First Acceptance Corporation (FAC) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $0.73 million, or $ 0.02 a share in the quarter, against a net loss of $5.50 million, or $0.13 a share in the last year period. Revenue during the quarter dropped 9.16 percent to $88.07 million from $96.95 million in the previous year period. Net premium earned for the quarter declined 8.63 percent or $6.59 million to $69.81 million.
Total expenses come down
Benefits, losses and expenses for the quarter were at $86.49 million, or 123.89 percent of premium earned from $105.32 million or 137.84 percent of premium earned in the last year period. Operating income for the quarter was $1.58 million, compared with an operating loss of $8.37 million in the previous year period. Property and casualty insurance division has booked premium of $69.81 million on net basis during the quarter, down 8.63 percent or $6.59 million from year-ago period.
Net investment income was at $1.03 million for the quarter, up 7.38 percent or $0.07 million from year-ago period. Meanwhile, income from fees and commission for the quarter declined 12.02 percent or $2.35 million to $17.23 million.
President and Chief Executive Officer, Ken Russell, commented “The Company’s net income for the recent quarter marks what we anticipate will be the start of our return to consistent profitability. We believe that the recent efforts undertaken by our team to improve risk management and the quality and efficiency of our claims handling resulted in the reduced loss ratio behind these positive results. It was encouraging to see our premium production for the pivotal first quarter push through barriers stemming from rate increases, underwriting actions and store closures. I view the results achieved this quarter as confirmation that our focus on maintaining appropriate risk-adjusted premiums is the foundation for attaining our business objectives.”
Assets fall, liabilities grow
Total assets decreased 3.19 percent or $14.04 million to $425.50 million on Mar. 31, 2017. On the other hand, total liabilities were at $351.80 million as on Mar. 31, 2017, up 3.58 percent or $12.16 million from year-ago. Return on assets was at 0.43 percent in the quarter against a negative 1.01 percent in the last year period. Return on equity was at 0.99 percent in the quarter against a negative 5.51 percent in the last year period.
Investments come down
Investments stood at $127.57 million as on Mar. 31, 2017, down 9.64 percent or $13.61 million from year-ago. Meanwhile, yield on investments went up 13 basis points to 0.81 percent in the quarter. Net premiums and other receivables decreased 3.08 percent or $2.87 million over the year to $90.25 million on Mar. 31, 2017.
Total debt was almost stable over the past one year at $70.10 million on Mar. 31, 2017. Shareholders equity stood at $73.70 million as on Mar. 31, 2017, down 26.23 percent or $26.20 million from year-ago. As a result, debt to equity ratio went up 25 basis points to 0.95 percent in the quarter from 0.70 percent in the last year period.
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