Conseco shares leap after first profit in 3 years-WEB ONLY

Shares of Conseco Inc. rose as much as 30 percent this morning after the company reported its first quarterly profit in three years.

The Carmel-based owner of life and health insurance companies turned a profit of $24.5 million, or 13 cents per share, in the three months ended March 31. In the same quarter a year ago, Conseco lost $7.2 million, or 4 cents per share.

The company reported that operating earnings spiked at least 34 percent at all three of its subsidiaries: Carmel-based Conseco Insurance, Chicago-based Bankers Life and Philadelphia-based Colonial Penn.

Wall Street sent Conseco shares as high as $3.52 each on the news. Since touching a low of 26 cents on March 10, the stock has soared more than 12-fold.

“We were very pleased that the first quarter results of 2009 again showed significant improvement in operating earnings,” Conseco CEO Jim Prieur told stock analysts in a conference call this morning.

Excluding $6.9 million in investment losses, Conseco earned 17 cents per share, compared with earnings of 11 cents per share in the same period a year ago.

On that basis, analysts polled by Thomson Reuters had expected Conseco to earn 20 cents a share in the latest quarter.

Conseco’s quarterly revenue rose slightly, from $1.03 billion a year ago to $1.07 billion this year.

The company’s net operating income rose to $31.4 million in the quarter, up 56 percent over the same period of 2008.

Conseco spent $9.5 million in the quarter to renegotiate $912 million in bank loans to give it more breathing room under the terms of those loans. In exchange, the company agreed to a hike in the cash interest rate on the loans from 2.6 percent to 6.5 percent, and a payment equal to 1 percent of the principal balance tacked on when the loans mature.