DALLAS, Nov. 14, 2022 (GLOBE NEWSWIRE) — Hallmark Financial Services, Inc. (“Hallmark”) (NASDAQ: HALL) right now filed its Form 10-Q and introduced monetary outcomes for the third quarter and 9 months ended September 30, 2022.
| Third Quarter | Year-to-Date | ||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||
| $ in tens of millions: | |||||||||||||
| Net loss from persevering with operations | $ | (29.3 | ) | $ | (2.0 | ) | $ | (104.9 | ) | $ | (3.9 | ) | |
| Net revenue from discontinued operations | $ | 1.1 | $ | 5.5 | $ | 4.2 | $ | 15.4 | |||||
| Net (loss) revenue | $ | (28.2 | ) | $ | 3.4 | $ | (100.8 | ) | $ | 11.6 | |||
| Operating loss (1) | $ | (20.6 | ) | $ | (1.6 | ) | $ | (69.2 | ) | $ | (11.1 | ) | |
| $ per diluted share: | |||||||||||||
| Net loss from persevering with operations | $ | (1.61 | ) | $ | (0.11 | ) | $ | (5.77 | ) | $ | (0.21 | ) | |
| Net revenue from discontinued operations | $ | 0.06 | $ | 0.30 | $ | 0.23 | $ | 0.85 | |||||
| Net (loss) revenue | $ | (1.55 | ) | $ | 0.19 | $ | (5.54 | ) | $ | 0.64 | |||
| Operating loss (1) | $ | (1.13 | ) | $ | (0.09 | ) | $ | (3.81 | ) | $ | (0.61 | ) | |
(1) See “Non-GAAP Financial Measures” beneath
Highlights:
- On October 7, 2022, Hallmark accomplished the sale of considerably all of its extra and surplus strains operations, for $40.0 million money consideration, plus an estimated $19.2 million consideration for the acquisition prices related to sure web unearned premium reserves. As a outcome, the outcomes of operations for the affected strains of business are included in discontinued operations for all durations proven in its Consolidated Statement of Operations and the corresponding property and liabilities are introduced individually as single line objects within the asset and legal responsibility sections of its Consolidated Balance Sheet at September 30, 2022.
- Net loss from persevering with operations of $29.3 million, or $1.61 per share, within the third quarter of 2022 as in comparison with a web lack of $2.0 million, or $0.11 per share, for a similar interval of 2021. Year-to-date web loss from persevering with operations of $104.9 million, or $5.77 per share, as in comparison with web loss from persevering with operations of $3.9 million, or $0.21 per share, for a similar interval of 2021.
- Net revenue from discontinued operations of $1.1 million, or $0.06 per share, within the third quarter of 2022 as in comparison with web revenue from discontinued operations of $5.5 million, or $0.30 per share, for a similar interval of 2021. Year-to-date web revenue from discontinued operations of $4.2 million, or $0.23 per share, as in comparison with web revenue from discontinued operations of $15.4 million, or $0.85 per share, for a similar interval of 2021.
- Net lack of $28.2 million, or $1.55 per share, within the third quarter of 2022 as in comparison with web revenue of $3.4 million, or $0.19 per share, for a similar interval of 2021. Year-to-date web lack of $100.8 million, or $5.54 per share, as in comparison with web revenue of $11.6 million, or $0.64 per share, for a similar interval of 2021.
- Net loss from persevering with operations and web loss included an extra valuation allowance in opposition to web deferred tax property of $6.5 million for the third quarter of 2022 leading to a full valuation allowance in opposition to web deferred tax property of $30.4 million year-to-date primarily because of current web losses, together with the present interval web loss.
- Net loss from persevering with operations and web loss for the third quarter included a $12.4 million after-tax influence from the beforehand exited contract binding business pushed by unfavorable prior yr loss reserve growth of $14.0 million throughout the quarter.
- Net mixed ratio of 177.1% and 184.1% for the three and 9 months ended September 30, 2022, in comparison with 105.5% and 108.8% for a similar durations the prior yr.
- Underlying mixed ratio (excluding web prior yr growth and disaster losses) of 115.5% and 114.0% for the three and 9 months ended September 30, 2022, in comparison with 110.8% and 107.5% for a similar durations the prior yr. See Non-GAAP Financial Measures beneath.
- Gross premiums written for the three and 9 months ended September 30, 2022 decreased 5.0% and 10.0%, respectively, in comparison with the identical interval the prior yr.
- Net disaster losses had been $1.8 million within the third quarter of 2022, or 4.9 factors of the online mixed ratio, as in comparison with $0.6 million, or 1.4 factors of the online mixed ratio, for a similar interval the prior yr. Net disaster losses had been $3.2 million for the primary 9 months of 2022, or 2.8 factors of the online mixed ratio, as in comparison with $6.6 million, or 4.3 factors of the online mixed ratio, for a similar interval the prior yr.
