CNA FINANCIAL ANNOUNCES THIRD QUARTER 2024 NET INCOME OF $1.04 PER SHARE AND CORE INCOME OF $1.08 PER SHARE
CNA Financial reported Q3 2024 net income of $283 million ($1.04 per share), up 10% from $258 million in the prior year quarter. Core income reached $293 million ($1.08 per share). Property & Casualty segments showed strong performance with 9% gross written premium growth and 8% net written premium growth. Net investment income increased 13% to $626 million. The P&C combined ratio was 97.2%, including 5.8 points of catastrophe loss impact totaling $143 million. The company declared a quarterly dividend of $0.44 per share. Book value per share reached $39.72, with book value excluding AOCI at $46.50, representing a 7% increase from year-end 2023.
CNA Financial ha riportato un reddito netto di 283 milioni di dollari per il terzo trimestre del 2024 (1,04 dollari per azione), con un incremento del 10% rispetto ai 258 milioni dello stesso trimestre dell’anno precedente. Il reddito core ha raggiunto i 293 milioni di dollari (1,08 dollari per azione). I settori di Proprietà e Causa hanno mostrato una solida performance con una crescita del 9% dei premi lordi scritti e una crescita dell’8% dei premi netti scritti. Il reddito netto dagli investimenti è aumentato del 13% arrivando a 626 milioni di dollari. Il rapporto combinato P&C è stato del 97,2%, includendo 5,8 punti di impatto per perdite da catastrofi per un totale di 143 milioni di dollari. L’azienda ha dichiarato un dividendo trimestrale di 0,44 dollari per azione. Il valore contabile per azione ha raggiunto i 39,72 dollari, con un valore contabile escluso AOCI a 46,50 dollari, rappresentando un incremento del 7% rispetto alla fine del 2023.
CNA Financial reportó un ingreso neto de 283 millones de dólares para el tercer trimestre de 2024 (1.04 dólares por acción), un aumento del 10% respecto a los 258 millones del trimestre del año anterior. El ingreso central alcanzó los 293 millones de dólares (1.08 dólares por acción). Los segmentos de Propiedad y Siniestros mostraron un sólido rendimiento con un crecimiento del 9% en las primas brutas escritas y un crecimiento del 8% en las primas netas escritas. Los ingresos netos de inversiones aumentaron un 13% a 626 millones de dólares. El ratio combinado de P&C fue del 97,2%, incluyendo 5,8 puntos de impacto por pérdidas catastróficas que totalizan 143 millones de dólares. La compañía declaró un dividendo trimestral de 0,44 dólares por acción. El valor en libros por acción alcanzó los 39,72 dólares, con un valor en libros excluyendo AOCI de 46,50 dólares, lo que representa un aumento del 7% respecto al final de 2023.
CNA Financial은 2024년 3분기 순이익이 2억 8천 3백만 달러 (주당 1.04달러)에 달했다고 보고했으며, 이는 작년 동기 대비 10% 증가한 수치입니다. 핵심 수익은 2억 9천 3백만 달러에 도달했습니다 (주당 1.08달러). 재산 및 상해 부문은 총 서면 보험료가 9% 증가하고 순 서면 보험료가 8% 증가 하는 등 강력한 성과를 보였습니다. 순 투자 수익은 13% 증가하여 6억 2천 6백만 달러에 이르렀습니다. P&C 결합 비율은 97.2%였으며, 이 중 143백만 달러에 달하는 재해 손실의 영향으로 5.8포인트가 포함되었습니다. 회사는 주당 0.44달러의 분기 배당금을 선언했습니다. 주당 장부 가치는 39.72달러에 도달했으며, AOCI를 제외한 장부 가치는 46.50달러로, 2023년 연말 대비 7% 증가한 수치입니다.
