Reno, NV – Employers Holdings, Inc. (NYSE:EIG) recently reported net income and net income excluding the impact of the LPT of $35.5 million, or $1.08 per diluted share, and $32.6 million, or $0.99 per diluted share, respectively, for the fourth quarter of 2016. Operating income was $31.3 million, or $0.95 per diluted share, for the quarter ended December 31, 2016. The Company’s loss ratio before the LPT decreased 5.8 percentage points in the quarter. The Company’s commission expense ratio declined 0.9 percentage points and the underwriting and other operating expense ratio declined 0.6 percentage points, each compared to the previous year’s fourth quarter. We repurchased common shares worth $2.5 million in the fourth quarter.
For the full year 2016, net income was $106.7 million, or $3.24 per diluted share, and net income excluding the impact of the LPT was $90.1 million, or $2.73 per diluted share. Operating income was $83.0 million, or $2.52 per diluted share. The combined ratio was 91.8% while the combined ratio before the impact of the LPT was 94.1%. The accident year combined ratio before the impact of the LPT was 96.8%. During the year, we repurchased $21.1 million in common shares. The Company had approximately 32.1 million common shares outstanding as of December 31, 2016.
In addition, today EHI announced that the Board of Directors has voted to raise the Company’s quarterly dividend to $0.15 per share of common stock. This represents a 67% increase over the previous quarterly rate of $0.09 per share. The dividend is payable on March 22, 2017 to stockholders of record as of March 8, 2017.
Chief Executive Officer Douglas Dirks commented on the results:
“We are very pleased with our performance in the quarter and the year 2016. For these reporting periods, we delivered improved underwriting profitability demonstrated in historically low combined ratios. We increased net income and achieved historically high returns on equity while growing our book value per share by 8%. We lowered our provision rate for losses in the then current accident year and, in the fourth quarter, we released $16.9 million of reserves for prior accident years. Our strong fourth quarter and full year performance continues to reflect, in large part, the results of our ongoing initiatives to close claims on an accelerated basis and to grow and diversify across our markets using data-driven strategies.
“We are also pleased to report that, in the fourth quarter, we returned approximately $2.5 million to our shareholders through share repurchases and $2.9 million in dividends. The Board of Directors announced today that it is raising the dividend from $0.09 per common share to $0.15 per common share effective the first quarter of 2017, demonstrating our continued confidence in the financial strength of the Company.
“We remain committed to delivering profitable results over the long-term as we further strengthen our technological capabilities and our national presence. We now operate in 36 of our 44 targeted states.”
The complete results release is available here: Employers Holdings, Inc. Q4 and Full Year 2016 Results