<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C.
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities and Exchange Act of 1934
For Quarter Ended Commission File No.
June 30, 1995 0-8403
LAURENTIAN CAPITAL CORPORATION
Delaware 59-1611314
(State of Incorporation) (I.R.S. Employer
Identification Number)
640 Lee Road
Wayne, Pennsylvania 19087
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number,
including area code (610) 889-7400
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 and 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 such filing
requirements for the past 90 days.
Yes X No
Number of shares outstanding of the Registrant's Common Stock as of August 11,
1995:
Common stock, $0.05 Par Value - 7,587,398
----------
Page 1 of 18
Exhibit Index Page 16
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONTENTS
<TABLE>
<CAPTION>
Page(s)
<S> <C>
Consolidated Balance Sheets as at June 30, 1995
(Unaudited) and December 31, 1994 .................................................................. 3-4
Consolidated Statements of Operations (Unaudited) for the
Six Months and Quarter Ended June 30, 1995 and 1994................................................. 5
Consolidated Statements of Cash Flows (Unaudited) for the
Six Months Ended June 30, 1995 and 1994............................................................. 6
Notes to Interim Consolidated Financial Statements
(Unaudited)......................................................................................... 7-8
Management's Discussion and Analysis of Financial
Condition and Results of Operations................................................................. 9-12
Part II - Other Information................................................................................ 13-14
Signature.................................................................................................. 15
Exhibit Index.............................................................................................. 16
Exhibit 11 - Computation of Per Share Earnings............................................................. 17
Exhibit 27 - Financial Data Schedule....................................................................... 18
</TABLE>
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
--------- ---------
(Unaudited)
<S> <C> <C>
ASSETS
Investments:
Fixed maturities held to maturity, at
amortized cost (market, 1995- $266,513;
1994 - $243,191) ........................................................... $ 268,918 $ 273,418
Fixed maturities available for sale, at
market (amortized cost, 1995 - $209,197;
1994 - $234,537)............................................................ 211,823 218,645
Equity securities, at market (cost,
1995 - $10,318; 1994 - $11,313)............................................. 10,456 10,638
Mortgage loans on real estate................................................. 19,662 21,420
Investment real estate ....................................................... 3,558 4,489
Policy loans ................................................................. 49,883 50,600
Short-term investments ....................................................... 29,721 1,616
----------- ----------
TOTAL INVESTMENTS....................................................... 594,021 580,826
Cash ........................................................................... 49,992 20,250
Accounts, notes and premiums receivable......................................... 6,024 5,379
Reinsurance receivables......................................................... 73,012 92,170
Accrued investment income....................................................... 4,922 6,190
Deferred policy acquisition costs............................................... 76,606 74,085
Costs in excess of net assets of business
acquired ..................................................................... 7,204 7,362
Property and equipment, net..................................................... 10,928 11,738
Other assets ................................................................... 6,343 3,535
Assets held in separate accounts .............................................. 230,146 226,351
----------- -----------
TOTAL ASSETS............................................................ $1,059,198 $1,027,886
=========== ===========
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
-3-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars In Thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
----------- ------------
(Unaudited)
<S> <C> <C>
LIABILITIES
Policy liabilities and accruals:
Future policy benefits........................................................ $ 445,395 $ 436,318
Unearned premiums............................................................ 1,776 1,710
