-- Book value per share up 19.4 percent
-- Annual revenues increased 5.7 percent
-- Net income up 7.4 percent for 2007
LANSING, Mich., March 28 /PRNewswire/ -- Leading health care risk management and insurance provider FinCor Holdings Inc. reported its quarterly and year-end results for the period ended Dec. 31, 2007, highlighted by solid increases in revenues and net income.
Fiscal Year 2007 Highlights
The Company posted a 7.4 percent increase in net income on a 5.7 percent increase in revenues for the year ended 2007. FinCor reported total revenues of $97.2 million for 2007, up from $91.9 million in 2006. FinCor reported net income of $15.1 million, or $23.57 per diluted share during 2007, compared with $14.1 million, or $22.89 per diluted share, in the prior year.
The increase in revenues was primarily driven by the inclusion of its Washington Casualty Company (WCC) subsidiary's book of business for the full year. FinCor acquired WCC in October 2006. The Company also noted that positive cash flow from operations allowed for significant increases in the amount of investment income generated during the year.
The Company's combined ratio declined 10.7 percentage points to 80.7 percent for the year, from 91.4 percent for the year ended 2006. This improvement was primarily due to the recognition of $31 million of favorable reserve development in 2007, compared to $18 million of favorable reserve development during 2006. The combined ratio is the sum of incurred losses and underwriting expenses divided by earned premiums and is considered a key measure of an insurer's health and profitability. A combined ratio of less than 100 percent indicates the company is making an underwriting profit.
Other key factors contributing to the Company's success included the April 2007 acquisition of the Insurance Services and Employee Safety and Disability Management divisions of the MHA Service Corporation, which significantly increased the amount of income the company realized in 2007. FinCor Holdings added that while it faces ongoing price-based competition in its markets, its overall renewal rate continues to exceed 90 percent.
Return on common equity for the year ended 2007 was 15.6 percent compared to 17.5 percent for 2006. Book value per share increased $28.09, or 19.4 percent, and total assets increased 7.9 percent to $541.4 million during 2007.
In September, FinCor Holdings was named to the first-ever Inc. 5,000 list of the fastest-growing private companies in the United States. Inc. reported FinCor had an impressive three-year growth rate of more than 74 percent on revenues of $52.8 million in 2003. FinCor was ranked 26th relative to other insurance companies on the Inc. 5,000 list and was among the top 10 in revenue in the insurance category.
Fourth Quarter 2007 Results
FinCor's fourth-quarter revenues increased 9.3 percent to $24.6 million, compared to $22.5 million for the same period in 2006. However, net income for the quarter ended Dec. 31, 2007, decreased to $3.6 million, or $5.06 per diluted share, down from $5.6 million, or $8.39 per diluted share, for the fourth quarter of 2006.
The Company noted that fourth-quarter and year-to-date earnings were negatively impacted by a one-time $1.9 million after-tax charge associated with its switch from a multi-employer pension plan to a stand-alone, single- employer pension plan.
"We are extremely pleased with the Company's performance for the year," said Thomas Dickinson, FinCor Holdings president and CEO. "Our acquisition strategy, excellent client retention rate and increased revenue from other income sources such as our Risk Management and Patient Safety Institute and FinCor Solutions have offset the challenges we're seeing as a result of a soft market. This multi-pronged strategy coupled with stable claims trends in the market made for a strong year and gives us positive momentum heading into 2008."
About FinCor Holdings
FinCor Holdings Inc. is a Lansing, Mich.-based integrated risk management corporation offering insurance protection and clinical risk management programs to meet the needs of today's health care providers.
FinCor Holdings and its subsidiaries -- FinCor Solutions, The Risk Management and Patient Safety Institute, MHA Insurance Company, Washington Casualty Company and Capital Risk Solutions -- provide industry-leading insurance products and support services, including medical professional liability insurance, workers' compensation insurance and risk management solutions to clients nationally. With its focus on providing clients with financial loss protection and clinical risk reduction, FinCor Holdings has built an outstanding reputation for serving the needs of the health care industry.
For more information, visit http://www.fincorholdings.com .
|SOURCE FinCor Holdings Inc.|
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