First Acceptance Corporation Reports Operating Results for the Three and Six Months Ended June 30, 2023

August 01, 2023 at 16:02 PM EDT

NASHVILLE, TN / ACCESSWIRE / August 1, 2023 / First Acceptance Corporation (OTCQX:FACO) today reported its financial results for the three and six months ended June 30, 2023. A quarterly report can be found at www.otcmarkets.com/stock/FACO/disclosure.

Income before income taxes, for the three months ended June 30, 2023 was $4.2 million, compared with loss before income taxes of $4.9 million for the three months ended June 30, 2022. Net income for the three months ended June 30, 2023 was $3.2 million, compared with net loss of $3.6 million for the three months ended June 30, 2022. Diluted net income per share was $0.08 for the three months ended June 30, 2023, compared with diluted net loss per share of $0.09 for the same period in the prior year.

Income before income taxes, for the six months ended June 30, 2023 was $5.6 million, compared with loss before income taxes of $8.8 million for the six months ended June 30, 2022. Net income for the six months ended June 30, 2023 was $4.3 million, compared with net loss of $6.7 million for the six months ended June 30, 2022. Diluted net income per share was $0.11 for the six months ended June 30, 2023, compared with diluted net loss per share of $0.18 for the same period in the prior year.

For the three months ended June 30, 2023, we recognized favorable prior period loss and LAE development of $0.1 million, compared with unfavorable prior period loss and LAE development of $1.1 million for the same period in the prior year. For the six months ended June 30, 2023, we recognized $0.7 million of unfavorable prior period loss and LAE development compared with $3.5 million for the same period in the prior year.

Net income for the three months ended June 30, 2023 included $0.3 million in net gains on investments, compared with net losses on investments of $1.5 million for the same period in the prior year. Net income for the six months ended June 30, 2023 included $0.8 million in net gains on investments, compared with $0.8 million in net losses on investments for the same period in the prior year.

Interim President and Chief Executive Officer, Ken Russell, "The financial results for the past quarter reflect a continuation of the positive trends we began to first witness last quarter. Premium revenues once again grew through a combination of our recent rate increases impacting renewing policies and strong new business production coming from all our distribution channels. Claims cost severities have now shown two consecutive quarters of moderation from their previously elevated levels and investment income yields in our portfolio continue to climb as we invest through a period of rising interest rates. Cost containment efforts and our diversification into the independent agency channel have also stabilized our expense ratio. Collectively, we believe these favorable movements are providing optimism and encouragement for the Acceptance team as we move forward."

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 289 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. 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 words "believe," "expect," "trend," "focus," "optimism," or the negative of these objective terms 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, 2022 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						Six Months Ended
		June 30,						June 30,
		2023			2022			2023			2022
Revenues		$	112,645		$	70,024		$	210,555		$	137,667
Income (loss) before income taxes		$	4,198		$	(4,890	)	$	5,616		$	(8,798	)
Net income (loss)		$	3,154		$	(3,559	)	$	4,312		$	(6,694	)
Net income (loss) per diluted share		$	0.08		$	(0.09	)	$	0.11		$	(0.18	)
Average diluted shares outstanding			38,211			37,702			38,119			37,820

Combined Ratio for Insurance Companies:
Loss			69.7	%		74.9	%		72.3	%		76.9	%
Expense			30.5	%		29.5	%		29.0	%		28.7	%
Combined			100.2	%		104.4	%		101.3	%		105.6	%

INVESTOR RELATIONS CONTACT:

Michael J. Bodayle
615.844.2885

SOURCE: First Acceptance Corporation

View source version on accesswire.com:
https://www.accesswire.com/771525/First-Acceptance-Corporation-Reports-Operating-Results-for-the-Three-and-Six-Months-Ended-June-30-2023

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First Acceptance Corporation Reports Operating Results for the Three and Six Months Ended June 30, 2023

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