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Travelers Reports Record Net Income Per Diluted Share Of $2.41, Up 91% From Prior Year Quarter

Stocks in this article: TRV

The Travelers Companies, Inc. today reported net income of $925 million, or $2.41 per diluted share, for the quarter ended June 30, 2013, compared to $499 million, or $1.26 per diluted share, in the prior year quarter. Operating income in the current quarter was $816 million, or $2.13 per diluted share, compared to $495 million, or $1.26 per diluted share, in the prior year quarter. The increase in net and operating income compared to the prior year quarter primarily resulted from lower catastrophe losses, higher underlying underwriting margins (i.e., excluding net favorable prior year reserve development and catastrophe losses), and favorable tax and legal settlements, partially offset by lower net investment income and lower net favorable prior year reserve development. Net income also benefited from higher net realized investment gains.

Consolidated Highlights

               

($ in millions, except for per share amounts, and after-tax, except for premiums & revenues)

  Three Months Ended June 30,       Six Months Ended June 30,  
2013   2012   Change 2013   2012   Change
 
Net written premiums $ 5,824 $ 5,868 (1 ) % $ 11,421 $ 11,365

-

%

 
 
Total revenues $ 6,674 $ 6,359 5 $ 13,002 $ 12,751 2
 
Operating income $ 816 $ 495 65 $ 1,703 $ 1,296 31
per diluted share $ 2.13 $ 1.26 69 $ 4.44 $ 3.27 36
 
Net income $ 925 $ 499 85 $ 1,821 $ 1,305 40
per diluted share $ 2.41 $ 1.26 91 $ 4.75 $ 3.29 44
 

Diluted weighted average shares outstanding

379.9 391.6 (3 ) 380.8 393.5 (3 )
 
GAAP combined ratio 94.3 % 100.5 % (6.2 ) pts 91.4 % 96.3 % (4.9 ) pts
 
Underlying GAAP combined ratio 91.7 % 94.5 % (2.8 ) pts 91.3 % 94.6 % (3.3 ) pts
 
Operating return on equity

14.2

% 9.0 % 5.2 pts 15.0 % 11.8 % 3.2 pts

 

 

Return on equity 14.6 % 8.0 % 6.6 pts 14.4 % 10.5 % 3.9 pts
 

Change from

June 30,

December 31,

June 30,

December 31,

June 30,

2013

2012

2012

2012

2012

 

Book value per share

$

66.65

$

67.31

$  64.90

 

(1

)%

 

3

%

 

 

Adjusted book value per share

 

62.12

 

59.09

57.18

 

5

 

9

 

 
See Glossary of Financial Measures for definitions and the statistical supplement for additional financial data.
 

“Results for the quarter were very strong, with net income of $925 million and return on equity of 14.6%,” commented Jay Fishman, Chairman and Chief Executive Officer. “Operating return on equity was 14.2% for the quarter and 15.0% on a year-to-date basis, a significant improvement over prior year results primarily due to lower catastrophe losses and continued improvement in our underlying underwriting margins.

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