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First Acceptance Corporation Reports Operating Results for the Quarter Ended March 31, 2022

By: First Acceptance Corp. via AccessWire

May 03, 2022 at 16:05 PM EDT

NASHVILLE, TN / ACCESSWIRE / May 3, 2022 / First Acceptance Corporation (OTCQX:FACO) today reported its financial results for the quarter ended March 31, 2022. A quarterly report can be found at www.otcmarkets.com/stock/FACO/disclosure.

Loss before income taxes, for the three months ended March 31, 2022 was $3.9 million, compared with income before income taxes of $2.7 million for the three months ended March 31, 2021. Net loss for the three months ended March 31, 2022 was $3.1 million, compared with net income of $2.1 million for the three months ended March 31, 2021. Diluted net loss per share was $0.08 for the three months ended March 31, 2022 compared with diluted net income per share of $0.05 for the for the three months ended March 31, 2021.

For the three months ended March 31, 2022, we recognized unfavorable prior period loss and LAE development of $2.8 million compared with favorable prior period loss and LAE development of $2.3 million, for the same period in the prior year.

Revenues and net loss for the three months ended March 31, 2022 included $0.7 million in net gains on investments and revenues and net income for the three months ended March 31, 2021 included $0.4 million in net gains on investments.

President and Chief Executive Officer, Larry Willeford, commented, "Along with most other automobile insurers, Acceptance continued to suffer the impact of higher claims severity resulting from increased used car prices and vehicle repair costs. Fortunately, this impact on losses incurred was somewhat tempered by lower claims frequency as our insureds drove fewer miles due to higher gasoline prices. Were it not for unfavorable loss development, we would have been right on target with our plan for the first quarter. However, on a positive note, March claims severity did show signs of improvement. We also believe that our recent and continued rate strengthening actions will reflect favorably in the coming months as will the disciplined expansion of our independent agent channel. And despite our recent challenges with claims severity, Acceptance was pleased to have its AM Best rating affirmed at B (Fair) with a ‘stable' outlook."

Mr. Willeford further added, "Not only am I pleased to report that our retail location staffing levels for our employee-agents remains strong, but Acceptance was recently honored to be named to the ‘Forbes America's Best Employers' list for 2022. I extend my thanks to our Company leadership for making employee morale a high priority."

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 336 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 word "believe" or the negative of this term 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
	March 31,
	2022			2021
Revenues	$	67,644		$	68,695
(Loss) income before income taxes	$	(3,907	)	$	2,702
Net (loss) income	$	(3,134	)	$	2,090
Net (loss) income per diluted share	$	(0.08	)	$	0.05
Average diluted shares outstanding		37,939			38,462

Statutory Combined Ratio:
Loss		79.2	%		64.2	%
Expense		27.9	%		29.8	%
Combined		107.1	%		94.0	%

INVESTOR RELATIONS CONTACT:
Michael J. Bodayle
615.844.2885

SOURCE: First Acceptance Corp.

View source version on accesswire.com:
https://www.accesswire.com/699945/First-Acceptance-Corporation-Reports-Operating-Results-for-the-Quarter-Ended-March-31-2022

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First Acceptance Corporation Reports Operating Results for the Quarter Ended March 31, 2022

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