 17,819,000 20,898,000
Operating and
administrative
expenses 36,703,000 30,108,000 13,107,000 10,769,000
Transportation
operating expenses 21,288,000 24,587,000 7,077,000 7,157,000
Interest expense 3,612,000 3,698,000 1,202,000 1,158,000
Other operating and
administrative
expenses 3,195,000 2,503,000 628,000 524,000
-------------- -------------- ------------- -------------
Total 254,023,000 256,402,000 84,242,000 86,490,000
-------------- -------------- ------------- -------------
INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE FEDERAL INCOME
TAX 21,736,000 (5,740,000) 8,707,000 (1,165,000)
PROVISION (CREDIT) FOR
FEDERAL INCOME TAX 6,312,000 (3,186,000) 2,595,000 (792,000)
-------------- -------------- ------------- -------------
INCOME (LOSS) FROM
CONTINUING OPERATIONS 15,424,000 (2,554,000) 6,112,000 (373,000)
-------------- -------------- ------------- -------------
DISCONTINUED OPERATIONS:
Loss from operations
of discontinued
segment -
less applicable
income tax credits
of $1,881,000,
$1,289,000,
$685,000 and $4,000,
respectively (3,492,000) (2,430,000) (1,250,000) (21,000)
Loss on disposal of
segment -
less income tax
credit of
$1,790,000 (3,325,000) - (3,325,000) -
-------------- -------------- ------------- -------------
INCOME (LOSS) FROM
DISCONTINUED
OPERATIONS (6,817,000) (2,430,000) (4,575,000) (21,000)
-------------- -------------- ------------- -------------
NET INCOME (LOSS) $ 8,607,000 $ (4,984,000) $ 1,537,000 $ (394,000)
============== ============== ============= =============
EARNINGS (LOSS) PER
SHARE OF COMMON
STOCK:
Continuing
operations $ 5.00 $ (.83) $ 1.97 $ (.12)
Discontinued
operations (2.21) (.79) (1.48) (.01)
-------------- -------------- ------------- -------------
TOTAL $ 2.79 $ (1.62) $ .49 $ (.13)
============== ============== ============= =============
CASH DIVIDENDS PER
SHARE OF COMMON
STOCK $ .525 $ .495 $ .175 $ .165
============== ============== ============= =============
See notes to the consolidated financial statements.
<PAGE>
THE MIDLAND COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
FOR THE NINE-MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
1997 1996
-------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 8,607,000 $ (4,984,000)
Loss from discontinued operations 6,817,000 2,430,000
-------------- --------------
Income (loss) from continuing operations 15,424,000 (2,554,000)
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 8,252,000 5,824,000
Increase in unearned insurance premiums 16,989,000 20,852,000
Increase in insurance loss reserves 15,623,000 30,081,000
Increase in net accounts receivable (15,104,000) (12,113,000)
Increase in other accounts payable and accruals 6,848,000 1,118,000
Increase in reinsurance recoverables and
prepaid reinsurance premiums (3,863,000 (20,047,000)
Increase (decrease) in insurance commissions
payable 2,547,000 (1,940,000)
Increase in deferred insurance policy
acquisition costs (462,000) (2,884,000)
Increase (decrease) in funds held under
reinsurance agreements and reinsurance payables (328,000) 5,108,000
Decrease in deferred federal income tax (260,000) (114,000)
Decrease (increase) in other assets 107,000 (525,000)
Other-net 76,000 1,232,000
-------------- --------------
Net cash provided by continuing operations 45,849,000 24,038,000
Net cash used in discontinued operations (3,629,000) (13,978,000)
-------------- --------------
Net cash provided by operating activities 42,220,000 10,060,000
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of marketable securities (144,948,000) (104,882,000)
Sale of marketable securities 66,197,000 68,060,000
Maturity of marketable securities 32,023,000 32,081,000
Decrease in cash equivalent marketable securities 25,434,000 7,750,000
Acquisition of property, plant and equipment (17,198,000) (3,522,000)
Proceeds from sale of discontinued operations 13,330,000 -
Sale of property, plant and equipment 1,034,000 1,162,000
-------------- --------------
Net cash provided by (used in) investing
activities (24,128,000) 649,000
-------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in net short-term borrowings (14,188,000) (9,359,000)
Issuance of long-term debt 2,300,000 -
Repayment of long-term debt (2,293,000) (1,979,000)
Dividends paid (1,589,000) (1,464,000)
Payment of capitalized lease obligations (278,000) (251,000)
Net issuance (purchase) of treasury stock 239,000 (211,000)
-------------- --------------
Net cash used in financing activities (15,809,000) (13,264,000)
-------------- --------------
NET INCREASE (DECREASE) IN CASH 2,283,000 (2,555,000)
CASH AT BEGINNING OF PERIOD 3,342,000 6,221,000
-------------- --------------
CASH AT END OF PERIOD $ 5,625,000 $ 3,666,000
============== ==============
See Notes to the Consolidated Financial Statements.
