ST. PAUL (dpa-AFX) - Property casualty insurer Travelers Companies, Inc. (TRV) Tuesday reported higher first-quarter profit, helped by rise in underlying underwriting gains and investment income. Total revenues grew 6 percent from last year. Earnings per share also topped analysts' expectations. Further, the board announced a 10 percent increase in quarterly dividend per share.
For the first quarter, the company's net income increased to $1.05 billion or $2.95 per share from $896 million or $2.33 per share in the previous year.
Excluding certain items, operating income for the prior-year quarter totaled $887 million or $2.31 per share.
On average, 27 analysts polled by Thomson Reuters expected the company to report earnings of $2.16 per share for the quarter. Analysts' estimates typically exclude special items.
Underwriting gains increased to $791 million from $602 million a year ago. Net investment income before tax was $736 million, compared with $670 million in the prior year. After tax, net investment income increased 7 percent, benefited from strong returns in non-fixed income portfolio.
The company noted that underlying underwriting gains in the recent quarter included a $49 million after-tax benefit resulting from a reduction in the estimated liability for state assessments to be paid by the company related to workers' compensation premiums.
Jay Fishman, chairman and chief executive officer of the company said, '...These underwriting results, along with our proven investment philosophy and active capital management strategy, leave us well positioned to deliver on our goal of producing a mid-teens operating return on equity over time.'
Total revenues for the quarter grew 6 percent to $6.71 billion from $6.33 billion in the prior year. Wall Street expected revenues of $5.91 billion.
Net written premiums increased 5 percent to $5.87 billion from $5.60 billion a year ago, that reflected mainly Dominion of Canada, acquired in November 2013.
Combined ratio was 85.7 percent, compared to 88.5 percent last year.
The board has also declared a regular quarterly dividend of $0.55 per share, up 10 percent from last year, to shareholders of record on June 10, payable on June 30.
TRV closed Monday's regular trading at $86.40, down 0.32 percent. In the pre-market activity, the shares are up 0.36 percent.
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