Other policy claims and benefits payable...................................... 12,253 12,033
----------- -----------
Total policy liabilities and accruals........................................... 459,424 450,061
Other policyholders' funds...................................................... 169,184 179,143
Debt............................................................................ 45,000 45,000
Other liabilities............................................................... 24,801 17,289
Current income taxes............................................................ 41 241
Deferred income taxes........................................................... 15,247 7,711
Liabilities related to separate accounts..................................... 230,146 226,351
----------- ----------
TOTAL LIABILITIES......................................................... 943,843 925,796
----------- ----------
Commitments and contingent liabilities
Redeemable preferred stock, Series A Convertible,
$.01 par value, at redemption value
Shares authorized: 5 million
Shares issued: 57,767
Outstanding: 1995 - 0; 1994 - 32,939......................................... 0 3,294
----------- ----------
STOCKHOLDERS' EQUITY
Common stock, $.05 par value
Shares authorized: 20 million
Shares issued: 8,111,496...................................................... 406 406
Capital in excess of par value................................................... 59,127 59,127
Net unrealized appreciation (depreciation) of
securities, net of tax (1995 - $940; 1994 - ($5,633))........................ 1,824 (10,934)
Treasury stock, at cost
(shares 524,098).............................................................. (2,656) (2,656)
Retained earnings............................................................... 56,654 52,853
------------ ----------
TOTAL STOCKHOLDERS' EQUITY................................................. 115,355 98,796
----------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY............................. $1,059,198 $1,027,886
=========== ==========
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
-4-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30, Quarter Ended June 30,
-------------------------- -------------------------
1995 1994 1995 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues:
Premiums $ 47,673 $ 40,653 $ 24,144 $ 21,377
Net investment income 23,237 21,959 11,654 10,963
Realized investment gains 2,427 2,380 1,917 758
Other revenue 2,514 1,656 1,109 790
------- -------- -------- --------
Total revenues 75,851 66,648 38,824 33,888
------- ------- -------- -------
Benefits and expenses:
Benefits and settlement expenses 45,829 38,099 23,441 19,751
Amortization of deferred
policy acquisition costs 6,799 6,685 2,998 3,217
Insurance and other expenses 17,126 15,555 9,759 7,749
------- -------- -------- --------
Total benefits and expenses 69,754 60,339 36,198 30,717
------- -------- ------- -------
Income before income taxes 6,097 6,309 2,626 3,171
Income tax expense:
Current 1,135 200 835 100
Deferred 946 1,503 66 693
------- --------- -------- --------
2,081 1,703 901 793
------- --------- -------- --------
NET INCOME $ 4,016 $ 4,606 $ 1,725 $ 2,378
======== ======= ======= =======
Net income available to common shareholders:
Net income $ 4,016 $ 4,606 $ 1,725 $ 2,378
Less: accrued dividends on
preferred stock 103 127 52 64
-------- --------- --------- ---------
Net income attributable
to common shareholders $ 3,913 $ 4,479 $ 1,673 $ 2,314
======= ======= ======= =======
Earnings per share $ 0.52 $ 0.59 $ .22 $ 0.30
======== ========= ======= ========
Weighted average shares 7,587 7,570 7,587 7,591
======== ========= ======= ========
outstanding (in thousands)
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
-5-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1995 1994
-------- --------
<S> <C> <C>
Cash flow from operations:
Net income $ 4,016 $ 4,606
Adjustments to reconcile net income
to net cash provided by operating activities:
Deferred income taxes 946 1,503
Increase in policy liabilities and accruals,
policyholders' funds and income taxes 17,325 6,801
Decrease in accrued investment income and
accounts and notes receivable 1,402 1,187
Decrease (increase) in accrued expense and
other liabilities 4,369 (466)
Amortization of deferred policy acquisition costs 7,140 6,685
Policy acquisition costs deferred (9,661) (6,231)
Depreciation expense 686 744
Amortization of goodwill 173 133
Realized gains on investments (2,427) (2,380)
Other reconciling adjustments, net (5,653) (1,634)
------- --------
Net cash provided by operating activities 18,316 10,948
------- --------
Cash flow from investing activities:
Sale of fixed maturities available for sale 84,358 6,714
