Midland Reports Record Q1 Results

Cincinnati-based specialty insurer Midland Co. reported record results for the first quarter of 2004. Net income per share was 90 cents, including 16 cents in realized capital gains. That compares with the prior record of 56 cents per share in last year’s first quarter, which included 7 cents in realized capital losses. Revenue for the quarter increased 12.6 percent to $190.6 million, compared with $169.3 million in last year’s first quarter. (All per share amounts are on an after-tax, diluted basis.)

Net income before realized capital gains and losses was a record $13.8 million, or 74 cents per share, up 17.5 percent, on a per share basis, from the prior record of $11.2 million, or 63 cents per share reported in last year’s first quarter. The company believes that this non-GAAP financial measure provides a clearer picture of the core operations than the GAAP measure of net income, as it removes potential issues such as timing of investment gains and losses.

Midland CEO John W. Hayden said the company was committed to “growing those lines of business that we know the best and mastering those products that have not met our performance expectations in recent years.”

For the first quarter, subsidiary American Modern Insurance Group’s property/casualty gross written premiums grew 10.5 percent to $160.4 million, including manufactured housing gross written premium growth of 10.5 percent to $80.6 million.

“We are pleased with the results that we achieved in our core manufactured housing lines,” Hayden said. “Despite persistent difficult conditions in the point- of-sale markets, American Modern continued to expand its manufactured housing premium.

Gross written premium from other property and casualty specialty lines — such as site-built dwelling, excess and surplus lines, collateral protection, mortgage fire, recreational vehicle and collector automobile products — collectively grew 20.1 percent to $68.8 million. As anticipated, the motorcycle gross written premium decreased 26.7 percent to $11.0 million as the company implemented necessary corrective underwriting and rate actions.