Travelers Companies TRV reported third-quarter earnings that rang in above analysts forecasts as a drop in what it calls catastrophic losses related to natural disasters like fires and hurricanes offset record net written premiums.
The New York-based property insurer said it earned $662 million U.S. or $2.62 a share, down from $827 million or $3.23 a share a year ago. Analysts polled by FactSet had been expecting per-share earnings of $1.88 a share.
Revenue came in at $8.8 billion, below the $8.3 billion posted a year ago, but also above analysts forecasts of $8.2 billion. Net written premiums were $8.32 billion vs. $7.77 billion in the third quarter of 2020.
Catastrophic events including storms and other natural disasters were partially responsible for the lower year-on-year numbers, Travelers said, though that was partially offset by higher net investment income and a higher underlying underwriting gain.
The company clocked catastrophe losses of $501 million pre-tax compared to $397 million pre-tax in the prior year quarter. Offsetting that was a record $8.32 billion in net written premiums, which was up 7 per cent from the previous quarter.
These results, together with our strong balance sheet, enabled us to return $821 million of excess capital to shareholders this quarter, including $601 million of share repurchases, CEO Alan Schnitzer said in a statement, noting that below-market share losses from Hurricane Ida were a direct result of the company s focus on streamlining its operations and becoming more efficient.
Meantime, the company board said it approved a quarterly cash dividend of 88 cents a share. It also said it repurchased 3.8 million shares during the third quarter at an average price of $155.56 a share for a total of $601 million.
At the end of the quarter, statutory capital and surplus was $22.9 billion and the ratio of debt-to-capital was 20.4 per cent.
Shares of Travelers were up 2.63 per cent at $156.90 in premarket trading.