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Unum Group (UNM) Q2 Earnings Top Estimates, Revenues Rise Y/Y
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Unum Group’s (UNM - Free Report) second-quarter 2024 operating net income of $2.16 per share beat the Zacks Consensus Estimate by 6.9%. The bottom line increased 4.8% year over year.
The quarterly results reflected favorable recoveries in the group long-term disability product line, in-force block growth, higher sales, premium growth and improved persistency. Favorable benefit experience in the product lines also added to the upside.
Total operating revenues of Unum Group were $3.2 billion, up 4.2% year over year, driven by higher premium income, other income and improved net investment income. The top line beat the Zacks Consensus Estimate by 0.5%.
Premiums increased 4.7% from the prior-year quarter to $2.6 billion. The figure matched our estimate as well as the Zacks Consensus Estimate.
Total benefits and expenses increased 4.7% year over year to $2.7 billion, largely attributable to higher policy benefits, including remeasurement gain, commissions, interest and debt expense, amortization of deferred acquisition costs and other expenses. The figure matched our estimate.
Quarterly Segment Update
Unum U.S.: Premium income was $1.7 billion, up 5.5% year over year. Adjusted operating income rose 4.2% year over year to $357.5 million. The Zacks Consensus Estimate was pegged at $357.2 million. Our estimate was $323.8 million.
Unum International: Premium income of $228.8 million increased 10.1% year over year. Adjusted operating income was $42.5 million, down 2.3% year over year. Our estimate was $37.4 million.
The Unum U.K. line of business premium income was £151.8 million, up 6.1% from the year-ago quarter due to in-force block growth. Adjusted operating income, in local currency, of £32.5 million was down 5.2% from a year ago.
The benefit ratio was 69.5, which improved 280 basis points (bps) due to favorable recoveries in the group long-term disability product line. Sales increased 5.7% to £44.3 million.
Persistency increased in the group long-term disability and group life product line but decreased in the supplemental line of business.
Colonial Life: Premium income increased 3.6% from the prior-year figure to $446.2 million due to higher prior period sales and favorable persistency. Sales increased 0.7% from the year-ago figure to $122.9 million. Adjusted operating income increased 1.2% from the prior-year period to $116.9 million. Our estimate was $106.7 million while the Zacks Consensus Estimate was pegged at $118.1 million.
Persistency was 78.2% in the first half of 2024, which expanded 70 bps year over year.
The benefit ratio improved 50 bps year over year to 47.8, primarily due to favorable benefit experience in the life and accident, sickness and disability product lines.
Closed Block: Adjusted operating income was $51.6 million, which increased 0.7% year over year. Our estimate was $31.5 million, while the Zacks Consensus Estimate was $33.6 million.
Corporate: The segment incurred an adjusted operating loss of $45.3 million against $34.9 million earned in the year-ago quarter. The loss was primarily due to a decrease in net investment income, attributable to increased allocation to lines of business. Our estimate for loss was $44.8 million, while the Zacks Consensus Estimate was pegged at a loss of $44.5 million.
Capital Management
As of Jun 30, 2024, the weighted average risk-based capital ratio for the company’s traditional U.S. insurance companies was approximately 470%.
Unum Group exited the second quarter of 2024 with liquidity worth $1.3 billion.
Book value per share grew 18.2% year over year to $47.06 as of Jun 30, 2024.
UNM bought back 3.5 shares for $179.8 million.
2024 Guidance
Riding on the solid first half of 2024, UNM increased the outlook for after-tax adjusted operating income per share to 10-15% from the earlier guidance of 7-9%
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2024 operating income of $1.29 per share, which surpassed the Zacks Consensus Estimate by 33%. The bottom line increased 7% year over year. Total operating revenues in the quarter under review were $2.4 billion, which improved 10.8% year over year. However, the top line missed the consensus mark by 1.5%.
Net written premiums climbed 14% year over year to $2.4 billion. Investment income, net of expenses, increased 10% year over year to $242 million and missed our estimate of $246.2 million. The Zacks Consensus Estimate was pegged at $252 million. Total benefits and expenses of Cincinnati Financial increased 11.2% year over year to $2.1 billion. Our estimate was $2.2 billion. In its P&C insurance business, CINF witnessed an underwriting income of $35 million, which decreased 26% from the year-ago period. Our estimate was pegged at an income of $1.5 million.