<PAGE>
THE MIDLAND COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of The Midland
Company and subsidiaries (the "Company") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete annual financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Financial information as of December 31, 1996 has been derived from
the audited consolidated financial statements of the Company. Revenue and
operating results for the three and nine-month periods ended September 30, 1997
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1997. For further information, refer to the audited
consolidated financial statements and footnotes thereto for the year ended
December 31, 1996 included in the Company's Annual Report on Form 10-K.
Certain reclassifications (minor in nature) have been made to the 1996 amounts
to conform to 1997 classifications.
2. DISCONTINUED OPERATIONS
Effective September 29, 1997, CS Crable Sportswear, Inc., the Company's
wholly-owned sportswear subsidiary, sold substantially all of its sportswear
related assets for approximately $13.3 million. As a result of the disposal,
in the accompanying financial statements, the Company has presented, seperated
from continuing operations, the estimated loss on disposal, the results of
discontinued operations, and the net assets of the discontinued operations,
including reclassification of amounts previously reported for 1996 and the first
two quarters of 1997.
3. EARNINGS PER SHARE
Earnings per share (EPS) of common stock are computed by dividing net income by
the weighted average number of shares and share equivalents (which considers
stock options and restricted stock awards) outstanding during the period. Such
weighted average numbers outstanding used for EPS calculations were as follows:
Nine-months ended September 30: For Primary EPS For Fully Diluted EPS
--------------- ---------------------
1997 3,085,000 3,119,000
1996 3,072,000 3,075,000
Statement of Financial Accounting Standards No. 128 (the "Statement") has been
issued and will require companies to change the method of calculating earnings
per share. The Statement is effective for financial statements for both interim
and annual periods ending after December 15, 1997 and early application is not
permitted. On a pro-forma basis, the Company's basic and diluted earnings per
share calculated in accordance with the Statement would be:
Nine-Mos. Ended Sept. 30, Three-Mos. Ended Sept. 30,
------------------------- --------------------------
1997 1996 1997 1996
------------ ------------ ------------ ------------
Basic earnings (loss)
per share:
Continuing operations $ 5.17 $( .87) $ 2.04 $(.12)
Discontinued operations (2.28) ( .82) (1.53) (.01)
------------ ------------ ------------ ------------
Total $ 2.89 $(1.69) $ .51 $(.13)
============ ============ ============ ============
Diluted earnings (loss)
per share:
Continuing operations $ 5.00 $( .87) $ 1.97 $(.12)
Discontinued operations (2.21) ( .82) (1.48) (.01)
------------ ------------ ------------ ------------
Total $ 2.79 $(1.69) $ .49 $(.13)
============ ============ ============ ============
4. INCOME TAXES
The federal income tax provisions (credits) for the three and nine-month periods
ended September 30, 1997 and 1996 are different from amounts derived by applying
the statutory tax rates to income before federal income tax as follows:
Nine-Mos. Ended Sept. 30, Three-Mos. Ended Sept. 30,
------------------------- --------------------------
1997 1996 1997 1996
------------ ------------ ------------ ------------
Federal income tax
(credit) at statutory
rate $ 3,937,000 $(3,311,000) $ 580,000 $(417,000)
Add (deduct) the tax
effect of:
Tax exempt interest
and excludable
dividend income (1,167,000) (1,301,000) (402,000) (416,000)
Investment tax credits (274,000) (127,000) (92,000) (42,000)
Other - net 145,000 264,000 34,000 79,000
------------ ------------ ------------ ------------
Provision (credit)
for federal income
tax $ 2,641,000 $(4,475,000) $ 120,000 $(796,000)
============ ============ ============ ============
5. CONTINGENCIES
As discussed in Note 12 of the Company's financial statements for the year ended
December 31, 1996, there are certain potential or actual legal claims pending
against the Company, the outcome of which are not expected to have a material
effect upon the Company's consolidated financial position or results of
operations.
