-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QAlEvx+RChWfJTwvk3VL9iVXsYyLVB1gHvwnlot0r84deomFV4Wisox+j+msgV8C b26Fr9EysKfHH/okWnI8TQ== 0000926236-03-000062.txt : 20030507 0000926236-03-000062.hdr.sgml : 20030507 20030507120059 ACCESSION NUMBER: 0000926236-03-000062 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030506 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030507 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HALLMARK FINANCIAL SERVICES INC CENTRAL INDEX KEY: 0000819913 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE CARRIERS, NEC [6399] IRS NUMBER: 870447375 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-16090 FILM NUMBER: 03685536 BUSINESS ADDRESS: STREET 1: 14651 DALLAS PKWY STE 900 CITY: DALLAS STATE: TX ZIP: 75254 BUSINESS PHONE: 9724041637 MAIL ADDRESS: STREET 1: 14651 DALLAS PKWY STREET 2: STE 900 CITY: DALLAS STATE: TX ZIP: 75254 FORMER COMPANY: FORMER CONFORMED NAME: ACOI INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN CREDIT OPTICAL INC /DE/ DATE OF NAME CHANGE: 19910611 FORMER COMPANY: FORMER CONFORMED NAME: PYRAMID GROWTH INC DATE OF NAME CHANGE: 19890124 8-K 1 hfs8k03q1.txt CURRENT REPORT RESULTS FIRST QUARTER 2003 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): May 6, 2003 HALLMARK FINANCIAL SERVICES, INC. --------------------------------- (Exact name of registrant as specified in its charter) Nevada 0-16090 87-0447375 ---------------------------- ----------- ------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 14651 Dallas Parkway, Suite 900, Dallas, Texas 75254 ---------------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (972) 404-1637 Not Applicable (Former name or former address, if changed since last report.) Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (c) Exhibits. 99.1 Press release dated May 6, 2003 Item 9. Regulation FD Disclosure. On May 6, 2003, the Registrant issued a press release announcing its financial results for the first quarter ended March 31, 2003. A copy of the Registrant's press release is attached as Exhibit 99.1 to this Current Report. Item 12. Results of Operations and Financial Condition. On May 6, 2003, the Registrant issued a press release announcing its financial results for the first quarter ended March 31, 2003. A copy of the Registrant's press release is attached as Exhibit 99.1 to this Current Report. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HALLMARK FINANCIAL SERVICES, INC. Date: May 6, 2003 By: /s/ Scott K. Billings ------------------------- Scott K. Billings, Its Chief Financial Officer EX-99.1 3 exh99-1.txt PRESS RELEASE FIRST QUARTER 2003 EARNINGS RESULTS EXHIBIT 99.1 FOR IMMEDIATE RELEASE HALLMARK FINANCIAL SERVICES, INC. FIRST QUARTER 2003 EARNINGS RESULTS DALLAS, Texas, (May 6, 2003) - Hallmark Financial Services, Inc, today reported operating results for the first quarter ended March 31, 2003. Net income for the quarter ended March 31, 2003 was $8.6 million, or $0.75 on a diluted per share basis, as compared to a net loss of $1.5 million, or $0.14 on a diluted per share basis for the same period in 2002. Excluding the extraordinary gain and the cumulative effect of a change in accounting principle described below, net income for the quarter ended March 31, 2003 was $0.4 million, as compared to net income of $0.2 million for the same period in 2002. Total revenues were $18.7 million for the quarter ended March 31, 2003, as compared to $5.1 million for the corresponding 2002 period. Hallmark's first quarter 2003 earnings were favorably impacted by its recent acquisitions of Phoenix Indemnity Insurance Company ("Phoenix"), effective January 1, 2003, and Millers General Agency ("MGA"), effective December 1, 2002. The acquisition of Phoenix was accounted for in accordance with Statement of Financial Accounting Standards (SFAS) No. 141, "Business Combinations." This statement requires that the Company estimate the fair value of assets acquired and liabilities assumed by the Company as of the date of the acquisition. In accordance with the application of SFAS 141, the Company recognized an extraordinary gain of $8.2 million from the acquisition of Phoenix. In addition, the Company has shown improvements in its normal operating earnings for the first quarter of 2003, as compared to 2002, due to improved loss ratios as a result of increases in premium rates in the Company's various insurance operations. During fiscal 2002, the Company adopted SFAS No. 142, "Goodwill and Other Intangible Assets." This statement requires that the Company identify its reporting units and then, at least annually, measure the amount of impairment, if any, based on a comparison of the fair value of a reporting unit to its carrying value. In connection with the adoption of SFAS No. 142, the Company determined that goodwill as of January 1, 2002, had been impaired by $1.7 million. This goodwill adjustment was made during the fourth quarter of 2002, but is required to be disclosed in the first quarter of 2002 for comparative purposes. The adjustment is a non-cash charge recorded as a cumulative effect of a change in accounting principle. "The assimilation of our recent acquisitions and the operational enhancements at our existing Texas non-standard auto insurance operation are proceeding according to the Company's plan," stated Mark E. Schwarz, Chairman and CEO. Hallmark Financial Services, Inc. engages primarily in sale of property and casualty insurance products. The Company's business involves marketing, underwriting and premium financing of non-standard personal automobile insurance primarily in Texas, Arizona and New Mexico, commercial insurance in Texas, New Mexico, Idaho, Oregon and Washington, third party claims administration, and other insurance related services. The Company is headquartered in Dallas, Texas and its common stock is listed on the American Stock Exchange under the symbol "HAF.EC". Forward-looking statements in this Release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties including, but not limited to, continued acceptance of the Company's products and services in the marketplace, competitive factors, interest rate trends, the availability of financing, underwriting loss experience and other risks detailed from time to time in the Company's periodic report filings with the Securities and Exchange Commission. For further information, please contact: Timothy A. Bienek, President and COO at 972.866.5708 www.hallmarkgrp.com ------------------- HALLMARK FINANCIAL SERVICES, INC. AND CONSOLIDATED SUBSIDIARIES (In thousands, except earnings per share and shares outstanding) Selected Operating Results Three Months Ended March 31 --------------------------- 2003 2002 ----------- ----------- Gross Premiums Written $ 21,752 $ 13,952 Total Revenues $ 18,721 $ 5,148 Pretax Income $ 611 $ 299 Income Tax Expense $ 208 $ 104 Net Income before Cumulative Effect of a Change in Accounting Principle and Extraordinary Gain $ 403 $ 195 Cumulative Effect of a Change in Accounting Principle $ - $ (1,694) Extraordinary Gain $ 8,152 $ - Net Income (Loss) $ 8,555 $ (1,499) Basic Earnings Per Share $ 0.77 $ ( 0.14) Diluted Earnings Per Share $ 0.75 $ (0.14) Weighted Average Shares Outstanding, Basic 11,055,307 11,049,133 Weighted Average Shares Outstanding, Diluted 11,444,911 11,049,133 -----END PRIVACY-ENHANCED MESSAGE-----