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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Allstate Corporation | NYSE:ALL | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 164.67 | 0 | 11:30:03 |
The Allstate Corporation (NYSE: ALL) today reported financial results for the first quarter of 2024.
The Allstate Corporation Consolidated Highlights
Three months ended March 31,
($ in millions, except per share data and ratios)
2024
2023
% / pts Change
Consolidated revenues
$
15,259
$
13,786
10.7
%
Net income (loss) applicable to common shareholders
1,189
(346
)
NM
per diluted common share (1)
4.46
(1.31
)
NM
Adjusted net income (loss)*
1,367
(342
)
NM
per diluted common share* (1)
5.13
(1.30
)
NM
Return on Allstate common shareholders’ equity (trailing twelve months)
Net income (loss) applicable to common shareholders
7.6
%
(13.0
)%
20.6
Adjusted net income (loss)*
11.3
%
(6.7
)%
18.0
Common shares outstanding (in millions)
263.9
263.1
0.3
%
Book value per common share
$
62.27
$
58.65
6.2
%
Consolidated premiums written (2)
$
14,288
$
12,865
11.1
Property-Liability insurance premiums earned
12,900
11,635
10.9
Property-Liability combined ratio
Recorded
93.0
108.6
(15.6
)
Underlying combined ratio*
86.9
93.3
(6.4
)
Catastrophe losses
$
731
$
1,691
(56.8
)%
Total policies in force (in thousands)
197,326
186,726
5.7
(1)
In periods where a net loss or adjusted net loss is reported, weighted average shares for basic earnings per share is used for calculating diluted earnings per share because all dilutive potential common shares are anti-dilutive and are therefore excluded from the calculation.
(2)
Includes premiums and contract charges for the Health and Benefits segment.
*
Measures used in this release that are not based on accounting principles generally accepted in the United States of America (“non-GAAP”) are denoted with an asterisk and defined and reconciled to the most directly comparable GAAP measure in the “Definitions of Non-GAAP Measures” section of this document.
NM = not meaningful“Allstate’s broad-based profitability reflects the benefits of strong operating capabilities, decisive actions to improve shareholder value and lower catastrophe losses,” said Tom Wilson, Chair, President and CEO of The Allstate Corporation. “Auto profitability was enhanced as a growing number of states achieved targeted margin levels in the quarter. Industry leading home insurance capabilities, when combined with lower catastrophe losses, further improved profitability. Investment income increased primarily due to higher yields and extension of fixed income maturities over the last 18 months. Revenues reached $15.3 billion for the quarter, increasing 10.7% compared to the prior year. Net income was $1.2 billion with adjusted net income* of $5.13 per diluted common share.”
“Allstate’s results support accelerated execution of the strategy to increase auto and home insurance market share and broaden protection provided to customers. Attractive auto insurance margins supported a significant increase in Allstate brand advertising, resulting in greater new business through Allstate agents and direct operations. National General increased policy growth through independent agents. Progress was also made in broadening protection offerings, with Allstate Protection Plans’ revenues increasing by over 20% due to an expanded product set and international growth. Allstate’s strategy, operational expertise, people, and financial strength will enable us to continue creating value for customers and shareholders,” concluded Wilson.
