The Loyalist Insurance Group Ltd. announced on Friday that revenue for the year ended Dec. 31, 2006 increased to $2.1 million from $2 million in 2005.

Expenses for the year were $2.4 million compared to $2.3 million in 2005. Loss from operations was $50,399 vs a loss of $266,040 in the prior year. Cash balances decreased to $4,834 from $22,482 for the same period as the prior year. Cash and short-term investments in trust decreased to $563,777 from slightly more than $1 million for the same period in 2005. The decrease was primarily due to the timing of collection of accounts receivable and accounts payable of one significant commercial brokerage account.

In July 2006, Loyalist Insurance Brokers Ltd., a subsidiary of the company, negotiated the sale of a minor portion of its book of business to a former employee for cash consideration of approximately $174,000. This resulted in a gain on sale of approximately $174,000.

In August 2006, LIB received full payment for a note receivable from the sale of its St. Catharines, Ont. division. Payment consisted of a note receivable for $100,000. LIB made a reserve provision for the entire amount of the note prior to the end of 2005.

During the year, LIB successfully renewed two significant brokerage accounts in excess of $1.5 million in insurance premiums.

Proceeds from previous asset sales and investments in the past two years have been used to reduce debt obligations of the company. This has improved its liquidity.

Loyalist divested its investments in various subsidiary companies in 2005 and prior years. The company no longer owns any interest in insurance underwriting or the mutual fund asset management business. This allowed the firm to re-focus completely on its profitable core operations.

The company has eliminated operations that had negative cash flow and/or that were capital intensive with a historic low return on equity. The company’s management resources are now better utilized pursuing profitable businesses in which it has experience and expertise.

Loyalist Insurance Brokers continues to pursue revenue growth through internal sales and its recruitment of new key personnel. The plan is to enhance this strategy over the next year.