NASHVILLE, TN / ACCESSWIRE / March 1, 2022 / First Acceptance Corporation (OTCQX:FACO) today reported its financial results for the quarter and year ended December 31, 2021. Our 2021 Annual Report can be found at www.otcmarkets.com/stock/FACO/disclosure.
Loss before income taxes, for the three months ended December 31, 2021, was $7.5 million, compared with net income of $2.5 million for the three months ended December 31, 2020. Net loss for the three months ended December 31, 2021, was $5.6 million, compared with net income of $1.8 million for the three months ended December 31, 2020. Diluted net loss per share was $0.15 for the three months ended December 31, 2021, compared with diluted net income per share of $0.05 for the same period in the prior year.
Loss before income taxes, for the year ended December 31, 2021, was $2.6 million, compared with income before income taxes of $13.6 million for the year ended December 31, 2020. Net loss for the year ended December 31, 2021, was $1.2 million, compared with net income of $10.4 million for the year ended December 31, 2020. Diluted net loss per share was $0.03 for the year ended December 31, 2021, compared with net income per share was $0.27 for the prior year.
For the three months ended December 31, 2021, we recognized unfavorable prior period loss and loss adjustment expense development of $0.5 million compared to favorable prior period loss and loss adjustment expense development of $2.7 million in the same period last year. For the years ended December 31, 2021, and 2020, we recognized favorable prior period loss and loss adjustment expense development of $1.6 million and $4.2 million, respectively.
For the three months ended December 31, 2021, and 2020, (loss) income before income taxes and revenues included net gains on investments of $0.5 million and $0.9 million, respectively. For the year ended December 31, 2021, (loss) before income taxes and revenues included a net gain on investments and foreclosed real estate held for sale of $7.5 million compared with a net loss on investments of $1.0 million in the prior year.
President and Chief Executive Officer, Larry Willeford, commented, "While our fourth quarter operating results were once again impacted by the unprecedented rapid rise in loss severity resulting from increased car prices and vehicle repair costs, we were encouraged that this industrywide situation appears to have stabilized. Additionally, to date, we have made significant progress in strengthening our premium rates in response to these increased claims costs."
Mr. Willeford further added, "Despite this unexpected downturn in the last half of 2021, we closed out the year in a strong regulatory capital position. We have a full plate of initiatives on the table to profitably grow our business in 2022, and on behalf of Acceptance, I want to thank our stockholders for their continued support as we navigate our way through these economically-challenged times."
On December 6, 2021, the Board of Directors declared a special cash dividend of $0.11 per common share, that was paid on December 21, 2021, to all common stockholders of record as of the close of business on December 16, 2021.Both dividends paid by the Company in 2021 are non-taxable return of capital distributions to stockholders.
About First Acceptance Corporation
We own and operate "Acceptance Insurance," an insurance agency headquartered in Nashville, Tennessee that sells insurance and related products underwritten and serviced by our own insurance companies (known as the First Acceptance Insurance Group) and through third-party carriers for which we receive a commission. We operate under an "Agency Model" in 15 states where we sell both our own underwritten insurance policies and those issued by third-party insurers for which we earn commissions.
Acceptance Insurance primarily sells non-standard personal automobile insurance through our own insurance companies and third-party carriers. Non-standard personal automobile insurance is sought after by individuals because of their inability or unwillingness to obtain standard insurance coverage due to various factors including their payment preference, failure to have maintained continuous insurance coverage, or their driving record. We also offer a variety of other commissionable third-party products such as roadside assistance and in most states, we also sell an insurance product for renters that we underwrite. We believe that our agency-focused operations provide us with a variety of insurance alternatives for our core customers as well as the ability to provide products that suit other potential customers.
Acceptance Insurance currently leases and operates 338 retail locations staffed with employee-agents. In addition to our retail locations, we are able to complete sales over the phone through employee-agents in our call center or through our consumer-based website and mobile platform. On a limited basis, we also sell our products through selected retail locations operated by independent agents.
Additional information about First Acceptance Corporation can be found online at www.acceptance.com.
Forward-Looking Statements
This press release contains forward-looking statements. All statements made other than statements of historical fact are forward-looking statements. You can identify these statements from our use of the words "believe," "expect," "look," or the negative of these objective terms and similar expressions. These statements, which have been included in reliance on the "safe harbor" provisions of the federal securities laws, involve risks and uncertainties. Investors are hereby cautioned that these statements may be affected by important factors, including, among others, the factors set forth under the caption "Risk Factors" in our Annual Report for the year ended December 31, 2021, filed by the Company with the OTCQX. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
| First Acceptance Corporation and Subsidiaries | |||||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||||
| (amounts in thousands, except per share data) | |||||||||||||||||
| Three Months Ended | Year Ended | ||||||||||||||||
| December 31, | December 31, | ||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||
Revenues | $ | 66,445 | $ | 67,498 | $ | 285,247 | $ | 269,580 | |||||||||
(Loss) income before income taxes | $ | (7,476 | ) | $ | 2,477 | $ | (2,581 | ) | $ | 13,639 | |||||||
Net (loss) income | $ | (5,630 | ) | $ | 1,841 | $ | (1,228 | ) | $ | 10,418 | |||||||
Net (loss) income per diluted share | $ | (0.15 | ) | $ | 0.05 | $ | (0.03 | ) | $ | 0.27 | |||||||
Average diluted shares outstanding | 37,971 | 38,432 | 38,151 | 39,117 | |||||||||||||
Loss Ratio | 79.1 | % | 66.7 | % | 74.2 | % | 64.8 | % | |||||||||
Expense Ratio | 32.3 | % | 29.9 | % | 29.3 | % | 29.6 | % | |||||||||
Combined Ratio | 111.4 | % | 96.6 | % | 103.5 | % | 94.4 | % | |||||||||
INVESTOR RELATIONS CONTACT:
Michael J. Bodayle
615.844.2885
SOURCE: First Acceptance Corporation
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https://www.accesswire.com/690967/First-Acceptance-Corporation-Reports-Operating-Results-for-the-Quarter-and-Year-Ended-December-31-2021
