Wednesday, Assurant, Inc. (AIZ), a provider of specialized insurance, reported a profit for the third quarter, aided by higher revenues, a gain in the investment portfolio and the absence of a year-ago reportable catastrophe losses.
The New York-based company reported a third-quarter net income of $144.7 million or $1.22 per share, compared to a net loss of $111.4 million or $0.94 per share in the third quarter 2008.
Quarterly results benefited from a $12.9 million after-tax realized gain in the investment portfolio versus a $194.5 million after-tax loss in the third quarter 2008. In addition, there were no reportable catastrophe losses compared to $94.8 million after-tax of reportable catastrophe losses and reinstatement premiums in the third quarter 2008, the company said.
Net operating income increased to $126.2 million or $1.07 per share from $83.1 million or $0.70 per share in the prior year. The improvement reflects the absence of reportable catastrophe losses at Assurant Specialty Property and increased profitability at Assurant Solutions. Less favorable results at Assurant Employee Benefits and a loss at Assurant Health partially offset the increase, the company noted.
On average, 13 analysts polled by Thomson Reuters estimated earnings of $0.94 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the third quarter of 2009 increased to $2.16 billion from $1.95 billion for the third quarter of 2008. Analysts expected revenues of $2.13 billion for the quarter.
Net earned premiums in the third quarter slid 6% to $1.9 billion from $2.0 billion in the prior-year period, declining across all Assurant businesses, driven primarily by the difficult economic environment.
Net investment income also decreased 10% to $172.9 million from $192.3 million a year ago due to lower average invested assets and lower yields.
The company had net realized gains on investments of $19.87 million for the quarter, compared to a loss on investments of $299.21 million in the year-earlier quarter.
Robert Pollock, chief executive officer of the company, said, "Assurant Specialty Property delivered excellent results while Assurant Solutions continued to show improved performance. Assurant Health and Assurant Employee Benefits are managing through an especially challenging landscape. Both were affected by economic pressures on consumers and small businesses."
Segment wise, Assurant Solutions had a net operating income of $31.6 million, up 55% from $20.4 million in the year-earlier quarter. Assurant Specialty Property's net operating income surged to $103.2 million from $30.9 million. Assurant Health had a net operating loss of $4.8 million, compared to net operating income of $30.2 million in the prior-year quarter. Net operating income for Assurant Employee Benefits declined 47% to $11.5 million from $21.5 million in third quarter of 2008.
For the nine-month period, net income rose to $418.6 million or $3.54 per share, from $265.4 million or $2.22 per share for the first nine months of 2008. Total revenue for the period increased to $6.52 billion from $6.38 billion last year.
AIZ closed Wednesday's regular trading at $29.34, down $0.74 or 2.46%, on a volume of 1.32 million shares on the New York Stock Exchange.
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