-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pA70BjeIKPDSCKn4nSZnDeuCzaRPtvnvubwi3m2ZXR7AsQG9aEBj55hpFR1fycCF f+5k/WDv3oVDGI813RoyQA== 0000818155-95-000004.txt : 19950516 0000818155-95-000004.hdr.sgml : 19950516 ACCESSION NUMBER: 0000818155-95-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950515 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: WALSHIRE ASSURANCE COMPANY CENTRAL INDEX KEY: 0000818155 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 232023240 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-16267 FILM NUMBER: 95539462 BUSINESS ADDRESS: STREET 1: 3350 WHITEFORD RD STREET 2: PO BOX 3849 CITY: YORK STATE: PA ZIP: 17402 BUSINESS PHONE: 7177570000 MAIL ADDRESS: STREET 1: 3350 WHITEFORD RD STREET 2: PO BOX 3849 CITY: YORK STATE: PA ZIP: 174020138 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 10-Q (Mark One) ( X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 1995 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________to_________ Commission file number 0-16267 WALSHIRE ASSURANCE COMPANY __________________________ (Exact name of registrant as specified in its charter) Pennsylvania 23- 2023242 _______________________________ ___________ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 3350 Whiteford Road, York, PA 17402 _____________________________ _____ (Address of principal executive offices) (Zip code) (717) 757-0000 ______________ (Registrant's telephone number, including area code) ____________________________________________________ (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X NO ________ ________ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date. Class: Outstanding at April 28, 1995: _________ ________________________________ Common stock - $.01 Par Value 3,652,672 shares WALSHIRE ASSURANCE COMPANY AND SUBSIDIARIES INDEX
Page Number ______ Part I FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets as of March 31, 1995 (unaudited) and December 31, 1994. . . . . . . . . . . . . . . . . . . . . 2 Consolidated Statements of Income for the three months ended March 31, 1995 and 1994 (unaudited) . . . . . . . . . . . . . . . . . . . 4 Consolidated Statements of Cash Flows for the three months ended March 31, 1995 and 1994 (unaudited) . . . . . . . . . . . . . . . . . . . 5 Notes to Consolidated Financial Statements (unaudited). . . . . . . . . . . . . . . . . . . . . . . . 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . 6 Part II OTHER INFORMATION. . . . . . . . . . . . . . . . . . . . . 7 Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . 7 Item 2. Changes in Securities. . . . . . . . . . . . . . . . . . . 7 Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . . 7 Item 4. Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . . . . . 7 Item 5. Other Information. . . . . . . . . . . . . . . . . . . . . 7 Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . 7 SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
WALSHIRE ASSURANCE COMPANY AND SUBSIDIARIES Consolidated Balance Sheets
(In thousands, except per share data) March 31, December 31, Assets 1995 1994 ______ ____ ____ (Unaudited) Investments: Held to maturity: Fixed maturities (market $17,025 and $16,140). . . . . . . . . . . $16,882 $16,508 Available for sale: Fixed maturities (cost $23,546 and $22,588). . . . . . . . . . . . 23,232 21,664 Equity securities (cost $8,021 and $8,263) . . . . . . . . . . . . 7,670 7,611 Short-term investments. . . . . . . . . . . . . . . . . . . . . . . . 456 3,889 Other investments . . . . . . . . . . . . . . . . . . . . . . . . . . 848 868 ______ ______ Total investments. . . . . . . . . . . . . . . . . . . . . . . . . 49,088 50,540 Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293 184 Accrued investment income receivable . . . . . . . . . . . . . . . . . . 907 895 Amounts receivable from reinsurers . . . . . . . . . . . . . . . . . . . 2,359 2,644 Amounts receivable from reinsured company. . . . . . . . . . . . . . . . 1,440 1,325 Agents' balances (net of allowance for doubtful accounts of $100). . . . 4,251 3,627 Installment premiums receivable. . . . . . . . . . . . . . . . . . . . . 3,701 3,633 Agents' balances and installment premiums receivable from related parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,514 2,258 Premium finance receivables (net of unearned finance charges and allowance for credit losses of $134 and $123) . . . . . . . . . . . . 5,552 4,678 Reinsurance receivable . . . . . . . . . . . . . . . . . . . . . . . . . 6,131 6,355 Deferred acquisition costs . . . . . . . . . . . . . . . . . . . . . . . 3,895 3,791 Property and equipment (net of accumulated depreciation of $1,067 and $1,054) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,703 2,656 Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 468 482 ______ ______ Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . $83,302 $83,068 ====== ====== See accompanying notes to consolidated financial statements.
