Pre-Paid Legal Announces 2010 2nd Quarter Production Results
New Sales Associates Enrolled Up 44.3% - New Memberships Produced Up 2.6%
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<p>ADA, Okla., <span class="xn-chron">July 1</span> /CNW/ -- Pre-Paid Legal Services, Inc. (NYSE: PPD) reported new sales associates enrolled and new memberships produced for the 2010 second quarter. During the 2nd quarter of 2010, new sales associates enrolled increased 44.3% to 36,313 from the 25,172 enrolled in the 2nd quarter of 2009 and new memberships produced increased 2.6% to 125,417 during the 2010 quarter compared to 122,230 for the 2009 quarter.</p>
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<p>On a sequential quarterly basis, new associates enrolled decreased 3.5%, new memberships produced decreased 6.5%, new membership fees written decreased 4.2% and our active membership base decreased by 15,184 memberships.</p>
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Three Months Ended:
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New Memberships: 6/30/2010 3/31/2010 6/30/2009
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New legal service membership sales 120,443 128,989 118,050
New "stand-alone" IDT membership sales 4,974 5,192 4,180
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Total new membership sales 125,417 134,181 122,230
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New "add-on" IDT membership sales 75,593 76,309 78,009
Average Annual Membership fee $333.29 $325.17 $328.79
Active Memberships:
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Active legal service memberships at
end of period 1,419,673 1,433,872 1,419,092
Active "stand-alone" IDT memberships
at end of period (see note below) 90,062 91,047 86,779
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Total active memberships at end of
period 1,509,735 1,524,919 1,505,871
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Active "add-on" IDT memberships at
end of period (see note below) 697,468 702,266 670,769
New Sales Associates:
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New sales associates recruited 36,313 37,640 25,172
Average enrollment fee paid by new
sales associates $70.58 $70.30 $120.98
Average Membership fee in force:
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Average Annual Membership fee $303.74 $302.13 $301.37
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Note - reflects 3,958 net transfers from "add-on" status to "stand-
alone" status during the quarter.
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<p>Our total active membership fees in force increased 1% during the last twelve months. Membership persistency rate (defined as the number of memberships in force at the end of a 12 month period as a percentage of the total of memberships in force at the beginning of such period, plus new memberships sold during such period) was 72.3% for the 12 month period ended <span class="xn-chron">June 30, 2010</span>, an increase from the 72.1% for the 12 month period ended <span class="xn-chron">June 30, 2009</span>.</p>
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<p>During the 2010 2nd quarter, we returned <span class="xn-money">$3.8 million</span> to shareholders through the repurchase of 84,297 shares of common stock, at an average per share price of <span class="xn-money">$45.15</span>. Since <span class="xn-chron">April 1999</span>, we have returned <span class="xn-money">$463.2 million</span> to shareholders through the purchase of 15.2 million shares, at an average price of <span class="xn-money">$30.43</span> per share, and <span class="xn-money">$17.1 million</span> in dividends for a combined total of <span class="xn-money">$480.3 million</span> representing more than 100% of our net earnings during the same timeframe.</p>
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<p>We anticipate announcing our 2010 second quarter financial results on <span class="xn-chron">Wednesday, July 21, 2010</span> after the market closes. The Company will conduct a conference call to present the second quarter results on <span class="xn-chron">Friday, July 23, 2010</span>, at <span class="xn-chron">8:30 a.m. Eastern Time</span>. The conference call will be webcast on the investor relations' page of <a href="http://www.prepaidlegal.com">www.prepaidlegal.com</a> or may be accessed by dialing (970) 315-0440. Audio replay will be available beginning at <span class="xn-chron">11:30 a.m. Eastern Time</span> on <span class="xn-chron">July 23, 2010</span> and will run through midnight <span class="xn-chron">Friday, July 30, 2010</span> by dialing (706) 645-9291; conference ID for the replay is 79886196. The presentation will be available on the web site indefinitely by selecting "Earnings Calls" under the "Investor Relations" section. Questions may be submitted prior to the call via email to <a href="mailto:[email protected]">[email protected]</a>.</p>
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About Us
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<p>We believe our products are one of a kind, life events legal service plans. Our plans provide for legal service benefits provided through a network of independent law firms across the U.S. and <span class="xn-location">Canada</span>, and include unlimited attorney consultation, will preparation, traffic violation defense, automobile-related criminal charges defense, letter writing, document preparation and review and a general trial defense benefit. We have an identity theft restoration product we think is also one of a kind due to the combination of our identity theft restoration partner and our provider law firms. More information about us and our products can be found at our homepage at <a href="http://www.prepaidlegal.com">http://www.prepaidlegal.com</a>.</p>
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Forward-Looking Statements
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<p>Statements in this press release, other than purely historical information, regarding our future plans and objectives and expected operating results, dividends and share repurchases and statements of the assumptions underlying such statements, constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements contained herein are based on certain assumptions that may not be correct. They are subject to risks and uncertainties incident to our business that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are described in the reports and statements filed by us with the Securities and Exchange Commission, including (among others) those listed in our Form 10-K, Form 10-Q and Form 8-K, and include the risks that our membership persistency or renewal rates may decline, that we may not be able to continue to grow our memberships and earnings, that we are dependent on the continued active participation of our principal executive officer, that pending or future litigation may have a material adverse effect on us if resolved unfavorably to us, that we may have compromises of our information security, that consumer purchases of discretionary items may be impacted by a downturn in the economy, that we could be adversely affected by regulatory developments, that competition could adversely affect us, that we are substantially dependent on our marketing force, that our stock price may be affected by short sellers, that we have been unable to increase our employee group membership sales, that our active premium in force is not indicative of future revenue as a result of changes in active memberships from cancellations and additional membership sales and that we have repurchased more than half of our outstanding shares. Please refer to pages 16 through 19 of our 2009 Form 10-K and pages 7 and 8 of our <span class="xn-chron">March 31, 2010</span> Form 10-Q for a more complete description of these risks. We undertake no duty to update any of the forward-looking statements in this release.</p>
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For further information: Steve Williamson of Pre-Paid Legal Services, Inc., +1-580-436-1234 Web Site: http://www.prepaidlegal.com
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