What is the ruling on someone who says "I am an atheist" while believing in God and His Messenger and not praying? Is he excused by ignorance? And is the failure to disseminate the religious ruling on this considered concealment of knowledge?

An atheist is someone who denies the existence of the Creator, Glory be to Him and Exalted. If your sister uttered this statement while being sane, of her own free will, and aware of its meaning, then she has apostatized from Islam. The Hanafis have deemed someone who says, "I am an atheist," to be an infidel, because he is a disbeliever. Scholars have agreed on deeming anyone who utters a statement of disbelief to be an infidel, whether it be out of mockery, stubbornness, or conviction. It is incumbent upon your sister to offer sincere repentance, renew her faith by uttering the two testimonies of faith (Shahadatayn), and affirm what she denied if she had denied an obligation such as prayer. Your not mentioning the ruling for someone who says "I am an infidel" or "I am a Jew" regarding your sister is not considered concealment of knowledge.