in the second quarter, losing $492,097 in the three months to June 30.

American Safety said the loss, which compared with a $1.44 million profit in the same period a year earlier, was due to additional overhead and expense for new operating units, including a reinsurance underwriting management group, that ASIG added in the quarter.

The company said on Friday that net operating earnings for the second quarter of 2000 decreased to a loss of $412,433, or $.07 per diluted share on 5.5 million average shares outstanding, compared with earnings of $1,342,422, or $.22 per diluted share on 6.1 million average shares outstanding for the second quarter of 1999.

Net earnings for the second quarter of 2000 decreased to a loss of $492,097, or $.09 per diluted share, compared with earnings of $1,441,397, or $.24 per diluted share, for the second quarter of 1999.

Total revenues for the second quarter of 2000 increased 40 percent to $8,137,867 compared with $5,825,595 for the same quarter of 1999. Net premiums earned for the second quarter of 2000 increased 68 percent to $6,056,533 over the same quarter of 1999.

For the six months ended June 30, 2000, net operating earnings decreased to a loss of $2,235,139, or $.39 per diluted share on 5.7 million average shares outstanding (including the first quarter charge due to the company's rescission of the acquisition of a Michigan agency and two related insurance companies), compared with earnings of $3,062,718, or $.50 per diluted share on 6.1 million average shares outstanding over the same period in 1999.

Net earnings decreased to a loss of $2,440,850, or $.43 per diluted share, compared with earnings of $3,160,575, or $.52 per diluted share for the same period in 1999. Total revenues increased 46 percent to $15,731,766 compared with $10,755,220 over the same period in 1999.

Lloyd A. Fox, president and chief executive officer, said the company was pleased with the continued growth of insurance operations during the second quarter.

He said the net operating loss sustained during the second quarter was in large part attributable to additional overhead and expense for new operating units that the company added.

"The significant investments that we have made in experienced personnel in our insurance and financial services units are beginning to show increased production, and we expect that these underwriting groups will result in profitable operations as they continue to build their businesses this year,'' he said.