6. COMPREHENSIVE INCOME AND SEGMENT DISCLOSURES
In June of 1997, The Accounting Standards Board issued SFAS No. 130, "Reporting
on Comprehensive Income" and SFAS No. 131, "Disclosures about Segments of an
Enterprise and Related Information." The Midland Company will be required to
adopt these standards during 1998. Adoption of these standards will not impact
the reported results of operations or financial position of The Midland Company
but will require additional disclosure.
7. SUPPLEMENTAL CASH FLOW DISCLOSURES
The Company paid interest of $4,800,000 and $4,438,000 in the first nine months
of 1997 and 1996, respectively. The Company paid income taxes of $4,449,000
during the first nine months of 1997 and no income taxes were paid during the
first nine months of 1996. In January, 1997, the Company issued 65,350 shares
of treasury stock under a restricted stock award program that reduced treasury
stock by approximately $1,808,000 and also increased additional paid-in capital
by approximately $626,000.
<PAGE>
INDEPENDENT ACCOUNTANTS' REPORT
The Midland Company:
We have reviewed the accompanying consolidated balance sheet of The Midland
Company and subsidiaries as of September 30, 1997, and the related consolidated
statements of income for the three-month and nine-month periods ended September
30, 1997 and 1996 and of cash flows for the nine-month periods ended September
30, 1997 and 1996. These financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and of making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such consolidated financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of The Midland Company and
subsidiaries as of December 31, 1996, and the related consolidated statements of
income and retained earnings and of cash flows for the year then ended (not
presented herein); and in our report dated February 13, 1997, we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying consolidated balance sheet as of
December 31, 1996 is fairly stated, in all material respects, in relation to the
consolidated financial statements from which it has been derived.
October 23, 1997
Deloitte & Touche LLP
Cincinnati, Ohio
<PAGE>
THE MIDLAND COMPANY AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
A detailed discussion of the Company's liquidity and capital resources
is included in the 1996 Annual Report on Form 10-K. Except as discussed below,
no significant changes have taken place since that date and, accordingly, the
discussion is not repeated here.
Insurance Operations
- --------------------
Insurance revenues increased in the first nine months and third quarter
of 1997 as compared to the comparable periods in 1996 as a result of the
continued strong premium growth from the Company's core property and casualty
insurance products. The operating performance of the Company's insurance
operations improved significantly in the first nine months and third quarter of
1997 compared to the comparable periods in 1996 due primarily to the return to
more normal weather patterns throughout the United States during 1997. The nine
month and third quarter of 1996 operating performances were adversely impacted
by the catastrophic losses incurred from Hurricanes Fran and Bertha. Insurance
losses and loss adjustment expenses decreased during the first nine months and
third quarter of 1997 compared to the comparable periods in 1996 due to the
reasons discussed above. The loss ratios (ratio of losses to net premiums
earned) of the property and casualty insurance companies were 55.9% and 59.1%
during the first nine months and third quarter, respectively, of 1997. This
compares to loss ratios of 64.9% and 66.3% during the comparable periods of
1996.
Insurance commissions and other policy acquisition costs decreased in
the third quarter of 1997 compared to the third quarter of 1996. This decrease
is due primarily to the Company entering several new reinsurance agreements in
mid-1997. These reinsurance agreements essentially result in the Company
retaining less underwriting profit but earning a higher ceding commission
income, which reduces commission expense in the accompanying financial
statements.
After-tax capital gains for the first nine months totaled approximately
$.80 per share in 1997 compared to approximately $.56 per share for the same
period in 1996. Third quarter capital gains (after-tax) amounted to $.50 per
share in 1997 compared to $.14 per share in 1996.
Marketable securities, deferred federal income tax and net unrealized
gains on marketable securities increased as a result of the investment of the
strong cash flow generated by the Company's insurance operations coupled with
the unrealized appreciation in the market value of the investment portfolio.
Similarly, the increases in receivables, unearned insurance premiums, insurance
loss reserves and other payables and accruals are also the result of this
continued growth in the insurance operations.
