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EXHIBIT 99.1
[LETTERHEAD OF PMI]
FOR IMMEDIATE RELEASE:
PMI REVISES UPWARD 2000 AND 2001 OPERATING
EARNINGS GUIDANCE
SAN FRANCISCO, SEPTEMBER 6, 2000 --- The PMI Group, Inc. (NYSE:PMI) announced
today that operating earnings for 2000 will likely increase between 26 and 29
percent, based on the company's current estimated 2000 operating earnings of
between $5.70 and $5.80 per share. For 2001 PMI is estimating that operating
earnings will grow between 17 and 19 percent, to between $6.67 and $6.90 per
share. PMI believes stronger policy persistency, better than expected loss
experience and contributions from its international operations and other
strategic investments will continue to drive growth in the second half of the
year and into 2001. Included in the company's 2001 growth estimates are slightly
higher losses and claims estimates due to the aging of newer, relatively larger
books of business. The current consensus operating earnings estimate for PMI for
2000, as reported by First Call, is $5.72 per share, with estimates ranging
between $5.55 to $5.85 per share. For 2001 the current consensus operating
earnings estimate reported by First Call is $6.51, with estimates ranging
between $6.30 and $6.65.
The PMI Group, Inc. is headquartered in San Francisco and through its
subsidiary, PMI Mortgage Insurance Co., is one of the largest private mortgage
insurers in the United States. In addition, The PMI Group, Inc. through its
subsidiaries, provides mortgage
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guaranty reinsurance in Hong Kong and private mortgage insurance in Australia.
The PMI Group, Inc. is a leader in risk management technology providing various
products and services for the home mortgage finance industry as well as title
insurance. This release can be accessed through the World Wide Web at
www.pmigroup.com or a fax copy of this release can be obtained by dialing 800-
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758-5804, entering The PMI Group, Inc. company code no. 706963 when prompted,
and following the automated prompts.
Cautionary Statement: The Company's statements in this press release that are
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not historical facts, and that relate to future plans, events or performance are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements include, but are
not limited to, PMI's estimate that operating earnings for the year 2000 likely
will increase between 26 and 29% to $5.70 and $5.80 per share, PMI's estimate
that operating earnings for the year 2001 will likely increase between 17 and
19%, to between $6.67 and $6.90 per share, PMI's belief that stronger
persistency, better than expected loss experience and contributions from its
international operations, investments and subsidiaries will continue to drive
growth, and the Company's belief that it may experience slightly higher losses
and claims in 2001. These forward-looking statements are subject to a number of
risks and uncertainties including, but not limited to, the following factors
that could cause the Company's actual results to differ materially from those
expressed herein:
A number of factors affecting PMI and the mortgage industry in general
could cause claims on policies issued by PMI to increase and this could
materially adversely affect the Company's financial condition and results of
operations. The loss experience of PMI could be materially and adversely
affected by economic recession, declining housing values, higher employment
rates, deteriorating borrower credit, rising interest rates, legislation
impacting borrowers' rights, or any combination of such factors. A decrease in
persistency, resulting from policy cancellations of older books of business,
could materially impact the Company's financial results of operations. While
stable or rising interest rates may positively contribute to the persistency
rate, declining interest rates could adversely affect the Company's persistency
rate, its premium yield and its financial condition and results of operations.
The Company's financial condition and results of operations could be
materially and adversely affected by delays in the introduction by PMI of new
products or a decrease in customer demand for new and existing products. In
addition, there can be no assurance that newly introduced products will be as
profitable as the Company's existing products or programs.
The Company's financial condition and results of operations may be
materially and adversely affected by changes to the current legal environment,
including, but not limited to, legislation that would affect the ability of
Fannie Mae or Freddie Mac to offer a substitute for mortgage insurance,
legislation that would increase statutory lending limits of FHA and VA, and
proposed risk-based capital regulations developed by the Office of Federal
Housing Enterprise Oversight. PMI's financial condition and results of
operations may be materially and adversely affected by a reduction in the amount
of mortgage insurance coverage required by Fannie Mae and Freddie Mac. Also, in
1999, a coalition of financial services and housing related trade associations,
including MICA and several large mortgage lenders, formed FM Watch, a lobbying
organization that supports expanded federal oversight and legislation relating
to the role of
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Fannie Mae and Freddie Mac ("GSE's") in the secondary mortgage market. The GSE's
and other organizations are in the process of forming a coalition designed in
part to counter activities of FM Watch. The Company's financial condition and
results of operations could be adversely affected in the event that these
actions polarize the GSE's, members of FM Watch, PMI and PMI's customers.
The performance of the Company's Australian subsidiary could be materially
and adversely affected by a weakening in the demand for housing, interest rate
volatility, and/or an increase in claims. The performance of the Company's other
strategic investments could materially and adversely be affected by changes in
the real estate, mortgage lending, mortgage servicing and financial guaranty
markets; future movements in interest rates; those operations' future financial
condition and performance; the ability of those entities to execute future
business plans; and PMI's dependence upon management to operate those companies
in which PMI does not own a controlling share.
Any or all of these factors could affect the Company and cause PMI's
performance to differ materially from the forward-looking statements contained
in this press release. Other risks and uncertainties that could affect the
Company are discussed in PMI's various Securities and Exchange Commission
filings.
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