First Quarter 2024 Results
Property-Liability Results
Three months ended March 31,
($ in millions)
2024
2023
% / pts
Change
Premiums earned
$
12,900
$
11,635
10.9
%
Allstate brand
10,604
9,852
7.6
National General
2,296
1,783
28.8
Premiums written
$
13,183
$
11,783
11.9
%
Allstate brand
10,509
9,705
8.3
National General
2,674
2,078
28.7
Underwriting income (loss)
$
898
$
(1,001
)
NM
Allstate brand
790
(972
)
NM
National General
110
(28
)
NM
Recorded combined ratio
93.0
108.6
(15.6
)
Underlying combined ratio*
86.9
93.3
(6.4
)
Allstate Protection Auto Results
Three months ended March 31,
($ in millions, except ratios)
2024
2023
% / pts
Change
Premiums earned
$
8,778
$
7,908
11.0
%
Allstate brand
7,173
6,660
7.7
National General
1,605
1,248
28.6
Premiums written
$
9,357
$
8,349
12.1
%
Allstate brand
7,399
6,826
8.4
National General
1,958
1,523
28.6
Policies in Force (in thousands)
25,207
25,733
(2.0
)%
Allstate brand
20,038
21,142
(5.2
)
National General
5,169
4,591
12.6
Recorded combined ratio
96.0
104.4
(8.4
)
Underlying combined ratio*
95.1
102.6
(7.5
)
Allstate Protection Homeowners Results
Three months ended March 31,
($ in millions, except ratios)
2024
2023
% / pts
Change
Premiums earned
$
3,154
$
2,810
12.2
%
Allstate brand
2,767
2,488
11.2
National General
387
322
20.2
Premiums written
$
2,874
$
2,534
13.4
%
Allstate brand
2,517
2,210
13.9
National General
357
324
10.2
Policies in Force (in thousands)
7,364
7,262
1.4
%
Allstate brand
6,681
6,621
0.9
National General
683
641
6.6
Recorded combined ratio
82.1
119.0
(36.9
)
Catastrophe Losses
$
555
$
1,449
(61.7
)%
Underlying combined ratio*
65.5
67.6
(2.1
)
Protection Services Results
Three months ended March 31,
($ in millions)
2024
2023
% / $
Change
Total revenues (1)
$
753
$
671
12.2
%
Allstate Protection Plans
464
385
20.5
Allstate Dealer Services
146
148
(1.4
)
Allstate Roadside
66
64
3.1
Arity
39
37
5.4
Allstate Identity Protection
38
37
2.7
Adjusted net income (loss)
$
54
$
34
$
20
Allstate Protection Plans
40
28
12
Allstate Dealer Services
6
7
(1
)
Allstate Roadside
11
4
7
Arity
(4
)
(4
)
—
Allstate Identity Protection
1
(1
)
2
(1) Excludes net gains and losses on investments and derivatives.
Allstate Health and Benefits Results
Three months ended March 31,
($ in millions)
2024
2023
% Change
Premiums and contract charges
$
478
$
463
3.2
%
Employer voluntary benefits
248
255
(2.7
)
Group health
118
107
10.3
Individual health
112
101
10.9
Adjusted net income
$
56
$
56
—
Allstate Investment Results
Three months ended March 31,
($ in millions, except ratios)
2024
2023
$ / pts
Change
Net investment income
$
764
$
575
$
189
Market-based (1)
626
507
119
Performance-based (1)
201
126
75
Net gains (losses) on investments and derivatives
$
(164
)
$
14
$
(178
)
Change in unrealized net capital gains and losses, pre-tax
$
(273
)
$
872
$
(1,145
)
Total return on investment portfolio
0.5
%
2.4
%
(1.9
)
Total return on investment portfolio (trailing twelve months)
4.8
%
1.2
%
3.6
(1) Investment expenses are not allocated between market-based and performance-based portfolios with the exception of investee level expenses.
Proactive Capital Management
“Operating and financial performance in the first quarter demonstrates Allstate’s operational excellence and focus on profitability. Financial condition and capital position remain strong with statutory surplus in the insurance companies increasing compared to the prior quarter to $15.9 billion, and $3.2 billion of assets held at the holding company. Successfully executing the profit improvement plan, advancing Transformative Growth, proactively investing and expanding Protection Services delivered attractive shareholder returns,” said Jess Merten, Chief Financial Officer.
Visit www.allstateinvestors.com for additional information about Allstate’s results, including a webcast of its quarterly conference call and the call presentation. The conference call will be at 9 a.m. ET on Thursday, May 2. Financial information, including material announcements about The Allstate Corporation, is routinely posted on www.allstateinvestors.com.
Forward-Looking Statements
This news release contains “forward-looking statements” that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words like “plans,” “seeks,” “expects,” “will,” “should,” “anticipates,” “estimates,” “intends,” “believes,” “likely,” “targets” and other words with similar meanings. We believe these statements are based on reasonable estimates, assumptions and plans. However, if the estimates, assumptions or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those communicated in these forward-looking statements. Factors that could cause actual results to differ materially from those expressed in, or implied by, the forward-looking statements may be found in our filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” section in our most recent annual report on Form 10-K. Forward-looking statements are as of the date on which they are made, and we assume no obligation to update or revise any forward-looking statement.
