Allmerica Financial Announces Lower First Quarter 2001 Operating Earnings Per Share

Apr 17, 2001, 01:00 ET from Allmerica Financial Corporation

    WORCESTER, Mass., April 17 /PRNewswire/ -- Allmerica Financial Corporation
 (NYSE:   AFC) today announced that first quarter 2001 consolidated net operating
 earnings per share will be significantly lower than the $1.22 operating
 earnings per share Allmerica reported for the first quarter of 2000 and the
 current First Call estimates. The Company said it expects net operating
 earnings per share from continuing operations for this year's first quarter to
 fall within a range of $0.70 per share to $0.80 per share due to lower than
 expected operating results in both its Allmerica Financial Services and Risk
 Management businesses.  Net operating earnings per share from continuing
 operations excludes net realized investment gains and losses and other
 non-recurring gains and charges, net of taxes.
     "We are disappointed that operating earnings in the first quarter will be
 lower than expected," said John F. O'Brien, president and chief executive
 officer of Allmerica.  "Volatility from the weather and the equity markets is
 a part of our business, and over the long term we have managed it effectively.
 Despite this recent volatility, the fundamental strategies we have in each of
 our key businesses remain intact.  In Allmerica Financial Services, we are
 pursuing new growth opportunities to expand our variable products business and
 are continuing to invest in growth related initiatives.  In Risk Management,
 we have good growth opportunities in our core markets and are successfully
 obtaining necessary rate increases.  With the first quarter weather behind us,
 and given a stabilization in the equity markets, we are confident in our
 business outlook."
     For the first quarter 2001, net operating income in Allmerica Financial
 Services has been negatively impacted by reduced average variable product
 assets under management and related variable product fee income due to the
 recent decline in the equity markets, as well as higher growth related
 expenses.  Additionally, the Risk Management segment has experienced lower net
 operating income in the current quarter primarily due to increased
 non-catastrophe weather-related losses in personal lines and a reduced benefit
 from the development of prior years' loss reserves.
     Allmerica Financial Corporation will announce first quarter financial
 results on April 30, 2001.
     Allmerica Financial Corporation is the holding company for a diversified
 group of insurance and financial services companies headquartered in
 Worcester, Mass.
 
     Certain statements in this release may be considered to be forward-looking
 statements as defined in the Private Securities Litigation Reform Act of 1995.
 Use of the words "believes," "anticipates," "expects" and similar expressions
 is intended to identify forward-looking statements. The Company cautions
 investors that any such forward-looking statements are not guarantees, and
 actual results could differ materially. Investors are directed to consider the
 risks and uncertainties in the Company's business that may affect reported
 results and future performance and that are discussed in readily available
 documents, including the Company's annual report and other documents filed by
 Allmerica with the Securities and Exchange Commission.
 
 

SOURCE Allmerica Financial Corporation
    WORCESTER, Mass., April 17 /PRNewswire/ -- Allmerica Financial Corporation
 (NYSE:   AFC) today announced that first quarter 2001 consolidated net operating
 earnings per share will be significantly lower than the $1.22 operating
 earnings per share Allmerica reported for the first quarter of 2000 and the
 current First Call estimates. The Company said it expects net operating
 earnings per share from continuing operations for this year's first quarter to
 fall within a range of $0.70 per share to $0.80 per share due to lower than
 expected operating results in both its Allmerica Financial Services and Risk
 Management businesses.  Net operating earnings per share from continuing
 operations excludes net realized investment gains and losses and other
 non-recurring gains and charges, net of taxes.
     "We are disappointed that operating earnings in the first quarter will be
 lower than expected," said John F. O'Brien, president and chief executive
 officer of Allmerica.  "Volatility from the weather and the equity markets is
 a part of our business, and over the long term we have managed it effectively.
 Despite this recent volatility, the fundamental strategies we have in each of
 our key businesses remain intact.  In Allmerica Financial Services, we are
 pursuing new growth opportunities to expand our variable products business and
 are continuing to invest in growth related initiatives.  In Risk Management,
 we have good growth opportunities in our core markets and are successfully
 obtaining necessary rate increases.  With the first quarter weather behind us,
 and given a stabilization in the equity markets, we are confident in our
 business outlook."
     For the first quarter 2001, net operating income in Allmerica Financial
 Services has been negatively impacted by reduced average variable product
 assets under management and related variable product fee income due to the
 recent decline in the equity markets, as well as higher growth related
 expenses.  Additionally, the Risk Management segment has experienced lower net
 operating income in the current quarter primarily due to increased
 non-catastrophe weather-related losses in personal lines and a reduced benefit
 from the development of prior years' loss reserves.
     Allmerica Financial Corporation will announce first quarter financial
 results on April 30, 2001.
     Allmerica Financial Corporation is the holding company for a diversified
 group of insurance and financial services companies headquartered in
 Worcester, Mass.
 
     Certain statements in this release may be considered to be forward-looking
 statements as defined in the Private Securities Litigation Reform Act of 1995.
 Use of the words "believes," "anticipates," "expects" and similar expressions
 is intended to identify forward-looking statements. The Company cautions
 investors that any such forward-looking statements are not guarantees, and
 actual results could differ materially. Investors are directed to consider the
 risks and uncertainties in the Company's business that may affect reported
 results and future performance and that are discussed in readily available
 documents, including the Company's annual report and other documents filed by
 Allmerica with the Securities and Exchange Commission.
 
 SOURCE  Allmerica Financial Corporation