Cincinnati Financial Corp.
) reported fourth quarter 2012 operating earnings of $1.11 per
share, substantially beating the Zacks Consensus Estimate of 50
cents. Earnings were also up substantially 32% year over year.
The earnings beat came on the back of increased property casualty
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Full year 2012 operating income was $2.40 per share, up more than
three fold from 73 cents per share in the year ago period.
Revenue for the quarter stood at $1.07 billion, up 12.0% year
over year and ahead of the Zacks Consensus Estimate of $1.04
billion. The increase in total revenue was primarily led by
higher premiums earned.
Investment income came in at $136 million, climbing 3% from the
The Commercial Lines Insurance segment recorded written premium
of $588 million, up 8.0% from the prior-year quarter, due to
higher renewal written premiums. Lower loss and loss expenses led
to underwriting profit of $107 million up 15% year over year.
Combined ratio, a measure of insurer's profitability, improved
100 basis points year over year to 82.9% due to favorable prior
accident year reserve development partly offset by higher
Premiums written in the Personal Lines Insurance segment
increased 13% year over year to $222 million, aided by a rise in
renewals as well as growth in new business written premium.
Underwriting profit was $46 million, compared with $1 million in
the prior-year quarter.
Premiums written in Excess and Surplus Lines Insurance segment
amounted to $27 million, surging 50.0% year over year. The
increase was primarily due to the renewal of many accounts for
the first time.
Earned premiums in the Life Insurance segment increased 14% year
over year to $48 million led by an increase in premium from both
Universal life insurance as well as Term Life insurance products.
Book value per share - a measure of net worth - as on Dec 31,
2012 was recorded at $33.48, up 8% from Dec 31, 2011.
The company had 1,408 agency relationships at Dec 31, 2012,
compared with 1,312 agency relationships at year-end 2011. The
company appointed 140 new agencies, exceeding the initial
full-year target of approximately 130.
Cincinnati Financial currently retains a Zacks Rank #3 (Hold).
Other players from the same industry such as
The Chubb Corp.
The Travelers Companies Inc.
The Allstate Corp.
), all reported earnings ahead of the Zacks Consensus Estimate
despite incurring loss from Sandy.