Independence Holding Company Announces 2021 First-Quarter Results

·5 min read

STAMFORD, Conn., May 06, 2021 (GLOBE NEWSWIRE) -- Independence Holding Company (NYSE: IHC) today reported 2021 first-quarter results.

Financial Results

Net income attributable to IHC was $5,621,000, or $.38 per share, diluted, for the three months ended March 31, 2021 compared to $4,278,000, or $.29 per share, diluted, for the three months ended March 31, 2020.

The Company reported revenues of $124,657,000 for the three months ended March 31, 2021 compared to revenues for the three months ended March 31, 2020 of $103,997,000. The increase in revenues primarily relates to an increase for the Paid Family Leave (“PFL”) portion of our New York disability law (“DBL”) business, higher premium volume in our pet insurance business and an increase in sales of insurance products (primarily senior products, Affordable Care Act (“ACA”) plans and small group stop-loss) by the IHC agencies for multiple unaffiliated insurance carriers.

Chief Executive Officer’s Comments

Roy T. K. Thung, Chief Executive Officer, commented, “We are pleased with the increases in net income and revenues for the first quarter of 2021, primarily attributable to the performance of our DBL/PFL line of business as referenced above. Partially offsetting these positive results, we are experiencing a sharp drop in short term medical sales due to changes in the ACA, including the extended Special Enrollment Period for ACA coverage and the increased Advanced Premium Tax Credits, also known as subsidies, which have made ACA plans more affordable for many people who in the past may have elected short term medical. The Company expects weak sales in short term medical to continue. In addition, the group life incidence rate was higher than expected in the first quarter due to COVID-19 reported deaths, but subsequent to March 31st the death rates have returned to normal.”

Mr. Thung added, “IHC has a very strong balance sheet with no indebtedness and a very substantial amount of free cash at the corporate level and significant excess capital in our insurance companies. Our book value was $32.36 per share at March 31, 2021. Our overall investment portfolio continues to be very highly rated (on average, AA) and has an effective duration of under three years.”

About Independence Holding Company

Through our subsidiaries, Independence Holding Company (NYSE: IHC) underwrites and distributes health, group disability and life, New York State DBL and paid family leave, and pet insurance. IHC underwrites policies in all 50 states, Washington D.C., Puerto Rico and the U.S. Virgin Islands through our three carriers: Independence American Insurance Company, Standard Security Life Insurance Company of New York (“Standard Security Life”) and Madison National Life Insurance Company, Inc. We also distribute products nationally through multiple channels, including our agencies, call centers, advisors, direct and affinity relationships, Web Broker, and web properties, including www.healthedeals.com; www.healthinsurance.org; www.medicareresources.org; www.petplace.com; and www.mypetinsurance.com. As previously announced, IHC recently entered into a stock purchase agreement to sell all of the issued and outstanding capital stock of Standard Security Life. To learn more, visit https://ihcgroup.com/.

Forward-looking Statements

Certain statements and information contained in this release may be considered “forward-looking statements,” such as statements relating to management’s views with respect to future events and financial performance. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the markets in which IHC operates, new federal or state governmental regulation, IHC’s ability to effectively operate, integrate and leverage any past or future strategic acquisition, and other factors which can be found in IHC’s other news releases and filings with the Securities and Exchange Commission. IHC expressly disclaims any duty to update its forward-looking statements unless required by applicable law.



INDEPENDENCE HOLDING COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
March 31, 2021

(In Thousands, Except Shares and Per Share Data)

Three Months Ended

March 31,

2021

2020

REVENUES:

Premiums earned

$

115,141

$

96,050

Net investment income

2,592

3,240

Fee income

6,356

3,942

Other income

353

477

Net investment gains

215

288

124,657

103,997

EXPENSES:

Insurance benefits, claims and reserves

67,378

54,058

Selling, general and administrative expenses

50,420

44,574

117,798

98,632

Income before income taxes

6,859

5,365

Income taxes

1,293

1,043

Net income

5,566

4,322

(Income) loss from noncontrolling interests

55

(44

)

NET INCOME ATTRIBUTABLE TO IHC

$

5,621

$

4,278

Basic income per common share

$

.38

$

.29

WEIGHTED AVERAGE SHARES OUTSTANDING

14,641

14,856

Diluted income per common share

$

.38

$

.29

WEIGHTED AVERAGE DILUTED SHARES OUTSTANDING

14,778

14,911

As of May 6, 2021, there were 14,639,449 common shares outstanding, net of treasury shares.



INDEPENDENCE HOLDING COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)

March 31,

December 31,

2021

2020

ASSETS:

Investments:

Short-term investments

$

1,559

$

2,634

Securities purchased under agreements to resell

145,392

49,990

Fixed maturities, available-for-sale

390,942

406,649

Equity securities

2,671

6,119

Other investments

10,768

8,238

Total investments

551,332

473,630

Cash and cash equivalents

22,123

72,089

Due and unpaid premiums

40,688

29,182

Due from reinsurers

357,053

357,205

Goodwill

74,900

74,900

Other assets

78,876

76,150

TOTAL ASSETS

$

1,124,972

$

1,083,156

LIABILITIES AND STOCKHOLDERS’ EQUITY:

LIABILITIES:

Policy benefits and claims

$

193,282

$

179,232

Future policy benefits

196,439

198,086

Funds on deposit

141,891

141,376

Unearned premiums

43,798

12,789

Other policyholders’ funds

11,920

12,001

Due to reinsurers

2,634

3,872

Accounts payable, accruals and other liabilities

58,961

63,682

TOTAL LIABILITIES

648,925

611,038

Commitments and contingencies

Redeemable noncontrolling interest

2,258

2,312

STOCKHOLDERS’ EQUITY:

Preferred stock (none issued)

-

-

Common stock

18,625

18,625

Paid-in capital

125,189

124,757

Accumulated other comprehensive income

2,268

4,197

Treasury stock, at cost

(77,228

)

(77,088

)

Retained earnings

404,894

399,273

TOTAL IHC STOCKHOLDERS’ EQUITY

473,748

469,764

NONREDEEMABLE NONCONTROLLING INTERESTS

41

42

TOTAL EQUITY

473,789

469,806

TOTAL LIABILITIES AND EQUITY

$

1,124,972

$

1,083,156


CONTACT: Loan Nisser
(646) 509-2107
www.IHCGroup.com