Co-operators General Insurance Company Reports Third Quarter 2013 Results
This quarterly earnings news release should be read in conjunction with our
Third Quarter 2013 consolidated financial statements and Management's
Discussion and Analysis (MD&A) as well as our 2012 Annual Report which are
available on SEDAR at www.sedar.com. Unless otherwise noted, all amounts are
expressed in Canadian dollars.
GUELPH, ON, Oct. 24, 2013 /CNW/ - Co-operators General Insurance Company
(Co-operators General) today released consolidated financial results for the
three months ended September 30, 2013. The consolidated net loss was $37.9
million compared to net income of $12.6 million for the same quarter in 2012.
This resulted in earnings (loss) per common share of ($2.02) for the quarter
compared to $0.46 in the same period last year.
For the first nine months of the year, net income is $14.3 million, which is a
decrease of $129.2 million from the same period last year, resulting in
earnings per common share of $0.11.
"The heavy rains and flooding in the Greater Toronto Area, which were the most
costly natural disaster in Ontario's history, had a very significant impact on
our financial results this quarter. The estimated net losses from July's
catastrophic event were $47.9 million," said Kathy Bardswick, President and
CEO of The Co-operators. "Despite the recent weather-related challenges we've
faced, the organization's financial strength is solid. Our capital position
remains strong, and we were pleased with the growth we achieved in the auto,
home and commercial lines of business across the country."
Co-operators General's Third Quarter Financial Highlights
3rd quarter 3rd quarter 2013 2012
2013 2012 YTD YTD
premium (DWP) 594.3 561.4 1,654.1 1,587.9
premium (NEP) 528.8 511.9 1,534.7 1,498.7
(loss) (37.9) 12.6 14.3 143.5
(1) 5,103.5 4,910.3 5,103.5 4,910.3
equity(1) 1,395.2 1,418.4 1,395.2 1,418.4
DWP growth 5.9% 2.7% 4.2% 2.8%
NEP growth 3.3% 3.4% 2.4% 4.8%
share ($2.02) $0.46 $0.11 $6.48
average equity (11.5%) 3.4% 1.5% 18.1%
MYA 114.3% 105.7% 107.7% 95.5%
(MCT)(1) 234% 260% 234% 260%
(1)Balance sheet data and MCT results for 2012 are as at December 31
Third quarter review
DWP improvements are attributable to policy count growth in the auto, home and
commercial lines of business as well as home portfolio rate and inflation
adjustments. DWP in the third quarter has increased by 5.9% or $32.9 million
to $594.3 million. NEP increased during the third quarter by 3.3% or $16.9
million compared to the same period last year. The increase in NEP is seen in
all geographical regions.
The combined ratio, excluding the market yield adjustment (MYA) for the
quarter, was 114.3% compared to 105.7% for the same period last year.
Undiscounted net claims and adjustment expenses have increased by 14.0% from
the third quarter 2012, bringing the loss ratio to 81.1%, excluding MYA.
Results were negatively impacted by the heavy rains and flooding in Toronto,
where before-tax losses net of reinsurance were $47.9 million, inclusive of
reinsurance premiums to purchase coverage for another event in the impacted
layer. The expense ratio increased 1.0 percentage point to 33.2%, compared to
32.2% for the same period in 2012 mainly as a result of one-time costs related
to information technology initiatives.
Net investment income and gains decreased by $30.5 million versus the third
quarter of 2012. This is attributable to realized and unrealized losses,
mainly the result of increasing interest rates which decreased the value of
our portfolio holdings.
Our investment portfolio composition is conservative and is comprised of high
quality and well diversified assets. The credit quality of our portfolio
remains high with 99.7% of our bonds considered investment grade and 89.1%
rated A or higher. Our equity portfolio is 80.6% weighted to Canadian stocks.
The Company's capital position remains strong, as the Minimum Capital Test
(MCT) for Co-operators General Insurance Company was 234% at September 30,
2013, well above the regulatory minimum requirement of 150%.
This document may contain forward-looking statements and forward-looking
information, including statements regarding the operations, objectives,
strategies, financial situation and performance of Co-operators General
Insurance Company. These statements generally can be identified by the use of
forward-looking words such as "may", "will", "expect", "intend", "estimate",
"anticipate", "believe", "plan", "would", "should", "could", "trend",
"predict", "likely", "potential" or "continue" or the negative thereof and
similar variations. These statements are not guarantees of future performance
and involve known and unknown risk, uncertainties and other factors that may
cause actual results or events to differ materially from those anticipated in
the forward-looking statements or information. Although we believe that the
expectations reflected in the forward-looking statements and information are
reasonable, there can be no assurance that such expectations will prove to be
correct. Consequently, we make no representation that actual results
achieved will be the same in whole or in part as those set out in the
forward-looking statements and information. For further information, refer to
our Third Quarter 2013 MD&A or our 2012 Annual Report.
SHAREHOLDER AND INVESTOR INFORMATION
About Co-operators General Insurance Company
With assets of more than $5.1 billion, Co-operators General is a leading
Canadian-owned multi-product insurance company. Co-operators General is part
of The Co-operators Group Limited, a Canadian-owned co-operative. Through its
group of companies it offers home, auto, life, group, travel, commercial and
farm insurance, as well as investment products. The Co-operators is well known
for its community involvement and its commitment to sustainability, and is
listed among the 50 Best Employers in Canada.
Co-operators General Class E, Series C Preference Shares trade under ticker
symbol CCS.PR.C and the Class E Series D Preference Shares trade under ticker
symbol CCS.PR.D. Both series of shares trade on the Toronto Stock Exchange
(TSX). Further information can be found at www.cooperators.ca.
SOURCE The Co-operators
P. Bruce West Executive Vice-President, Finance and Chief Financial Officer
Telephone: (519) 767-3036
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-0- Oct/24/2013 20:30 GMT
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