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Strategies & Market Trends : YEEHAW CANDIDATES -- Ignore unavailable to you. Want to Upgrade?

To: Crossy who wrote (1002)	1/14/2003 6:34:50 PM
From: JoeinIowa	Read Replies (1) \| Respond to of 23958

Crossy, Did not bite on SMAN because I really could not figure out what their earnings are and what they might be given all the gains/losses. Too much accounting stuff for me. I mean I can not figure out if they made or lost money in the last quarter? Did they lose $5.1M or make $1.4M? Operating Earnings from Continuing Operations * For the quarter ended September 30, 2002, the Company reported an operating loss from continuing operations of $5.1 million, or $.63 per diluted share, compared to a $1.4 million gain, or $.17 per diluted share from continuing operations for the comparable prior year period. Impacting the current quarter were charges of $.64 per diluted share from the accelerated amortization of deferred acquisition costs ("DAC") on fixed annuity products, $.06 associated with the write-off and legal costs related to the recovery of an agency receivable balance, $.05 per diluted share of operating expenses associated with the costs of new marketing initiatives, and $.04 from FAS 133 adjustment related to declining treasury yields. The third quarter 2001 results were positively affected by $.06 per diluted share due to a lower effective tax rate resulting from the utilization of net operating loss carryforwards. Pete Pheffer, Standard Management President and CFO, stated, "Our current quarter charge of $0.64 for accelerated amortization of DAC results largely from our reduced investment yields in recent periods, along with revised expectations of future yields. We amortize DAC over the lives of our fixed annuity contracts in relation to estimated gross profits, of which spread income and realized gains and losses on investments are major components. When our estimates of historical and future gross profits change, as in the current period, our amortization of DAC is restated retrospectively, resulting in the accelerated amortization. As a result of this charge, future amortization will emerge more consistently with our gross margins, supporting core earnings growth." Net Income * For the quarter ended September 30, 2002, net income was $1.4 million, or $.18 per diluted share, up from $341,000, or $.04 per diluted share for the third quarter of 2001.