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ABOUT US2008 Financial Highlights
Financial SummaryOverview of 2008 Consolidated Results and Capitalization*Trustmark reported pretax gain of $53.0 million in 2008. This was down from $62.2 million reported in 2007, due primarily to higher loss ratios in our major medical business and a planned shift away from more volatile professional sports disability programs toward lower-risk benefit administration services and voluntary products. This changing mix of business from low-volume, high-revenue products to high-volume but lower-priced products also impacted revenue, which fell from $890 million to just over $830 million. Sales, however, increased significantly. Full-year sales came in at $192.8 million, a 31 percent increase over sales of $147 million in 2007. Sales in the small-group segment jumped 94 percent over 2007, while sales in CoreSource and Voluntary Benefit Solutions rose by 16 percent and 18 percent, respectively. With careful expense management, including more efficient operations and consolidation of shared processes among group major medical product lines, Trustmark’s total expenses fell by 3 percent in 2008. Due to Trustmark’s strong capital position, the company was able to take advantage of weakness in the financial markets to negotiate the repurchase of $36 million face value of $75 million in trust preferred securities issued by Trustmark Group, Inc. in 2005. The securities were acquired for $27 million, or 75 percent of face value, resulting in a pretax gain of $7.3 million in the fourth quarter, after acceleration of unamortized issuance costs. This reduced the company’s already conservative ratio of debt to total capitalization from 14 percent to 8 percent. Trustmark has virtually no direct exposure to sub-prime mortgage-backed securities. While the company recorded after-tax investment losses of approximately $37 million in 2008, the losses were less than 4 percent of Trustmark’s investment portfolio. As a mutual holding company, Trustmark has a conservative investment philosophy based on careful diversification and steady, long-term returns. At year-end 2008, more than 96 percent of Trustmark’s $1.5 billion investment portfolio was in fixed income and preferred securities, and approximately 98 percent of those were investment grade. Due to solid overall operating results and relatively modest investment losses, as of December 31, 2008, Trustmark’s consolidated capital and surplus, a key measure of financial strength, was $453.4 million, just $1.5 million less than the company started with on January 1. The company’s NAIC Risk-Based Capital Ratio was 1,079 percent. On January 21, 2009, A.M. Best affirmed Trustmark’s A- (Excellent) insurer financial strength rating. * Represents the consolidated financial results of Trustmark Mutual Holding Company for the 2008 calendar year. Trustmark subsidiary companies and operating divisions include Trustmark Life Insurance Company, Trustmark Insurance Company, CoreSource, Health Contact Partners, Starmark, Trustmark, Group Benefits, Trustmark Affinity Markets and Trustmark Voluntary Benefit Solutions. Trustmark Mutual Holding Company’s total admitted assets and adjusted surplus at year-end 2008 were $1.7 billion and $453.4 million, respectively. |
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© 2010 Trustmark Companies (Trustmark Mutual Holding Company) and its subsidiaries |
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