Sale of fixed maturities held to maturity 25,141 0
Sale of other investments 5,689 0
Maturity or repayment of investments 15,356 67,373
Purchases of fixed maturities available for sale (60,807) (37,392)
Purchases of fixed maturities held to maturity (23,844) (31,886)
Purchases of other investments (6,166) (4,568)
Purchases (disposals) of property and equipment (176) (708)
Net (increase) decrease in short-term investments (28,105) 6,932
Other, net (20) 0
------- ---------
Net cash provided by investing activities 11,426 6,465
------- ---------
Cash flow from financing activities:
Proceeds from borrowing 0 45,000
Repayment of debt 0 (54,822)
Sale of treasury shares 0 225
Other financing activities, net 0 52
------- ---------
Net cash (used in) financing activities 0 (9,545)
------- ---------
Net increase in cash 29,742 7,868
Cash at beginning of period 20,250 8,722
------- ---------
Cash at end of period $49,992 $16,590
======= =========
Supplemental disclosure of cash flow information:
Cash paid for interest expense $ 1,868 $ 2,121
Cash paid for federal income taxes 1,035 70
</TABLE>
SEE NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
-6-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION:
The Interim Consolidated Financial Statements should be read in conjunction with
the following notes and with the Notes to the Consolidated Financial Statements
included in the Registrant's Annual Report on Form 10-K for the year ended
December 31, 1994. In the opinion of management, the financial statements
contain all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial position as of June 30, 1995 and the
results of operations and statements of cash flows for the three month and six
month periods ended June 30, 1995 and 1994.
The consolidated financial statements include, after intercompany eliminations,
Laurentian Capital Corporation (individually or collectively with its
subsidiaries, the "Company"), and its wholly-owned subsidiaries Loyal American
Life Insurance Company ("Loyal"), Prairie States Life Insurance Company
("Prairie"), and Rushmore National Life Insurance Company ("Rushmore").
The results of operations for the six month period ended June 30, 1995 are not
necessarily indicative of the results to be expected for the full year. Certain
prior year information has been reclassified to conform with the current year's
presentation.
NOTE 2 - PENDING MERGER AGREEMENT:
On May 26, 1995, the Company and American Annuity Group, Inc. (AAG) jointly
announced that they had executed a definitive agreement by which AAG will
acquire by merger the Company for an aggregate consideration of $105.6 million
in cash, and will repay approximately $45 million of the Company's debt. AAG
will pay $13.875 per share for all of the more than 80% of the Company's shares
beneficially owned by Desjardins Laurentian Financial Corporation and $14.125
for all remaining Company shares. The consumation of the merger is subject to
fulfillment of various conditions, including regulatory and shareholder
approvals.
Pursuant to the definitive agreement, the Company's outstanding Series A
Convertible Cumulative Preferred Stock is to be redeemed prior to the closing of
the transaction. As of June 30, 1995, the Company has sent notices of redemption
to all Preferred Stockholders and has recorded the redemption payable in Other
Liabilities in the balance sheet. The amounts will be paid during the third
quarter.
-7-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 3 - INVESTMENTS:
During the second quarter, the Company's main life insurance companies, Prairie
and Loyal, were notified by a state insurance department that their ability to
conduct business in the state was under review due to the extent of
concentration in Mortgage Backed Securities (MBS), in general, and certain types
of Collateralized Mortgage Obligations in particular. In addition, certain state
regulators in the past had expressed general concerns regarding the
concentration of MBS in the Company's fixed maturities portfolio. In response to
regulatory concerns, the Company reduced the percentage of investments in
certain types of MBS. The Company sold $54.6 million of MBS of which $24.4
million were designated as Fixed maturities held to maturity and $30.2 million
of Fixed maturities available for sale. The sale of Fixed maturities held to
maturity resulted in $0.8 million in net realized gains.
The Company's fixed maturity investments include $2.3 million at amortized cost,
less permanent impairments rated as below investment grade as of June 30, 1995.
These investments had an associated market value of $2.4 million. As of December
31, 1994, $3.4 million at amortized cost, less permanent impairments, with an
associated market value of $3.1 million were rated as below investment grade.