- Net funding revenue was $3.7 million and $8.7 million throughout the three and 9 months ended September 30, 2022, as in comparison with $2.2 million and $7.6 million throughout the identical durations in 2021.
- Net funding losses of $2.8 million throughout the third quarter of 2022 as in comparison with web funding losses of $0.5 million throughout the identical interval the prior yr. Net funding losses of $6.8 million for the 9 months ended September 30, 2022 as in comparison with web funding positive factors of $9.1 million throughout the identical interval the prior yr.
Third Quarter and Year-to-Date 2022 Financial Review
| Third Quarter | Year-to-Date | |||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||
| ($ in 1000’s) | ||||||||||||||
| Gross premiums written | $ | 52,520 | $ | 55,128 | $ | 167,857 | $ | 185,738 | ||||||
| Net premiums written | $ | 36,618 | $ | 33,540 | $ | 115,325 | $ | 124,729 | ||||||
| Net premiums earned | $ | 36,380 | $ | 42,703 | $ | 112,732 | $ | 151,343 | ||||||
| Investment revenue, web of bills | $ | 3,721 | $ | 2,213 | $ | 8,700 | $ | 7,576 | ||||||
| Investment (losses) positive factors, web | $ | (2,821 | ) | $ | (533 | ) | $ | (6,764 | ) | $ | 9,122 | |||
| Net (loss) from persevering with operations | $ | (29,253 | ) | $ | (2,044 | ) | $ | (104,943 | ) | $ | (3,864 | ) | ||
| Net revenue from discontinued operations | $ | 1,100 | $ | 5,489 | $ | 4,154 | $ | 15,435 | ||||||
| Net (loss) revenue | $ | (28,153 | ) | $ | 3,445 | $ | (100,789 | ) | $ | 11,571 | ||||
| Operating (loss) revenue | $ | (20,553 | ) | $ | (1,623 | ) | $ | (69,240 | ) | $ | (11,070 | ) | ||
| Net (loss) revenue per share – from persevering with operations primary & diluted | $ | (1.61 | ) | $ | (0.11 | ) | $ | (5.77 | ) | $ | (0.21 | ) | ||
| Net revenue per share from discontinued operations – primary & diluted | $ | 0.06 | $ | 0.30 | $ | 0.23 | $ | 0.85 | ||||||
| Net loss per share – primary & diluted | $ | (1.55 | ) | $ | 0.19 | $ | (5.54 | ) | $ | 0.64 | ||||
| Operating (loss) per share – primary & diluted (1) | $ | (1.13 | ) | $ | (0.09 | ) | $ | (3.81 | ) | $ | (0.61 | ) | ||
| Book worth per share | $ | 3.62 | $ | 9.78 | $ | 3.62 | $ | 9.78 | ||||||
(1) See “Non-GAAP Financial Measures” beneath
Gross Premiums Written
Gross premiums written had been $52.5 million and $167.9 million throughout the three and 9 months ended September 30, 2022, representing a lower of 5% and 10% from the $55.1 million and $185.7 in gross premiums written for a similar durations in 2021.
Net Premiums Written
Net premiums written had been $36.6 million and $115.3 million throughout the three and 9 months ended September 30, 2022, representing a rise of 9% and a lower of 8%, respectively, from the $33.5 million and $124.7 million in web premiums written for a similar durations in 2021.
Net Premiums Earned
Net premiums earned had been $36.4 million and $112.7 million for the three and 9 months ended September 30, 2022, representing a lower of 15% and 26% from the $42.7 million and $151.3 million in web premiums earned for a similar durations in 2021.
Investments
Total return on funding securities was -0.6% and -2.0% for the three and 9 months ended September 30, 2022.
Despite important outperformance relative to market benchmarks, extreme declines in markets have precluded optimistic contribution from investments within the quarter and yr up to now durations. Year up to now, the overall return on Hallmark’s fairness portfolio was -10.2% in comparison with -23.9% for the S&P 500 Stock Index. Year up to now, the overall return on Hallmark’s mounted revenue portfolio was -1.8% in comparison with -14.6% for the Bloomberg Aggregate Bond Index.
Net funding revenue was $3.7 million and $8.7 million throughout the three and 9 months ended September 30, 2022, as in comparison with $2.2 million and $7.6 million throughout the identical durations in 2021. The 68% improve in web funding revenue throughout the third quarter of 2022 was because of a better quantity of revenue producing securities and to increased yields.
Net funding losses had been $2.8 million for the third quarter of 2022 as in comparison with web funding losses of $0.5 million for a similar interval in 2021. In the present quarter, web funding losses embrace $3.3 million unrealized losses on widespread and most popular shares.
