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Atlas Financial (AFH) Q2 Earnings Beat on Higher Revenues

Atlas Financial Holdings, Inc.AFH reported second-quarter 2016 operating income of 59 cents per share, which comfortably surpassed the Zacks Consensus Estimate of 37 cents. Earnings also increased 18% year over year on higher revenues.

Atlas Financial Holdings Inc. (AFH) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany

Including non-recurring items, net income surged 22.6% year over year to 38 cents per share.

Behind the Headlines

Atlas Financial's total revenue jumped 8.6% year over year to $43 million on 9.1% higher net premiums earned and a 1.6% rise in other income. However, operating revenues missed the Zacks Consensus Estimate of $49 million by 12.7%.

Gross premiums written inched up 3.8% year over year to $48.4 million. Commercial auto business reported a premium of $47.8, up 3.5% from the year-ago quarter.

The company's total expenses increased 6.6% year over year to $35.7 million due to a rise in net claims incurred, interest expenses, amortization of intangible assets and other underwriting expenses.

Atlas Financial's underwriting income was $6.4 million, which reflects a 28.1% increase from the year-ago quarter. Combined ratio improved 220 basis points (bps) year over year to 84.8% driven by a 220 bps improvement in underwriting ratio.

Financial Update

Atlas Financial exited the quarter with cash and cash equivalents of $22.4 million, which remained almost unchanged from the 2015-end level.

Total assets of Atlas Financial inched up 0.4% from year-end 2015 to $413.1 million as of Jun 30, 2016.

Total shareholders' equity increased 10.3% from year-end 2015 to $143 million.

Book value was $11.27 per share as of Jun 30, 2016, up 11% from the year-end quarter, 2015.

Atlas Financial's return on average common equity was 14.6% in the reported quarter as against 13.7% in the year-ago quarter.

2016 Guidance

Atlas Financial expects annualized after-tax ROE to increase provided market conditions remain stable or improve.

Zacks Rank

Atlas Financial presently carries a Zacks Rank #4 (Sell).

ATLAS FINL HLDG Price, Consensus and EPS Surprise

ATLAS FINL HLDG Price, Consensus and EPS Surprise | ATLAS FINL HLDG Quote

Performance of Other Insurers

Among the other players in the insurance industry that have reported their earnings so far, the bottom line at The Travelers Companies, Inc. TRV and First American Financial Corporation FAF beat their respective Zacks Consensus Estimate, while earnings of RLI Corp. RLI missed the same.

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RLI CORP (RLI): Free Stock Analysis Report

TRAVELERS COS (TRV): Free Stock Analysis Report

FIRST AMER FINL (FAF): Free Stock Analysis Report

ATLAS FINL HLDG (AFH): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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