Most of these securities have been evaluated by the National Association of
Insurance Commissioners and found to be suitable for reporting at book value for
statutory reporting purposes. No material effect is expected from these holdings
on the Company's financial condition or the results of operations. The Company's
investment strategy is to hold fixed income instruments to maturity and to
recognize permanent impairments on those investments where reduction in amounts
to be received at maturity is likely.
-8-
<PAGE>
*******************************************************************************
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Pending Merger Agreement
On May 26, 1995, the Company and American Annuity Group, Inc. (AAG) jointly
announced that they had executed a definitive agreement by which AAG will
acquire by merger the Company for an aggregate consideration of $105.6 million
in cash, and will repay approximately $45 million of the Company's debt. AAG
will pay $13.875 per share for all of the more than 80% of the Company's shares
beneficially owned by Desjardins Laurentian Financial Corporation and $14.125
for all remaining Company shares. The consumation of the merger is subject to
fulfillment of various conditions, including regulatory and shareholder
approvals.
Premium Income
The following table sets forth for the periods shown the amount of premium
income for the Company, and the percentage change from the corresponding
prior-year period:
<TABLE>
<CAPTION>
Six Months Ended Quarter Ended
June 30 June 30
--------------------- ---------------
(Dollars in thousands)
<S> <C> <C>
1995 amount $47,673 $24,144
1994 amount 40,653 21,377
Percentage increase 17.3% 12.9%
</TABLE>
For the six months and quarter ended June 30, 1995, the increase in premium
income, as compared to the corresponding period in 1994, was due to increased
single premium life insurance sales at Prairie, higher levels of accident and
health insurance sales at Loyal and improved persistency at both companies.
Net Investment Income, Realized Investment Gains and Other Revenue
The following table sets forth for the periods shown the amount of net
investment income, realized investment gains and other revenue and the
percentage change from the corresponding prior-year period:
<TABLE>
<CAPTION>
Six Months Ended Quarter Ended
June 30 June 30
-------------------- --------------
(Dollars in thousands)
<S> <C> <C>
1995 amount $28,178 $14,680
1994 amount 25,995 12,511
Percentage increase 8.4% 17.3%
</TABLE>
For the six months and quarter ended June 30, 1995, the increase in net
investment income, realized investment gains and other revenue in 1995, as
compared to 1994, were primarily due to increases in net investment income and
other revenue. The increase in net investment income reflects the improving
portfolio yield as funds invested during the fourth quarter of 1994 and the
first six months of 1995 were invested at higher rates than the portfolio yield.
An increase in invested assets also contributed to higher investment income.
Other revenue increased due to continued growth in the Company's non-life
insurance operations.
-9-
<PAGE>
Benefits & Expenses
The following table sets forth for the periods shown the benefits and expenses
incurred by the Company as a percentage of premium income:
<TABLE>
<CAPTION>
Six Months Ended Quarter Ended
June 30 June 30
------------------------- -------------------------
Benefits Expenses Benefits Expenses
------- ------- -------- --------
<S> <C> <C> <C> <C>
1995 96.1% 50.2% 97.1% 52.8%
1994 93.7% 54.7% 92.4% 51.3%
</TABLE>
For the six months and quarter ended June 30, 1995, benefits increased by $7.7
million and $3.7 million, respectively. The increase in the benefit ratios for
both the three and six month period reflects the higher level of single premium
life insurance sales at Prairie that have a high initial benefit reserve. In
addition, improved accident and health sales at Loyal also contributed to a high
benefits ratio as the initial benefit reserve is a high percentage of initial
premium collected.
For the six months and quarter ended June 30, 1995, expenses increased as
compared to the prior year by $1.7 million and $1.8 million, respectively. The
increase was due primarily to expenses associated with the pending merger with
American Annuity Group. Expenses increased $1.7 million for the six month period
in 1995 as compared to the prior year with merger related expenses accounting
for $1.0 million of the increase. For the three month period in 1995, as
compared to the comparable 1994 period, expenses increased $1.8 million with
merger related expenses of $1.0 million being incurred. Higher expenses were
incurred due to premium taxes which are directly related to higher sales
produced in 1995 as compared to 1994. In addition, the Company continued its
development of its sales distribution network.
