-----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, LltxKsl9wicldwSgEsOrxK3AcWOqoOAXvCR03LvKRi+Vhh4UX3JTDgOj965uwG4m KZPgDZ2t1lH1dK08ejaQog== 0000878897-02-000011.txt : 20020414 0000878897-02-000011.hdr.sgml : 20020414 ACCESSION NUMBER: 0000878897-02-000011 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010205 ITEM INFORMATION: FILED AS OF DATE: 20020206 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN MEDICAL SECURITY GROUP INC CENTRAL INDEX KEY: 0000878897 STANDARD INDUSTRIAL CLASSIFICATION: HOSPITAL & MEDICAL SERVICE PLANS [6324] IRS NUMBER: 391431799 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13154 FILM NUMBER: 02528297 BUSINESS ADDRESS: STREET 1: 3100 AMS BLVD CITY: GREEN BAY STATE: WI ZIP: 54313 BUSINESS PHONE: 9206611111 MAIL ADDRESS: STREET 1: 3100 AMS BLVD CITY: GREEN BAY STATE: WI ZIP: 54313 FORMER COMPANY: FORMER CONFORMED NAME: UNITED WISCONSIN SERVICES INC /WI DATE OF NAME CHANGE: 19930328 8-K 1 presentn.txt FINANCIAL PRESENTATION 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): February 5, 2002 AMERICAN MEDICAL SECURITY GROUP, INC. (Exact name of Registrant as specified in its charter) Wisconsin 1-13154 39-1431799 (State of Incorporation)(Commission File Number) (I.R.S. Employer Identification No.) 3100 AMS Boulevard, Green Bay, Wisconsin 54313 (Address of principal executive offices) (Zip Code) (920) 661-1111 (Registrant's telephone number, including area code) -------------- Item 9. Regulation FD Disclosure. American Medical Security Group, Inc. (the "Company") has developed an investor financial presentation that is available on its website - www.AMSchoices.com, and presented to a number of financial analysts, investors and potential investors. The presentation furnished herewith supercedes a presentation previously furnished pursuant to a Form 8-K dated September 10, 2001 and the presentation on the Company's website. The presentation (i) describes the Company's current businesses, strategies and financial highlights; (ii) describes projected changes in the mix of revenue contributions from the Company's major businesses anticipated by 2003; and (iii) describes discussions between the Company and Cobalt Corporation, the parent of the Company's largest shareholder. The content of the presentation will form the base of future presentations the Company expects to make at financial forums, including health care conferences sponsored by various financial institutions. The presentation is prepared in summary fashion and contains information that should be read in conjunction with the Company's reports filed with the Securities and Exchange Commission from time to time. Also included in this Form 8-K is a financial supplement containing historical data that is available on the Company's website and provided to the financial analysts, investors and potential investors. Following is the content of the presentation and the financial supplement furnished herewith. [American Medical Security Group, Inc. LOGO] February 2002 [AMS Logo] FORWARD-LOOKING STATEMENT Some of the statements made during this presentation may be forward-looking statements subject to inherent risks and uncertainties that may cause actual results to differ materially from the company's expectitations. Please refer to the cautionary statement contained in written materials distributed with this presentation and the various reports filed by the company with the SEC for discussions of risk factors affecting the company and its business. The company assumes no obligation to update forward-looking statements included in this presentation. 2 [AMS Logo] AMS OVERVIEW [Map of the United States] - Specializes in providing AMS Markets healthcare benefit plans for small-employer groups, Alabama Arizona-1 Arkansas individuals & families Colorado-1 Delaware Florida-1,2 Georgia-1 Illinois-1,2 Indiana-1 - PPO model Iowa Kansas-1 Louisiana Maryland Michigan-2 Mississippi-2 - 2001 Revenues: $876.6 million Missouri-1 Nebraska-1 Nevada New Mexico-2 North Carolina-2 North Dakota - 557,716 health members at 12/31/2001 Ohio-1,2 Oklahoma-1,2 Pennsylvania-1,2 South Carolina South Dakota Tennessee-1,2 Texas-1,2 Utah-2 Virginia-1 West Virginia Wisconsin-1,3 Washington DC 1- Regional Sales Office located in this state 2- District Sales Office located in this state 3- Headquarters located in Green Bay, Wisconsin 3
