Conseco Inc. made money in the fourth quarter, but that profit was cut in half by the costs of pending legal settlements, the Carmel-based insurance company announced Wednesday night.

The company earned $18.2 million, or 9 cents per diluted common share, compared with a whopping loss in the same quarter a year ago of $453.3 million, or $2.45 per share.

Revenue for the quarter rose 1 percent, to $1.06 billion.

Profits were pared in the most recent quarter by investment losses, additional debt payments and a change in the value of tax assets. Excluding those effects, Conseco would have earned $32 million, or 15 cents per share, down by 4 percent from a year ago.

Conseco's operating results were dampened because it set aside $16 million to settle legal cases. One case involves 700 former life insurance policyholders who opted out of a previous class-action settlement. The other cases concerns 15,000 former customers who held Conseco’s Lifetrend insurance. This spending reduced earnings by 4 cents per share.

Excluding all those special items, Conseco would have earned 19 cents per share. On that adjusted basis, Wall Street analysts expected Conseco to earn 20 cents per share, according to a survey by Thomson Financial Network.

"We are pleased to report that Conseco delivered its fourth consecutive profitable quarter," CEO Jim Prieur said in a statement. He highlighted that Conseco’s sales of new life and health insurance policies surged 18 percent in the quarter, compared with the same period a year ago.

Conseco posted sales gains of 28 percent at its Chicago-based Bankers Life unit and a gain of 4 percent at its Carmel-based Conseco Insurance Group. However, the company’s Colonial Penn subsidiary, based in Philadelphia, saw its sales drop 22 percent compared with the fourth quarter last year.

For the year, Conseco’s profits totaled $85.7 million, or 45 cents per share, compared with a loss in 2008 of $1.1 billion, which was fueled by a major restructuring that transferred a block of money-losing policies to an aging trust.

Income from operations totaled $164.6 million last year, up 20 percent from 2008 operating income of $137 million.

Revenue in 2009 clocked in at $4.3 billion, up nearly 4 percent from 2008.