CNA Financial a annoncé un revenu net de 283 millions de dollars pour le troisième trimestre de 2024 (1,04 dollar par action), en hausse de 10% par rapport à 258 millions lors du même trimestre de l'année précédente. Le revenu de base a atteint 293 millions de dollars (1,08 dollar par action). Les segments de l'Assurance Habitation et Responsabilité ont montré de bonnes performances avec une croissance de 9% des primes brutes souscrites et une croissance de 8% des primes nettes souscrites. Les revenus nets des investissements ont augmenté de 13% pour atteindre 626 millions de dollars. Le ratio combiné P&C était de 97,2%, incluant un impact de 5,8 points de pertes dues à des catastrophes totalisant 143 millions de dollars. L'entreprise a déclaré un dividende trimestriel de 0,44 dollar par action. La valeur comptable par action a atteint 39,72 dollars, avec une valeur comptable excluant l'AOCI à 46,50 dollars, représentant une augmentation de 7% par rapport à la fin de 2023.
CNA Financial hat einen Nettoverdienst von 283 Millionen Dollar im 3. Quartal 2024 (1,04 Dollar pro Aktie) gemeldet, was einem Anstieg von 10% gegenüber 258 Millionen im Vorjahresquartal entspricht. Der Kernverdienst erreichte 293 Millionen Dollar (1,08 Dollar pro Aktie). Die Bereiche Sach- und Haftpflichtversicherung zeigten eine starke Leistung mit einem Wachstum der brutto geschriebenen Prämien um 9% und einem Wachstum der netto geschriebenen Prämien um 8%. Die Nettoerträge aus Investitionen stiegen um 13% auf 626 Millionen Dollar. Die kombinierte Schaden-/Unfallquote betrug 97,2%, einschließlich eines Einflusses von 5,8 Punkten aufgrund von Katastrophenschäden in Höhe von insgesamt 143 Millionen Dollar. Das Unternehmen erklärte eine vierteljährliche Dividende von 0,44 Dollar pro Aktie. Der Buchwert pro Aktie erreichte 39,72 Dollar, wobei der Buchwert ohne AOCI bei 46,50 Dollar lag, was einem Anstieg von 7% gegenüber dem Jahresende 2023 entspricht.
- Net income increased 10% to $283 million
- Year-to-date core income up 6% to record $974 million
- Net investment income grew 13% to $626 million
- P&C segments achieved 9% gross written premium growth
- Book value per share excluding AOCI increased 7% from year-end 2023
- P&C combined ratio deteriorated to 97.2% from 94.3% year-over-year
- Catastrophe losses increased to $143 million from $94 million in prior year
- P&C core income decreased to $346 million from $351 million
- Underlying combined ratio worsened to 91.6% from 90.4%
Insights
CNA Financial's Q3 2024 results demonstrate solid performance with notable strengths and challenges. Core income increased to
Key performance metrics reveal mixed signals: The P&C combined ratio of
The company maintains strong pricing discipline with renewal premium change of
The underwriting performance shows some concerning trends despite overall positive results. The underlying combined ratio increased to
The Specialty segment faces challenges with its combined ratio increasing
The
- Net income up
10% to versus$283 million in the prior year quarter; core income of$258 million versus$293 million in the prior year quarter. Year to date core income up$289 million 6% to a record .$974 million - P&C core income of
$346 million versus$351 million , reflects the largely offsetting impacts of higher catastrophe losses and higher investment income. - Life & Group core loss of
versus$9 million in the prior year quarter, reflects higher investment income.$29 million - Net investment income up
13% to pretax, includes a$626 million increase from limited partnerships and common stock to$52 million and a$80 million increase from fixed income securities and other investments to$21 million .$546 million - P&C combined ratio of
97.2% , compared with94.3% in the prior year quarter, including 5.8 points of catastrophe loss impact compared with 4.1 points in the prior year quarter. P&C underlying combined ratio was91.6% compared with90.4% in the prior year quarter. P&C underlying loss ratio was61.1% and the expense ratio was30.2% . - Preannounced catastrophe losses of
pretax, includes$143 million for Hurricane Helene, versus$55 million in the prior year quarter.$94 million - P&C segments, excluding third party captives, generated gross written premium growth of
9% and net written premium growth of8% for the third quarter of 2024. - P&C renewal premium change of +