[AMS Logo] FEBRUARY 4 EARNINGS HIGHLIGHTS o Net income of $0.30 per share in 4Q 2001 o $0.25 in 3Q 2001 o $0.10 in 2Q 2001 o $0.05 in 1Q 2001 (excluding $0.41 non-recurring litigation charge) o Guidance of $1.15 - 1.25 per share for full-year 2002 o Health segment loss ratio improves for 5th consecutive quarter o Lowest point in more than 2 years o New product lines reaching markets 4 [AMS Logo] AMS OVERVIEW o Strategies o Grow individual MedOne business o Continue to improve small group business performance o Rollout new product lines o Grow dental business 5 [AMS Logo] BUSINESSES Revenue Contribution Changes (% of all AMS revenues) [Bar Chart]] 2000 2001 2003 (projected) 63% Small Group 54% Small Group 46% Small Group 25% MedOne 36% MedOne 44% MedOne 9% Specialty 10% Specialty 10% Specialty 6 [AMS Logo] Small Group Small Group Medical, Dental, Life and STD associated with group members 7 [AMS Logo] SMALL GROUP COMPONENT o Small-employer groups, ranging in size from 2 to 50 employees o Average group size is 6 employees o Distribution through 25,000 independent agents 8 [AMS Logo] SMALL GROUP COMPONENT o Improving performance of small group business o Several quarters of aggressive rate action o Premiums increasing faster than claim costs o Industry finally overcomes impact of Health Insurance Portability & Accountability Act (HIPAA) o Double-digit health care inflation compounds HIPAA o Medicare cost-shifting makes matters worse 9 [AMS Logo] SMALL GROUP COMPONENT o New group product rollout o Extremely strong agent reception o Employers can tailor coverage to meet their needs o Aggressive efforts to invigorate new member growth 10 [AMS Logo] SMALL GROUP COMPONENT o Increase small group profitability by: o Focusing on core markets o Introducing new products o Higher deductibles, copays, etc. 11 [AMS Logo] MedOne MedOne Medical, and Life associated with MedOne members 12 [AMS Logo] MEDONE COMPONENT o Product for individuals and their families o No employer coverage o Self-employed o Temporary coverage o Sold through independent agents o Higher profit potential than small group o More flexibility in underwriting and pricing o Better risk selection 13 [AMS Logo] MEDONE COMPONENT o Well-positioned in softening economy o Layoffs o Small employers dropping coverage o New MedOne product rollout o Individuals have a greater stake in health care costs o Elect higher deductibles and co-pays o Builds on success of Affordable One o Improving competitive environment 14 [AMS Logo] MEDONE COMPONENT o MedOne Revenues o Up 24% in 2001 from 2000 o MedOne Membership o 45% of total 2001 membership vs. 34% in 2000 15 [AMS Logo] MEDONE COMPONENT o Increase revenues & profitability: o Expand number of agents o Introduce new product o Create additional regional/national distribution relationships o Provide agents with power of Internet o eAMS.com secured agent site o Electronic quoting and enrollment 16 [AMS Logo] Specialty Business Stand-Alone Dental and Self-Funded 17 [AMS Logo] SPECIALTY BUSINESS o Consists of: o Dental business o 167,000 stand-alone dental members o 79,000 additional members bundled to group plans o Self-funded business 18 [AMS Logo] SPECIALTY BUSINESS o Increase Profitability by: o Expanding dental business o Increase sales & marketing activity o New product o Selectively developing self-funded business 19 [AMS Logo] FINANCIAL HIGHLIGHTS 20 [AMS Logo] EARNINGS PER SHARE (*excluding non-recurring charge) [Line Graph] Quarter 3 2000 $(0.09) Quarter 4 2000 $ 0.01 Quarter 1 2001 $ 0.05* Quarter 2 2001 $ 0.10 Quarter 3 2001 $ 0.25 Quarter 4 2001 $ 0.30 21 [AMS Logo] ANNUAL EARNINGS PER SHARE (*excluding non-recurring charge) [Bar Chart] 2000 Actual 2001 Actual 2002 Company guidance as of 2/4/02 $0.18 $0.70* $1.15 - $1.25 22 [AMS Logo] OTHER FINANCIAL DATA As Of 12/31/99 12/31/00 12/31/01 Book Value per Share $14.86 $15.77 $16.30 Tangible Book Value per Share $7.69 $8.24 $8.85 Debt to Total Capital Ratio 16.2% 15.7% 14.9% Cash Flow from Operations $26.4 $(3.2) $17.6 Capital Adequacy (RBC) 339% 389% 486% est. 23 [AMS Logo] FINANCIAL HIGHLIGHTS SMALL CAP VALUE o Investment Considerations o Growing MedOne business o Small group market turnaround o Profitable dental business o Strong systems and back office o Low debt to total capital ratio - 14.9% o Book value of $16.30 per share on 12/31/2001 o Tangible book value of $8.85 per share on 12/31/2001 o Closing price of $11.48 on 2/1/2002 24 [AMS Logo] COBALT CORPORATION o 45% Shareholder o January 18: Files Schedule 13D with SEC o Discussions with AMS regarding the repurchase of a portion of its shares at market prices o Investment no longer "strategic asset" o July 2001: Hired investment banker to respond to inquiries from purchasers o AMS in discussions with Cobalt to resolve these issues favorably for shareholders 25 [AMS Logo] PROXY SOLICITATION The directors and executive officers of American Medical Security Group, Inc. ("AMS") and certain other persons may be deemed to be participants in solicitation by AMS of proxies from its shareholders in connection with AMS' 2002 Annual Meeting of Shareholders. Information concerning such participants was filed by AMS with the Securities and Exchange Commission (the "SEC") on January 22, 2002. SHAREHOLDERS OF AMS ARE ADVISED TO READ AMS' PROXY STATEMENT IN CONNECTION WITH ITS SOLICITATION OF PROXIES FROM ITS SHAREHOLDERS WHEN IN BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Shareholders of AMS and other interested parties may obtain, free of charge, copies of AMS' proxy statement, and any other documents filed by AMS with the SEC, at the SEC's Internet web site at www.sec.gov. When available, definitive proxy statements and other documents may also be obtained by contacting AMS: Cliff Bowers, American Medical Security, P.O. Box 19032, Green Bay, WI 54307-9032. (920) 661-2766 26 [AMS Logo] CAUTIONARY STATEMENT This presentation contains certain "forward-looking" statements (within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995) with respect to strategic business plans, earnings and changes in business mix. Such statements are subject to inherent risks and uncertainties that may cause actual results to differ materially from those contemplated. Risk factors that may affect actual results include: o Inability to successfully implement the Company's business plan, attain new business sales goals, retain existing customers and maintain acceptable profit margins o Unexpected increases in medical costs and increased utilization of medical services and prescription drugs resulting from bioterrorism concerns or otherwise o Competitive practice and demand for the Company's products o Changes in the Company's relationship with key sales agents and the ability of the Company to expand its distribution network o Developments in health care reform and changes in insurance and health care regulations and other regulatory issues o General economic conditions affecting consumer spending and the Company's investment performance o Outcome of commercial and other litigation o Other factors referred to in the Company's reports filed with the Securities and Exchange Commission from time to time This presentation reflects expectations of the Company as of February 4, 2002. The Company undertakes no obligation to update this information as a result of new information or future events. Information in this presentation related to the Company's major business products is provided in addition to previously disclosed information. In this presentation, historical and forward-looking