WALSHIRE ASSURANCE COMPANY AND SUBSIDIARIES Consolidated Balance Sheets, Continued
(In thousands, except per share data) March 31, December 31, Liabilities and Shareholders' Equity 1995 1994 ____________________________________ ____ ____ (Unaudited) Liabilities: Unpaid claims, claim settlement expenses and claims drafts . . . . . $14,930 $14,292 Unearned premiums . . . . . . . . . . . . . . . . . . . . . . . . . . 21,985 21,065 Short-term notes payable. . . . . . . . . . . . . . . . . . . . . . . 480 3,435 Long-term notes payable . . . . . . . . . . . . . . . . . . . . . . . 1,841 1,921 Deposits by insureds. . . . . . . . . . . . . . . . . . . . . . . . . 966 747 Commissions payable to agents . . . . . . . . . . . . . . . . . . . . 491 571 Commissions payable to related parties. . . . . . . . . . . . . . . . 209 214 Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 808 809 ______ ______ Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . 41,710 43,054 ______ ______ Shareholders' equity Preferred stock, par value $.01 per share; 2,000 shares authorized; 142 shares issued and outstanding. . . . . . . . . . . 1 1 Common stock, par value $.01 per share; 10,000 shares authorized; 3,649 and 3,638 shares issued and outstanding . . . . 36 36 Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . 25,830 25,751 Unrealized loss on investments available for sale (net of deferred tax benefits of $226 and $534 . . . . . . . . . . . . . . ( 439) ( 1,042) Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . 16,164 15,268 ______ ______ Net shareholders' equity . . . . . . . . . . . . . . . . . . . . . 41,592 40,014 ______ ______ Total liabilities and shareholders' equity . . . . . . . . . . . . $83,302 $83,068 ====== ====== See accompanying notes to consolidated financial statements.
WALSHIRE ASSURANCE COMPANY AND SUBSIDIARIES Consolidated Statements of Income
(In thousands, except per share data) Three Months Ended March 31, _________________________ 1995 1994 (Unaudited) (Unaudited) Revenues: Premiums earned . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,540 $ 8,136 Premiums ceded . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,302) (1,618) _______ _______ Net premiums earned . . . . . . . . . . . . . . . . . . . . . . . . . 8,238 6,518 Net investment income . . . . . . . . . . . . . . . . . . . . . . . . 662 500 Net realized gains on investments . . . . . . . . . . . . . . . . . . 66 328 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168 242 _____ _____ Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . 9,134 7,588 _____ _____ Expenses: Claims and claim settlement expenses. . . . . . . . . . . . . . . . . 4,860 4,787 Reinsurance recoveries. . . . . . . . . . . . . . . . . . . . . . . . ( 98) ( 834) _____ _____ Net claims and claims settlement expenses . . . . . . . . . . . . . . 4,762 3,953 Amortization of deferred acquisition costs . . . . . . . . . . . . . 1,196 1,486 Underwriting, general and administrative expenses . . . . . . . . . . 1,518 1,280 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 55 _____ _____ Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 7,554 6,774 _____ _____ Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . 1,580 814 Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . 332 191 _____ _____ Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,248 623 Less dividends on convertible preferred stock. . . . . . . . . . . . . . 115 29 _____ _____ Net income available for common stock. . . . . . . . . . . . . . . . . . $ 1,133 $ 594 ===== ===== Net income per common share and common equivalent share: Primary: Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ .30 $ .16 ===== ===== Weighted average shares outstanding. . . . . . . . . . . . . . . . 3,770 3,604 ===== ===== See accompanying notes to consolidated financial statements.
