Selective Reports Strong Results for the Third Quarter of 2018 - Net Income per Diluted Share of $0.93;
Non-GAAP Operating Income1 per Diluted Share of $0.99;
Dividend Increase of 11% to $0.20 per share
In the third quarter of 2018:
Net premiums written grew 8%
GAAP combined ratio was 94.6%
After-tax net investment income was up 45%, to $43 million
Annualized return on equity was 12.9% and non-GAAP annualized return on equity was 13.8%
Branchville, NJ - October 25, 2018 - Selective Insurance Group, Inc. (NASDAQ: SIGI) today reported its financial results for the third quarter ended September 30, 2018. Net income per diluted share was $0.93, compared to $0.79 a year ago. Non-GAAP operating income1 per diluted share was $0.99, compared to $0.72 a year ago.
“In the third quarter, we generated a 94.6% GAAP combined ratio, or 90.0% excluding catastrophe losses," said Gregory E. Murphy, Chairman and Chief Executive Officer. "Although Hurricane Florence added 2.4 points to our combined ratio, our financial results this quarter reflect our disciplined underwriting franchise and strong underlying insurance operations performance. Superior service is always a focus at Selective and never more important than in the wake of devastating storms like Hurricane Florence. We are proud of the work performed by our claims team in helping our customers rebuild their homes and businesses in the days and weeks following the storm. Growth in the quarter remains solid, as net premiums written increased 8%, driven by steady standard lines retention at 84% and commercial lines renewal pure price increases of 3.7%. Our strong relationships with our 'ivy league' distribution partners, investments in our sophisticated technology, underwriting capabilities, and focus on a superior experience for our customers and agents position us well for continued financial outperformance relative to the industry."
Mr. Murphy continued, "For the quarter, our annualized non-GAAP operating return on average equity1 was an excellent 13.8%, and 11.3% for the first nine months of 2018, compared to our financial target of 12% for 2018, which for 2018 we established as 300 basis points over our estimated weighted average cost of capital. Our results were particularly strong in the context of an above-average quarter in terms of catastrophe loss activity for the industry. We again generated superior investment performance in the quarter with after-tax net investment income up 45% from a year ago, to $43 million, benefiting from improved alternative investment returns, higher interest rates, active portfolio management and security selection,as well as the lower Federal income tax rate."
As a result of ongoing strong financial performance, the Board of Directors declared an 11% increase in the quarterly cash dividend on common stock, to $0.20 per share, that is payable December 3, 2018, to shareholders of record as of November 15, 2018.
The following information was filed by Selective Insurance Group Inc (SIGI) on Thursday, October 25, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.