Net funding losses had been $6.8 million for the 9 months ended September 30, 2022 as in comparison with web funding positive factors of $9.1 million for a similar interval in 2021. Year up to now, web funding losses embrace $1.1 million realized positive factors on widespread shares and $8.4 million unrealized losses on widespread and most popular shares.
Fixed-income securities had been $417.1 million at September 30, 2022, with a tax equal e-book yield of three.3% in comparison with 2.4% as of December 31, 2021. As of September 30, 2022, the fixed-income portfolio had a mean modified period of 1.0 years and 85% of the securities had remaining time to maturity of 5 years or much less. As of September 30, 2022, 9% of the funding portfolio was invested in fairness securities.
Total investments had been $458.1 million at September 30, 2022. Cash and money equivalents, together with restricted money had been $138.3 million. Total investments, money and money equivalents, and restricted money had been $596.4 million or $32.79 per share.
Pre-Tax (Loss) Income from Continuing Operations
Pre-tax loss from persevering with operations was $30.3 million for the three months ended September 30, 2022, as in comparison with a pre-tax loss from persevering with operations of $1.9 million reported throughout the identical interval in 2021. The decline in pre-tax outcomes from persevering with operations for the third quarter of 2022 in comparison with the identical interval of the prior yr was pushed by increased losses and LAE of $21.6 million, decrease web premiums earned of $6.3 million, increased web funding losses of $2.3 million, increased curiosity expense of $0.3 million and decrease finance fees of $0.1 million, partially offset by increased web funding revenue of $1.5 million and decrease working bills of $0.7 million.
Pre-tax loss from persevering with operations was $99.7 million for the 9 months ended September 30, 2022, as in comparison with a pre-tax loss from persevering with operations of $3.0 million reported for a similar interval the prior yr. The decline in pre-tax outcomes from persevering with operations for the 9 months ended September 30, 2022, was pushed by increased losses and LAE of $49.6 million, decrease web premiums earned of $38.6 million, web funding losses of $6.8 million in comparison with web funding positive factors of $9.1 million the prior yr, decrease finance fees of $0.4 million and better curiosity expense of $0.4 million, partially offset by decrease working bills of $7.1 million and better web funding revenue of $1.1 million.
Loss and Loss Adjustment Expenses (“LAE”) from Continuing Operations
Losses and LAE elevated by $21.6 million to $49.1 million for the three months ended September 30, 2022, as in comparison with the identical interval of the earlier yr. The improve in losses and LAE throughout the third quarter 2022 was primarily because of $20.6 million of opposed prior yr loss reserve growth, $14.0 million of which was from the exited contract binding line of the first industrial automobile business, as in comparison with $2.9 million of favorable prior yr loss reserve growth for a similar interval the prior yr, in addition to increased disaster loss. Losses and LAE for the third quarter of 2022 included $1.8 million of web disaster losses as in comparison with $0.6 million throughout the identical interval of the prior yr.
Losses and LAE elevated by $49.6 million to $161.2 million for the 9 months ended September 30, 2022, as in comparison with the identical interval of the earlier yr. The improve in losses and LAE for the primary 9 months of 2022 was primarily because of $75.8 million of unfavorable prior yr loss reserve growth, $58.4 million of which was from the exited contract binding line of the first industrial automobile business, as in comparison with $4.6 million of favorable prior yr loss reserve growth for the prior yr interval, partially offset by decrease web disaster losses. Losses and LAE for the 9 months ended September 30, 2022, included $3.2 million of web disaster losses as in comparison with $6.6 million throughout the identical interval of the prior yr.
Net (Loss) Income
Net loss from persevering with operations was $29.3 million and $104.9 million for the three and 9 months ended September 30, 2022 as in comparison with web loss from persevering with operations of $2.0 million and $3.9 million for a similar durations throughout 2021. On a diluted foundation per share, web loss from persevering with operations was $1.61 per share and $5.77 per share for the three and 9 months ended September 30, 2022 as in comparison with a web loss from persevering with operations of $0.11 per share and $0.21 per share for the three and 9 months ended September 30, 2021.
Net revenue from discontinued operations was $1.1 million and $4.2 million for the three and 9 months ended September 30, 2022 as in comparison with web revenue from discontinued operations of $5.5 million and $15.4 million for a similar durations throughout 2021. On a diluted foundation per share, web revenue from discontinued operations was $0.06 per share and $0.23 per share for the three and 9 months ended September 30, 2022 as in comparison with a web revenue from discontinued operations of $0.30 per share and $0.85 per share for the three and 9 months ended September 30, 2021.
Total web loss was $28.2 million and $100.8 million for the three and 9 months ended September 30, 2022 as in comparison with complete web revenue of $3.4 million and $11.6 million for a similar durations throughout 2021. On a diluted foundation per share, complete web loss was $1.55 per share and $5.54 per share for the three and 9 months ended September 30, 2022 as in comparison with web revenue of $0.19 per share and $0.64 per share for the three and 9 months ended September 30, 2021.