Income Taxes
The Company's effective tax rates for the periods ended June 30, 1995 and 1994
were 34% and 27%, respectively. The 1995 effective tax rate is equal to the
statutory tax rate. The effective tax rate for the 1994 period reflects the
realization of certain tax benefits associated with the Company's sale of
certain real estate assets during the 1994 period.
-10-
<PAGE>
Net Income
The following table sets forth for the periods shown net income and earnings per
share:
<TABLE>
<CAPTION>
Six Months Ended Quarter Ended
June 30 June 30
---------------- --------------
(Dollars in thousands except per share amounts)
Earnings Earnings
Amount Per Share Amount Per Share
------ --------- ------ ---------
<S> <C> <C> <C> <C>
1995 amount $4,016 $0.52 $1,725 $0.22
1994 amount 4,606 $0.59 2,378 0.30
Decrease amount (590) (0.07) (653) (0.08)
</TABLE>
The decrease in net income of approximately $0.6 million and $0.7 million for
the six month and quarter periods ended June 30, 1995, respectively, over the
corresponding periods in 1994, was due primarily to merger related expenses and
a higher effective tax rate.
Liquidity and Capital Resources
The life insurance industry is one that normally produces a positive cash flow
from operations and scheduled principal repayments from portfolios of fixed
maturity investments (bonds and redeemable preferred stocks) and mortgage loans.
This cash flow is used to fund an investment portfolio to finance future benefit
payments, which represent long-term obligations reserved using certain assumed
interest rates. Since future benefit payments are primarily long-term
obligations, the Company's investments are predominately long-term fixed rate
investments such as bonds and mortgage loans which should provide a sufficient
return to cover these obligations. The nature and quality of the various types
of investments made by a life insurance company must comply with the statutes
and regulations imposed by the states in which that company is licensed. These
statutes and regulations generally require that investments be in high grade
investments which provide protection for policyholders.
As of June 30, 1995, the Company's total fixed maturity investment portfolio had
an amortized cost of $478.1 million with a market value of $478.3 million, $0.2
million above amortized cost. This differential between amortized cost and
market is significantly influenced by changes in interest rates subsequent to
purchase of the investment. The Company had $19.7 million in mortgage loans at
June 30, 1995, which could reflect a small premium or discount if those loans
had quoted market prices. Since these assets are invested for terms generally
corresponding to anticipated future benefit payments and carry interest rates in
excess of assumed reserve interest rates, they produce predictable cash flows
and when combined with future premium income should be sufficient to fund the
Company's future benefit payments in the ordinary course of business without any
need for liquidation prior to maturity.
-11-
<PAGE>
The Company holds a substantial position in mortgage-backed securities ("MBS").
These are instruments collaterized by pools of residential or commercial
mortgages, which return interest and principal payments to the investor monthly.
The Company's MBS holdings are primarily issued by either U.S. government
agencies (i.e., GNMA, FNMA and FHLMC) or major U.S. financial institutions. MBS
are subject to prepayment risk, especially in periods when interest rates are
falling, which can adversely affect their yield and maturity. With the
significant decline experienced in interest rates throughout 1993 and early
1994, the Company had experienced significant prepayment activity. As a result,
the Company experienced a decline in the portfolio yield as a result of
reinvesting these proceeds into similar investments at then lower interest
rates. The level of prepayment activity abated steadily during 1994. The
portfolio yield is modestly improving as maturities and new funds are being
invested at higher rates in the current economic environment.