RLI Corp. (RLI - Free Report) reported second-quarter 2024 operating earnings of $1.72 per share, beating the Zacks Consensus Estimate by 27.4%. The bottom line improved 48.3% year over year. Operating revenues for the reported quarter were $413 million, up 17.6% year over year, driven by 17.6% higher net premiums earned and 18% higher net investment income. The top line beat the Zacks Consensus Estimate of $403 million. Gross premiums written increased 11% year over year to $563.4 million. Our estimate was $664 million.
Net investment income increased 18% year over year to $34 million. Our estimate was $39.1 million. The Zacks Consensus Estimate was pegged at $37.4 million. Total expenses increased 9.5% year over year to $314.8 million. Our estimate was $331.7 million. Underwriting income increased 70% year over year to $70 million. The combined ratio improved 570 bps year over year to 81.5. The Zacks Consensus Estimate for the metric was pegged at 95.3, while our estimate was 89.9.
CNA Financial Corporation (CNA - Free Report) reported second-quarter 2024 core earnings of $1.19 per share, which missed the Zacks Consensus Estimate by 1.6%. However, the bottom line increased 5.3% year over year. Total operating revenues of CNA Financial were $3.1 billion, up 6.7% year over year. The top line beat the Zacks Consensus Estimate by 1.3%. Net written premiums of Property & Casualty Operations increased 6% year over year to $2.6 billion.
Net investment income rose 7.4% year over year to $618 million. Our estimate for net investment was $601.1 million. The Zacks Consensus Estimate was pegged at $592.3 million. Total claims, benefits and expenses increased 7.3% to $2.6 billion. Our estimate was $2.5 billion. Catastrophe losses were $82 million, wider than a loss of $68 million in the year-ago quarter. Underwriting income declined 10.1% year over year to $124 million. Our estimate was $175.3 million.
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Unum Group (UNM) Q2 Earnings Top Estimates, Revenues Rise Y/Y
Unum Group’s (UNM - Free Report) second-quarter 2024 operating net income of $2.16 per share beat the Zacks Consensus Estimate by 6.9%. The bottom line increased 4.8% year over year.
The quarterly results reflected favorable recoveries in the group long-term disability product line, in-force block growth, higher sales, premium growth and improved persistency. Favorable benefit experience in the product lines also added to the upside.
Unum Group Price, Consensus and EPS Surprise
Unum Group price-consensus-eps-surprise-chart | Unum Group Quote
Operational Update
Total operating revenues of Unum Group were $3.2 billion, up 4.2% year over year, driven by higher premium income, other income and improved net investment income. The top line beat the Zacks Consensus Estimate by 0.5%.
Premiums increased 4.7% from the prior-year quarter to $2.6 billion. The figure matched our estimate as well as the Zacks Consensus Estimate.
Total benefits and expenses increased 4.7% year over year to $2.7 billion, largely attributable to higher policy benefits, including remeasurement gain, commissions, interest and debt expense, amortization of deferred acquisition costs and other expenses. The figure matched our estimate.
Quarterly Segment Update
Unum U.S.: Premium income was $1.7 billion, up 5.5% year over year.
Adjusted operating income rose 4.2% year over year to $357.5 million. The Zacks Consensus Estimate was pegged at $357.2 million. Our estimate was $323.8 million.
Unum International: Premium income of $228.8 million increased 10.1% year over year. Adjusted operating income was $42.5 million, down 2.3% year over year. Our estimate was $37.4 million.
The Unum U.K. line of business premium income was £151.8 million, up 6.1% from the year-ago quarter due to in-force block growth. Adjusted operating income, in local currency, of £32.5 million was down 5.2% from a year ago.
The benefit ratio was 69.5, which improved 280 basis points (bps) due to favorable recoveries in the group long-term disability product line. Sales increased 5.7% to £44.3 million.
Persistency increased in the group long-term disability and group life product line but decreased in the supplemental line of business.
Colonial Life: Premium income increased 3.6% from the prior-year figure to $446.2 million due to higher prior period sales and favorable persistency.
