No.1: American National has stellar 2019, but faces struggles in pandemic

American National Insurance Co.had a disappointing 2018 as revenues slipped and profits plunged by more than two-thirds. It didn’t make the Houston Chronicle’s list of the region’s top performing public companies.

But the Galveston company came roaring back in 2019 to jump to the No. 1 spot on the Chronicle 100. The company’s revenues climbed more than 20 percent to $4.1 billion from $3.3 billion in 2018. Profits nearly quadrupled to $620 million from $159 million, as did earnings per share, a key metric in the Chronicle 100 rankings.

American National’s earnings per share jumped to $23.07 from $5.91 in 2018.

American National was founded in 1905 and today provides a broad array of policies — auto, life, health, homeowners, business and farm and ranch insurance as well as annuities — in all 50 states and employs more than 4,600.

The company is controlled by the Libbie Shearn Moody Trust and the Moody Foundation, which own 36.9 percent and 22.7 percent, respectively, or nearly 60 percent combined.

The Moody Foundation is a charitable trust in Galveston, a legacy of William Lewis Moody Jr., a prominent Galveston businessman who also founded what is now Moody National Bank. The Libbie Shearn Moody Trust is the trust established from the estate of his wife, Libbie Shearn Moody.

American National, along with Moody Bank and the Moody Foundation, are headquartered at One Moody Plaza in Galveston. American National also maintains a significant presence in League City, where it has three buildings.

Stellar year

American National’s leap to the top of the Chronicle 100 was in part due to its disappointing performance in 2018, which the company attributed largely to changes in accounting guidance. But 2019’s profits were still more than 25 percent above the $494 million earned in 2017, another stellar year aided by the corporate tax cuts enacted by a Republican Congress and signed into law by President Donald Trump.

The value of the company’s assets hit a record $28.6 billion at the end of 2019, up 6 percent from the previous years, according to American National’s annual report. Paid, active life insurance policies also rose to record levels, climbing by $7.7 billion, or about 7 percent, to $118.1 billion

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Executives at American National did not respond to requests for interviews.

Like other personal insurance companies, the coronavirus pandemic is buffeting American National as customers seek rebates on car insurance as they drive less, claims on life insurance increase as people die from COVID-19, and economic conditions deteriorate, causing customers to drop coverage as well as hurting the value of investments.

American National Insurance reported a steep loss of $220 million in the first quarter of 2020 compared with a $258 million profit in the first quarter of 2019. In company filings, executives blamed the poor first quarter performance on COVID-19, which executives noted, disrupted the economy and financial markets. As the crisis progresses, executives wrote to shareholders, COVID-19 may also cause an increase in claims while reducing sales.

Merger completed

In a filing with the Securities and Exchange Commission at the end of 2019, the company warned stockholders that an economic downturn could “impair the ability of our customers to pay premiums as they come due.”

American National Insurance, which is based in Galveston, merged with its sister company American National Group in a deal that closed July 1. It does not change much for shareholders; they hold the same amount of stock in what is now American National Group Inc., trading on the NASDAQ under the same ticker, “ANAT.”

erin.douglas@chron.com

Twitter.com/erinmdouglas23