Canadian Underwriter

Lindsey Morden loss widens in 2003 despite revenue jump

February 12, 2004   by Canadian Underwriter

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Although international adjuster Lindsey Morden (TSX: LM) increased its revenue in 2003, lingering issues with its U.S. operations dragged the company’s net loss even deeper.
Overall, the company posted a net loss of $30 million, or $2.18 per share, for 2003, versus a net loss of $17.5 million, or $1.28 per share, in 2002.
This includes an impairment of $5.5 million of goodwill on the acquisition of RSKCo in and a write-off of $6.5 million in future tax assets, both attributable to U.S. operations. In total, the operating loss for U.S. operations in 2003 was $22.2 million, while all other subsidiaries posted operating income. The Canadian operations posted operating earnings of $2.4 million, down from $4.2 million in 2002, as a result of “lower claims activity that could only be partially offset by cost reductions”, the company reports.
The company posted increased revenue of $461.5 million in 2003, up from $457.9 million in 2002. Part of the increase is due to an 8% jump in U.S. revenue from the RSKCo acquisition.
Free cash flow from operations was down to $8.4 million, or $0.61 per share, last year, versus $17.4 million, or $1.27 per share, the year prior.

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