NASHVILLE, TN / ACCESSWIRE / August 7, 2018 / First Acceptance Corporation (OTCQX: FACO) today reported its financial results for the three and six months ended June 30, 2018. A quarterly report can be found at www.otcmarkets.com/stock/FACO/disclosure.

Income before income taxes, for the three months ended June 30, 2018 was $6.2 million, compared with loss before income taxes of $1.5 million for the three months ended June 30, 2017. Net income for the three months ended June 30, 2018 was $4.8 million, compared with net loss of $0.9 million for the three months ended June 30, 2017. Basic and diluted net income per share were $0.12 and $0.11, respectively, for the three months ended June 30, 2018, compared with a basic and diluted net loss per share of $0.02 for the same period in the prior year.

Income before income taxes, for the six months ended June 30, 2018 was $13.5 million, compared with $96 thousand for the six months ended June 30, 2017. Net income for the six months ended June 30, 2018 was $10.2 million, compared with a net loss of $173 thousand for the six months ended June 30, 2017. Basic and diluted net income per share were $0.25 for the six months ended June 30, 2018, compared with a basic and diluted net loss per share of $0.004 for the same period in the prior year.

For the three months ended June 30, 2018 and 2017, the Company recognized favorable prior period loss and LAE development of $3.5 million and unfavorable development of $0.2 million, respectively. For the six months ended June 30, 2018 and 2017, the Company recognized $7.2 million and $0.6 million of favorable prior period loss and LAE development, respectively.

For the three and six months ended June 30, 2018, the Company recognized $67 and $453 thousand, respectively, in unrealized losses on equity securities which are now a component of net income in accordance with newly-adopted accounting standards.

President and Chief Executive Officer, Ken Russell, commented, "The premium rate increases and enhanced underwriting standards we put in place in 2017 and early 2018 have continued to positively impact our current accident quarter loss ratio and lower our estimate of undeveloped prior period losses. As a result, I am pleased to report that we have now achieved our fourth consecutive profitable quarter and, in the process, have increased our statutory capital and surplus and reduced our underwriting leverage to 3.4-to-1. As I have previously remarked, I believe that these accomplishments have helped to establish a foundation upon which we can sustain profitable future growth. I also remain committed to moving towards a companywide agency model of offering third-party non-standard automobile insurance products alongside our Acceptance products, as well as other than auto insurance products, as the ultimate means for increasing our revenues."

Mr. Russell further added "Management is focused on supporting our Sales group which continues with the process of transitioning our distribution channels to a full agency model. We are conducting training throughout all our regions as retail stores are converting to this new model with completion expected before the end of the year. Working in concert with this transition, we are building a solid inventory of carrier partners and products for all markets. This inventory includes personal auto products, as well as our other than auto products (homeowners, mobile home, renters, recreational vehicles, commercial auto, motorcycle, and life). On the marketing front, our social media platform is beginning to build, and we are also committed to focusing on local marketing efforts over the next several quarters. I remain convinced that our efforts towards building a broader insurance product distribution will further enhance the Company's future success."

About First Acceptance Corporation

First Acceptance Corporation is principally a retailer, servicer and underwriter of non-standard personal automobile insurance based in Nashville, Tennessee. Its insurance operations generate revenue from selling non-standard personal automobile insurance products and related products in 16 states. The company currently conducts its insurance servicing and underwriting operations in 13 states and operates only as an insurance agency in three states. The company is also licensed as an insurance company in 13 states where it does not conduct any business. Non-standard personal automobile insurance is sought after by individuals because of their inability or unwillingness to obtain standard insurance coverage due to various factors, including payment history, payment preference, failure in the past to maintain continuous insurance coverage or driving record and/or vehicle type.

Forward-Looking Statements

This press release contains forward-looking statements. All statements made other than statements of historical fact are forward-looking statements. You can identify these statements from our use of the word "believe" or the negative of this term and similar expressions. These statements, which have been included in reliance on the "safe harbor" provisions of the federal securities laws, involve risks and uncertainties. Investors are hereby cautioned that these statements may be affected by important factors, including, among others, the possibility that there may not be an active trading market for our securities, the possibility that delisting and deregistration could adversely affect the price and liquidity of our securities, and the factors set forth under the caption "Risk Factors" in Item 1A. of our Annual Report on Form 10-K for the year ended December 31, 2017 and in our other filings with the SEC. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

First Acceptance Corporation and Subsidiaries
Condensed Consolidated Statements of Income
(amounts in thousands, except per share data)

INVESTOR RELATIONS CONTACT:

Michael J. Bodayle
615.844.2885

SOURCE: First Acceptance Corporation