Worcester, MA – The Hanover Insurance Group, Inc. (NYSE: THG) recently reported net income of $11.1 million, or $0.26 per diluted share, for the third quarter of 2017, compared to net income of $88.4 million, or $2.06 per diluted share, in the prior-year quarter. Operating income(1) was $4.7 million, or $0.11 per diluted share, for the third quarter of 2017, compared to $78.6 million, or $1.83 per diluted share, in the prior-year quarter.
Third Quarter Highlights
- Current accident year catastrophe losses* of $202.4 million before taxes, or 16.5% of earned premiums, primarily due to hurricanes Harvey, Irma, and Maria and earthquakes in Mexico
- Combined ratio, excluding catastrophes(2), of 88.9%, an improvement of 3.0 points over the prior-year quarter
- Net premiums written of $1.3 billion; up 5.7%, driven primarily by growth in Personal and Commercial Lines
- Continued price increases in Commercial and Personal Lines
- Net investment income of $76.6 million, up 13.0% compared to the prior-year quarter
- Book value per share of $70.10, down 0.1% from the second quarter of 2017; book value per share, excluding net unrealized gains on investments(3), of $64.71, down 0.2% from the second quarter of 2017
“The third quarter was defined for our industry by exceptional catastrophe activity. Our teams of professionals are working tirelessly, providing our partners and customers with responsive service needed to help them recover as quickly as possible,” said Jeffrey M. Farber, executive vice president and chief financial officer. “Despite this catastrophe activity, we delivered a profit for the quarter, demonstrating the strength of our underwriting and risk management practices. Catastrophes aside, we reported strong underlying results in both our domestic and international businesses, underscored by an overall ex-cat combined ratio of 88.9%, an improvement of three points from the prior-year quarter. Our results were supported by stable or improving accident year loss trends in our businesses, as well as by execution on the expense savings initiatives we laid out last quarter.
“We are also pleased with our top-line growth of 5.7%, driven by continued strong renewal and new business metrics of our account-focused Personal Lines business, increasing momentum in Commercial Lines, as well as thoughtful management of our international specialty business.
“Our CEO transition is well underway, and Jack Roche is ready to assume the role of president and chief executive officer of The Hanover on November 4th,” said Farber. “We are well aligned, committed and more energized than ever to deliver on the key elements of our strategy and deliver value to our shareholders.”
The complete results release is available here: The Hanover Third Quarter 2017 Results
Source: The Hanover