WALSHIRE ASSURANCE COMPANY Consolidated Statements of Cash Flows
(In thousands) Three Months Ended March 31, _________________________ 1995 1994 (Unaudited) (Unaudited) Cash flows from operating activities: Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,248 $ 623 Adjustments to reconcile net income to net cash provided by operating activities Net realized gains on investments. . . . . . . . . . . . . . . . . ( 66) ( 328) Decrease (increase) in assets: Accrued investment income receivable . . . . . . . . . . . . . ( 12) ( 14) Amounts receivable from reinsurers . . . . . . . . . . . . . . 285 637 Amounts receivable from reinsured company . . . . . . . . . . . ( 115) ( 2) Agents balances and installment premiums receivable . . . . . . ( 624) ( 355) Agents' balances and installment premiums receivable from related parties . . . . . . . . . . . . . . . ( 324) ( 141) Premium finance receivables . . . . . . . . . . . . . . . . . ( 874) 333 Reinsurance receivable . . . . . . . . . . . . . . . . . . . 224 ( 262) Deferred acquisition costs . . . . . . . . . . . . . . . . . . ( 104) ( 32) Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . 121 217 (Decrease) increase in liabilities: Unpaid claims, claim settlement expenses and claim drafts outstanding . . . . . . . . . . . . . . . . . . 638 1,041 Unearned premiums . . . . . . . . . . . . . . . . . . . . . . . 920 129 Deposits by insureds . . . . . . . . . . . . . . . . . . . . . 219 ( 155) Other, net. . . . . . . . . . . . . . . . . . . . . . . . . . . ( 94) ( 203) ________ ________ Net cash provided by operating activities. . . . . . . . . . . . . 1,442 1,488 Cash flows from investing activities: ________ ________ Purchase of investments: Held-to-maturity . . . . . . . . . . . . . . . . . . . . . . . . . ( 902) ( 671) Available-for-sale . . . . . . . . . . . . . . . . . . . . . . . . ( 1,888) ( 4,129) Sale of investments: Available-for-sale . . . . . . . . . . . . . . . . . . . . . . . . 1,192 2,032 Maturity of investments . . . . . . . . . . . . . . . . . . . . . . 486 236 Net (purchase) sale of short term and other investments . . . . . . 3,466 ( 5,598) Purchase of property and equipment . . . . . . . . . . . . . . . . . ( 185) ( 84) Sale of property and equipment . . . . . . . . . . . . . . . . . . . 31 14 Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . ( 224) 362 ________ ________ Net cash provided by (used in) investing activities . . . . . . . 1,976 ( 7,838) Cash flows from financing activities: ________ ________ Cash dividends paid . . . . . . . . . . . . . . . . . . . . . . . . ( 352) ( 235) Issuance of common stock . . . . . . . . . . . . . . . . . . . . . . 79 10 Issuance of preferred stock . . . . . . . . . . . . . . . . . . . . . - 6,778 Payment of notes payable . . . . . . . . . . . . . . . . . . . . . . ( 3,036) ( 224) ________ ________ Net cash provided by (used in) financing activities . . . . . . . ( 3,309) 6,329 ________ ________ Net increase (decrease) in cash . . . . . . . . . . . . . . . . . . . . 109 ( 21) Cash at beginning of the period . . . . . . . . . . . . . . . . . . . . 184 56 ________ ________ Cash at end of the period . . . . . . . . . . . . . . . . . . . . . . . $ 293 $ 35 ======== ======== See accompanying notes to consolidated financial statements.
