Affirmative Insurance Holdings Inc. has a market cap of $39.29 million; its shares were traded at around $2.55 with and P/S ratio of 0.09.
Highlight of Business Operations:Ceded premiums for the three months ended March 31 were $21.5 million in 2011 and $2.2 million in 2010.
We had a net loss from continuing operations of $9.6 million and $3.5 million for the three months ended March 31, 2011 and 2010, respectively.
Total commission income and fees decreased $3.6 million, or 15.1%, compared with the same period in the prior year. Policyholder fees decreased $4.3 million, or 35.4%, due to the lower overall volume of premiums written and a change in mix in states where these fees are realized. Premium finance revenue increased $0.3 million, or 5.9%, due to increases in the number of policies financed and revenue per policy. We experienced a steady increase in premium finance revenue since December 2007 when we began financing third-party premiums. Commissions and fees increased $0.4 million, or 9.7%, due to more of our retail customers choosing third-party products due to pricing and underwriting actions and an expansion of our ancillary product sales.
Net Investment Income and Other Income. Net investment income for the three months ended March 31, 2011 increased $0.1 million, or 4.4%, compared with the same period in the prior year. The increase was primarily due to an increase in income from our investment in real estate and from our investment in a hedge fund, partially offset by a reduction in yields and a 15.5% decrease in total average invested assets to $194.9 million during the current quarter from $230.6 million in the prior year. The average investment yield was 2.6% (2.7% on a taxable equivalent basis) in the current quarter, compared with 2.7% (3.4% on a taxable equivalent basis) in the prior year. The increase in income from our investment in real estate is due to a new long-term lease which commenced in the fourth quarter of 2010. We entered into an investment in a hedge fund in the fourth quarter of 2010 which increased in market value during the three months ended March 31, 2011.
In the first quarter of 2010, we began to reposition our investment portfolio by decreasing our exposure to tax-exempt investments. The repositioning was completed in the second quarter of 2010. We sold $35.1 million of available-for-sale securities for the three months ended March 31, 2010 for a net realized gain of $1.2 million.
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