Hanover Insurance Group (THG) Tops Q4 EPS by 7c

Hanover Insurance Group (NYSE: THG) reported Q4 EPS of $2.01, $0.07 better than the analyst estimate of $1.94.

Fourth Quarter and Full Year Highlights

• Fourth quarter combined ratio of 96.2%; combined ratio, excluding catastrophes(2) of 93.1%
• Net premiums written increase of 5.6%* in the fourth quarter and 4.5% during the year, reflected growth in more profitable businesses
• Price increases in the quarter of 7.9% in Core Commercial Lines (3) and 5.1% in Personal Lines (4)
• Current accident year loss and loss adjustment expense ("LAE") ratio, excluding catastrophes(5), of 61.8%, in the fourth quarter, reflecting elevated property loss experience, while liability lines continued to perform in line with expectations
• Net investment income of $72.7 million in the fourth quarter, up 4.8% from the prior-year quarter, and $281.3 million for the full year, up 5.2% from the prior year, driven by increased operational cash flows and the temporary investment of proceeds from the Chaucer sale prior to their deployment
• Completed the deployment of the remaining Chaucer equity through a $150 million accelerated share repurchase ("ASR") agreement and a special cash dividend of $2.50 per share announced in December
• On December 5, 2019, the Board of Directors approved an increase to the regular quarterly dividend of 8.3%, to $0.65 per common share
• Book value per share of $75.94, down 2.7% from September 30, 2019, primarily driven by capital actions, including the payment of special and regular cash dividends ($3.15 per share in aggregate), which was partially offset by earnings

"2019 was an excellent year for our company, marked by record earnings and solid growth in our most profitable segments, further strengthening our market position as we begin 2020," said John C. Roche, president and chief executive officer at The Hanover. "As the market environment becomes increasingly complex – with significant changes to profit pools, loss trends and rate movements – we are focused on ensuring that we continue to achieve broad-based profitability across our businesses. We have accomplished this to date through effective portfolio management and rate increases.

For earnings history and earnings-related data on Hanover Insurance Group (THG) click here.

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