5% , consistent with the prior quarter, with written rate of +3% . Commercial renewal premium change of +8% and Specialty renewal premium change of +2% , each up 1 point from the prior quarter. International renewal premium change of +1% , down 1 point from the prior quarter. - Book value per share of
; book value per share excluding AOCI of$39.72 , a$46.50 7% increase from year-end 2023 adjusting for of dividends per share paid.$3.32 - Board of Directors declares regular quarterly cash dividend of
per share.$0.44
Our Property & Casualty segments produced core income of
Our Life & Group segment produced a core loss of
CNA Financial declared a quarterly dividend of
Results for the Three Months | Results for the Nine Months | ||||||
($ millions, except per share data) | 2024 | 2023 | 2024 | 2023 | |||
Net income | $ 283 | $ 258 | $ 938 | $ 838 | |||
Core income (a) | 293 | 289 | 974 | 922 | |||
Net income per diluted share | $ 1.04 | $ 0.95 | $ 3.44 | $ 3.08 | |||
Core income per diluted share | 1.08 | 1.06 | 3.57 | 3.39 | |||
September 30, 2024 | December 31, 2023 | ||||||
Book value per share | $ | 39.72 | $ | 36.52 | |||
Book value per share excluding AOCI | 46.50 | 46.39 |
(a) | Management utilizes the core income (loss) financial measure to monitor the Company's operations. Please refer herein to the Reconciliation of GAAP Measures to Non-GAAP Measures section of this press release for further discussion of this non-GAAP measure. |
"We continue to produce excellent results with core income increasing to
The underlying combined ratio was
Gross written premium ex. captives was up
New business grew
We are very pleased with our results for the quarter with the continuation of strong renewal pricing in the lines most impacted by social inflation, which continues to exceed our loss cost trends. We remain optimistic about our abilities to capitalize on the favorable market conditions we expect to persist in many classes of business," said Dino E. Robusto, Chairman & Chief Executive Officer of CNA Financial Corporation.
Property & Casualty Operations | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Gross written premiums ex. 3rd party captives | $ 2,825 | $ 2,595 | $ 8,964 | $ 8,305 | |||||||
GWP ex. 3rd party captives change (% year over year) | 9 | % | 8 | % | |||||||
Net written premiums | $ 2,360 | $ 2,178 | $ 7,424 | $ 6,938 | |||||||
NWP change (% year over year) | 8 | % | 7 | % | |||||||
Net earned premiums | $ 2,484 | $ 2,295 | $ 7,204 | $ 6,662 | |||||||
NEP change (% year over year) | 8 | % | 8 | % | |||||||
Underwriting gain | $ 68 | $ 131 | $ 318 | $ 399 | |||||||
Net investment income | $ 372 | $ 318 | $ 1,090 | $ 951 | |||||||
Core income | $ 346 | $ 351 | $ 1,098 | $ 1,071 | |||||||
Loss ratio | 66.7 | % | 63.9 | % | 64.9 | % | 63.1 | % | |||
Effect of catastrophe impacts | (5.8) | (4.1) | (4.3) | (3.2) | |||||||
Effect of development-related items | 0.2 | 0.2 | 0.2 | — | |||||||
Underlying loss ratio | 61.1 | % | 60.0 | % | 60.8 | % | 59.9 | % | |||
Expense ratio | 30.2 | % | 30.1 | % | 30.3 | % | 30.6 | % | |||
Combined ratio | 97.2 | % | 94.3 | % | 95.6 | % | 94.0 | % | |||
Underlying combined ratio | 91.6 | % | 90.4 | % | 91.5 | % | 90.8 | % |
- The underlying combined ratio increased 1.2 points as compared with the prior year quarter. The underlying loss ratio increased 1.1 points as compared with the prior year quarter due to increases in our Commercial and Specialty segments. The expense ratio was generally consistent with the prior year quarter, with the impact of a favorable International reinsurance acquisition related catch-up adjustment in the prior year quarter largely offset by higher net earned premiums in the current quarter.
- The combined ratio increased 2.9 points as compared with the prior year quarter which reflects an underwriting gain of
compared with$68 million in the prior year quarter. Preannounced catastrophe losses were$131 million , or 5.8 points of the loss ratio in the quarter compared with$143 million , or 4.1 points of the loss ratio, for the prior year quarter. Catastrophe losses for the third quarter of 2024 include$94 million for Hurricane Helene. Favorable net prior period development improved the loss ratio by 0.2 points in the current and prior year quarter.$55 million - P&C segments, excluding third party captives, generated gross written premium growth of
9% and net written premium growth of8% .