data reflecting the Company's health and life insurance segment businesses have been allocated to major business products based on the underlying customer base. 27 [American Medical Security Group, Inc. Logo] FINANCIAL SUPPLEMENT AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES INCOME DATA - ------------------------------------------------------------------------------------------------------------------------------------ (in thousands, except earnings per share) 2000 2001 YTD -------------------------------------- -------------------------------------- ------------------ 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 12/31/00 12/31/01 REVENUES Premiums $247,905 $240,537 $231,963 $230,666 $222,470 $213,645 $204,399 $198,158 $951,071 $838,672 Investment income 4,883 4,886 4,620 4,618 4,514 4,405 4,280 4,244 19,007 17,443 Realized investment gain (loss) - (112) (90) (123) (27) (152) (660) 60 (325) (779) Fees & other 4,889 5,015 5,263 4,945 5,301 5,408 5,369 5,207 20,112 21,285 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Total revenues 257,677 250,326 241,756 240,106 232,258 223,306 213,388 207,669 989,865 876,621 OPERATING COSTS Benefits 188,063 182,012 180,141 174,397 166,580 156,174 144,000 135,188 724,613 601,942 General and administrative 35,458 32,991 32,215 32,742 33,080 33,723 33,821 34,048 133,406 134,672 Commissions and selling 28,412 28,459 27,650 29,184 28,146 27,794 26,233 26,342 113,705 108,515 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Total operating costs 251,933 243,462 240,006 236,323 227,806 217,691 204,054 195,578 971,724 845,129 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- EBITDA 5,744 6,864 1,750 3,783 4,452 5,615 9,334 12,091 18,141 31,492 Depreciation and amortization 2,014 2,181 2,141 2,105 2,092 2,263 2,365 2,463 8,441 9,183 Interest expense 896 883 890 915 876 744 687 570 3,584 2,877 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- INCOME BEFORE INCOME TAXES 2,834 3,800 (1,281) 763 1,484 2,608 6,282 9,058 6,116 19,432 Income taxes 1,175 1,540 95 637 774 1,142 2,778 4,713 3,447 9,407 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- INCOME BEFORE NON-RECURRING ITEMS 1,659 2,260 (1,376) 126 710 1,466 3,504 4,345 2,669 10,025 Non-recurring items, net of tax - - - - 5,850 - - - - 5,850 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- NET INCOME (LOSS) $ 1,659 $ 2,260 $ (1,376) $ 126 $ (5,140) $ 1,466 $ 3,504 $ 4,345 $ 2,669 $ 4,175 ======= ======= ======= ======= ======= ======= ======= ======= ======= ======= - ------------------------------------------------------------------------------------------------------------------------------------ PER SHARE DATA EBITDA - basic $ 0.37 $ 0.45 $ 0.12 $ 0.26 $ 0.31 $ 0.40 $ 0.67 $ 0.87 $ 1.22 $ 2.24 Income before non-recurring items - diluted $ 0.11 $ 0.15 $ (0.09) $ 0.01 $ 0.05 $ 0.10 $ 0.25 $ 0.30 $ 0.18 $ 0.70 Net income (loss) - basic $ 0.11 $ 0.15 $ (0.09) $ 0.01 $ (0.36) $ 0.10 $ 0.25 $ 0.31 $ 0.18 $ 0.30 Net income (loss) - diluted $ 0.11 $ 0.15 $ (0.09) $ 0.01 $ (0.36) $ 0.10 $ 0.25 $ 0.30 $ 0.18 $ 0.29 Weighted average common shares - basic 15,505 15,102 14,562 14,436 14,211 14,042 13,992 13,953 14,899 14,049 Weighted average common shares - diluted 15,573 15,156 14,562 14,453 14,211 14,094 14,063 14,336 15,049 14,228 - ------------------------------------------------------------------------------------------------------------------------------------ MARGIN ANALYSIS EBITDA 2.2% 2.7% 0.7% 1.6% 1.9% 2.5% 4.4% 5.8% 1.8% 3.6% Income before income taxes 1.1% 1.5% (0.5%) 0.3% 0.6% 1.2% 2.9% 4.4% 0.6% 2.2% Net income (loss) 0.6% 0.9% (0.6%) 0.1% (2.2%) 0.7% 1.6% 2.1% 0.3% 0.5%
AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES FINANCIAL DATA (in thousands, except membership) 2000 2001 YTD -------------------------------------- -------------------------------------- ------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 12/31/00 12/31/01 REVENUE MIX Premiums: Health $232,954 $228,437 $222,635 $223,696 $216,974 $209,124 $200,256 $194,304 $907,722 $820,658 Life 6,072 5,774 5,460 5,272 4,963 4,483 4,135 3,843 22,578 17,424 HMO and other 8,879 6,326 3,868 1,698 533 38 8 11 20,771 590 Investment income 4,883 4,774 4,530 4,495 4,487 4,253 3,620 4,304 18,682 16,664 Self funded admin fees 1,354 1,341 1,376 1,385 1,403 1,345 1,320 1,350 5,456 5,418 Other 3,535 3,674 3,887 3,560 3,898 4,063 4,049 3,857 14,656 15,867 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total revenues $257,677 $250,326 $241,756 $240,106 $232,258 $223,306 $213,388 $207,669 $989,865 $876,621 ======== ======== ======== ======== ======== ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ FINANCIAL STATISTICS Shareholders' equity, excluding FAS 115 $231,706 $228,088 $226,341 $225,125 $218,850 $219,804 $223,018 $227,497 $225,125 $227,497 Goodwill and other intangibles, net $110,401 $109,455 $108,508 $107,562 $106,655 $105,748 $104,841 $103,934 $107,562 $103,934 Debt $ 42,158 $ 41,858 $ 41,558 $ 41,258 $ 40,958 $ 40,658 $ 40,358 $ 40,058 $ 41,258 $ 40,058 Book value per share $ 15.01 $ 15.64 $ 15.58 $ 15.77 $ 15.54 $ 15.70 $ 15.98 $ 16.30 $ 15.77 $ 16.30 Tangible book value per share $ 7.86 $ 8.14 $ 8.11 $ 8.24 $ 7.97 $ 8.15 $ 8.47 $ 8.85 $ 8.24 $ 8.85 Debt to total capital 16.0% 16.1% 16.0% 15.7% 15.8% 15.7% 15.6% 14.9% 15.7% 14.9% Common shares outstanding, net of treasury 15,432 14,579 14,530 14,271 14,085 13,997 13,954 13,955 14,271 13,955 - ------------------------------------------------------------------------------------------------------------------------------------ MEMBERSHIP ANALYSIS Health: Fully insured medical 520,710 498,415 475,706 462,902 424,632 394,387 363,912 346,070 462,902 346,070 Self funded & HMO medical 67,364 62,160 61,958 53,954 49,768 45,490 45,190 44,594 53,954 44,594 Stand-alone dental 188,565 179,760 176,727 171,007 178,283 186,990 171,214 167,052 171,007 167,052 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Health 776,639 740,335 714,391 687,863 652,683 626,867 580,316 557,716 687,863 557,716 Life/AD&D 280,893 270,600 259,000 251,779 230,426 211,547 196,035 185,601 251,779 185,601 - ------------------------------------------------------------------------------------------------------------------------------------
AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES BALANCE SHEETS (in thousands) 2000 2001 3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31 -------------------------------------- -------------------------------------- ASSETS Investments: Securities available for sale, at fair value: Fixed maturities $281,044 $272,192 $269,950 $262,428 $261,136 $260,159 $258,181 $269,753 Equity securities - preferred 2,027 2,180 2,315 2,368 2,278 2,450 2,459 722 Fixed maturity securities held to maturity, at amortized cost 3,829 4,337 4,328 4,320 4,312 4,303 4,295 4,286 Trading securities, at fair value - 49 127 260 244 332 388 517 -------- -------- -------- -------- -------- -------- -------- -------- Total investments 286,900 278,758 276,720 269,376 267,970 267,244 265,323 275,278 Cash and cash equivalents (2,335) (3,531) (6) 15,606 10,484 12,123 23,307 24,975 Other assets: Property and equipment, net 34,089 33,175 32,607 32,451 33,143 33,576 32,756 33,381 Goodwill and other intangibles, net 110,401 109,455 108,508 107,562 106,655 105,748 104,841 103,934 Other assets 54,772 47,150 47,016 46,928 46,265 42,319 41,172 35,447 -------- -------- -------- -------- -------- -------- -------- -------- Total other assets 199,262 189,780 188,131 186,941 186,063 181,643 178,769 172,762 -------- -------- -------- -------- -------- -------- -------- -------- TOTAL ASSETS $483,827 $465,007 $464,845 $471,923 $464,517 $461,010 $467,399 $473,015 ======== ======== ======== ======== ======== ======== ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Medical and other benefits payable $150,512 $140,173 $137,019 $145,310 $133,285 $131,851 $132,028 $135,504 Advance premiums 22,835 21,449 20,780 17,568 