THE ALLSTATE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)
($ in millions, except par value data)
March 31, 2024
December 31, 2023
Assets
Investments
Fixed income securities, at fair value (amortized cost, net $51,837 and $49,649)
$
50,777
$
48,865
Equity securities, at fair value (cost $2,172 and $2,244)
2,383
2,411
Mortgage loans, net
815
822
Limited partnership interests
8,562
8,380
Short-term, at fair value (amortized cost $4,320 and $5,145)
4,318
5,144
Other investments, net
1,004
1,055
Total investments
67,859
66,677
Cash
850
722
Premium installment receivables, net
10,573
10,044
Deferred policy acquisition costs
5,946
5,940
Reinsurance and indemnification recoverables, net
8,726
8,809
Accrued investment income
567
539
Deferred income taxes
161
219
Property and equipment, net
802
859
Goodwill
3,502
3,502
Other assets, net
6,255
6,051
Total assets
$
105,241
$
103,362
Liabilities
Reserve for property and casualty insurance claims and claims expense
$
40,143
$
39,858
Reserve for future policy benefits
1,325
1,347
Contractholder funds
890
888
Unearned premiums
24,945
24,709
Claim payments outstanding
1,491
1,353
Other liabilities and accrued expenses
10,029
9,635
Debt
7,938
7,942
Total liabilities
86,761
85,732
Equity
Preferred stock and additional capital paid-in, $1 par value, 25 million shares authorized, 82.0 thousand shares issued and outstanding, $2,050 aggregate liquidation preference
2,001
2,001
Common stock, $.01 par value, 2.0 billion shares authorized and 900 million issued, 264 million and 262 million shares outstanding
9
9
Additional capital paid-in
3,894
3,854
Retained income
50,662
49,716
Treasury stock, at cost (636 million and 638 million shares)
(37,044
)
(37,110
)
Accumulated other comprehensive income:
Unrealized net capital gains and losses
(819
)
(604
)
Unrealized foreign currency translation adjustments
(90
)
(98
)
Unamortized pension and other postretirement prior service credit
12
13
Discount rate for reserve for future policy benefits
14
(11
)
Total accumulated other comprehensive loss
(883
)
(700
)
Total Allstate shareholders’ equity
18,639
17,770
Noncontrolling interest
(159
)
(140
)
Total equity
18,480
17,630
Total liabilities and equity
$
105,241
$
103,362
THE ALLSTATE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
($ in millions, except per share data)
Three months ended March 31,
2024
2023
Revenues
Property and casualty insurance premiums
$
13,512
$
12,173
Accident and health insurance premiums and contract charges
478
463
Other revenue
669
561
Net investment income
764
575
Net gains (losses) on investments and derivatives
(164
)
14
Total revenues
15,259
13,786
Costs and expenses
Property and casualty insurance claims and claims expense
9,501
10,326
Accident, health and other policy benefits
296
265
Amortization of deferred policy acquisition costs
1,939
1,744
Operating costs and expenses
1,885
1,716
Pension and other postretirement remeasurement (gains) losses
(2
)
(53
)
Restructuring and related charges
10
27
Amortization of purchased intangibles
69
81
Interest expense
97
86
Total costs and expenses
13,795
14,192
Income (loss) from operations before income tax expense
1,464
(406
)
Income tax expense (benefit)
266
(85
)
Net income (loss)
1,198
(321
)
Less: Net loss attributable to noncontrolling interest
(20
)
(1
)
Net income (loss) attributable to Allstate
1,218
(320
)
Less: Preferred stock dividends
29
26
Net income (loss) applicable to common shareholders
$
1,189
$
(346
)
Earnings per common share:
Net income (loss) applicable to common shareholders per common share - Basic
$
4.51
$
(1.31
)
Weighted average common shares - Basic
263.5
263.5
Net income (loss) applicable to common shareholders per common share - Diluted
$
4.46
$
(1.31
)
Weighted average common shares - Diluted
266.5
263.5
Definitions of Non-GAAP Measures
We believe that investors’ understanding of Allstate’s performance is enhanced by our disclosure of the following non-GAAP measures. Our methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.
