Wednesday, June 29, 2005

Citizens, Inc. Net Income Increases 581%

Citizens, Inc. Net Income Increases 581%

Austin, Texas – November 8, 2001 – Citizens, Inc. (AMEX: CIA), reported net income of $2.5 million or $0.10 per share for the first nine months of 2001, a 581.2% increase over $360,000 or $0.01 during the same period in 2000. New cash value life insurance premiums have increased by 20% in 2001 over the prior period. An increase in investment income and decline in accident and health benefits during the period combined with the growth in premiums contributed to the improvement in 2001 operating results.

(PRWEB) November 10, 2001

Investment income grew 9.2% during the nine-month period of 2001 to $10.1 million as a result of expansion of the CompanyÂ’s asset base and the actions taken to change the mix and duration of invested assets during the past year. Premium income increased during the period to $38.8 million. New life insurance premiums offset a 29.5% decline in accident and health premiums resulting from managementÂ’s decision in prior years to cancel a large portion of the CompanyÂ’s individual major medical and group dental blocks of business due to adverse claims experience. Claims and surrenders for the nine-month period ended September 30, 2001 declined 9.9% to $21.6 million from $24.0 million in 2000 as a result of the cancellation of the accident and health business.

Third quarter 2001 net income was $1.4 million, or $0.05 per share, a 474.3% increase over a net loss of $287,000, or $(0.01) per share, for the same period in 2000. New production of whole life insurance premiums measured in paid, annualized premiums increased 25% during the quarter while death claims decreased 44.7%. Revenues for the quarter increased $700,000 to $17.6 million, compared to $16.9 million for the same period in 2000.

Investment income in the third quarter of 2001 grew 8.9% to $3.5 million compared to $3.2 million for the same period in 2000. Accident and health premiums declined $500,000, or 30%, due to cancellation of the major medical and dental blocks of business. Death claims decreased as a result of reduced claim volume and smaller claim amounts. Premium income increased 2.5% during the quarter to $13.9 million, compared to $13.6 million in 2000 as the increased production of new life premium exceeded the decline in accident and health revenues.

Total assets increased to $287.2 million at September 30, 2001 from $267.8 million at December 31, 2000. StockholdersÂ’ equity reached $83.0 million compared to $77.3 million at December 31, 2000. Income earned in the first nine months of 2001 and increases in the market value of the CompanyÂ’s available-for-sale bond portfolio were the primary reasons for the increase in equity.

About Citizens, Inc.

Citizens, Inc. is a financial services company listed on the American Stock Exchange under the symbol CIA. Its growth strategy is to achieve $1 billion in assets, $250 million in revenues and $10 billion of life insurance in force by 2010 targeting the sale of U. S. dollar whole life insurance policies in the United States as well as world-wide and through the acquisition of other life insurance companies.

Citizens is included in the Russell 2000® Index, which measures the performance of the largest companies in the U. S. stock market, based on market capitalization. Citizens’ stock closed at $9.30 on November 7, 2001.

Additional information is available at the CompanyÂ’s web site: www. citizensinc. com.

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FOR FURTHER INFORMATION CONTACT: 

Joel H. Mathis

Vice President

Public Relations and Investor Relations

Post Office Box 149151

Austin, Texas 78714-9151

PR@citizensinc. com

 (512) 837-7100

Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as “may”, “will”, “expect”, “anticipate” or “continue” or comparable words. In addition, all statements other than statements of historical facts that address activities that the Company expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of the Company, particularly its Form 10-K for the fiscal year ended December 31, 2000, for the meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.

CITIZENS, INC.

COMPARATIVE CONSOLIDATED FINANCIAL HIGHLIGHTS

OPERATING STATEMENTS

 (Unaudited)Nine-Months EndedSeptember 30, (Unaudited)Three-Months EndedSeptember 30,

 2001 2000 2001 2000

Premiums and Other Revenues

Premium income $38,819,800 $38,798,671 $13,892,419 $13,558,646

Net investment income 10,110,224 9,257,159 3,489,266 3,204,023

Other  488,240  611,042  201,049  128,363

Total revenues $49,418,264 $48,666,872 $17,582,734 $16,891,032

Benefits and Expenses

Increase in future policy benefit reserves $ 4,702,073 $ 4,615,938 $ 1,383,049 $ 2,145,261

Claims and surrenders 21,606,679 23,969,251 7,445,642 8,899,271

Policyholder dividends 2,301,322 2,129,379 905,569 836,021

Commissions 9,633,958 8,822,030 3,663,972 3,217,551

Underwriting and insurance expenses 7,879,929 7,729,985 2,514,909 2,443,061

Net change in deferred policy acquisition costs (1,635,902) (424,607) (855,703) (520,028)

Other  1,536,674 1,697,659  579,953  491,775

Total benefits and expenses  46,024,733 48,539,635 15,637,391 17,512,912

Income (loss) before federal income tax $ 3,393,531 $ 127,237 $ 1,945,343 $ (621,880)

Federal income tax expense (benefit) $ 930,000 $  (234,398) $ 585,000 $ (335,073)

Net income (loss) $ 2,463,531 $ 361,635 $ 1,360,343 $ (286,807)

INCOME (LOSS) PER SHARE(UNAUDITED)

Net income (loss) per share $0.10 $0.01 $0.05 $(0.01)

Average shares outstanding 25,128,158 25,128,158 25,128,158 25,128,158

BALANCE SHEETS

 (Unaudited)September 30, 2001 (Unaudited)June 30,2001 (Unaudited)March 31,2001 December 31,2000 (Unaudited)September 30, 2000

Total assets $287,194,989 $273,276,061 $270,633,059 $267,842,364 $261,556,405

Total invested assets $203,106,657 $197,071,562 $196,214,529 $194,203,327 $186,896,625

Stockholders' equity $ 82,973,203 $ 78,991,654 $ 79,325,947 $ 77,313,031 $ 73,836,647