Hartford Profit Tops Estimate

(RTTNews) - Hartford Financial Services Group Inc. (HIG) on Monday reported a swing to profit for the second quarter, helped mainly by improved underwriting results in property and casualty business, and contribution from Talcott Resolution, while the prior year included a one-time loss from discontinued operations. Hartford's quarterly earnings easily topped Wall Street estimates, while revenues fell shy of expectations.

The insurer also increased its share buyback program by $1.6 billion, and raised dividend by 17 percent to $0.21 per share.

"The Hartford delivered strong financial and operational performance for the second quarter of 2015, reporting improved results across all of our businesses," said CEO Christopher Swift.

"Looking ahead, we have the right strategy, capabilities and people to drive our continued success in a dynamic marketplace."

The Hartford, Connecticut-based insurer reported quarterly net earnings of $413 million or $0.96 per share, compared with a loss of $467 million or $1.00 per share last year.

The prior year results included had a loss of $1.32 per share from discontinued operations linked to the Japan annuity business sale.

Excluding items, core earnings for the quarter were $389 million or $0.91 per share, compared with $144 million or $0.31 per share in the prior year. On average, 17 analysts polled by Thomson Reuters expected Hartford to report earnings of $0.77 per share for the quarter. Analysts' estimates typically exclude special items.

The improvement in P&C underwriting results included better current accident year loss results. The results show lower unfavorable prior year loss and loss adjustment expense reserve development related to the company's annual ground-up asbestos and environmental study.

Higher core earnings in Talcott Resolution were due to a $48 million tax benefit and the impact of a strong investment income, principally from higher limited partnership and other alternative investments.

Hartford's revenues for the quarter increased to $4.69 billion from $4.62 billion a year ago. Three analysts had a consensus revenue estimate of $4.70 billion for the second quarter.

Hartford said its property and casualty combined ratio before catastrophes and prior year favorable loss reserve development was 88.9, a 3.8 point improvement over last year.

Hartford has been seen as a possible takeover target following Ace Ltd's agreeing to acquire Chubb Corp for about $28 billion.

Hartford has been weaning itself from non-core businesses in order to focus on property and casualty, group benefits and mutual fund businesses.

HIG closed Monday at $45.66, down $0.81 or 1.74%, on a volume of 5.4 million shares on the NYSE. In after hours, the stock dropped $0.04 or 0.09% at $45.62. In the past year, the stock has trended in the range of $33.64 - 47.42.