Wednesday, auto insurer Progressive Corp. (PGR) reported a fall in its July profits, hurt by lower revenues, despite an increase in policies issued.
The Mayfield Village, Ohio-based company reported that net income for July 2008 fell 31% to $81.8 million from $118.5 million in July 2007. Earnings per share declined 26% to $0.12 from $0.16 in July last year.
Progressive wrote slightly lower net premiums at $1.384 billion, compared with $1.390 billion written in July 2007.
The company generated total revenues of $1.351 billion in July 2008. Of this, net premiums earned decreased by 2% to reach $1.314 billion, compared with $1.338 billion in the last year. Pretax net realized losses on securities were $16.1 million, versus last year's gain of $13.2 million. Investment income in July 2008 was $51.8 million, while Service revenue amounted to $1.4 million in July 2009.
Progressive, one of the largest auto insurance groups in U.S., noted that of all the policies in force, total Personal Auto polices came in slightly higher at 7.14 million from 7.04 million in the year-ago month. Total Special Lines policies came 8% higher at 3.39 million from 3.12 million in July last year. Total Commercial Auto polices was 556.5 thousand, 4% higher than 537.2 thousand reported in July 2007.
The company's total expenses for the month of July came in at $1.234 billion. Of this, losses and loss adjustment expenses was $942.5 million, Policy acquisition costs came in at $130.5 million, and other underwriting expenses totaled $146.8 million.
For the year-to-date period, Progressive posted net income of $536.7 million, down 30% from $765.7 million in the last year period. Earnings per share declined 24% to $0.79 from $1.04 a year ago. Net premiums written was $8.385 billion, 2% lower than the $8.596 billion written in the earlier year period. Total revenues declined 3% to $8.474 billion from $8.772 billion a year earlier. Of this, net premiums earned decreased by 3% to reach 8.115 billion from $8.341 billion in the last year.
PGR is currently trading on the NYSE at $18.77, down $0.48 or 2.49%, on a volume of 912,454 shares.
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