State National Companies, Inc. (SNC) has reported an 18.82 percent rise in profit for the quarter ended Mar. 31, 2017. The company has earned $11.49 million, or $0.27 a share in the quarter, compared with $9.67 million, or $0.23 a share for the same period last year.
Revenue during the quarter grew 17.74 percent to $58.99 million from $50.10 million in the previous year period. Net premium earned for the quarter increased 15.25 percent or $4.83 million to $36.51 million.
Total expenses move up
Benefits, losses and expenses for the quarter were at $41.07 million, or 112.50 percent of premium earned from $35.02 million or 110.55 percent of premium earned in the last year period. Operating income for the quarter was $17.91 million, compared with $15.08 million in the previous year period. For financial year 2017, the company forecasts diluted earnings per share to be in the range of $1.18 to $1.26 on adjusted basis.
Net investment income was at $2.15 million for the quarter, up 5.44 percent or $0.11 million from year-ago period. Meanwhile, income from fees and commission for the quarter increased by 8.19 percent or $1.36 million to $17.92 million. The company has recorded a gain on investments of $1.88 million in the quarter compared with a loss of $0.64 million for the previous year period.
Commenting on the results, State National’s chairman and chief executive officer, Terry Ledbetter, said, "We generated strong growth in the first quarter in both business segments compared to the prior year that led to increased earnings and EBITDA. In Lender Services, premiums earned grew 15 percent in the first quarter and ceding fees in our Program Services segment grew 9 percent for the quarter. In early May, we were pleased to announce the addition of two significant client relationships in Program Services that have begun writing with us in the second quarter. These clients both bring existing books of business to State National and together are expected to produce annual premiums of approximately $200 million. Furthermore, we continue to see a high level of Program Services activity in our sales pipeline as a result of our increased sales efforts and the elevated profile of State National in the marketplace.” In both Lender and Program Services, favorable industry trends underscore our firm belief that we are well positioned for continued growth and profitability," added Ledbetter.
Liabilities outpace assets growth
Total assets increased 22.02 percent or $536.95 million to $2,975.96 million on Mar. 31, 2017. On the other hand, total liabilities were at $2,668.71 million as on Mar. 31, 2017, up 23.21 percent or $502.68 million from year-ago. Return on assets stood at 0.41 percent in the quarter, down 0.01 from 0.42 percent in the last year period. At the same time, return on equity was at 3.74 percent in the quarter, up 0.20 from 3.54 percent in the last year period.
Investments move up
Investments stood at $379.23 million as on Mar. 31, 2017, up 9.56 percent or $33.11 million from year-ago. Meanwhile, yield on investments went down 2 basis points to 0.57 percent in the quarter. Total debt was almost stable over the past one year at $43.79 million on Mar. 31, 2017. Shareholders equity stood at $307.25 million as on Mar. 31, 2017, up 12.55 percent or $34.27 million from year-ago. As a result, debt to equity ratio went down 2 basis points to 0.14 percent in the quarter from 0.16 percent in the last year period.
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