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ALLSTATE REPORTS IMPROVED THIRD-QUARTER RESULTS

 NORTHBROOK, Ill., Oct. 21 /PRNewswire/ -- The Allstate Corporation (NYSE:ALL) today reported higher revenue and income for the third quarter ended Sept. 30, 1993. The company cited lower catastrophe losses and higher realized capital gains on its investment portfolio than a year ago in accounting for its improved bottom-line results.
 Consolidated net income for 1993's third quarter totaled $325.7 million, or 72 cents per share against a net loss of $845.8 million, or a pro forma loss of $1.96 per share, for the third quarter of 1992. Third quarter 1992 results included a loss of $1.14 billion due to Hurricane Andrew, the company explained; for the full year 1992, Allstate recorded a loss of $1.65 billion from the hurricane. The company noted that 1993 net income included a favorable income tax adjustment of $27.5 million resulting from the federal income tax rate change enacted in August.
 Allstate's Chairman and Chief Executive Officer, Wayne Hedien, commented that ``Operating results continue to remain strong and in line with expectations. Although auto frequencies were higher in the quarter, underlying auto loss costs continue to be at very positive levels.''
 Consolidated operating income for the quarter was $298.7 million, or 67 cents per share, versus an operating loss of $844.1 million, or a pro forma loss of $1.96 per share for the year-earlier period. Average shares outstanding in the third quarter, the company said, totaled 450 million compared to pro forma shares outstanding of 431 million in 1992. Excluding the impact of Hurricane Andrew in 1992, operating income for last year's third quarter totaled $299.5 million, or pro forma operating earnings per share of 70 cents. Revenues for the quarter rose 4.9 percent to $5.32 billion from $5.07 billion for the third quarter 1992.
 Consolidated net income for the first nine months of 1993 totaled $1.04 billion, or $2.42 per share, compared to the year earlier's loss of $360.7 million, or a pro forma loss per share of 84 cents before the cumulative effect of accounting changes. After accounting changes that totaled $325.6 million, the net loss for the first nine months of 1992 was $686.3 million, or $1.59 per share. The 1992 results included a $1.14 billion loss from Hurricane Andrew. Revenues for the nine months rose 3.8 percent to $15.66 billion from $15.09 billion for the same period in 1992.
 PROPERTY-LIABILITY OPERATIONS
 Income from property-liability operations for the third quarter was $330.3 million compared to a loss of $851.5 million for the same period in 1992. Underwriting losses for the 1993 quarter totaled $119 million versus a loss of $107 million excluding pre-tax losses from Hurricane Andrew of $1.73 billion.
 Underwriting results were under pressure in the quarter. Auto frequency (rate of occurrence) and severity (average cost per claim) were slightly higher. However, the increase in severity continues to be lower than corresponding inflation indicators. In addition, expenses were higher than the 1992 third quarter because of the recognition of certain employee-related costs and higher local taxes, while 1992 third quarter expenses benefitted from the sale of a foreign branch office.
 Catastrophe losses for the third quarter totaled $46.7 million compared to $186.3 million excluding Hurricane Andrew for the year-ago quarter. Including Hurricane Andrew, catastrophe losses totaled $1.92 billion for the third quarter of 1992.
 Investment income from property-liability operations for 1993's third quarter was $369.3 million compared to $366.4 million a year ago. Higher investment balances were offset, the company said, ``by historically low interest rates, which continued through the period.'' Growth in investments was driven primarily by strong cash flow from operations and increased available capital funds. Realized capital gains, net of tax, totaled $41.9 million, and were up from $18.8 million in the year-ago period due to favorable market conditions.
 Third quarter revenues from property-liability operations rose 3.8 percent to $4.56 billion from $4.39 billion for the same period in 1992. Premiums earned increased 4.3 percent after giving effect to the company's exit from national commercial coverages in 1992.
 For the first nine months of 1993, income from property-liability operations totaled $960.3 million versus a loss of $423.6 million a year earlier, before accounting changes. The underwriting loss for the nine months was $280 million compared to a loss of $578.8 million excluding pre-tax losses from Hurricane Andrew of $1.73 billion. The improvement in underwriting results is primarily due to lower catastrophe losses other than Hurricane Andrew. Catastrophe losses for the first nine months totaled $389.9 million compared to $584.1 million excluding Hurricane Andrew. Including Hurricane Andrew, catastrophe losses totaled $2.32 billion for the first nine months of 1992.
 Investment income from property-liability operations for the first nine months declined 2.5 percent to $1.08 billion from $1.11 billion for the same period last year. The decrease resulted from declining interest rates and lower funds available for investment during the first half of the year due to catastrophe claim payments, principally from Hurricane Andrew. Realized capital gains, net of tax, totaled $130.7 million for the first nine months compared to $65.3 million for the first nine months of 1992. Allstate said that the increase ``is attributable primarily to the sale of investments to take advantage of favorable market conditions during the period.''
 Revenues from property-liability operations for the first nine months rose 3.4 percent to $13.46 billion from $13.02 billion for the same period last year. Premiums earned grew 4.6 percent after giving effect to the company's exit from national commercial coverages last year.
 LIFE OPERATIONS
 Income from life operations for 1993's third quarter totaled $8.1 million, including a non-recurring charge of $17.5 million related to management's decision to discontinue the use of a policy processing system. Excluding this non-recurring charge, income totaled $25.6 million versus $5.7 million for the year-ago quarter. ``This improvement,'' Allstate said, ``is primarily the result of stronger operating income.'' Realized capital losses, net of tax, were $14.9 million versus $20.5 million for the year-ago quarter. Revenues from life operations increased 11.8 percent to $750.1 million in the quarter, up from $670.8 million for the prior year's third quarter.
 For 1993's first nine months, income from life operations rose to $121.1 million from $62.9 million a year earlier before accounting changes. The improvement is primarily the result of stronger operating income before the non-recurring charge and lower commercial mortgage loan losses. Revenue for the nine months increased 6.1 percent to $2.19 billion from $2.07 billion for the comparable period a year ago. Invested assets, including Separate Accounts, rose to $23.82 billion at Sept. 30, 1993, an increase of $2.56 billion, or 12 percent, from Sept. 30, 1992.
 Earlier this month, Allstate, through its wholly owned subsidiaries, Allstate Life Insurance Co. and Northbrook Life Insurance Co., announced a strategic alliance to develop, market and distribute proprietary annuity and life insurance products through Dean Witter account executives.
 Allstate Corporation Chairman Hedien noted that ``over the last 10 years, we have developed a powerful working relationship with Dean Witter to provide annuity products to Dean Witter clients. We believe all parties have benefitted from this relationship and with this new alliance, our relationship with Dean Witter and their clients will grow even stronger.''
 The Allstate Corporation is the parent of Allstate Insurance Company, the nation's largest publicly held property and casualty insurance company, with more than 20 million customers and approximately 14,500 full-time agents in the U.S. and Canada. Established in 1931 by Sears, Roebuck and Co., Allstate is also a major life insurer. In June 1993, Allstate had the largest initial public offering of stock in U.S. history.
 -0- 10/21/93
 /CONTACT: Kathleen Hogan 708-402-5600, Allstate/


CO: The Allstate Corporation ST: Illinois IN: INS SU: ERN

DH -- NY033 -- 5194 10/21/93 12:08 EDT
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Date:Oct 21, 1993
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