Mercury General Sees 1Q Profit, Beats Street

LOS ANGELES (AP) — Mercury General Corp., which provides automobile, homeowners and commercial property insurance, on Monday reported a first-quarter profit, reversing a year-ago loss, helped by investment gains even as written premiums declined and the company cut 7 percent of its work force.

The results beat Wall Street estimates.

Quarterly profit at the Los Angeles-based company totaled $96.7 million, or $1.75 per share, compared with year-ago loss of $4 million, or 7 cents per share. The latest period includes investment gains of $50.7 million, or 92 cents per share, compared with losses of $59.9 million, or $1.09 per share, in the 2008 period.

Operating profit, a measure most commonly used by insurance analysts, was 83 cents per share in the January to March period, down from $1.02 per share last year.

Analysts surveyed by Thomson Reuters had expected profit excluding one-time items of 64 cents per share, on average.

Mercury General said it cut 360 jobs in the quarter, as well as suspended its employee 401(k) matching program to cut costs. The company took an $8 million charge in the first quarter related to the job cuts.