Sales increased 0.7% from the year-ago figure to $122.9 million. Adjusted operating income increased 1.2% from the prior-year period to $116.9 million. Our estimate was $106.7 million while the Zacks Consensus Estimate was pegged at $118.1 million.
Persistency was 78.2% in the first half of 2024, which expanded 70 bps year over year.
The benefit ratio improved 50 bps year over year to 47.8, primarily due to favorable benefit experience in the life and accident, sickness and disability product lines.
Closed Block: Adjusted operating income was $51.6 million, which increased 0.7% year over year. Our estimate was $31.5 million, while the Zacks Consensus Estimate was $33.6 million.
Corporate: The segment incurred an adjusted operating loss of $45.3 million against $34.9 million earned in the year-ago quarter. The loss was primarily due to a decrease in net investment income, attributable to increased allocation to lines of business. Our estimate for loss was $44.8 million, while the Zacks Consensus Estimate was pegged at a loss of $44.5 million.
Capital Management
As of Jun 30, 2024, the weighted average risk-based capital ratio for the company’s traditional U.S. insurance companies was approximately 470%.
Unum Group exited the second quarter of 2024 with liquidity worth $1.3 billion.
Book value per share grew 18.2% year over year to $47.06 as of Jun 30, 2024.
UNM bought back 3.5 shares for $179.8 million.
2024 Guidance
Riding on the solid first half of 2024, UNM increased the outlook for after-tax adjusted operating income per share to 10-15% from the earlier guidance of 7-9%
Zacks Rank
Unum Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2024 operating income of $1.29 per share, which surpassed the Zacks Consensus Estimate by 33%. The bottom line increased 7% year over year. Total operating revenues in the quarter under review were $2.4 billion, which improved 10.8% year over year. However, the top line missed the consensus mark by 1.5%.
Net written premiums climbed 14% year over year to $2.4 billion. Investment income, net of expenses, increased 10% year over year to $242 million and missed our estimate of $246.2 million. The Zacks Consensus Estimate was pegged at $252 million. Total benefits and expenses of Cincinnati Financial increased 11.2% year over year to $2.1 billion. Our estimate was $2.2 billion. In its P&C insurance business, CINF witnessed an underwriting income of $35 million, which decreased 26% from the year-ago period. Our estimate was pegged at an income of $1.5 million.
RLI Corp. (RLI - Free Report) reported second-quarter 2024 operating earnings of $1.72 per share, beating the Zacks Consensus Estimate by 27.4%. The bottom line improved 48.3% year over year. Operating revenues for the reported quarter were $413 million, up 17.6% year over year, driven by 17.6% higher net premiums earned and 18% higher net investment income. The top line beat the Zacks Consensus Estimate of $403 million. Gross premiums written increased 11% year over year to $563.4 million. Our estimate was $664 million.
Net investment income increased 18% year over year to $34 million. Our estimate was $39.1 million. The Zacks Consensus Estimate was pegged at $37.4 million. Total expenses increased 9.5% year over year to $314.8 million. Our estimate was $331.7 million. Underwriting income increased 70% year over year to $70 million. The combined ratio improved 570 bps year over year to 81.5. The Zacks Consensus Estimate for the metric was pegged at 95.3, while our estimate was 89.9.
CNA Financial Corporation (CNA - Free Report) reported second-quarter 2024 core earnings of $1.19 per share, which missed the Zacks Consensus Estimate by 1.6%. However, the bottom line increased 5.3% year over year. Total operating revenues of CNA Financial were $3.1 billion, up 6.7% year over year. The top line beat the Zacks Consensus Estimate by 1.3%. Net written premiums of Property & Casualty Operations increased 6% year over year to $2.6 billion.
Net investment income rose 7.4% year over year to $618 million. Our estimate for net investment was $601.1 million. The Zacks Consensus Estimate was pegged at $592.3 million. Total claims, benefits and expenses increased 7.3% to $2.6 billion. Our estimate was $2.5 billion. Catastrophe losses were $82 million, wider than a loss of $68 million in the year-ago quarter. Underwriting income declined 10.1% year over year to $124 million. Our estimate was $175.3 million.