Providence S&L, whose 1978 earnings were reported in Wednesday's Washington Post, is headquartered in Vienna, Va. The story gave the wrong location for the company's main office.
Government Employees Insurance Co. reported yesterday another sharp surge in profitability but a continuation of sluggish automobile policy sales is causing executives some concern.
For 1978, Geico earned $62.4 million ($1.74 a share) from operations, up sharply from $37.7 million ($1.10) the pervious year, when the Chevy Chase firm had staged a major recovery.
Counting capital gains or losses plus tax credits related to prior-year losses, Geico's net income for 1978 was a record $88.2 million ($2.49 a share) compared with $58.6 million ($1.70).
In the fourth quarter alone, Geico earned $18.3 million (51 cents a share) from operations compared with $10.7 million (31 cents) in the final three months of 1977 and net income soared to $26.7 million (75 cents a share) from $16.7 million (48 cents).
Chairman John Byrne cautioned, however, that the rate of increase in profits probably will moderate somewhat until Geico achieves increases in auto premium policy volume. 1978 was a decline of 4 percent in
"Our greatest disappointment" in 1978 was a decline of 4 percent in written premium and service charges to $525.3 million from $547.6 million in the previous year, Byrne said.
In a telephone interview from Williamsburg, where Geico officers were secluded yesterday for a meeting on company objectives this year, Byrne said the afternoon session had been devoted to the major issue of a marketing strategy to attract new customers.
"We're working very hard on it, I really do think we have a good program for 1979... that will give us a modest increase," he stated. At the same time, Byrne recalled that he had made such statements previously and that Geico "was not able to deliver what we planned to do in 1978."
Byrne said Geico's declining business base -- which was generated by the auto insurer's financial problems in 1975 and 1976 -- has been "essentially stabilized" and that the decline in business was more moderate in the final quarter.
We are focusing a lot of attention on it," he added.
Geico also reported yesterday that the firm's surplus for protection of policyholders rose substantially to a record $220.5 million at year's end from $178.6 million in 1977 and Byrne said he expects additional growth of surplus this year, providing the capacity for "future profitable growth." Full details will be published in the annual report, due to be mailed March 1, along with details of a proposed exchange offer of 20-year subordinated debentures for up to 5 million Geico common shares, announced last week.
Providence S&L, of Baileys Crossroads, reported 1978 earnings of $1.24 million ($5.68 a share) compared with $1.1 million ($5.00) in 1977, an increase of 13 1/2 percent. Assets rose 16 1/2 percent to $116.5 million last year. Providence has nine offices and is opening a tenth this month in Great Falls shopping center.