Adjusted net income is net income (loss) applicable to common shareholders, excluding:
Net income (loss) applicable to common shareholders is the GAAP measure that is most directly comparable to adjusted net income.
We use adjusted net income as an important measure to evaluate our results of operations. We believe that the measure provides investors with a valuable measure of the Company’s ongoing performance because it reveals trends in our insurance and financial services business that may be obscured by the net effect of net gains and losses on investments and derivatives, pension and other postretirement remeasurement gains and losses, amortization or impairment of purchased intangibles, gain or loss on disposition and adjustments for other significant non-recurring, infrequent or unusual items and the related tax expense or benefit of these items. Net gains and losses on investments and derivatives, and pension and other postretirement remeasurement gains and losses may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions, the timing of which is unrelated to the insurance underwriting process. Gain or loss on disposition is excluded because it is non-recurring in nature and the amortization or impairment of purchased intangibles is excluded because it relates to the acquisition purchase price and is not indicative of our underlying business results or trends. Non-recurring items are excluded because, by their nature, they are not indicative of our business or economic trends. Accordingly, adjusted net income excludes the effect of items that tend to be highly variable from period to period and highlights the results from ongoing operations and the underlying profitability of our business. A byproduct of excluding these items to determine adjusted net income is the transparency and understanding of their significance to net income variability and profitability while recognizing these or similar items may recur in subsequent periods. Adjusted net income is used by management along with the other components of net income (loss) applicable to common shareholders to assess our performance. We use adjusted measures of adjusted net income in incentive compensation. Therefore, we believe it is useful for investors to evaluate net income (loss) applicable to common shareholders, adjusted net income and their components separately and in the aggregate when reviewing and evaluating our performance. We note that investors, financial analysts, financial and business media organizations and rating agencies utilize adjusted net income results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the Company and management’s performance. We note that the price to earnings multiple commonly used by insurance investors as a forward-looking valuation technique uses adjusted net income as the denominator. Adjusted net income should not be considered a substitute for net income (loss) applicable to common shareholders and does not reflect the overall profitability of our business.
The following tables reconcile net income (loss) applicable to common shareholders and adjusted net income (loss). Taxes on adjustments to reconcile net income (loss) applicable to common shareholders and adjusted net income (loss) generally use a 21% effective tax rate.
($ in millions, except per share data)
Three months ended March 31,
Consolidated
Per diluted common share
2024
2023
2024
2023
Net income (loss) applicable to common shareholders (1)
$
1,189
$
(346
)
$
4.46
$
(1.31
)
Net (gains) losses on investments and derivatives
164
(14
)
0.62
(0.05
)
Pension and other postretirement remeasurement (gains) losses
(2
)
(53
)
(0.01
)
(0.20
)
Amortization of purchased intangibles
69
81
0.26
0.31
(Gain) loss on disposition
(4
)
(9
)
(0.02
)
(0.04
)
Income tax benefit
(49
)
(1
)
(0.18
)
(0.01
)
Adjusted net income (loss) * (1)
$
1,367
$
(342
)
$
5.13
$
(1.30
)
Weighted average dilutive potential common shares excluded due to net loss applicable to common shareholders (1)
—
2.6
_____________
(1)In periods where a net loss or adjusted net loss is reported, weighted average shares for basic earnings per share is used for calculating diluted earnings per share because all dilutive potential common shares are anti-dilutive and are therefore excluded from the calculation.
