Kansas City Life Posts Small Net Drop for 2015; Company Re-Emerges as Privately Held Firm
March 11, 2016 by Dennis Gorski, managing editor-online, BestWeek: Dennis.Gorski@ambest.com
KANSAS CITY, Mo. – Kansas City Life Insurance Co., which has transitioned into a private company that delisted from the NASDAQ stock exchange at the end of last year, reported lower fourth-quarter net income as well as revenue.
Profit for the quarter dropped to $6.1 million, from $7.7 million, primarily due to lower investment revenues, partially offset by reduced policyholder benefits, amortization of deferred acquisition costs and operating expenses, according to KCLI’s earnings report.
For the year, net income totaled $29.2 million — a slight decrease from $29.9 million in 2014. The company attributed its results to less insurance revenues and investment revenues. However, the company said these results were buoyed by lower policyholder benefit costs, amortization of deferred acquisition costs and operating expenses.
Fourth-quarter revenue decreased to $108.9 million; last year’s revenue for the period hit $117.7 million.
On Dec. 16, Kansas City Life completed a reverse/forward stock-split transaction (Best’s News Service, Dec. 17, 2015). Using a 1-for-250 share formula, the company purchased some 906,500 shares, or 9% of the outstanding shares, valued at $52.50 per share for $47.6 million, according to its earnings statement.
KCLI then completed a 250-for-1 forward stock split for each share of its common stock, it disclosed. The company delisted from NASDAQ on Dec. 31, and then deregistered the following week from the U.S. Securities and Exchange Commission “as a non-public company,” Tracy Knapp, senior vice president of finance, told Best’s News Service.
The company left the NASDAQ/SEC process “primarily due to the costs associated with being a public company,” Knapp said. “The transition has gone very smoothly for us and our shareholders.”
The company re-emerged on Jan. 4 as a member of the Over-the-Counter Markets Group Inc., trading under the symbol OTCQX: KCLI. That was the first business day after the SEC deregistration process was completed, Knapp said.
The company previously noted it would be able to delist from NASDAQ, and deregister with the SEC, once the number of shareholders slipped below 300. “We have about 10 million shareholders,” Knapp said, but the 300 refers to “300 shareholders of record” — brokerages and shares held in street name.
He added KCLI will continue to issue financial quarterly and annual earnings statements despite its deregistration and delisting. “We want to continue to provide meaningful information to our shareholders,” Knapp said, noting the OTCQX marketplace requires such disclosures.
Operating units of Kansas City Life Insurance Co. have current Best’s Financial Strength Ratings ranging from A- to A (Excellent).