The efficient tax price was -13.1% for the primary 9 months of 2022 in comparison with 20.8% for a similar interval in 2021. During the primary 9 months of 2022, Hallmark recorded a full valuation allowance of $30.4 million in opposition to web deferred tax property primarily because of current web losses, together with the present interval web loss. The efficient price for the 9 months ended September 30, 2021 various from the statutory tax charges primarily because of tax exempt curiosity revenue.
Net Loss, Expense and Combined Ratios
The web loss ratio for persevering with operations was 135.1% and 143.0% for the three and 9 months ended September 30, 2022, as in comparison with 64.5% and 73.7% reported throughout the identical durations in 2021. Net unfavorable prior yr loss reserve growth contributed 56.7 factors and 67.3 factors to the online loss ratio for the three and 9 months ended September 30, 2022, respectively, as in comparison with web favorable prior yr loss reserve growth lowering the online loss ratio 6.7 factors and three.0 factors for a similar durations throughout 2021. Catastrophe losses contributed 4.9 factors and a pair of.8 factors to the online loss ratio for the three and 9 months ended September 30, 2022, respectively, as in comparison with 1.4 factors and 4.3 factors for a similar durations throughout 2021.
The expense ratio was 42.0% and 41.1% for the three and 9 months ended September 30, 2022, as in comparison with 41.0% and 35.1% throughout the identical durations in 2021. The web mixed ratio was 177.1% and 184.1% for the three and 9 months ended September 30, 2022, as in comparison with 105.5% and 108.8% for a similar durations throughout 2021. The exited contract binding business adversely impacted the online mixed ratio by 35.3 factors and 58.6 factors throughout the three and 9 months ended September 30, 2022.
Book Value Per Share
Book worth per share decreased 63% to $3.62 per share as of September 30, 2022 as in comparison with $9.66 per share as of December 31, 2021.
Non-GAAP Financial Measures
The Company’s monetary statements are ready in accordance with United States typically accepted accounting ideas (“GAAP”). However, the Company additionally presents and discusses sure non-GAAP monetary measures that it believes are helpful to traders as measures of working efficiency. Management may use such non-GAAP monetary measures in evaluating the effectiveness of business methods and for planning and budgeting functions. However, these non-GAAP monetary measures shouldn’t be seen as a substitute or substitute for the outcomes mirrored within the Company’s GAAP monetary statements. In addition, the Company’s definitions of these things will not be akin to the definitions utilized by different firms.
Operating revenue and working revenue per share are calculated by excluding web funding positive factors and losses and asset impairments or valuation allowances from GAAP web revenue from persevering with operations. Asset impairments and valuation allowances are uncommon and rare fees for the Company. Management believes that working revenue and working revenue per share present helpful data to traders concerning the efficiency of and underlying traits within the Company’s core insurance operations. Net revenue from persevering with operations and web revenue per share from persevering with operations are the GAAP measures which can be most immediately akin to working earnings and working earnings per share. A reconciliation of working revenue and working revenue per share to probably the most comparable GAAP monetary measures is introduced beneath.
| Hallmark Financial Services, Inc. and Subsidiaries | |||||||||||||||
| Non-GAAP Financial Measures Reconciliation | |||||||||||||||
| ($ in 1000’s) | Income (Loss) from Continuing Operations Before Tax |
Less Tax Effect |
Net After Tax |
Weighted Average Shares Diluted |
Diluted Per Share |
||||||||||
| Third Quarter 2022 | |||||||||||||||
| Reported GAAP measures | $ | (30,260 | ) | $ | (1,007 | ) | $ | (29,253 | ) | 18,185 | $ | (1.61 | ) | ||
