Allen Bradley, AMERISAFE’s Chairman and Chief Executive Officer, commented, “The workers’ compensation market remains attractive in terms of pricing but lethargic in terms of exposure expansion in certain industries. We remain hopeful that employment in construction and other basic industries will accelerate in the remainder of the year.”
G. Janelle Frost, President and Chief Operating Officer, noted, “Favorable pricing and frequency trends continued this quarter resulting in an 89.4% combined ratio.Favorable prior year loss development and controlled fixed costs as premium grew also benefitted the results this quarter.These benefits were a direct result of our emphasis on claims management and prudent cost administration which are fundamental to the Amerisafe business model.”
(1) The tax equivalent yield is calculated using the effective interest rate and a 35% marginal tax rate.
During the quarter, the Company paid a regular quarterly cash dividend of $0.12 per share on June 26, 2014.On July 29, 2014, the Company’s Board of Directors declared a quarterly cash dividend of $0.12 per share, payable on September 26, 2014 to shareholders of record as of September 12, 2014.
During the quarter, no shares were repurchased under the share repurchase plan. A $25.0 million authorization remains in place.Since beginning the plan, the Company has repurchased a total of 1,258,250 shares for $22.4 million for an average per share price of $17.78, including commissions.
(1) The tax effect of net realized capital gains is calculated assuming an annual tax rate of 35% plus the change in valuation allowance for deferred taxes.
(2) Operating net income, operating return on average adjusted equity and operating earnings per share are non-GAAP financial measures. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures.
(3) Average shareholders’ equity is calculated by taking the average of the beginning and ending shareholders’ equity.
(4) Return on average equity is calculated by dividing the annualized net income by the average shareholders’ equity.
AMERISAFE has scheduled a conference call for July 31, 2014, at 10:30 a.m. Eastern Time to discuss the results for the quarter and the outlook for future periods.To participate in the conference call dial 720-545-0027 at least ten minutes before the call begins and ask for the AMERISAFE conference call.A replay of the call will be available approximately two hours after the live broadcast ends and will be accessible through August 7, 2014.To access the replay, dial 855-859-2056 or 404-537-3406 and use the pass code 76701223.
AMERISAFE, Inc. is a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, manufacturing, oil and gas and agriculture.AMERISAFE actively markets workers’ compensation insurance in 30 states and the District of Columbia.
Statements made in this press release that are not historical facts, including statements accompanied by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” or similar words are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding AMERISAFE’s plans and performance.These statements are based on management’s estimates, assumptions and projections as of the date of this release and are not guarantees of future performance and include statements regarding management’s views and expectations of the workers’ compensation market, the Company’s growth opportunities, underwriting margins and actions by competitors.Actual results may differ materially from the results expressed or implied in these statements as the results of risks, uncertainties and other factors including the factors set forth in the Company’s filings with the Securities and Exchange Commission, including AMERISAFE’s Annual Report on Form 10-K for the year ended December 31, 2013.AMERISAFE cautions you not to place undue reliance on the forward-looking statements contained in this release.AMERISAFE does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.