Business Operating Highlights
Specialty | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Gross written premiums ex. 3rd party captives | $ 982 | $ 949 | $ 2,846 | $ 2,796 | |||||||
GWP ex. 3rd party captives change (% year over year) | 3 | % | 2 | % | |||||||
Net written premiums | $ 862 | $ 825 | $ 2,511 | $ 2,438 | |||||||
NWP change (% year over year) | 4 | % | 3 | % | |||||||
Net earned premiums | $ 848 | $ 829 | $ 2,493 | $ 2,438 | |||||||
NEP change (% year over year) | 2 | % | 2 | % | |||||||
Underwriting gain | $ 59 | $ 83 | $ 195 | $ 237 | |||||||
Loss ratio | 60.1 | % | 58.0 | % | 59.3 | % | 58.2 | % | |||
Effect of catastrophe impacts | — | — | — | — | |||||||
Effect of development-related items | — | 0.6 | 0.3 | 0.3 | |||||||
Underlying loss ratio | 60.1 | % | 58.6 | % | 59.6 | % | 58.5 | % | |||
Expense ratio | 32.7 | % | 31.8 | % | 32.5 | % | 31.9 | % | |||
Combined ratio | 93.0 | % | 90.1 | % | 92.1 | % | 90.3 | % | |||
Underlying combined ratio | 93.0 | % | 90.7 | % | 92.4 | % | 90.6 | % |
- The underlying combined ratio increased 2.3 points as compared with the prior year quarter. The underlying loss ratio increased 1.5 points primarily driven by continued pricing pressure in management liability lines over the last several quarters. The expense ratio increased 0.9 points primarily driven by higher employee related costs.
- The combined ratio increased 2.9 points as compared with the prior year quarter. There was no net prior period development in the current quarter compared with 0.6 points of favorable development improving the loss ratio in the prior year quarter.
- Gross written premiums, excluding third party captives, grew
3% and net written premiums grew4% for the third quarter of 2024.
Commercial | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Gross written premiums ex. 3rd party captives | $ 1,538 | $ 1,340 | $ 5,022 | $ 4,384 | |||||||
GWP ex. 3rd party captives change (% year over year) | 15 | % | % | 15 | % | ||||||
Net written premiums | $ 1,221 | $ 1,071 | $ 4,017 | $ 3,588 | |||||||
NWP change (% year over year) | 14 | % | % | 12 | % | ||||||
Net earned premiums | $ 1,325 | $ 1,170 | $ 3,774 | $ 3,336 | |||||||
NEP change (% year over year) | 13 | % | % | 13 | % | ||||||
Underwriting (loss) gain | $ (3) | $ 13 | $ 65 | $ 96 | |||||||
Loss ratio | 72.0 | % | 68.9 | % | 69.7 | % | 67.0 | % | |||
Effect of catastrophe impacts | (9.6) | (7.4) | (7.5) | (5.7) | |||||||
Effect of development-related items | 0.1 | — | — | 0.2 | |||||||
Underlying loss ratio | 62.5 | % | 61.5 | % | 62.2 | % | 61.5 | % | |||
Expense ratio | 27.7 | % | 29.5 | % | 28.1 | % | 29.6 | % | |||
Combined ratio | 100.2 | % | 98.9 | % | 98.3 | % | 97.1 | % | |||
Underlying combined ratio | 90.7 | % | 91.5 | % | 90.8 | % | 91.6 | % |
- The underlying combined ratio improved 0.8 points as compared with the prior year quarter, and is the lowest on record. The expense ratio improved 1.8 points, to a record low, primarily driven by net earned premium growth of
13% . The underlying loss ratio increased 1.0 point as compared with the prior year quarter driven by the continuation of elevated loss cost trends in commercial auto and mix of business. - The combined ratio increased 1.3 points as compared with the prior year quarter. Catastrophe losses were
, or 9.6 points of the loss ratio in the quarter compared with$127 million , or 7.4 points of the loss ratio, for the prior year quarter. Favorable net prior period development improved the loss ratio by 0.1 point in the current quarter compared with no net prior period development in the prior year quarter.$87 million - Gross written premiums, excluding third party captives, grew
15% and net written premiums grew14% for the third quarter of 2024.
International | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Gross written premiums | $ 305 | $ 306 | $ 1,096 | $ 1,125 | |||||||
GWP change (% year over year) | — | % | (3) | % | |||||||
Net written premiums | $ 277 | $ 282 | $ 896 | $ 912 | |||||||
NWP change (% year over year) | (2) | % | (2) | % | |||||||
Net earned premiums | $ 311 | $ 296 | $ 937 | $ 888 | |||||||
NEP change (% year over year) | 5 | % | 6 | % | |||||||
Underwriting gain | $ 12 | $ 35 | $ 58 | $ 66 | |||||||
Loss ratio | 62.5 | % | 60.2 | % | 60.6 | % | 62.2 | % | |||
Effect of catastrophe impacts | (5.1) | (2.3) | (3.0) | (2.7) | |||||||
Effect of development-related items | 0.7 | — | 0.5 | (1.7) | |||||||
Underlying loss ratio | 58.1 | % | 57.9 | % | 58.1 | % | 57.8 | % | |||
Expense ratio | 33.6 | % | 28.1 | % | 33.1 | % | 30.3 | % | |||
Combined ratio | 96.1 | % | 88.3 | % | 93.7 | % | 92.5 | % | |||
Underlying combined ratio | 91.7 | % | 86.0 | % | 91.2 | % | 88.1 | % |
- The underlying combined ratio increased 5.7 points as compared with the prior year quarter. The expense ratio increased 5.5 points primarily driven by a favorable reinsurance acquisition related catch-up adjustment in the prior year quarter and higher employee related costs in the current quarter. The underlying loss ratio increased 0.2 points as compared with the prior year quarter.
- The combined ratio increased 7.8 points as compared with the prior year quarter. Catastrophe losses were
, or 5.1 points of the loss ratio in the quarter compared with$16 million , or 2.3 points of the loss ratio, for the prior year quarter. Favorable net prior period development improved the loss ratio by 0.7 points in the current quarter compared with no net prior period development in the prior year quarter.$7 million - Excluding currency fluctuations, gross written premiums were consistent with the third quarter of 2023 and net written premiums declined
1% for the third quarter of 2024.
Life & Group | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Net earned premiums | $ 110 | $ 112 | $ 329 | $ 340 | |||||||
Claims, benefits and expenses | 367 | 371 | 1,063 | 1,087 | |||||||
Net investment income | 240 | 216 | 710 | 659 | |||||||
Core loss | (9) | (29) | (5) | (52) |
Core loss improved
The assumption updates in the third quarter of 2024 unfavorably impacted core loss by
The assumption updates in the third quarter of 2023 unfavorably impacted core loss by
Corporate & Other | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||||||
Insurance claims and policyholders' benefits | $ 16 | $ 10 | $ 35 | $ 32 | |||||||
Interest expense | 32 | 35 | 101 | 93 | |||||||
Net investment income | 14 | 19 | 53 | 43 | |||||||
Core loss | (44) | (33) | (119) | (97) |
Core loss increased
Net Investment Income | |||||||||||
Results for the Three Months | Results for the Nine Months | ||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Fixed income securities and other | $ 546 | $ 525 | $ 1,627 | $ 1,529 | |||||||
Limited partnership and common stock investments | 80 | 28 | 226 | 124 | |||||||
Net investment income | $ 626 | $ 553 | $ 1,853 | $ 1,653 |
Net investment income increased
Stockholders' Equity
Stockholders' equity of
Book value per share ex AOCI of
About the Company
CNA is one of the largest
Contacts
Media: | Analysts: | |
Kelly | Ralitza K. Todorova | Vice President, | |
872-817-0350 | 312-822-3834 |
Earnings Remarks & Materials
A transcript of earnings remarks will be available on CNA's website at www.cna.com via the Investor Relations section. Remarks will include commentary from the Company's Chairman & Chief Executive Officer, Dino Robusto, and Chief Financial Officer, Scott Lindquist. An earnings presentation and financial supplement information related to the results will also be posted and available on the CNA website.