During the second quarter, the Company's main life insurance companies, Prairie
and Loyal, were notified by a state insurance department that their ability to
conduct business in the state was under review due to the extent of
concentration in Mortgage Backed Securities (MBS), in general, and certain types
of Collateralized Mortgage Obligations in particular. In addition, certain state
regulators in the past had expressed general concerns regarding the
concentration of MBS in the Company's fixed maturities portfolio. In response to
regulatory concerns, the Company reduced the percentage of investments in
certain types of MBS. The Company sold $54.6 million of MBS of which $24.4
million were designated as Fixed maturities held to maturity and $30.2 million
of Fixed maturities available for sale.
Policy loans at June 30, 1995 were $49.9 million. These loans have associated
rates in the 3.5% to 8% range, at least equal to the assumed interest rates used
for future policy benefits; accordingly, policy loans should not result in
negative cash flow.
In addition to the cash flow necessary to fund benefit payments, the Company
requires cash flows for operating and administrative expenses. The level of
expenses normally fluctuates in direct proportion to the amount of premium
produced; however, the Company's cash disbursements in the holding company have
from time to time exceeded its cash receipts, principally due to its former
acquisitions program. Funding of interest on debt incurred in connection with
acquisitions and the subsequent consolidation of operations required an
expenditure of approximately $1.8 million for the six month period ended June
30, 1995.
The Company's subsidiaries are currently producing earnings and net cash flow
sufficient to cover debt service at the parent. However, under the insurance
laws of the states in which the Company's insurance subsidiaries are domiciled,
certain restrictions are imposed on cash dividends from the subsidiaries to the
parent. The insurance laws and regulations generally limit the amount of
dividends to the greater of net statutory gain from operations or 10% of
statutory surplus, and dividends in excess of these amounts can be paid only
with the prior approval of the insurance regulators.
-12-
<PAGE>
Part II - OTHER INFORMATION
<TABLE>
<S> <C> <C> <C> <C>
Item 1 Legal Proceedings
Not applicable
Item 2 Changes in Securities
Not applicable
Item 3 Defaults upon Senior Securities
Not applicable
Item 4 Submission of Matters to a Vote of Security Holders
Not applicable
Item 5 Other Information
Not applicable
Item 6 Exhibits and Reports on Form 8-K
(a)
(2) Plan of acquisition, reorganization, arrangement, liquidation or succession.
Not applicable
(4) Instruments defining the rights of security holders, including indentures.
Not applicable
(10) Material Contracts.
10.2.1 Management Services Agreement between the Company and Desjardins
Laurentian Financial Corporation dated May 9, 1995, incorporated by reference
herein from Exhibit 10.2.1 to the Form 8-K Current Report of the Company dated
May 17, 1995.
(11) Statement re: computation of per share earnings.
See Exhibit 11 - attached
(15) Letter re:unaudited interim financial information
Not applicable
(18) Letter re:change in accounting principles.
Not applicable
(19) Report furnished to security holders.
Not applicable
(22) Published report re:matters submitted to vote of security holders
Not applicable
(23) Consents of experts and counsel.
Not applicable
(24) Power of attorney.
Not applicable
</TABLE>
-13-
<PAGE>
Part II - OTHER INFORMATION (continued)
ITEM 6 Exhibits and Reports on Form 8-K (continued)
(a) (contined)
(27) Financial data schedule.
See Exhibit attached
(99) Additional exhibits.
Not applicable
(b) During the period covered by this Form 10-Q Quarterly Report,
the Company filed two (2) reports on Form 8-K.
<TABLE>
<CAPTION>
Date of Item Financial
Report Reported Statements
------- -------- -----------
<S> <C> <C>
May 25, 1995 Item 1. Reporting a definitive None
(filed June agreement with American Annuity
2, 1995) Group (AAG) pursuant to which
AAG would acquire all the
outstanding capital stock of LCC.
Reporting change of control
agreements, each of which
amended and restated prior
agreements between Robert T.
Rakich, President and Chief
Executive Officer of the
Company, and Bernhard M. Koch,
Senior Vice President, Treasurer,
Chief Financial Officer and
Secretary of the Company, and
the Company, respectively.
