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RLI Corp.'s (RLI) Q2 Earnings Beat Estimates, Revenues Miss
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RLI Corp.’s (RLI - Free Report) second-quarter 2019 operating earnings of 66 cents per share surpassed the Zacks Consensus Estimate by 13.8%. The bottom line increased 10% from the prior-year quarter.
RLI witnessed improved premiums across most of its product lines along with increase in net investment income in the reported quarter.
Operating revenues for the reported quarter totaled $224.5 million, up 1.6% year over year. This upside can be attributed to higher net premiums earned and net investment income. However, the top line missed the Zacks Consensus Estimate by 1.1%.
Gross premiums written increased 5% year over year to $283.3 million. The uptick can be attributed to solid performance of Casualty and Property segments.
Total expenses increased 6.1% year over year to $197.8 million, primarily due to increased insurance operating expenses, loss and settlement expenses, policy acquisition costs, interest expense and general corporate expense.
Net investment income rose nearly 16.6% year over year to $17 million. Total return from the investment portfolio was 2.9%.
The company reported underwriting income of $14.9 million, which increased 5.7% from the year-ago period. This upside was due to solid results at the Surety and Casualty segments, partially offset by soft performance of the Property segment.
Combined ratio improved 180 basis points year over year to 92.8%
Financial Update
The company exited the second quarter with total investments and cash of $2.4 billion, up 10.1% from 2018 end.
Book value was $21.43 per share as of Jun 30, 2019, up 21% from the figure as of Dec 31, 2018.
Long-term debt was $149.2 million, up 0.1% from Dec 31, 2018.
Statutory surplus improved 9.7% to $984.9 million, up 18.7% from Dec 31, 2018.
Return on equity was 20.7%, reflecting an increase of 1100 basis points.
Net cash flow from operations declined 11.9% year over year to $74.6 million in the quarter under review.
Dividend Update
On Jun 20, 2019, the company paid out a cash dividend of 23 cents per share. Dividends totaled $603 million in the last five years.
The Progressive Corporation (PGR - Free Report) recently reported second-quarter earnings, which surpassed expectations.
Upcoming Releases
The Travelers Companies, Inc. (TRV - Free Report) will release second-quarter 2019 earnings on Jul 23. The Zacks Consensus Estimate for the same stands at $2.31 per share, suggesting 27.6% year-over-year increase.
Chubb Corporation (CB - Free Report) will release second-quarter 2019 earnings on Jul 23. The Zacks Consensus Estimate for the same is pegged at $2.58, indicating year-over-year decrease of 3.7%.
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It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
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RLI Corp.'s (RLI) Q2 Earnings Beat Estimates, Revenues Miss
RLI Corp.’s (RLI - Free Report) second-quarter 2019 operating earnings of 66 cents per share surpassed the Zacks Consensus Estimate by 13.8%. The bottom line increased 10% from the prior-year quarter.
RLI witnessed improved premiums across most of its product lines along with increase in net investment income in the reported quarter.
RLI Corp. Price, Consensus and EPS Surprise
RLI Corp. price-consensus-eps-surprise-chart | RLI Corp. Quote
Operational Performance
Operating revenues for the reported quarter totaled $224.5 million, up 1.6% year over year. This upside can be attributed to higher net premiums earned and net investment income. However, the top line missed the Zacks Consensus Estimate by 1.1%.
Gross premiums written increased 5% year over year to $283.3 million. The uptick can be attributed to solid performance of Casualty and Property segments.
Total expenses increased 6.1% year over year to $197.8 million, primarily due to increased insurance operating expenses, loss and settlement expenses, policy acquisition costs, interest expense and general corporate expense.
Net investment income rose nearly 16.6% year over year to $17 million. Total return from the investment portfolio was 2.9%.
The company reported underwriting income of $14.9 million, which increased 5.7% from the year-ago period. This upside was due to solid results at the Surety and Casualty segments, partially offset by soft performance of the Property segment.
Combined ratio improved 180 basis points year over year to 92.8%
Financial Update
The company exited the second quarter with total investments and cash of $2.4 billion, up 10.1% from 2018 end.
Book value was $21.43 per share as of Jun 30, 2019, up 21% from the figure as of Dec 31, 2018.
Long-term debt was $149.2 million, up 0.1% from Dec 31, 2018.
Statutory surplus improved 9.7% to $984.9 million, up 18.7% from Dec 31, 2018.
Return on equity was 20.7%, reflecting an increase of 1100 basis points.
Net cash flow from operations declined 11.9% year over year to $74.6 million in the quarter under review.
Dividend Update
On Jun 20, 2019, the company paid out a cash dividend of 23 cents per share. Dividends totaled $603 million in the last five years.
Zacks Rank
RLI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Release
The Progressive Corporation (PGR - Free Report) recently reported second-quarter earnings, which surpassed expectations.
Upcoming Releases
The Travelers Companies, Inc. (TRV - Free Report) will release second-quarter 2019 earnings on Jul 23. The Zacks Consensus Estimate for the same stands at $2.31 per share, suggesting 27.6% year-over-year increase.
Chubb Corporation (CB - Free Report) will release second-quarter 2019 earnings on Jul 23. The Zacks Consensus Estimate for the same is pegged at $2.58, indicating year-over-year decrease of 3.7%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>