| Excluded deferred tax valuation allowance | $ | – | $ | (6,471 | ) | $ | 6,471 | 18,185 | $ | 0.36 | |||||
| Excluded funding (positive factors)/losses | $ | 2,821 | $ | 592 | $ | 2,229 | 18,185 | $ | 0.12 | ||||||
| Operating loss | $ | (27,439 | ) | $ | (6,886 | ) | $ | (20,553 | ) | 18,185 | $ | (1.13 | ) | ||
| Third Quarter 2021 | |||||||||||||||
| Reported GAAP measures | $ | (1,883 | ) | $ | 161 | $ | (2,044 | ) | 18,142 | $ | (0.11 | ) | |||
| Excluded funding (positive factors)/losses | $ | 533 | $ | 112 | $ | 421 | 18,142 | $ | 0.02 | ||||||
| Operating loss | $ | (1,350 | ) | $ | 273 | $ | (1,623 | ) | 18,142 | $ | (0.09 | ) | |||
| Year-to-Date 2022 | |||||||||||||||
| Reported GAAP measures | $ | (99,701 | ) | $ | 5,242 | $ | (104,943 | ) | 18,181 | $ | (5.77 | ) | |||
| Excluded deferred tax valuation allowance | $ | – | $ | (30,359 | ) | $ | 30,359 | 18,181 | $ | 1.67 | |||||
| Excluded funding (positive factors)/losses | $ | 6,764 | $ | 1,420 | $ | 5,344 | 18,181 | $ | 0.29 | ||||||
| Operating loss | $ | (92,937 | ) | $ | (23,697 | ) | $ | (69,240 | ) | 18,181 | $ | (3.81 | ) | ||
| Year-to-Date 2021 | |||||||||||||||
| Reported GAAP measures | $ | (3,036 | ) | $ | 828 | $ | (3,864 | ) | 18,157 | $ | (0.21 | ) | |||
| Excluded funding (positive factors)/losses | $ | (9,122 | ) | $ | (1,916 | ) | $ | (7,206 | ) | 18,157 | $ | (0.40 | ) | ||
| Operating revenue | $ | (12,158 | ) | $ | (1,088 | ) | $ | (11,070 | ) | 18,157 | $ | (0.61 | ) | ||
Underlying mixed ratio is calculated by excluding the influence of web favorable or unfavorable prior yr loss growth and disaster losses from the calculation of the online mixed ratio. Management believes that the underlying mixed ratio supplies helpful data to traders concerning the present efficiency of the Company’s insurance operations absent historic developments and uncontrollable occasions. Combined ratio is the GAAP measure most akin to underlying mixed ratio. A reconciliation of the underlying mixed ratio to the mixed ratio is introduced beneath.
| 3rdQ 2022 | 3rdQ 2021 | YTD 2022 | YTD 2021 | |||||||||
| Net mixed ratio | 177.1 | % | 105.5 | % | 184.1 | % | 108.8 | % | ||||
| Impact on web mixed ratio | ||||||||||||
| Net Unfavorable (Favorable) Prior Year Development | 56.7 | % | -6.7 | % | 67.3 | % | -3.0 | % | ||||
| Catastrophes, web of reinsurance | 4.9 | % | 1.4 | % | 2.8 | % | 4.3 | % | ||||
| Underlying mixed ratio | 115.5 | % | 110.8 | % | 114.0 | % | 107.5 | % | ||||
About Hallmark
Hallmark is a property and casualty insurance holding firm with a diversified portfolio of insurance merchandise written on a nationwide platform. With six insurance subsidiaries, Hallmark markets, underwrites and providers industrial and private insurance in choose markets. Hallmark is headquartered in Dallas, Texas and its widespread inventory is listed on NASDAQ beneath the image “HALL.”
Forward-looking statements on this launch are made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that precise outcomes could differ materially from such forward-looking statements. Forward-looking statements contain dangers and uncertainties together with, however not restricted to, continued acceptance of the Company’s services within the market, aggressive components, rate of interest traits, common financial circumstances, the supply of financing, underwriting loss expertise and different dangers detailed sometimes within the Company’s filings with the Securities and Exchange Commission.
For additional data, please contact:
Chris Kenney
President
Chief Financial Officer
817.348.1600
www.hallmarkgrp.com
| Hallmark Financial Services, Inc. and Subsidiaries | ||||||
| Consolidated Balance Sheets | ||||||
| ($ in 1000’s, besides par worth) | Sep. 30 | Dec. 31 | ||||
| ASSETS | 2022 | 2021 | ||||
| Investments: | (unaudited) | |||||
| Debt securities, available-for-sale, at truthful worth (amortized value: $426,870 in 2022 and $288,175 in 2021) | $ | 417,053 | $ | 290,073 | ||
| Equity securities (value: $42,858 in 2022 and $42,120 in 2021) | 41,002 | 48,695 | ||||
| Total investments | 458,055 | 338,768 | ||||
| Cash and money equivalents | 129,468 | 352,867 | ||||
