The Hartford Financial Services Group reported first-quarter earnings Monday that beat analysts’ expectations.
Net income was $495 million, or $1.03 per diluted share, for the quarter, compared with a net loss of $241 million, or 58 cents per diluted share, during the same period a year ago.
Core earnings were $564 million, or $1.18 per diluted share, for the quarter, compared with $457 million, or 93 cents per diluted share, during the same period in 2013. Analysts polled by Thomson Reuters were expecting, an average, 93 cents per share.
The Property & Casualty division had a 3 percent increase in written premium revenue for a total of $2.6 billion, from $2.52 billion during the same period a year earlier. Underwriting gain, which is premium revenue minus administrative expenses and losses from claims, improved 64 percent to $253 million during the quarter from $154 million in 2013.
Catastrophe losses totaled $86 million during the quarter compared with $32 million during the same period in 2013.
Property & Casualty Commercial, the portion sold to businesses rather than consumers, had a 1 percent increase in written premium, raising the total to $1.67 billion for the quarter from $1.65 billion during the same period in 2013.
The Hartford has adjusted its risk profile, exiting certain types of specialty, commercial-auto coverage. Premium revenue increased for all other commercial lines: 3 percent in small commercial, 4 percent in middle market and 16 percent in national accounts.
In Consumer Markets, which is personal lines auto and home coverage, premium revenue increased 6 percent to $927 million for the quarter from $878 million during the same period in 2013. New business premium in the first quarter totaled $136 million, up 16 percent from the same quarter a year ago, driven partly by an affinity relationship with AARP, which endorses The Hartford’s policies.
The Group Benefits business had a 4 percent decline in premium revenue, for a total of $776 million compared with $812 million during the same period a year earlier. Core earnings for Group Benefits improved to $45 million for the quarter, compared with $30 million in 2013.
In Mutual Funds, total sales were down 10 percent during the quarter to $3.7 billion from $4.1 billion during the same period in 2013. Core earnings were up 5 percent during the quarter to $21 million from $20 million in 2013.
Net investment income was down 2 percent to $836 million for the quarter, from $856 million in 2013.
On Monday morning, The Hartford announced plans to sell its Japan annuity business to Orix Life Insurance Corp. for an estimated capital benefit of $1.4 billion. The divestiture has been anticipated for about a year as The Hartford looks to reduce its risk profile. See related article.
The company reported earnings after the close of the New York Stock Exchange on Monday. Shares of the company’s stock were up 63 cents to $35.10 in after-hours trading.