EX-99.1 CHARTER 2 ex991.htm ex991.htm
 
 
 

                                                                                                           Ex. 99.1
The National Security Group, Inc.
661 East Davis Street
Post Office Box 703
Elba, Alabama 36323
 
 

PRESS RELEASE
FOR IMMEDIATE RELEASE
The National Security Group, Inc. Releases Third Quarter Earnings
 

Elba, Alabama (November, 12, 2010)… The National Security Group, Inc. (the  Company) (Nasdaq: NSEC), today reported results for  the  quarter and nine months ended September 30, 2010 and 2009, based on accounting principles generally accepted in the United States of America, as follows:


   
Three Months
    
Nine Months
  
   
Ended September 30
    
Ended September 30
  
   
2010
    
2009
    
2010
    
2009
  
                         
REVENUES
                        
Net premiums earned
   $ 15,248,000     $ 14,357,000     $ 46,189,000     $ 44,950,000  
Net investment income
     1,175,000       1,603,000       3,696,000       4,214,000  
Net realized investment gains (losses)
     75,000       79,000       1,433,000       (151,000 )
Other Income
     259,000       208,000       814,000       541,000  
                                 
  Total Revenues
     16,757,000       16,247,000       52,132,000       49,554,000  
                                 
BENEFITS AND EXPENSES
                                
Policyholder benefits paid or provided
     10,096,000       9,131,000       29,630,000       28,237,000  
Policy acquisition costs
     3,082,000       3,432,000       8,800,000       9,699,000  
General expenses
     2,792,000       2,483,000       7,532,000       6,979,000  
Taxes, licenses and fees
     525,000       376,000       1,492,000       1,356,000  
Interest expense
     294,000       277,000       859,000       842,000  
Total Expenses
                                
    16,789,000       15,699,000       48,313,000       47,113,000  
                                 
(Loss)  Income  Before Income Taxes
     (32,000 )     548,000       3,819,000       2,441,000  
                                 
INCOME TAX (BENEFIT) EXPENSE
     (255,000 )     (103,000 )     888,000       217,000  
                                 
   Net Income
   $ 223,000     $ 651,000     $ 2,931,000     $ 2,224,000  
                                 



For the quarter ended September 30, 2010, the Company had net income of $223,000 ($0.09 per share) compared to net income of $651,000 ($0.26 per share) for the same period last year.  The most significant factors contributing to the decline in the third quarter of 2010 were a $965,000 increase in policyholder benefits paid or provided coupled with a $309,000 increase in general expenses.  The 10.6% increase in policyholder benefits paid or provided was largely related to a $659,000 increase in losses paid during the third quarter of 2010 compared to the same period last year in the P&C segment combined with a $320,000 increase in death and maturity benefits in the Life segment for the same time period.  The 12.4% increase in general expenses was primarily related to litigation expense.  Positively impacting the quarter were an $891,000 ($0.36 per share) increase in net premiums earned as well as a $350,000 reduction in policy acquisition costs.

For the nine-months ended September 30, 2010, the Company had net income of $2,931,000 ($1.19 per share) compared to net income of $2,224,000 ($0.90 per share) for the same period last year.  The year-to-date increase of $1,584,000 in net realized investment gains was the primary reason for the improvement in net income in 2010 compared to the same period in 2009.  The increase in year-to-date net income was partially offset by a $1,393,000 increase in policyholder benefits paid or provided.  Year-to-date incurred losses were up in the first nine-months of 2010 in the life segment as well as in the homeowners and automobile programs in the P&C segment compared to the same period last year.

At September 30, 2010, the Company had aggregate equity capital, unrealized investment gains (net of income taxes) and retained earnings of $44,870,000 ($18.19 per share), up $3,702,000 ($1.50 per share) compared to $41,168,000 ($16.69 per share) at December 31, 2009.  Factors contributing to the change in equity for the nine months ended September 30, 2010 were year-to-date net income of $2,931,000, recoveries in market values of fixed maturities and equity securities of $2,312,000, a net loss on interest rate swaps of $431,000 and dividends paid of $1,110,000.

The National Security Group, Inc., through its property & casualty and life insurance subsidiaries, offers property, casualty, life, accident and health insurance in twelve states.  For more financial information please visit the investor section our website www.nationalsecuritygroup.com.

        Contact:         Brian McLeod, CFO & Treasurer
The National Security Group, Inc.
P.O. Box 703
Elba, Alabama 36323