| Restricted money | 8,845 | 3,810 | ||||
| Ceded unearned premiums | 30,473 | 29,207 | ||||
| Premiums receivable | 74,920 | 90,621 | ||||
| Accounts receivable | 5,749 | 6,914 | ||||
| Receivable from reinsurer | 62,028 | – | ||||
| Receivable for securities | 883 | 1,326 | ||||
| Reinsurance recoverable | 542,818 | 549,964 | ||||
| Deferred coverage acquisition prices | 5,341 | 6,811 | ||||
| Intangible property, web | 441 | 819 | ||||
| Federal revenue tax recoverable | 2,378 | 18,217 | ||||
| Deferred federal revenue taxes, web | – | 8,906 | ||||
| Prepaid pension | 172 | – | ||||
| Prepaid bills | 2,320 | 2,173 | ||||
| Other property | 25,671 | 25,119 | ||||
| Assets held-for-sale | 132,444 | 118,076 | ||||
| Total Assets | $ | 1,482,006 | $ | 1,553,598 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
| Liabilities: | ||||||
| Senior unsecured notes due 2029 (much less unamortized debt issuance prices of $672 in 2022 and $746 in 2021) | $ | 49,328 | $ | 49,254 | ||
| Subordinated debt securities (much less unamortized debt issuance prices of $704 in 2022 and $744 in 2021) | 55,998 | 55,959 | ||||
| Reserves for unpaid losses and loss adjustment bills | 858,888 | 816,681 | ||||
| Unearned premiums | 86,595 | 82,736 | ||||
| Reinsurance payable | 97,065 | 117,908 | ||||
| Pension legal responsibility | – | 174 | ||||
| Payable for securities | – | 3,280 | ||||
| Accounts payable and different liabilities | 52,836 | 49,442 | ||||
| Liabilities held-for-sale | 215,528 | 202,643 | ||||
| Total Liabilities | 1,416,238 | 1,378,077 | ||||
| Commitments and contingencies | ||||||
| Stockholders’ fairness: | ||||||
| Common inventory, $.18 par worth, licensed 33,333,333 shares; issued 20,872,831 shares in 2022 and 2021 | 3,757 | 3,757 | ||||
| Additional paid-in capital | 122,959 | 122,844 | ||||
| (Accumulated deficit) retained earnings | (26,086 | ) | 74,703 | |||
| Accumulated different complete loss | (10,228 | ) | (1,035 | ) | ||
| Treasury inventory (2,688,007 shares in 2022 and a pair of,700,364 shares in 2021), at value | (24,634 | ) | (24,748 | ) | ||
| Total Stockholders Equity | 65,768 | 175,521 | ||||
| Total Liabilities & Stockholders Equity | $ | 1,482,006 | $ | 1,553,598 | ||
| Hallmark Financial Services, Inc. and Subsidiaries | |||||||||||||
| Consolidated Statements of Operations | Three Months Ended | Year-to-Date | |||||||||||
| ($ in 1000’s, besides per share quantities, unaudited) | September 30, | September 30, | |||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||
| Gross premiums written | $ | 52,520 | $ | 55,128 | $ | 167,857 | $ | 185,738 | |||||
| Ceded premiums written | (15,902 | ) | (21,588 | ) | (52,532 | ) | (61,009 | ) | |||||
| Net premiums written | 36,618 | 33,540 | 115,325 | 124,729 | |||||||||
| Change in unearned premiums | (238 | ) | 9,163 | (2,593 | ) | 26,614 | |||||||
| Net premiums earned | 36,380 | 42,703 | 112,732 | 151,343 | |||||||||
| Investment revenue, web of bills | 3,721 | 2,213 | 8,700 | 7,576 | |||||||||
| Investment (losses) positive factors, web | (2,821 | ) | (533 | ) | (6,764 | ) | 9,122 | ||||||
| Finance fees | 937 | 1,076 | 2,900 | 3,318 | |||||||||
| Commission and charges | 1 | 2 | 3 | 3 | |||||||||
| Other revenue | 14 | 15 | 42 | 50 | |||||||||
| Total revenues | 38,232 | 45,476 | 117,613 | 171,412 | |||||||||
| Losses and loss adjustment bills | 49,141 | 27,549 | 161,168 | 111,570 | |||||||||
| Operating bills | 17,816 | 18,558 | 51,967 | 59,114 | |||||||||
| Interest expense | 1,528 | 1,245 | 4,158 | 3,743 | |||||||||
| Amortization of intangible property | 7 | 7 | 21 | 21 | |||||||||
| Total bills | 68,492 | 47,359 | 217,314 | 174,448 | |||||||||
| (Loss) revenue from persevering with operations earlier than tax | (30,260 | ) | (1,883 | ) | (99,701 | ) | (3,036 | ) | |||||
| Income tax expense (profit) from persevering with operations | (1,007 | ) | 161 | 5,242 | 828 | ||||||||
| Net (loss) revenue from persevering with operations | $ | (29,253 | ) | $ | (2,044 | ) | $ | (104,943 | ) | $ | (3,864 | ) | |
| Discontinued operations: | |||||||||||||