WALSHIRE ASSURANCE COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. The consolidated balance sheet as of March 31, 1995, the consolidated statements of income for the three months ended March 31, 1995 and 1994, and the consolidated statements of cash flows for the three months then ended have been prepared by Walshire Assurance Company ("the Company") without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at March 31, 1995 and for all periods presented, have been made. 2. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted. It is suggested that these unaudited consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's 1994 Annual Report dated March 3, 1995. The results of operation for the period ended March 31, 1995 are not necessarily indicative of the results of operations for the full year. 3. Net income per share is computed after recognition of preferred stock dividend requirements and is based on the weighted average number of shares of common stock and common stock equivalents outstanding. The number of common shares was increased by the number of shares issuable on the exercise of options when the market price of the common stock exceeds the exercise price of the options. This increase in the number of common shares was reduced by the number of common shares that are assumed to have been purchased with the proceeds from the exercise of the options; these purchases were assumed to have been made at the average price of the common stock during that part of the year when the market price of the common stock exceeded the exercise price of the options. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations _____________________________________________________________________________ Revenues for the three month period ended March 31, 1995 increased $1.5 million, or 20.4%, from revenues for the three month period ended March 31, 1994. This increase was primarily the result of an increase in net premiums earned, offset, in part, by a decrease in net realized gains on investments. Direct premiums written increased 38.6% in the three month period ended March 31, 1995 when compared to the same period in 1994. The following table sets forth the direct premiums written by the Company, as well as the percentage change, for the three month periods ended March 31, 1995 and 1994 by line of business. (In thousands) Three months ended March 31, ____________________________ 1995 1994 % Change ______ ______ ________ Auto liability $ 4,988 $ 3,748 33.1% Auto physical damage 4,285 3,820 12.2% Workers compensation 1,215 - N/M Inland marine 682 485 40.6% Other 230 170 34.7% ______ ______ Total $11,400 $ 8,223 38.6% ====== ====== Expenses for the three month period ended March 31, 1995 increased $.8 million, or 11.5%, over expenses for the three month period ended March 31, 1994. The increase was primarily the result of increases in net claims and claim settlement expenses and underwriting, general and administrative expenses, offset, in part, by a decrease in amortization of deferred acquisition costs. Increases in claims and claim settlement expenses were the result of increases in earned premiums, offset, in part, by a decrease in the statutory loss ratio from 62.2% in 1994 to 60.8% in 1995. In the first quarter of 1994, claims were negatively impacted as a result of the severe weather conditions. Increases in underwriting, general and administrative expenses were primarily the result of increases in premiums written. The decrease in the amortization of deferred acquisition costs were primarily the result of the increase in ceding commissions, offset, in part, by an increase in net premiums earned. The statutory combined ratio for the three month period ended March 31, 1995 was 88.0%, a decrease from 99.5% for the three month period ended March 31, 1994. Liquidity and Capital Resources _______________________________ Historically, the Company has generated funds sufficient to support its operations and has maintained a high degree of liquidity in its investment portfolio. The primary sources of funds to meet the demands of claim settlements and operating expenses are premiums, ceding commissions and investment income. The Company's funds generally are invested in securities with maturities intended to provide adequate funds to pay claims and expenses without the forced sale of investments. The Company believes that its current cash and short term investments, together with funds generated from operations, will be sufficient to meet its operating and capital requirements for the foreseeable future. Part II OTHER INFORMATION Item 1. Legal Proceedings None Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matter to a Vote of Security Holders None Item 5. Other Information None Item 6. Exhibits and Reports on Form 8-K None SIGNATURES Pursuant to the requirements of Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. WALSHIRE ASSURANCE COMPANY __________________________ (Registrant) DATE: May 8, 1995 /s/ Kenneth R. Taylor __________________________ Kenneth R. Taylor President and Chief Executive Officer DATE: May 8, 1995 /s/ Gary J. Orndorff __________________________ Gary J. Orndorff Vice President / Treasurer and Chief Financial Officer EX-27 2
7 3-MOS DEC-31-1995 MAR-31-1995 23,232 16,882 17,025 7,670 122 0 49,088 293 3,799 3,895 83,302 14,930 21,985 0 966 2,321 36 0 1 41,555 83,302 8,238 662 66 168 4,762 1,196 1,518 1,580 332 0 0 0 0 1,248 .30 .30 14,292 4,623 106 1,751 2,476 14,930 0
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