Earnings per share before accounting change $ 1.84 $ 0.67 $ 1.86 $ 1.54 $ 1.62 Cumulative accounting changes .09 ------- ------- ------- ------- ------- Net earnings per common share $ 1.84 $ 0.67 $ 1.86 $ 1.63 $ 1.62 ======= ======= ======= ======= ======= Weighted average common and equivalent shares outstanding 14,973 13,324 12,136 12,538 12,479 ======= ====== ====== ======= ======
After-tax realized investment gains in 1996 and 1995, were $5,496,000 and $2,139,000, respectively. The significant increase in 1996 after-tax realized investment gains, compared to 1995, was predominately due to the strong stock market during 1996. The sale of equity securities resulted in approximately 94% of the total realized investment gains.
In an analysis of the results for the first six months of 1995, the Company observed several adverse claim trends which led to a special actuarial review of the Company's loss (losses and loss adjustment expenses) reserves. This extensive actuarial review indicated that higher frequency and severity trends were causing the unanticipated higher claim costs. As a result, the Company strengthened its loss reserves by recording a pre-tax charge to earnings of $13,971,000 during the third quarter. Approximately one-half of this $13,971,000 charge was attributed to 1994 and the prior two accident years.
During 1995, the Company experienced catastrophic losses, net of reinsurance recoveries, amounting to $1,615,000, or $0.12 per share, net of tax and reinsurance recoveries. This compares to $1,080,000 in catastrophic losses, or $0.09 per share, net of tax and reinsurance recoveries, during 1994. For the most part the catastrophic losses affected the commercial and personal lines operating units, and primarily related to hurricanes and wind and hail storms.
On December 17, 1996, James R. Pouliot was promoted to President and Chief Executive Officer, following Roger B. Ware's retirement on this same date. Also, during 1996, the Company's Board of Directors elected W. Marston Becker, who was named Chairman and CEO of Orion, to the Company's Board of Directors.
James R. Pouliot Michael L. Pautler President and Chief Executive Officer Senior Vice President - Finance and Treasurer
Liabilities: Unpaid losses $303,266 $290,156 Unpaid loss adjustment expenses 65,142 64,478 Unearned premiums 154,242 146,205 Notes payable 101,688 103,000 Reinsurance payables and deposits 7,268 8,290 Other liabilities 59,447 47,493 -------- -------- Total liabilities 691,053 659,622 -------- -------- Commitments and contingencies Shareholders' equity: Preferred stock, $.10 par value; authorized, 6,000,000 shares; none issued and outstanding Common stock, $1 par value; authorized, 30,000,000 shares; issued 14,975,497 shares - 1996; 14,961,354 shares - 1995 14,975 14,961 Capital in excess of par 121,272 121,050 Retained earnings 84,685 64,664 Deferred compensation on restricted stock (644) Net unrealized investment gains 17,107 15,520 -------- -------- Total shareholders' equity 238,039 215,551 -------- -------- Total liabilities and shareholders' equity $929,092 $875,173 ======== =========
GUARANTY NATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Year Ended December 31, -------------------------------------- 1996 1995 1994 ---- ---- ---- Fixed maturities held to maturity $ (967) $ 4,999 $ (7,819) Fixed maturities available for sale (4,188) 24,044 (20,675) Equity securities 6,630 10,697 (6,672) ------ ------ ------- Total $ 1,475 $39,740 $(35,166) ====== ====== =======
In May 1996, Viking moved its Freeport, Illinois operations from a leased facility to an office building which was acquired by Viking. Viking purchased the building in February 1996, for approximately $1,300,000.
Range of Exercise Prices for Options Outstanding at December 31 $13.50-23.25 $14.50-23.25 ============ ============