Boston, MA – Liberty Mutual Holding Company Inc. and its subsidiaries recently reported net income attributable to LMHC of $15 million and $408 million for the three and six months ended June 30, 2016, decreases of $239 million and $122 million from the same periods in 2015. Including $5 million of net loss and $5 million of net income attributable to non-controlling interest, consolidated net income for the three and six months ended June 30, 2016 was $10 million and $413 million, respectively.
“Energy investments continue to have a detrimental effect on overall results” said David H. Long, Liberty Mutual Insurance Chairman and CEO. “Pre-tax losses from energy were $220 million in the quarter, including $110 million in impairments. Total realized investment losses were $95 million versus a gain of $241 million last year, leading to net income of $15 million in the quarter versus $254 million a year ago.”
“Investments aside, net operating income was $123 million in the quarter, up 12% despite elevated catastrophe losses, combined ratio improved 1.2 points to 101.4%, and net written premium increased 1.2% after the impact of foreign exchange.”
Second Quarter Highlights
Net written premium (“NWP”) for the three months ended June 30, 2016 was $9.018 billion, an increase of $103 million or 1.2% over the same period in 2015.
Pre-tax operating income (“PTOI”) before partnerships, limited liability companies (“LLC”) and other equity method (loss) income for the three months ended June 30, 2016 was $173 million, an increase of $24 million or 16.1% over the same period in 2015.
Net operating income before partnerships, LLC and other equity method (loss) income for the three months ended June 30, 2016 was $123 million, an increase of $13 million or 11.8% over the same period in 2015.
Partnerships, LLC and other equity method (loss) income for the three months ended June 30, 2016 was ($59) million, versus $51 million in the same period in 2015.
Net realized (losses) gains for the three months ended June 30, 2016 were ($95) million, versus $241 million in the same period in 2015.
Consolidated net income from continuing operations for the three months ended June 30, 2016 was $10 million, a decrease of $286 million or 96.6% from the same period in 2015.
Discontinued operations, net of tax for the three months ended June 30, 2016 were zero versus ($47) million in the same period in 2015.
Net income attributable to LMHC for the three months ended June 30, 2016 was $15 million, a decrease of $239 million or 94.1% from the same period in 2015.
Cash flow provided by operations for the three months ended June 30, 2016 was $346 million, a decrease of $295 million or 46.0% from the same period in 2015.
The consolidated combined ratio before catastrophesa, net incurred losses attributable to prior yearsb and current accident year re-estimationc for the three months ended June 30, 2016 was 91.4%, an improvement of 1.2 points over the same period in 2015. Including the impact of catastrophes, net incurred losses attributable to prior years and current accident year re-estimation, the Company’s combined ratio for the three months ended June 30, 2016 improved 1.2 points to 101.4%.
Year-to-date Highlights
NWP for the six months ended June 30, 2016 was $17.790 billion, an increase of $149 million or 0.8% over the same period in 2015.
PTOI before partnerships, LLC and other equity method loss for the six months ended June 30, 2016 was $787 million, an increase of $93 million or 13.4% over the same period in 2015.
Net operating income before partnerships, LLC and other equity method loss for the six months ended June 30, 2016 was $528 million, an increase of $14 million or 2.7% over the same period in 2015.
Partnerships, LLC and other equity method loss for the six months ended June 30, 2016 were $36 million, an increase of $34 million over the same period in 2015.
Net realized (losses) gains for the six months ended June 30, 2016 were ($134) million, versus $278 million in the same period in 2015.
Consolidated net income from continuing operations for the six months ended June 30, 2016 was $413 million, a decrease of $273 million or 39.8% from the same period in 2015.
Discontinued operations, net of tax for the six months ended June 30, 2016 were zero versus ($165) million in the same period in 2015.
Net income attributable to LMHC for the six months ended June 30, 2016 was $408 million, a decrease of $122 million or 23.0% from the same period in 2015.
Cash flow provided by operations for the six months ended June 30, 2016 was $645 million, a decrease of $489 million or 43.1% from the same period in 2015.
The consolidated combined ratio before catastrophes and net incurred losses attributable to prior years for the six months ended June 30, 2016 was 91.0%, an improvement of 1.4 points over the same period in 2015. Including the impact of catastrophes and net incurred losses attributable to prior years, the Company’s combined ratio for the six months ended June 30, 2016 improved 1.0 point to 98.9%.
Financial Condition as of June 30, 2016
Total debt was $8.002 billion as of June 30, 2016, an increase of $813 million or 11.3% over December 31, 2015.
Total equity was $21.206 billion as of June 30, 2016, an increase of $1.965 billion or 10.2% over December 31, 2015.
The complete results release is available here: Liberty Mutual Insurance Second Quarter 2016 Results
Source: Liberty Mutual
Disclosure:
Liberty Mutual subsidiary Helmsman is a WorkCompWire ad partner.
This is not a paid placement.