| Total pretax revenue from discontinued operations | $ | 2,801 | $ | 6,274 | $ | 10,573 | $ | 17,644 | |||||
| Income tax expense on discontinued operations | 1,701 | 785 | 6,419 | 2,209 | |||||||||
| Income from discontinued operations, web of tax | $ | 1,100 | $ | 5,489 | $ | 4,154 | $ | 15,435 | |||||
| Net (loss) revenue | $ | (28,153 | ) | $ | 3,445 | $ | (100,789 | ) | $ | 11,571 | |||
| Net (loss) primary revenue per share: | |||||||||||||
| Loss from persevering with operations | $ | (1.61 | ) | $ | (0.11 | ) | $ | (5.77 | ) | $ | (0.21 | ) | |
| Income from discontinued operations | 0.06 | $ | 0.30 | 0.23 | 0.85 | ||||||||
| Basic revenue per share | $ | (1.55 | ) | $ | 0.19 | $ | (5.54 | ) | $ | 0.64 | |||
| Net (loss) diluted revenue per share: | |||||||||||||
| Loss from persevering with operations | $ | (1.61 | ) | $ | (0.11 | ) | $ | (5.77 | ) | $ | (0.21 | ) | |
| Income from discontinued operations | 0.06 | 0.30 | 0.23 | 0.85 | |||||||||
| Diluted (loss) revenue per share | $ | (1.55 | ) | $ | 0.19 | $ | (5.54 | ) | $ | 0.64 | |||
| Hallmark Financial Services, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||
| Consolidated Segment Data | ||||||||||||||||||||||||||||||
| Three Months Ended Sep. 30 | ||||||||||||||||||||||||||||||
| Standard Commercial Segment |
Personal Segment | Runoff Specialty Segment |
Corporate | Consolidated | ||||||||||||||||||||||||||
| ($ in 1000’s, unaudited) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| Gross premiums written | $ | 34,556 | $ | 34,274 | $ | 15,638 | $ | 17,453 | $ | 2,326 | $ | 3,401 | $ | – | $ | – | $ | 52,520 | $ | 55,128 | ||||||||||
| Ceded premiums written | (15,801 | ) | (16,245 | ) | (76 | ) | (72 | ) | (25 | ) | (5,271 | ) | – | – | (15,902 | ) | (21,588 | ) | ||||||||||||
| Net premiums written | 18,755 | 18,029 | 15,562 | 17,381 | 2,301 | (1,870 | ) | – | – | 36,618 | 33,540 | |||||||||||||||||||
| Change in unearned premiums | (206 | ) | 959 | 38 | (417 | ) | (70 | ) | 8,621 | – | – | (238 | ) | 9,163 | ||||||||||||||||
| Net premiums earned | 18,549 | 18,988 | 15,600 | 16,964 | 2,231 | 6,751 | – | – | 36,380 | 42,703 | ||||||||||||||||||||
| Total revenues | 18,950 | 19,693 | 16,754 | 18,316 | 2,477 | 7,315 | 51 | 152 | 38,232 | 45,476 | ||||||||||||||||||||
| Losses and loss adjustment bills | 14,484 | 11,553 | 14,735 | 16,735 | 19,922 | (739 | ) | – | – | 49,141 | 27,549 | |||||||||||||||||||
| Pre-tax revenue (loss) | (2,386 | ) | 2,192 | (3,412 | ) | (3,887 | ) | (19,364 | ) | 4,343 | (5,098 | ) | (4,531 | ) | (30,260 | ) | (1,883 | ) | ||||||||||||
| Net loss ratio (1) | 78.1 | % | 60.8 | % | 94.5 | % | 98.7 | % | 893.0 | % | -10.9 | % | 135.1 | % | 64.5 | % | ||||||||||||||
| Net expense ratio (1) | 37.9 | % | 31.2 | % | 30.3 | % | 26.1 | % | 45.1 | % | 36.0 | % | 42.0 | % | 41.0 | % | ||||||||||||||
| Net mixed ratio (1) | 116.0 | % | 92.0 | % | 124.8 | % | 124.8 | % | 938.1 | % | 25.1 | % | 177.1 | % | 105.5 | % | ||||||||||||||
| Impact on web mixed ratio | ||||||||||||||||||||||||||||||
| Net Unfavorable (Favorable) Prior Year Development | 1.6 | % | -5.1 | % | 11.6 | % | 7.1 | % | 830.5 | % | -45.7 | % | 56.7 | % | -6.7 | % | ||||||||||||||
| Catastrophes, web of reinsurance | 9.8 | % | 0.2 | % | 0.5 | % | 19.3 | % | 0.0 | % | 0.0 | % | 4.9 | % | 1.4 | % | ||||||||||||||
| Underlying mixed ratio (1) | 104.6 | % | 96.9 | % | 112.7 | % | 98.4 | % | 107.6 | % | 70.8 | % | 115.5 | % | 110.8 | % | ||||||||||||||
| Net Unfavorable (Favorable) Prior Year Development | 300 | (973 | ) | 1,810 | 1,197 | 18,528 | (3,088 | ) | – | – | 20,638 | (2,864 | ) | |||||||||||||||||
(1) The web loss ratio is calculated as incurred losses and loss adjustment bills divided by web premiums earned, every decided in accordance with GAAP. The web expense ratio is calculated as complete underwriting bills offset by company charge revenue divided by web premiums earned, every decided in accordance with GAAP. The web mixed ratio is calculated because the sum of the online loss ratio and the online expense ratio. The underlying mixed ratio is the online mixed ratio excluding the influence of web prior yr reserve growth and catastrophes.
