OREANDA-NEWS. The Travelers Companies, Inc. today reported net income of \$833 million, or \$2.55 per diluted share, for the quarter ended March 31, 2015, compared to net income of \$1.052 billion, or \$2.95 per diluted share, in the prior year quarter. Operating income in the current quarter was \$827 million, or \$2.53 per diluted share, compared to \$1.052 billion, or \$2.95 per diluted share, in the prior year quarter. The decrease in net and operating income primarily resulted from the factors described above. Per diluted share amounts also benefited from the impact of share repurchases.
             

Consolidated Highlights

                       
(\$ in millions, except for per share amounts, and after-tax, Three Months Ended March 31,
except for premiums & revenues)

2015

2014

Change

 
Net written premiums         \$ 5,897     \$ 5,873     -   %
Total revenues \$ 6,626 \$ 6,708 (1 )
 
Operating income \$ 827 \$ 1,052 (21 )

per diluted share \$ 2.53 \$ 2.95 (14 )
 
Net income \$ 833 \$ 1,052 (21 )
 
per diluted share \$ 2.55 \$ 2.95 (14 )
 
Diluted weighted average 324.5 354.6 (8 )
shares outstanding

 
Combined ratio 88.9 % 85.7 % 3.2 pts
Underlying combined ratio 90.3 % 88.2 % 2.1 pts
 
Operating return on equity 14.5 % 17.8 % (3.3 ) pts
Return on equity           13.4 %     16.8 %   (3.4 ) pts
 
         

Change from

March 31,

December 31,

March 31,

December 31,

March 31,

2015

2014

2014

2014

2014

Book value per share \$ 77.96 \$ 77.08 \$ 73.06 1 % 7 %
Adjusted book value per share 71.45 70.98 68.25 1 5
 
See Glossary of Financial Measures for definitions and the statistical supplement for additional financial data.      
 

“We were very pleased with our first quarter operating income of \$827 million and operating return on equity of 14.5%,” commented Jay Fishman, Chairman and Chief Executive Officer. “Underwriting results remained very strong, as evidenced by our combined ratio of 88.9%, while net investment income declined due to lower private equity and fixed income returns. Also during the quarter, we returned \$850 million to shareholders, including \$178 million of dividends and \$672 million in share repurchases. Today, our Board of Directors announced an 11% increase in our quarterly dividend, raising it to \$0.61 per share, marking 11 consecutive years of dividend increases with a compound annual growth rate of nearly 10%. The Board also authorized an additional \$5 billion of share repurchases.

“Business and International Insurance posted a strong combined ratio of 93.3%. We were particularly pleased that in our domestic business we achieved a record level of retention while posting positive renewal rate change. New business was up 16% domestically as cumulative price increases over the past four years resulted in an increase in the number of new business opportunities that met our return thresholds. Bond & Specialty Insurance results also remained very strong, producing a combined ratio of 76.1%. In Personal Insurance, we posted a very solid combined ratio of 83.5%. Our Agency Auto business continued to perform well with net written premium growth of 4% and policies in force growth of nearly 2% in the quarter.

“Our performance this quarter is an encouraging start to the year, and our strategies remain unchanged. We do continue to note the severity of weather patterns, as evidenced by another very difficult winter on the East Coast and prolonged drought on the West Coast. In that regard, we continue to refine our highly segmented underwriting and pricing analytics to ensure that we are appropriately reflecting this uncertainty. We remain committed to delivering superior profitability and returns on equity over time.”