21st Century Holding Company drops as Q3 profit falls
Shares of 21st Century Holding Company (Nasdaq: TCHC) fell sharply on news after the start of trading that third-quarter profit suffered a sharp decline.
The Lauderdale Lakes, Fla.-based insurance holding company reported that net income for the third-quarter was $1.87 million, or $0.24 per share, a decline of 38% compared with a net income of $3.03 million, or $0.40 per share during the same period in 2006.
Total revenues advanced 19.4% to $29.6 million from $24.8 million during the same period in 2006.
21st Century, which underwrites insurance in the state of Florida, attributed the decline in profit to a charge of $2.8 million, or $0.22 per share, imposed by the Florida Insurance Guarantee Association. The charge is related to the company’s requirement to participate in funding for the insolvency of other property and casualty insurance carriers operating in the state. The money will be recouped over a future 12-month period.
“Even with this charge to earnings, we believe our fourth quarter will be significantly more profitable and we are hereby reiterating guidance that the company will report earnings of approximately $2.50 per share for calendar year 2007,” said chairman and CEO Edward Lawson.
That’s an increase of 36% compared with earnings of $1.84 per share during 2006.
Lawson also said that 21st Century is now free of debt for the first time in its history.
At 3:43 p.m. ET, shares of 21st Century Holding Company (TCHC) were down $2.13, or 13%, to $13.88. The 52-week low of $9.74 was touched on May 8, while the 52-week high of $29.00 was reached on Nov. 15, 2006.
