Earnings Up 18.2 percent, Net Income per Diluted Share Up 18.4 percent for the Quarter
Erie Indemnity Company (NASDAQ: ERIE) today announced financial results for the quarter ending March 31, 2016. Net income was $45.9 million, or $0.87 per diluted share, in the first quarter of 2016, compared to $38.8 million, or $0.74 per diluted share, in the first quarter of 2015. The growth in the first quarter of 2016 was driven by increased net revenue from operations.
“Strong topline growth together with prudent expense management resulted in solid earnings per share for the quarter", said Terry Cavanaugh, President and CEO.
1Q 2016
|
(dollars in thousands) |
1Q'15 |
1Q'16 |
|---|---|---|
|
Net revenue from operations |
$ 52,430 |
$ 67,665 |
|
Investment income |
6,539 |
2,559 |
|
Income before income taxes |
58,969 |
70,224 |
|
Income tax expense |
20,136 |
24,329 |
|
Net income |
$ 38,833 |
$ 45,895 |
|
Gross margin from operations |
14.9 % |
18.1 % |
1Q 2016 Highlights
Net revenue from operations before taxes increased $15.2 million, or 29.1 percent, in the first quarter of 2016 compared to the first quarter of 2015.
- Management fee revenue increased $24.2 million, or 7.1 percent, in the first quarter of 2016 compared to the first quarter of 2015.
- Commissions increased $15.0 million in the first quarter of 2016 compared to the first quarter of 2015, primarily as a result of the 7.1 percent increase in direct and assumed premiums written by the Exchange, while approximately one-quarter of the increase was due to higher agent incentive costs primarily related to profitable growth, compared to the prior year quarter.
- Non-commission expense decreased $6.3 million in the first quarter of 2016 compared to the first quarter of 2015. Underwriting and policy processing costs increased $1.0 million due to increased personnel costs. Information technology costs decreased $4.7 million primarily due to decreased professional fees. Administrative and other costs decreased $2.6 million primarily due to decreased personnel costs. Personnel costs in all expense categories were impacted by decreased pension costs primarily due to an increase in the pension discount rate.
- The gross margin in the first quarter of 2016 was 18.1 percent compared to 14.9 percent in the first quarter of 2015.
Income from investments before taxes totaled $2.6 million in the first quarter of 2016 compared to $6.5 million in the first quarter of 2015. Losses from limited partnerships were $0.7 million in the first quarter of 2016 compared to earnings of $2.4 million in the first quarter of 2015.
Webcast Information
Indemnity has scheduled a conference call and live audio broadcast on the Web for 10:00 AM ET on April 29, 2016. Investors may access the live audio broadcast by logging on to www.erieinsurance.com. Indemnity recommends visiting the website at least 15 minutes prior to the Webcast to download and install any necessary software. A Webcast audio replay will be available on the Investor Relations page of the Erie Insurance website by 12:30 PM ET.