The Progressive Corporation CEO Discusses Q3 2010 Results – Earnings Call Transcript
The Progressive Corporation (
)
Q3 2010 Earnings Conference Call
November 9, 2010 9:00 AM ET
Executives
Clark Khayat – Head of Corporate Development
Glenn Renwick – President and CEO
Brian Domeck – VP and CFO
Analysts
Josh Shanker – Deutsche Bank
Vinay Misquith – Credit Suisse
Keith Walsh – Citi
Raymond Ardella [ph] – Oppenheimer
Doug Mewhirter – RBC Capital Markets
Vincent D’Agostino – Stifel Nicolaus
Ian Gutterman – Adage Capital
Brian Meredith – UBS
James Engle – John W. Bristol & Co.
Presentation
Operator
Compare to:
Previous Statements by PGR
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Progressive Q2 2010 Earnings Call Transcript
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The Progressive Corporation 2010 Annual Investor Relations Meeting Transcript
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Progressive Corporation Q4 2009 Earnings Call Transcript
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Progressive Corp. Q3 2009 Earnings Call Transcript
Welcome to the Progressive Corporation’s Investor Relations Conference Call. This conference call is available via an audio webcast. Webcast participants will be able to listen only throughout the duration of the call.
In addition, this conference is being recorded at the request of Progressive. If you have any objections, you may disconnect at this time.
The company will not make detailed comments in addition to those provided on its quarterly report on Form 10-Q, Shareholders’ Report and Letter to Shareholders, which have been posted to the company’s website, and will use this conference call to respond to questions. Acting as moderator for the call will be Clark Khayat. At this time, I will turn the call over to Mr. Khayat.
Clark Khayat
Thank you, and good morning. Welcome to Progressive’s Third Quarter Conference Call. Participating on today’s call are Glenn Renwick, our CEO; Brian Domeck, our CFO; and also on the line is Bill Cody, our Chief Investment Officer. Call is scheduled to last about an hour.
Statements in this conference call that are not historical facts are forward-looking statements that are subject to certain risks and uncertainties that could cause actual events and results to differ materially from those discussed herein.
These risks and uncertainties include, without limitation, uncertainties related to estimates, assumptions and projections generally; inflation and changes in interest rates and security prices; the financial condition of, and other issues relating to the strength of, and liquidity available to, issuers of securities held in our investment portfolios, and other companies with which we have ongoing business relationships, including counterparties to certain financial transactions; the accuracy and adequacy of our pricing and loss reserving methodologies; the competitiveness of our pricing and the effectiveness of our initiatives to retain more customers; initiatives by competitors and the effectiveness of our response; our ability to obtain regulatory approval for requested rate changes and the timing thereof; the effectiveness of our brand strategy and advertising campaigns relative to those of competitors; legislative and regulatory developments, including but not limited to, healthcare reform and tax law changes; disputes relating to intellectual property rights; the outcome of litigation pending or that may be filed against us; weather conditions; changes in driving patterns and loss trends; acts of war and terrorist activities; our ability to maintain the uninterrupted operation of our facilities, systems and business functions; court decisions and trends in litigation and healthcare and auto repair costs; and other matters described from time to time by us in other releases and publications.
In addition, investors should be aware that Generally Accepted Accounting Principles prescribed when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when a reserve is established for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude as additional information regarding claims activity becomes known. Reported results therefore may be volatile in certain accounting periods.
We are now ready to take our first question.
Question-and-Answer Session
Operator
(Operator Instructions) Our first question is from Josh Shanker with Deutsche Bank. Your line is now open.
Josh Shanker – Deutsche Bank
Well, good morning. My first question, I’m interested to know the schedule and what the plans are for potentially new marketing campaign beginning in 2011 in terms of whether you are introducing a new ads, (inaudible) what not – the plans mostly television-oriented?
Glenn Renwick
Yes, I’m happy to talk about that. I don’t think we have said too publicly about this, but as we go into next year, we will complement or augment which we might choose current superstore campaign with another campaign that we now have developed, and are quite excited about it. We’ll just be very little bit of consumer testing in the fourth quarter, but you will see that more as a companion piece to our current superstore campaign, we’re very happy with superstore campaign, and we have several new ads that have yet to be shown, as well. Some of those will start to appear in the fourth quarter. But we have a couple of rounds that mostly new material.
So as we look forward to the first quarter of next year, which as most of you know, is very important quarter or time of the year for buying. We really have a nice inventory of the superstore campaign and something additional to add to that. Along with that, we actually expect probably later in the first quarter, maybe around the cusp of the first and second quarter, to be going more national with our Snapshot advertising. So we have some Snapshot advertising designed already and available for a local market test but we’ll wait until we have a slightly increased number of states with our Snapshot. We’ve got 24 there in direct today. I think we put that in the 10-Q, and we’ll have at least 75% of the country covered by that offering, and we’ll nationally advertise it around the end of that quarter.
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