May 9, 1995 Item 5. Reporting the None
(filed May execution of the Management
17, 1995) Services Agreement for the 1995
fiscal year by and between the
Company and Desjardins Laurentian
Financial Corporation.
</TABLE>
-14-
<PAGE>
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.
LAURENTIAN CAPITAL CORPORATION
-------------------------------
Registrant
Date: August 11, 1995 /s/ Bernhard M. Koch
- --------------------- -------------------------------
Bernhard M. Koch
Senior Vice President, Treasurer,
Chief Financial Officer and Secretary
-15-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Page
Number
------
<S> <C> <C>
Exhibit 11 Statement regarding computation of 17
per share earnings
Exhibit 27 Financial Data Schedule 18
</TABLE>
-16-
<PAGE>
LAURENTIAN CAPITAL CORPORATION
Exhibit 11 - Computation of Per Share Earnings
<TABLE>
<CAPTION>
Six Months Ended June 30, Quarter Ended June 30,
------------------------- -----------------------
1995 1994 1995 1994
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Shares outstanding 7,587,398 7,548,757 7,587,398 7,548,757
Number of days 181 96 91 6
Shares outstanding 7,593,757 7,593,757
Number of days 85 85
--------- --------- --------- ---------
Weighted Average
Shares Outstanding 7,587,398 7,569,890 7,587,398 7,590,790
========= ========== ========= =========
Total Net Income $4,015,670 $4,605,741 $1,724,396 $2,377,553
Less:
Accrued Dividends
on Preferred Stock 102,452 126,918 51,831 63,414
---------- ---------- ---------- ----------
Adjusted Net Income $3,913,218 $4,478,823 $1,672,565 $2,314,139
========== ========== ========== ==========
Earnings Per Common Share:
Net Income $ 0.52 $ 0.59 $ 0.22 $ 0.30
========== ========== ========== =========
</TABLE>
The Company's Series A Redeemable Preferred Stock are considered to be common
stock equivalents. These shares were not included in the earnings per share
computation because their effect was anti-dilutive. Options granted to
purchase the Company's common stock are also considered common stock
equivalents. These options were not included in the computation of earnings
per share because their maximum possible dilution was not material.
-17-
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
ARTICLE 7 AS PART OF CONGLOMERATE SCHEDULE THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS CONTAINED IN THE
REGISTRANT'S FORM 10-Q QUARTERLY REPORT FOR THE QUARTER ENDED JUNE 30, 1995 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<EXCHANGE-RATE> 1
<DEBT-HELD-FOR-SALE> 211,823
<DEBT-CARRYING-VALUE> 268,918
<DEBT-MARKET-VALUE> 266,513
<EQUITIES> 10,456
<MORTGAGE> 19,662
<REAL-ESTATE> 3,558
<TOTAL-INVEST> 594,021
<CASH> 49,992
<RECOVER-REINSURE> 73,012
<DEFERRED-ACQUISITION> 76,606
<TOTAL-ASSETS> 1,059,198
<POLICY-LOSSES> 445,395
<UNEARNED-PREMIUMS> 1,776
<POLICY-OTHER> 12,253
<POLICY-HOLDER-FUNDS> 169,184
<NOTES-PAYABLE> 45,000
<COMMON> 406
0
0
<OTHER-SE> 114,949
<TOTAL-LIABILITY-AND-EQUITY> 1,059,198
47,673
<INVESTMENT-INCOME> 23,237
<INVESTMENT-GAINS> 2,427
<OTHER-INCOME> 2,514
<BENEFITS> 45,829
<UNDERWRITING-AMORTIZATION> 6,799
<UNDERWRITING-OTHER> 17,126
<INCOME-PRETAX> 6,097
<INCOME-TAX> 2,081
<INCOME-CONTINUING> 4,016
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,016
<EPS-PRIMARY> 0.52
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
<PAGE>
</TABLE>
