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After tax operating earnings for the third quarter were a gain of$6,279,000 ($0.24 per diluted share) compared with a gain of $60,653,000($2.28 per diluted share) for the same period in 2007. After tax operatingearnings exclude after tax net realized investment gains and losses.
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After tax net realized investment losses were $131,312,000 ($4.93 perdiluted share) for the third quarter of 2008 compared with after tax netrealized investment gains of $18,592,000 ($0.70 per diluted share) for thesame period in 2007.
YEAR-TO-DATE RESULTS
The net loss for the nine months ended September 30, 2008 totaled$88,943,000 ($3.34 per diluted share) compared to net income of $187,441,000($7.04 per diluted share) for the nine months ended September 30, 2007. Theafter tax operating earnings for the first nine months totaled $48,794,000($1.82 per diluted share) compared to $165,359,000 ($6.21 per diluted share)for the same period in 2007. After tax operating earnings exclude after taxnet realized investment gains and losses, which totaled a net realized loss of$137,737,000 ($5.17 per diluted share) for the first nine months of 2008compared to a net realized gain of $22,082,000 ($0.83 per share) in the sameperiod of 2007.
OPERATIONS
Current quarter revenues and pre-tax earnings were impacted by $205million of other-than-temporary impairments on security investments. Theimpairments were primarily on financial sector stocks and bonds of companiessuch as Fannie Mae, Freddie Mac, Lehman Brothers, Washington Mutual and AIG.The effect of the impairments on after-tax earnings was $133 million for thequarter ended September 30, 2008.
Catastrophe losses in the company's property and casualty operationscontinued to be above average in the third quarter. American National'scatastrophe losses, including losses from Hurricanes Ike and Gustav, impactedthe third quarter by $25 million net of reinsurance and net of tax. This isover three times the net catastrophe losses of $7 million recorded in thethird quarter of 2007. Earnings in the third quarter of 2008 were alsoimpacted by $24 million, net of tax, from litigation related to the company'slife insurance business.
While earnings have been impacted by the volatile economic and weatherconditions, sales of deferred annuities increased significantly through thefirst nine months of 2008. Total policyholder deposits, for both life andannuities, increased 65% to a total of $1.5 billion through September 30, from$944 million in the same period of 2007. Life insurance in force alsoincreased as of September 30 to a total of $70 billion, which is an increaseof 1.9% from December 31, 2007. Total assets as of September 30, 2008 were$18.8 billion compared to $18.4 billion as of December 31, 2007.
American National Insurance Company is headquartered in Galveston, Texas.American National has over $18.8 billion in assets and is rated A+ (Superior)by A.M. Best Company, and AA (Very Strong) by Standard & Poor's. The AmericanNational family of companies offers a broad line of products and services,which include life insurance, annuities, health insurance, credit insurance,pension plan services and property and casualty insurance for personal lines,agribusiness, and targeted commercial exposures. American National's majorinsurance subsidiaries include American National Life Insurance Company ofTexas, Standard Life and Accident Insurance Company, Garden State LifeInsurance Company, American National Property and Casualty Company, FarmFamily Life Insurance Company, Farm Family Casualty Insurance Company andUnited Farm Family Insurance Company.
For more information, including company news and investor relationsinformation, visit the company's web site at http://www.anico.com.
The statements contained in this release that are not historicalstatements, including statements regarding future performance, plans andprojections, are forward-looking statements based on management's currentexpectations. These statements involve certain risks and uncertaintiesdetailed in the Company's financial statements. Actual results may differmaterially from these statements due to changes in business, regulatory,competitive, market, economic, and political factors that are beyond ourcontrol. We disclaim any intention or obligation to update or revise anyforward-looking statements, whether as a result of new information, futureevents or otherwise, except as may be required by law.American National Insurance Company COMPARATIVE OPERATIONAL HIGHLIGHTS Compiled on a GAAP basis (Unaudited) Quarter Ended Nine Months Ended September 30, September 30, 2008 2007 2008 2007 Revenues $552,943,000 $768,729,000 $2,012,860,000 $2,338,116,000 After-tax earnings: Operating earnings * $6,279,000 $60,653,000 $48,794,000 $165,359,000 Net realized investment gains (losses) $(131,312,000) $18,592,000 $(137,737,000) $22,082,000 Net income (loss) $(125,033,000) $79,245,000 $(88,943,000) $187,441,000 Per share earnings: Operating earnings * $0.24 $2.28 $1.82 $6.21 Net realized investment gains (losses) $(4.93) $0.70 $(5.17) $0.83 Net income (loss) - Diluted $(4.69) $2.98 $(3.34) $7.04 Net income (loss) - Basic $(4.72) $2.99 $(3.36) $7.08 Weighted average number of shares Upon which computations are based: Diluted 26,631,908 26,633,488 26,631,908 26,633,488 Basic 26,479,832 26,479,832 26,479,832 26,479,832 As of September 30, 2008 December 31, 2007 Book value per diluted share $126.70 $140.28 * Operating earnings exclude after-tax realized investment gains and losses. The sum of Operating earnings and Realized investment gains (losses) is equal to Net income.
SOURCE American National Insurance Company
