Specialty Insurer Atlas Financial Announces Decent Earnings

We only touch on the earnings just announced late today by Atlas Financial Holdings (NASDAQ:AFH), because the company had sold a 6.625% baby bond a year ago and then recently announced a surprise write down sending the baby bonds tumbling. We had bought the bonds in the Medium Duration Income Portfolio as well as in our personal accounts at $25.45. Shares had traded as high as $27 early in 2018. Today, just prior to the earnings announcement the baby bonds ended the day at $24.84.

Atlas is a small specialty insurer involved primarily with the taxi and limousine business. They had announced a huge write down based on old claims which had not been adequately reserved for–the write down was massive, but getting the news out and the write down behind them should allow a recovery in the baby bond price–over time.

AFH announced earnings of 45 cents/share which is pretty much on target and there were not any surprises in the earnings report. We have noted over the years that when a company announces a surprising financial event it takes at least a quarter and many times 2, before investors begin to regain some trust.

With these earnings we feel some comfort and relief that the company appears to be on the road to recovery–but 1 more quarter is required for us feel totally comfortable.

3 thoughts on “Specialty Insurer Atlas Financial Announces Decent Earnings”

  1. On another note,

    For the SOHOK fans:

    Earnings are out for SOHO

    Revenue and RevPAR. For the three-month period ending March 31, 2018, Total Revenue increased 7.9% over the three-month period ending March 31, 2017. Room revenue per available room (“RevPAR”) for the Company’s composite portfolio, which includes the performance of the rooms participating in our rental program at the Hyde Resort & Residences, during the three-month period ending March 31, 2018, increased 6.6% over the three months ended March 31, 2017, to $112.03 reflecting a 4.6% decrease in occupancy and an 11.8% increase in average daily rate (“ADR”).

    Adjusted FFO available to common holders per share and unit: was down 1 penny from the same quarter a year ago.

    Adjusted FFO. For the three-month period ending March 31, 2018, Adjusted FFO decreased 7.5% or approximately $0.4 million from the three months ended March 31, 2017.

  2. Thanks for the update Tim. Let’s hope they turn the boat around as that’s a pretty ugly drop on the chart you show.

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