Definition of Reported Segments
- Specialty provides management and professional liability and other coverages through property and casualty products and services using a network of brokers, independent agencies and managing general underwriters.
- Commercial works with a network of brokers and independent agents to market a broad range of property and casualty insurance products to all types of insureds targeting small business, construction, middle markets and other commercial customers.
- International underwrites property and casualty coverages on a global basis through a branch operation in
Canada , a European business consisting of insurance companies based in theU.K and Luxembourg and Hardy, our Lloyd's Syndicate. - Life & Group includes the individual and group run-off long-term care businesses as well as structured settlement obligations not funded by annuities related to certain property and casualty claimants.
- Corporate & Other primarily includes certain corporate expenses, including interest on corporate debt, and the results of certain property and casualty business in run-off, including CNA Re, asbestos and environmental pollution (A&EP), a legacy portfolio of excess workers' compensation (EWC) policies and legacy mass tort reserves.
Financial Measures
Management utilizes the following metrics in their evaluation of the Property & Casualty Operations.
These ratios are calculated using financial results prepared in accordance with accounting principles generally accepted in
- Loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums.
- Underlying loss ratio represents the loss ratio excluding catastrophe losses and development-related items.
- Expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums.
- Dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums.
- Combined ratio is the sum of the loss, expense and dividend ratios.
- Underlying combined ratio is the sum of the underlying loss, expense and dividend ratios.
The underlying loss ratio and the underlying combined ratio are deemed to be non-GAAP financial measures, and management believes some investors may find these ratios useful to evaluate our underwriting performance since they remove the impact of catastrophe losses which are unpredictable as to timing and amount, and development-related items as they are not indicative of our current year underwriting performance. The components to reconcile the combined ratio and loss ratio to the underlying combined ratio and underlying loss ratio for Property & Casualty, Specialty, Commercial and International segments are set forth on pages 3, 4, 5 and 6, respectively.
Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes.
Rate represents the average change in price on policies that renew excluding exposure change.
Exposure represents the measure of risk used in the pricing of the insurance product. The change in exposure represents the change in premium dollars on policies that renew as a result of the change in risk of the policy.
Retention represents the percentage of premium dollars renewed, excluding rate and exposure changes, in comparison to the expiring premium dollars from policies available to renew.
New business represents premiums from policies written with new customers and additional policies written with existing customers.
Gross written premiums ex. 3rd party captives represents gross written premiums excluding business which is ceded to third party captives, including business related to large warranty programs.
Development-related items represents net prior year loss reserve and premium development, and includes the effects of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts.
Statutory capital and surplus represents the excess of an insurance company's admitted assets over its liabilities, including loss reserves, as determined in accordance with statutory accounting practices. Statutory capital and surplus as of the current period is preliminary.
The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk.
Reconciliation of GAAP Measures to Non-GAAP Measures
Management utilizes financial measures not in accordance with GAAP to monitor the Company's insurance operations and investment portfolio. The Company believes the presentation of these measures provides investors with a better understanding of the significant factors that comprise the Company's operating performance. Reconciliations of these measures to the most comparable GAAP measures follow below.
Reconciliation of Net Income (Loss) to Core Income (Loss)
Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses and gains or losses resulting from pension settlement transactions. Net investment gains or losses are excluded from the calculation of core income (loss) because they are generally driven by economic factors that are not necessarily reflective of our primary operations. The calculation of core income (loss) excludes gains or losses resulting from pension settlement transactions as they result from decisions regarding our defined benefit pension plans which are unrelated to our primary operations. Management monitors core income (loss) for each business segment to assess segment performance. Presentation of consolidated core income (loss) is deemed to be a non-GAAP financial measure.
Results for the Three Months | Results for the Nine Months | ||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | |||
Net income | $ 283 | $ 258 | $ 938 | $ 838 | |||
Less: Net investment losses | (7) | (31) | (33) | (84) | |||
Less: Pension settlement transaction losses | (3) | — | (3) | — | |||
Core income | $ 293 | $ 289 | $ 974 | $ 922 |
Reconciliation of Net Income (Loss) per Diluted Share to Core Income (Loss) per Diluted Share
Core income (loss) per diluted share provides management and investors with a valuable measure of the Company's operating performance for the same reasons applicable to its underlying measure, core income (loss). Core income (loss) per diluted share is core income (loss) on a per diluted share basis.
