Donegal Group (DGICB) has reported 56.92 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $5.10 million in the quarter, compared with $11.85 million for the same period last year.
Revenue during the quarter grew 7.77 percent to $178.97 million from $166.07 million in the previous year period. Net premium earned for the quarter increased 6.74 percent or $10.68 million to $169.16 million.
Total expenses move upBenefits, losses and expenses for the quarter were at $172.25 million, or 101.83 percent of premium earned from $150.05 million or 94.68 percent of premium earned in the last year period. Operating income for the quarter was $6.72 million, compared with $16.02 million in the previous year period. Meanwhile, income from fees and commission for the quarter declined 16.65 percent or $0.23 million to $1.14 million. The company has recorded a gain on investments of $2.55 million in the quarter compared with a gain of $0.47 million for the previous year period.
Kevin G. Burke, president and chief executive officer of Donegal Group Inc., noted, "Donegal Group reported strong organic growth, a higher return from our investment portfolio, and profitable operations in the first quarter of 2017, despite higher-than-expected losses related to severe storm activity in several of our marketing regions. Our net premiums written increased by 8.5% compared to the prior-year first quarter. This increase reflected a continuation of strong growth in our commercial lines. We achieved this growth in spite of reinsurance reinstatement premiums that reduced net premiums written for our homeowners line of business and our commercial multi-peril line of business by 4.5% and 2.5%, respectively, during the first quarter. We strive to leverage our position as a trusted and well-recognized regional insurer to win market share, while we price our products appropriately in light of the current conditions within our industry. We continue to implement appropriate premium rate increases that respond to increasing loss cost trends in our personal and commercial auto lines, with the expectation that these premium rate increases will contribute to higher premiums written and increased underwriting profitability over time."
Liabilities outpace assets growthTotal assets increased 6.35 percent or $99.28 million to $1,663.19 million on Mar. 31, 2017. On the other hand, total liabilities were at $1,216.48 million as on Mar. 31, 2017, up 6.92 percent or $78.77 million from year-ago. Return on assets stood at 0.33 percent in the quarter, down 0.45 from 0.78 percent in the last year period. At the same time, return on equity was at 1.14 percent in the quarter, down 1.64 from 2.78 percent in the last year period.
Investments move upInvestments stood at $960.52 million as on Mar. 31, 2017, up 5.18 percent or $47.29 million from year-ago. Meanwhile, reinsurance recoverables moved down 28.03 percent or $105.08 million over the year to $269.80 million on Mar. 31, 2017.
Total debt was at $74 million as on Mar. 31, 2017, down 13.95 percent or $12 million from year-ago. Shareholders equity stood at $446.71 million as on Mar. 31, 2017, up 4.81 percent or $20.51 million from year-ago. As a result, debt to equity ratio went down 4 basis points to 0.17 percent in the quarter from 0.20 percent in the last year period.
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