AMIC American Independence Corp.

American Independence Corp. (NASDAQ:AMIC) today reported 2016 first-quarter results.

Financial Results

AMIC completed the sale of IHC Risk Solutions LLC (“Risk Solutions”) and the medical stop-loss business it produced on March 31, 2016 and realized an after tax gain of approximately $114 million.  In addition, under the purchase and sale agreement, all of the in-force medical stop-loss business of Independence American produced by Risk Solutions is 100% co-insured as of January 1, 2016.  AMIC’s block of medical stop-loss business is in run-off.  The sale of Risk Solutions and exit from the medical stop-loss business represents a strategic shift that will have a major effect on the Company’s operations and financial results.  The disposal transaction qualifies for reporting as discontinued operations in the first quarter of 2016.  

AMIC reported net income of $114.2 million ($14.10 per diluted share) for the three months ended March 31, 2016 compared to $0.7 million ($.09 per diluted share) for the three months ended March 31, 2015.  Income from continuing operations was $0.4 million ($.03 per diluted share), and $0.3 million ($.03 per diluted share), for the three months ended March 31, 2016 and 2015, respectively.

Revenues decreased to $29.4 million for the three months ended March 31, 2016 compared to revenues of $39.4 million for the three months ended March 31, 2015, primarily due to the sale of Risk Solutions and the exit from the medical stop-loss business. 

Independence Holding Company (“IHC”) has announced a “going private” transaction by way of a statutory “short-form" merger of AMIC with and into AMIC Holdings, Inc. (“Holdings”), a newly formed subsidiary into which IHC and one of its subsidiaries will contribute their shares of AMIC common stock, with Holdings continuing as the surviving corporation.  Once the transaction is consummated, Holdings will own all of the outstanding shares of common stock of AMIC.  IHC is under no obligation to consummate the merger and could decide to withdraw from the transaction at any time before it becomes effective.

Chief Executive Officer’s Comments

Roy T. K. Thung, Chief Executive Officer, commented, “Our financial condition and balance sheet remain strong.  As previously announced, AMIC completed the sale of IHC Risk Solutions LLC and the stop-loss business it produced on March 31, 2016 and realized an after tax gain of approximately $114 million.  AMIC has re-positioned itself as a specialty health underwriter and sales and marketing company, and produced solid growth and underwriting results in these lines in the first quarter.  Our occupational accident line has been underperforming, and we are implementing changes to improve our results.”

About American Independence Corp.

American Independence Corp. (AMIC) is a holding company principally engaged in health insurance and reinsurance.  It provides specialized health coverage and related services to commercial customers and individuals.  Through Independence American Insurance Company and its other subsidiaries, it offers non-subscriber occupational accident, pet insurance, short-term medical, vision, dental and various supplemental products.  Through its subsidiaries IHC Specialty Benefits, Inc. (including through www.healthedeals.com and www.aspiraAmas.com), IPA Direct, LLC and IPA Family, LLC, AMIC markets products underwritten by its affiliated companies and various products (including ACA plans and medical stop-loss) on behalf of unaffiliated carriers.

Forward-Looking Statements

Certain statements and information contained in this release may be considered “forward-looking statements,” such as statements relating to management's views with respect to future events and financial performance.  Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements.  Potential risks and uncertainties include, but are not limited to, economic conditions in the markets in which AMIC operates, new federal or state governmental regulation, AMIC’s ability to effectively operate, integrate and leverage any past or future strategic acquisition, and other factors which can be found in AMIC’s other news releases and filings with the Securities and Exchange Commission.  AMIC expressly disclaims any duty to update its forward-looking statements unless required by applicable law.

American Independence Corp.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
							Three Months
							Ended March 31,
							2016			2015
REVENUES:
	Premiums earned					$	21,096		$	36,217
	Agency income						5,500			2,477
	Net investment income						1,470			599
	Net realized investment gains (losses)						214			141
	Other income						1,122			1
							29,402			39,435
EXPENSES
	Insurance benefits, claims and reserves						14,966			23,970
	Selling, general and administrative expenses						13,506			14,952
	Amortization and depreciation						280			115
							28,752			39,037
Income from continuing operations before income taxes							650			398
Provision for income taxes							234			140
Income from continuing operations							416			258
Discontinued operations: (Note 3)
				Income from discontinued operations, before income taxes			122,034			837
				Income taxes on discontinued operations			8,069			324
				Income from discontinued operations			113,965			513
Net income							114,381			771
	Less: Net (income) loss attributable to the non-controlling interest						178			49
Net income attributable to American Independence Corp.						$	114,203		$	722
Basic income per common share:
	Income from continuing operations					$	.03		$	.03
	Income from discontinued operations						14.07			.06
			Basic income per common share			$	14.10		$	.09
Weighted-average shares outstanding							8,101			8,079
Diluted income per common share:
	Income from continuing operations					$	.03		$	.03
	Income from discontinued operations						14.04			.06
			Basic income per common share			$	14.07		$	.09
Weighted-average diluted shares outstanding							8,119			8,094

American Independence Corp.
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
						March 31,
						2016				December 31,
ASSETS:						(Unaudited)				2015
	Investments:
	Securities purchased under agreements to resell				$	1,629			$	4,595
	Fixed maturities available-for-sale, at fair value					181,158				84,933
	Equity securities available-for-sale, at fair value					2,603				2,594
	Total investments					185,390				92,122
	Cash and cash equivalents					134,415				4,861
	Restricted cash					966				1,377
	Accrued investment income					769				727
	Premiums receivable					16,005				16,654
	Net deferred tax asset					15,848				13,944
	Due from reinsurers					19,987				4,950
	Goodwill					5,703				5,703
	Intangible assets					13,086				13,327
	Due from securities brokers					111				1,051
	Other assets					18,037				10,540
	Assets attributable to discontinued operations					-				31,718
		TOTAL ASSETS			$	410,317			$	196,974
LIABILITIES AND STOCKHOLDERS’ EQUITY:
	LIABILITIES:
	Policy benefits and claims				$	47,386			$	43,764
	Premium and claim funds payable					966				1,377
	Commission payable					8,444				5,817
	Accounts payable, accruals and other liabilities					13,346				11,192
	Debt					2,250				3,189
	State income taxes payable					5,882				-
	Due to securities brokers					99,777				-
	Due to reinsurers					8,896				100
	Liabilities attributable to discontinued operations					953				24,337
	Total liabilities					187,900				89,776
STOCKHOLDERS’ EQUITY:
	American Independence Corp. stockholders’ equity:
			Preferred stock, $0.10 par value, 1,000 shares designated; no shares
			issued and outstanding			-				-
			Common stock, $0.01 par value, 15,000,000 shares authorized;
			9,181,793 shares issued, respectively; 8,101,883 and 8,088,105
			shares outstanding, respectively			92				92
			Additional paid-in capital			88,648				88,637
			Accumulated other comprehensive gain (loss)			484				(197	)
			Treasury stock, at cost, 1,079,910 and 1,093,688 shares, respectively			(10,033	)			(10,161	)
			Retained earnings			139,749				25,549
				Total American Independence Corp. stockholders’ equity		218,940				103,920
	Non-controlling interest in subsidiaries					3,477				3,278
			Total equity			222,417				107,198
			TOTAL LIABILITIES AND EQUITY		$	410,317			$	196,974

CONTACT:  LOAN NISSER
(646) 509-2107
www.americanindependencecorp.com