Ascent Assurance Reports Q3 Results

Texas-based Ascent Assurance, Inc. reported a net loss excluding preferred stock dividends of ($114,000) for the third quarter of 2003 compared to net income of $154,000 for the prior year period.

Preferred stock dividends are payable through the issuance of additional shares of preferred stock or cash, at the company’s option. Preferred stock dividends accrued in the first nine months of 2003 and 2002 were paid through the issuance of 2,671 shares and 2,415 shares of preferred stock, respectively.

The loss applicable to common stockholders was ($1,028,000) or ($0.16) per common share, net of preferred stock dividends of ($914,000), for the third quarter of 2003 as compared to a loss applicable to common stockholders of ($672,000) or ($0.10) per common share, net of preferred stock dividends of ($826,000), for the third quarter of 2002. For the nine months ended Sept. 30, 2003, the loss applicable to common stockholders was ($2,236,000) or ($0.34) per common share, net of preferred stock dividends of ($2,673,000), as compared to ($2,590,000) or ($.40) per common share, net of preferred stock dividends of ($2,416,000), for the corresponding 2002 period.

Total revenues were $30.8 million and $93.1 million for the third quarter and nine months ended Sept. 30, 2003, respectively, as compared to $33.1 million and $100.1 million for the corresponding 2002 periods. Total premium revenues decreased by $2.3 million or 8.3% for the third quarter and $7.5 million or 8.9% for the nine months ended Sept. 30, 2003 as compared to the corresponding prior year periods. The benefits and claims to premium ratio was 68.3% and 68.1% for the three and nine months ended Sept. 30, 2003, respectively, as compared to 70.1% and 71.1% for the corresponding 2002 periods.

Patrick Mitchell, chairman and CEO, commenting on third quarter operations noted, “Although our 2003 benefits and claims ratio has improved over 2002, results for the third quarter of 2003 were adversely impacted by an unusual number of large claims which increased the company’s net loss by approximately ($500,000). We are pleased with the market acceptance of our new line of major medical products that were introduced in the third quarter of 2003. These products were designed to provide our customers optimum flexibility to manage their healthcare insurance needs in a more cost efficient manner. We expect that improved sales momentum will begin to positively impact first year premiums in early 2004.”