The Hanover Q4 Financial Results

1 February 2018

The Hanover Q4 Financial Results

WORCESTER, Mass., January 31, 2018 - The Hanover Insurance Group, Inc. (NYSE: THG) today reported net income of $51.5 million, or $1.20 per diluted share, for the fourth quarter of 2017, compared to a net loss of $13.5 million, or $0.32 per diluted share, in the prior-year quarter. Operating income(1) was $86.0 million, or $2.00 per diluted share, for the fourth quarter of 2017, compared to an operating loss of $19.7 million, or $0.46 per diluted share, in the prior-year quarter.

Net income for the full year 2017 was $186.2 million, or $4.33 per diluted share. This compared to net income of $155.1 million, or $3.59 per diluted share, for the full year 2016. Operating income was $203.8 million, or $4.74 per diluted share, in 2017, compared to operating income of $184.4 million, or $4.27 per diluted share, in 2016.

Fourth Quarter and Full Year Highlights

  • Combined ratio of 95.1% in the fourth quarter and 98.7% in the full year, including 3.8 and 7.9 points of catastrophe losses and 0.3 and 0.7 points of favorable prior-year development, respectively
  • Current accident year combined ratio, excluding catastrophes(2), of 91.6% in the fourth quarter, an improvement of 2.4 points over the prior-year quarter
  • Current accident year combined ratio, excluding catastrophes, of 91.5% for the full year, an improvement of 1.4 point over the prior-year
  • Net premiums written up 8.4% in the fourth quarter and 5.5% for the full year, driven by growth in all segments, with continued price increases in Commercial and Personal Lines
  • Net investment income of $78.1 million in the fourth quarter, up 5.3% from the prior-year quarter, and $298.1 million for the full year, up 6.7%
  • Book value per share of $70.59, up 4.7% from December 31, 2016; book value per share, excluding net unrealized gains on investments(3), of $65.75, up 4.3%
  • One-time non-operating tax expense of $22.3 million, or $0.52 per diluted share, related to the recently enacted changes in U.S. tax laws, consisting of a revaluation of deferred tax balances and the recognition of federal income taxes on previously untaxed income from foreign operations
  • On December 5, 2017, the Board of Directors approved an increase to the quarterly dividend of 8%, to $0.54 per common share

The Hanover Q4 Financial Results 


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