Progressive Corporation Announces First
Quarter Results
MAYFIELD VILLAGE, Ohio, April 18 The Progressive
Corporation today reported first quarter 2001 operating income per
share of $1.18, which excludes net realized gains/losses on security sales,
compared to an operating loss of $.50 in the first quarter last year.
Operating income for the first quarter was $88.3 million, compared to an
operating loss of $36.6 million in the first quarter of 2000. The Company's
GAAP combined ratio (CR) was 97.3 for the first quarter 2001, compared to
108.9 for the same period last year. Net premiums written for the quarter
were $1,702.8 million, compared to $1,639.7 million last year. First quarter
2001 net premiums written include $37.7 million associated with the
commutation of a reinsurance agreement that was part of a terminated Strategic
Alliance partnership; these premiums will be earned throughout 2001.
Excluding the additional premiums, volume grew 2% for the first quarter.
Net income per share was $1.16 for the first quarter 2001, compared to a
net loss of $.64 per share earned in the same period last year. Net income
for the quarter was $86.6 million, compared to a net loss of $46.6 million in
the first quarter 2000. Investment income, including net realized
gains/losses on security sales, was $95.0 million before taxes and
$68.3 million after taxes, compared to $75.3 million before taxes and
$55.7 million after taxes for the first quarter 2000. First quarter 2001
results include net realized losses on security sales of $2.5 million, or
$.02 per share, compared to net realized losses of $15.4 million, or $.14 per
share, last year. The change in the Company's net unrealized gains/losses was
a net loss of $40.2 million for the first quarter 2001, compared to a net gain
of $49.1 million last year.
Progressive's Personal Lines business units write insurance for private
passenger automobiles and recreation vehicles. For the first quarter 2001,
net premiums written in Personal Lines were $1,539.3 million, compared to
$1,516.6 million last year. Excluding the impact of the commutation of the
reinsurance agreement, Personal Lines net premiums written decreased 1%.
Standard and preferred automobile risks accounted for $853 million, or 55%, of
the Company's first quarter Personal Lines net premiums written, compared to
$775 million, or 51%, in the first quarter last year. The Personal Lines CR
was 97.7 for the first quarter 2001, compared to 110.1 last year.
Progressive's Personal Lines business is generated either by an agent or
written directly by the Company. The Agent channel includes business written
by our network of more than 30,000 Independent Insurance Agencies and through
Strategic Alliance business relationships (other insurance companies,
financial institutions, employers and national brokerage agencies). Direct
business includes business written through 1-800-AUTO-PRO(R), the Internet and
the Strategic Alliances business unit on behalf of affinity groups. See
"Supplemental Information" for Agent and Direct results, which can be found at
http://www.progressive.com/investors/releases.htm .
In addition to its Personal Lines business, the Company's other lines of
business include writing insurance for small fleets of commercial vehicles,
lenders' collateral protection, and directors' and officers' liability, and
providing related services. First quarter 2001 revenues in the other lines of
business were $147.9 million, compared to $112.2 million last year. The
pretax operating profit was $10.8 million for the first quarter 2001, compared
to $7.5 million last year.
During the quarter, the Company did not make any open market repurchases
of its Common Shares. As of March 31, 2001, the Company had authorization to
repurchase 5,248,008 Common Shares under a resolution approved by the Board in
April 1996.
Progressive , with headquarters in Mayfield Village, Ohio, is
the fourth largest U.S. private passenger auto insurance company. In business
since 1937, the Company provides all drivers with competitive rates and 24-
hour, in-person and online services. The Company sells its products over the
phone at 1-800-AUTO-PRO(R), online at progressive.com and through more than
30,000 independent agencies throughout the U.S. More information about the
Company can be found at http://www.progressive.com .
Safe Harbor statement under the Private Securities Litigation Reform Act
of 1995: Statements in this release that are not historical fact are forward-
looking statements that are subject to certain risks and uncertainties that
could cause actual events and results to differ materially from those
discussed herein. These risks and uncertainties include, without limitation,
uncertainties related to estimates, assumptions and projections generally;
changes in economic conditions (including changes in interest rates and
financial markets); pricing competition and other initiatives by competitors;
legislative and regulatory developments; weather conditions (including the
severity and frequency of storms, hurricanes, snowfalls, hail and winter
conditions); changes in driving patterns and loss trends; court decisions and
trends in litigation and health care costs; and other matters described from
time to time by the Company in other releases and publications and in its
periodic reports and other documents filed with the United States Securities
and Exchange Commission.
The Company will hold a one-hour conference call on Thursday, April 19,
2001, beginning at 9:00 a.m. eastern time. At that time, the Company will
discuss results and address questions. Visit the Company's Web site at
http://www.progressive.com/investors/events.htm to register and receive the
call-in details. An instant replay of the conference call will be available
until May 3, 2001, by calling 1-800-846-4244.
Logo: http://www.newscom.com/cgi-bin/prnh/20000629/PGRLOGO
Supplemental Information:
http://www.progressive.com/investors/releases.htm