Results for the Three Months | Results for the Nine Months | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net income per diluted share | $ 1.04 | $ 0.95 | $ 3.44 | $ 3.08 | |||
Less: Net investment losses | (0.03) | (0.11) | (0.12) | (0.31) | |||
Less: Pension settlement transaction losses | (0.01) | — | (0.01) | — | |||
Core income per diluted share | $ 1.08 | $ 1.06 | $ 3.57 | $ 3.39 |
Reconciliation of Net Income (Loss) to Underwriting Gain (Loss) and Underlying Underwriting Gain (Loss)
Underwriting gain (loss) is deemed to be a non-GAAP measure and is calculated pretax as net earned premiums less total insurance expenses, which includes insurance claims and policyholders' benefits, amortization of deferred acquisition costs and other insurance related expenses. Net income (loss) is the most directly comparable GAAP measure. Management believes some investors may find this measure useful to evaluate the profitability, before tax, derived from our underwriting activities which are managed separately from our investing activities.
Underlying underwriting gain (loss) is deemed to be a non-GAAP measure that represents pretax underwriting results excluding catastrophe losses and development-related items. Management believes some investors may find this measure useful to evaluate profitability, before tax, of our underwriting activities, excluding the impact of catastrophe losses which are unpredictable as to timing and amount, and development-related items as they are not indicative of our current year underwriting performance.
Results for the Three Months Ended September 30, 2024 | ||||
Specialty | Commercial | International | Property & | |
(In millions) | ||||
Net income | $ 167 | $ 132 | $ 34 | $ 333 |
Net investment losses, after tax | 4 | 7 | 2 | 13 |
Core income | $ 171 | $ 139 | $ 36 | $ 346 |
Net investment income | (157) | (183) | (32) | (372) |
Non-insurance warranty (revenue) expense | (14) | — | — | (14) |
Other (revenue) expense, including interest expense | 12 | 3 | (8) | 7 |
Income tax expense on core income | 47 | 38 | 16 | 101 |
Underwriting gain (loss) | 59 | (3) | 12 | 68 |
Effect of catastrophe losses | — | 127 | 16 | 143 |
Effect of favorable development-related items | — | — | (2) | (2) |
Underlying underwriting gain | $ 59 | $ 124 | $ 26 | $ 209 |
Results for the Three Months Ended | ||||
Specialty | Commercial | International | Property & | |
(In millions) | ||||
Net income | $ 165 | $ 117 | $ 40 | $ 322 |
Net investment losses, after tax | 13 | 16 | — | 29 |
Core income | $ 178 | $ 133 | $ 40 | $ 351 |
Net investment income | (136) | (156) | (26) | (318) |
Non-insurance warranty (revenue) expense | (21) | — | — | (21) |
Other (revenue) expense, including interest expense | 13 | 2 | 7 | 22 |
Income tax expense on core income | 49 | 34 | 14 | 97 |
Underwriting gain | 83 | 13 | 35 | 131 |
Effect of catastrophe losses | — | 87 | 7 | 94 |
Effect of favorable development-related items | (5) | — | — | (5) |
Underlying underwriting gain | $ 78 | $ 100 | $ 42 | $ 220 |
Results for the Nine Months Ended | ||||
Specialty | Commercial | International | Property & | |
(In millions) | ||||
Net income | $ 498 | $ 436 | $ 116 | $ 1,050 |
Net investment losses, after tax | 19 | 28 | 1 | 48 |
Core income | $ 517 | $ 464 | $ 117 | $ 1,098 |
Net investment income | (461) | (534) | (95) | (1,090) |
Non-insurance warranty (revenue) expense | (43) | — | — | (43) |
Other (revenue) expense, including interest expense | 40 | 10 | (5) | 45 |
Income tax expense on core income | 142 | 125 | 41 | 308 |
Underwriting gain | 195 | 65 | 58 | 318 |
Effect of catastrophe losses | — | 285 | 28 | 313 |
Effect of favorable development-related items | (8) | — | (5) | (13) |
Underlying underwriting gain | $ 187 | $ 350 | $ 81 | $ 618 |
Results for the Nine Months Ended | ||||
Specialty | Commercial | International | Property & | |
(In millions) | ||||
Net income | $ 487 | $ 390 | $ 103 | $ 980 |
Net investment losses (gains), after tax | 39 | 53 | (1) | 91 |
Core income | $ 526 | $ 443 | $ 102 | $ 1,071 |
Net investment income | (407) | (470) | (74) | (951) |