18,013 16,140 16,135 16,737 Payables and accrued expenses 25,246 23,581 27,559 25,902 34,139 33,047 30,358 28,032 Notes payable 42,158 41,858 41,558 41,258 40,958 40,658 40,358 40,058 Other liabilities 21,516 20,204 19,300 20,708 19,828 20,470 21,518 23,284 -------- -------- -------- -------- -------- -------- -------- -------- Total liabilities 262,267 247,265 246,216 250,746 246,223 242,166 240,397 243,615 Shareholders' equity: Common stock 16,654 16,654 16,654 16,654 16,654 16,654 16,654 16,654 Paid-in capital 187,956 187,956 187,956 187,956 187,956 187,956 187,834 187,927 Retained earnings 35,286 37,546 36,169 36,295 31,155 32,621 36,125 40,470 Unrealized gain (loss) on investments (10,146) (10,346) (7,712) (3,948) (556) (960) 3,984 1,903 Treasury stock (8,190) (14,068) (14,438) (15,780) (16,915) (17,427) (17,595) (17,554) -------- -------- -------- -------- -------- -------- -------- -------- Total shareholders' equity 221,560 217,742 218,629 221,177 218,294 218,844 227,002 229,400 -------- -------- -------- -------- -------- -------- -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS'EQUITY $483,827 $465,007 $464,845 $471,923 $464,517 $461,010 $467,399 $473,015 ======== ======== ======== ======== ======== ======== ======== ========
AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES SEGMENT DATA - HEALTH (in thousands, except financial statistics) 2000 2001 YTD ------------------------------------- -------------------------------------- ------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 12/31/00 12/31/01 OPERATING RESULTS Revenues: Premiums $232,954 $228,437 $222,635 $223,696 $216,974 $209,124 $200,256 $194,304 $907,722 $820,658 Investment income 2,545 2,353 2,243 2,372 2,450 2,265 2,299 2,183 9,513 9,197 Other revenue 3,963 4,020 4,220 3,912 4,230 4,357 4,370 4,315 16,115 17,272 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total revenues 239,462 234,810 229,098 229,980 223,654 215,746 206,925 200,802 933,350 847,127 Benefits and expenses: Benefits 178,505 175,569 175,529 170,908 164,197 154,981 142,766 133,867 700,511 595,811 General and administrative 33,765 31,876 31,215 31,649 31,752 32,469 32,860 32,996 128,505 130,077 Commissions and selling 26,476 26,817 26,310 27,541 27,211 26,975 25,511 25,679 107,144 105,376 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total benefits and expenses 238,746 234,262 233,054 230,098 223,160 214,425 201,137 192,542 936,160 831,264 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Income (loss) before income taxes $ 716 $ 548 $ (3,956) $ (118) $ 494 $ 1,321 $ 5,788 $ 8,260 $ (2,810) $ 15,863 ======== ======== ======== ======== ======== ======== ======== ======== ======== ======== FINANCIAL STATISTICS Loss ratio 76.6% 76.9% 78.8% 76.4% 75.7% 74.1% 71.3% 68.9% 77.2% 72.6% Expense ratio: General and administrative 12.8% 12.2% 12.1% 12.4% 12.7% 13.4% 14.3% 14.9% 12.4% 13.8% Commissions and selling 11.4% 11.7% 11.8% 12.3% 12.5% 12.9% 12.7% 13.2% 11.8% 12.8% -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Total expense ratio 24.2% 23.9% 23.9% 24.7% 25.2% 26.3% 27.0% 28.0% 24.2% 26.6% -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Combined ratio 100.8% 100.8% 102.8% 101.1% 100.9% 100.4% 98.3% 96.9% 101.4% 99.2% ======== ======== ======== ======== ======== ======== ======== ======== ======== ======== Premiums per member per month: Fully insured medical $ 131 $ 134 $ 137 $ 143 $ 146 $ 153 $ 158 $ 163 $ 136 $ 154 Self funded 46 44 42 42 48 49 47 50 44 48 Dental 18 19 19 19 20 20 21 21 19 21 Short-term disability 21 17 17 16 21 21 22 21 18 21 Benefits cost per member per month: Fully insured medical $ 101 $ 103 $ 109 $ 110 $ 112 $ 113 $ 113 $ 113 $ 105 $ 113 Self funded 39 41 40 35 36 42 36 34 39 37 Dental 13 13 12 13 13 14 14 13 13 14 Short-term disability 11 10 16 21 13 11 13 12 14 12 * First quarter and full-year 2001 health segment general and administrative expense excludes the non-recurring $9.0 million pre-tax litigation charge.
AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES SEGMENT DATA - LIFE (in thousands, except financial statistics) 2000 2001 YTD ------------------------------------- -------------------------------------- ------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 12/31/00 12/31/01 OPERATING RESULTS Revenues: Premiums $ 6,072 $ 5,774 $ 5,460 $ 5,272 $ 4,963 $ 4,483 $ 4,135 $ 3,843 $22,578 $17,424 Investment income 159 157 157 165 174 162 160 160 638 656 Other revenue 56 58 57 46 42 40 38 34 217 154 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Total revenues 6,287 5,989 5,674 5,483 5,179 4,685 4,333 4,037 23,433 18,234 Benefits and expenses: Benefits 2,290 1,547 2,102 1,842 1,992 1,690 1,356 1,296 7,781 6,334 General and administrative 650 582 571 649 531 561 613 559 2,452 2,264 Commissions and selling 1,107 1,070 995 957 906 836 749 691 4,129 3,182 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Total benefits and expenses 4,047 3,199 3,668 3,448 3,429 3,087 2,718 2,546 14,362 11,780 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Income before income taxes $ 2,240 $ 2,790 $ 2,006 $ 2,035 $ 1,750 $ 1,598 $ 1,615 $ 1,491 $ 9,071 $ 6,454 ======= ======= ======= ======= ======= ======= ======= ======= ======= ======== FINANCIAL STATISTICS Loss ratio 37.7% 26.8% 38.5% 34.9% 40.1% 37.7% 32.8% 33.7% 34.5% 36.4% Expense ratio: General and administrative 9.8% 9.1% 9.4% 11.4% 9.8% 11.7% 13.9% 13.7% 9.9% 12.1% Commissions and selling 18.2% 18.5% 18.2% 18.2% 18.3% 18.6% 18.1% 18.0% 18.3% 18.3% ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Total expense ratio 28.0% 27.6% 27.6% 29.6% 28.1% 30.3% 32.0% 31.6% 28.2% 30.4% ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Combined ratio 65.7% 54.4% 66.1% 64.5% 68.2% 68.0% 64.8% 65.4% 62.7% 66.7% ======= ======= ======= ======= ======= ======= ======= ======= ======= ========
AMERICAN MEDICAL SECURITY GROUP, INC. AND SUBSIDIARIES CORPORATE AND OTHER (in thousands) 2000 2001 YTD ------------------------------------- -------------------------------------- ------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 12/31/00 12/31/01 OPERATING RESULTS Revenues: Premiums $ 8,879 $ 6,326 $ 3,868 $ 1,698 $ 533 $ 38 $ 8 $ 11 $20,771 $ 590 Investment income 2,179 2,376 2,220 2,081 1,890 1,978 1,821 1,901 8,856 7,590 Realized investment gain (loss) - (112) (90) (123) (27) (152) (660) 60 (325) (779) Other revenue 870 937 986 987 1,029 1,011 961 858 3,780 3,859 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Total revenues 11,928 9,527 6,984 4,643 3,425 2,875 2,130 2,830 33,082 11,260 Benefits and expenses: Benefits 7,268 4,896 2,510 1,647 391 (497) (122) 25 16,321 (203) General and administrative 2,111 1,767 1,624 1,603 1,982 2,049 1,807 2,048 7,105 7,886 Commissions and selling 829 572 345 686 29 (17) (27) (28) 2,432 (43) Interest expense 896 883 890 915 876 744 687 570 3,584 2,877 Amortization of intangibles 946 947 946 946 907 907 906 908 3,785 3,628 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Total benefits and expenses 12,050 9,065 6,315 5,797 4,185 3,186 3,251 3,523 33,227 14,145 ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- Income (loss) before income taxes $ (122) $ 462 $ 669 $(1,154) $ (760) $ (311) $(1,121) $ (693) $ (145) $(2,885) ======= ======= ======= ======== ========= ======== ======== ======= ========= ========
SIGNATURE 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 thereunto duly authorized. AMERICAN MEDICAL SECURITY GROUP, INC. Dated: February 5, 2002 /s/ Gary D. Guengerich Gary D. Guengerich Executive Vice President & Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----