| Hallmark Financial Services, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||
| Consolidated Segment Data | ||||||||||||||||||||||||||||||
| Nine Months Ended Sep. 30 | ||||||||||||||||||||||||||||||
| Standard Commercial Segment |
Personal Segment | Runoff Specialty Segment |
Corporate | Consolidated | ||||||||||||||||||||||||||
| ($ in 1000’s, unaudited) | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
| Gross premiums written | $ | 110,013 | $ | 107,516 | $ | 47,589 | $ | 52,560 | $ | 10,255 | $ | 25,662 | $ | – | $ | – | $ | 167,857 | $ | 185,738 | ||||||||||
| Ceded premiums written | (51,434 | ) | (49,694 | ) | (226 | ) | (234 | ) | (872 | ) | (11,081 | ) | – | – | (52,532 | ) | (61,009 | ) | ||||||||||||
| Net premiums written | 58,579 | 57,822 | 47,363 | 52,326 | 9,384 | 14,581 | – | – | 115,325 | 124,729 | ||||||||||||||||||||
| Change in unearned premiums | (3,584 | ) | (2,326 | ) | (350 | ) | (72 | ) | 1,341 | 29,012 | – | – | (2,593 | ) | 26,614 | |||||||||||||||
| Net premiums earned | 54,995 | 55,496 | 47,013 | 52,254 | 10,724 | 43,593 | – | – | 112,732 | 151,343 | ||||||||||||||||||||
| Total revenues | 56,183 | 57,536 | 50,621 | 56,390 | 11,554 | 45,306 | (745 | ) | 12,180 | 117,613 | 171,412 | |||||||||||||||||||
| Losses and loss adjustment bills | 40,398 | 39,769 | 41,408 | 47,379 | 79,362 | 24,422 | – | – | 161,168 | 111,570 | ||||||||||||||||||||
| Pre-tax revenue (loss) | (3,143 | ) | 1,261 | (7,257 | ) | (8,275 | ) | (73,099 | ) | 5,212 | (16,202 | ) | (1,234 | ) | (99,701 | ) | (3,036 | ) | ||||||||||||
| Net loss ratio (1) | 73.5 | % | 71.7 | % | 88.1 | % | 90.7 | % | 740.0 | % | 56.0 | % | 143.0 | % | 73.7 | % | ||||||||||||||
| Net expense ratio (1) | 35.7 | % | 30.8 | % | 30.3 | % | 27.9 | % | 40.3 | % | 34.2 | % | 41.1 | % | 35.1 | % | ||||||||||||||
| Net mixed ratio (1) | 109.2 | % | 102.5 | % | 118.4 | % | 118.6 | % | 780.3 | % | 90.2 | % | 184.1 | % | 108.8 | % | ||||||||||||||
| Impact on web mixed ratio | ||||||||||||||||||||||||||||||
| Net Unfavorable (Favorable) Prior Year Development | 0.5 | % | -4.3 | % | 11.1 | % | 8.3 | % | 656.1 | % | -15.0 | % | 67.3 | % | -3.0 | % | ||||||||||||||
| Catastrophes, web of reinsurance | 5.4 | % | 10.4 | % | 0.4 | % | 1.6 | % | 0.0 | % | 0.0 | % | 2.8 | % | 4.3 | % | ||||||||||||||
| Underlying mixed ratio (1) | 103.3 | % | 96.3 | % | 106.9 | % | 108.7 | % | 124.2 | % | 105.2 | % | 114.0 | % | 107.5 | % | ||||||||||||||
| Net Unfavorable (Favorable) Prior Year Development | 250 | (2,371 | ) | 5,218 | 4,356 | 70,365 | (6,543 | ) | 75,833 | (4,558 | ) | |||||||||||||||||||
(1) The web loss ratio is calculated as incurred losses and loss adjustment bills divided by web premiums earned, every decided in accordance with GAAP. The web expense ratio is calculated as complete underwriting bills offset by company charge revenue divided by web premiums earned, every decided in accordance with GAAP. The web mixed ratio is calculated because the sum of the online loss ratio and the online expense ratio. The underlying mixed ratio is the online mixed ratio excluding the influence of web prior yr reserve growth and catastrophes.
A photograph accompanying this announcement is out there at https://www.globenewswire.com/NewsRoom/AttachmentNg/a204b59d-618d-45a4-823f-f2fc7a049fbd