Non-insurance warranty (revenue) expense | (67) | — | — | (67) |
Other (revenue) expense, including interest expense | 39 | 5 | 2 | 46 |
Income tax expense on core income | 146 | 118 | 36 | 300 |
Underwriting gain | 237 | 96 | 66 | 399 |
Effect of catastrophe losses | — | 190 | 24 | 214 |
Effect of (favorable) unfavorable development-related items | (7) | (4) | 15 | 4 |
Underlying underwriting gain | $ 230 | $ 282 | $ 105 | $ 617 |
Reconciliation of Book Value per Share to Book Value per Share Excluding AOCI
Book value per share excluding accumulated other comprehensive income (loss) (AOCI) allows management and investors to analyze the amount of the Company's net worth primarily attributable to the Company's business operations. The Company believes this measurement is useful as it reduces the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates.
September | December 31, | ||
Book value per share | $ 39.72 | $ 36.52 | |
Less: Per share impact of AOCI | (6.78) | (9.87) | |
Book value per share excluding AOCI | $ 46.50 | $ 46.39 |
Calculation of Return on Equity and Core Return on Equity
Core return on equity provides management and investors with a measure of how effectively the Company is investing the portion of the Company's net worth that is primarily attributable to its business operations.
Results for the Three Months | Results for the Nine Months | |||||||
($ millions) | 2024 | 2023 | 2024 | 2023 | ||||
Annualized net income | $ 1,132 | $ 1,033 | $ 1,251 | $ 1,118 | ||||
Average stockholders' equity including AOCI (a) | 10,316 | 8,644 | 10,326 | 8,555 | ||||
Return on equity | 11.0 | % | 11.9 | % | 12.1 | % | 13.1 | % |
Annualized core income | $ 1,176 | $ 1,154 | $ 1,299 | $ 1,229 | ||||
Average stockholders' equity excluding AOCI (a) | 12,508 | 12,228 | 12,580 | 12,225 | ||||
Core return on equity | 9.4 | % | 9.4 | 10.3 | % | 10.1 | % |
(a) | Average stockholders' equity is calculated using a simple average of the beginning and ending balances for the period. |
For additional information, please refer to CNA's most recent 10-K on file with the Securities and Exchange Commission, as well as the financial supplement, available at www.cna.com.
Forward-Looking Statements
This press release includes statements that relate to anticipated future events (forward-looking statements) rather than actual present conditions or historical events. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and generally include words such as "believes," "expects," "intends," "anticipates," "estimates" and similar expressions. Forward-looking statements, by their nature, are subject to a variety of inherent risks and uncertainties that could cause actual results to differ materially from the results projected. Many of these risks and uncertainties cannot be controlled by CNA. For a detailed description of these risks and uncertainties, please refer to CNA's filings with the Securities and Exchange Commission, available at www.cna.com.
Any forward-looking statements made in this press release are made by CNA as of the date of this press release. Further, CNA does not have any obligation to update or revise any forward-looking statement contained in this press release, even if CNA's expectations or any related events, conditions or circumstances change.
Any descriptions of coverage under CNA policies or programs in this press release are provided for convenience only and are not to be relied upon with respect to questions of coverage, exclusions or limitations. With regard to all such matters, the terms and provisions of relevant insurance policies are primary and controlling. In addition, please note that all coverages may not be available in all states.
"CNA" is a registered trademark of CNA Financial Corporation. Certain CNA Financial Corporation subsidiaries use the "CNA" trademark in connection with insurance underwriting and claims activities. Copyright © 2024 CNA. All rights reserved.
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SOURCE CNA Financial
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