Transportation Operations
- -------------------------
Transportation revenues decreased during the first nine months of 1997
as compared to the first nine months of 1996 due, in part, to the flooding
conditions which existed on the lower Mississippi River during the first six
months of 1997. This decrease is also due to the fact that the third quarter in
1996 was unusually favorable for the transportation industry in terms of
affreightment rates and volume. Pre-tax profits of the transportation
subsidiary improved significantly in the first nine months of 1997 compared to
the first nine months of 1996 due primarily to a significant reduction in
litigation related costs. On a pre-tax basis, litigation costs decreased $3.6
million during the first nine months of 1997 as compared to the comparable
period in 1996.
The increase in the Company's fixed assets was due primarily to the
transportation subsidiary's acquisition of 41 barges for a total cost of $11.9
million during the first quarter of 1997.
Discontinued Operations
- -----------------------
On September 29, 1997, the Company's sportswear subsidiary, CS Crable
Sportswear, Inc., sold the majority of its assets to Brazos, Inc., a subsidiary
of Brazos Sportswear, Inc. The assets were sold for approximately $13.3 million
in cash resulting in an after-tax loss on the disposal of approximately $3.3
million. The cash proceeds from this transaction were used to reduce the
Company's short-term bank borrowings.
The transaction, which includes the CS Crable Sportswear name, contracts
and customer lists, also includes a ten-year lease of the CS Crable facility in
Batavia, Ohio and the retention of the majority of CS Crable's workforce.
Management believes that the sale presents the Company with the opportunity to
focus on its insurance and transportation businesses.
<PAGE>
PART II. OTHER INFORMATION
THE MIDLAND COMPANY
AND SUBSIDIARIES
SEPTEMBER 30, 1997
Item 1. Legal Proceedings
Reference is made to Item 1 of the March 31, 1996 Registrant's
Form 10-Q concerning criminal litigation against M/G Transport
Services, Inc., a subsidiary of the Registrant. Upon Motion, the
Court dismissed six of the remaining eight counts against M/G,
four of the six remaining counts against one former employee and
all of the remaining counts against two former employees. The
United States has appealed. On October 31, 1997, M/G was fined
$250,000 and placed on two years' probation on the two remaining
counts. The Company does not expect any additional fines unless
the United States is successful in its appeal.
Item 2. Change in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
a.) Exhibit 15 - Letter re: Unaudited Interim Financial
Information
b.) Exhibit 27 - Financial Data Schedule
c.) Reports on Form 8-K - None were filed during the
quarter ended September 30, 1997. An 8-K was filed on
October 14, 1997 in connection with the September 29,
1997 sale of the Company's sportswear operations.
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 dully authorized.
THE MIDLAND COMPANY
Date___________October 23, 1997______ s/Michael J. Conaton____________
Michael J. Conaton, President
and Chief Operating Officer
Date___________October 23, 1997______ s/John I. Von Lehman____________
John I. Von Lehman, Executive
Vice President, Treasurer and
Chief Financial Officer
EXHIBIT 15
LETTER RE: UNAUDITED INTERIM FINANCIAL INFORMATION
The Midland Company:
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of The Midland Company and subsidiaries for the periods ended
September 30, 1997 and 1996, as indicated in our report dated October 23, 1997;
because we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended September 30, 1997, is
incorporated by reference in Registration Statements No. 33-64821 on Form S-3
and No. 33-48511 on Form S-8.
We are also aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
October 23, 1997
Deloitte & Touche LLP
Cincinnati, Ohio
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 5,625,000
<SECURITIES> 441,931,000
<RECEIVABLES> 126,446,000
<ALLOWANCES> (799,000)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 131,144,000
<DEPRECIATION> (43,183,000)
<TOTAL-ASSETS> 711,174,000
<CURRENT-LIABILITIES> 0
<BONDS> 62,199,000
<COMMON> 911,000
0
0
<OTHER-SE> 179,868,000
<TOTAL-LIABILITY-AND-EQUITY> 711,174,000
<SALES> 0
<TOTAL-REVENUES> 275,759,000
<CGS> 0
<TOTAL-COSTS> 247,216,000
<OTHER-EXPENSES> 3,195,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,612,000
<INCOME-PRETAX> 21,736,000
<INCOME-TAX> 6,312,000
<INCOME-CONTINUING> 15,424,000
<DISCONTINUED> (6,817,000)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,607,000
<EPS-PRIMARY> 2.79
<EPS-DILUTED> 2.76
</TABLE>