Adjusted net income (loss) return on Allstate common shareholders’ equity is a ratio that uses a non-GAAP measure. It is calculated by dividing the rolling 12-month adjusted net income by the average of Allstate common shareholders’ equity at the beginning and at the end of the 12-months, after excluding the effect of unrealized net capital gains and losses. Return on Allstate common shareholders’ equity is the most directly comparable GAAP measure. We use adjusted net income as the numerator for the same reasons we use adjusted net income, as discussed previously. We use average Allstate common shareholders’ equity excluding the effect of unrealized net capital gains and losses for the denominator as a representation of common shareholders’ equity primarily applicable to Allstate's earned and realized business operations because it eliminates the effect of items that are unrealized and vary significantly between periods due to external economic developments such as capital market conditions like changes in equity prices and interest rates, the amount and timing of which are unrelated to the insurance underwriting process. We use it to supplement our evaluation of net income (loss) applicable to common shareholders and return on Allstate common shareholders’ equity because it excludes the effect of items that tend to be highly variable from period to period. We believe that this measure is useful to investors and that it provides a valuable tool for investors when considered along with return on Allstate common shareholders’ equity because it eliminates the after-tax effects of realized and unrealized net capital gains and losses that can fluctuate significantly from period to period and that are driven by economic developments, the magnitude and timing of which are generally not influenced by management. In addition, it eliminates non-recurring items that are not indicative of our ongoing business or economic trends. A byproduct of excluding the items noted above to determine adjusted net income return on Allstate common shareholders’ equity from return on Allstate common shareholders’ equity is the transparency and understanding of their significance to return on common shareholders’ equity variability and profitability while recognizing these or similar items may recur in subsequent periods. We use adjusted measures of adjusted net income return on Allstate common shareholders’ equity in incentive compensation. Therefore, we believe it is useful for investors to have adjusted net income return on Allstate common shareholders’ equity and return on Allstate common shareholders’ equity when evaluating our performance. We note that investors, financial analysts, financial and business media organizations and rating agencies utilize adjusted net income return on common shareholders’ equity results in their evaluation of our and our industry’s financial performance and in their investment decisions, recommendations and communications as it represents a reliable, representative and consistent measurement of the industry and the company and management’s utilization of capital. We also provide it to facilitate a comparison to our long-term adjusted net income return on Allstate common shareholders’ equity goal. Adjusted net income return on Allstate common shareholders’ equity should not be considered a substitute for return on Allstate common shareholders’ equity and does not reflect the overall profitability of our business.
The following tables reconcile return on Allstate common shareholders’ equity and adjusted net income (loss) return on Allstate common shareholders’ equity.
($ in millions)
For the twelve months ended March 31,
2024
2023
Return on Allstate common shareholders’ equity
Numerator:
Net income (loss) applicable to common shareholders
$
1,219
$
(2,374
)
Denominator:
Beginning Allstate common shareholders’ equity
$
15,524
$
21,105
Ending Allstate common shareholders’ equity (1)
16,638
15,524
Average Allstate common shareholders’ equity
$
16,081
$
18,315
Return on Allstate common shareholders’ equity
7.6
%
(13.0
)%
($ in millions)
For the twelve months ended March 31,
2024
2023
Adjusted net income (loss) return on Allstate common shareholders’ equity
Numerator:
Adjusted net income (loss) *
$
1,960
$
(1,311
)
Denominator:
Beginning Allstate common shareholders’ equity
$
15,524
$
21,105
Less: Unrealized net capital gains and losses
(1,573
)
(996
)
Adjusted beginning Allstate common shareholders’ equity
17,097
22,101
Ending Allstate common shareholders’ equity (1)
16,638
15,524
Less: Unrealized net capital gains and losses
(819
)
(1,573
)
Adjusted ending Allstate common shareholders’ equity
17,457
17,097
Average adjusted Allstate common shareholders’ equity
$
17,277
$
19,599
Adjusted net income (loss) return on Allstate common shareholders’ equity *
11.3
%
(6.7
)%
_____________
(1)Excludes equity related to preferred stock of $2,001 million and $1,970 million as of March 31, 2024 and 2023, respectively.
Combined ratio excluding the effect of catastrophes, prior year reserve reestimates and amortization or impairment of purchased intangibles (“underlying combined ratio”) is a non-GAAP ratio, which is computed as the difference between four GAAP operating ratios: the combined ratio, the effect of catastrophes on the combined ratio, the effect of prior year non-catastrophe reserve reestimates on the combined ratio, and the effect of amortization or impairment of purchased intangibles on the combined ratio. We believe that this ratio is useful to investors, and it is used by management to reveal the trends in our Property-Liability business that may be obscured by catastrophe losses, prior year reserve reestimates and amortization or impairment of purchased intangibles. Catastrophe losses cause our loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude, and can have a significant impact on the combined ratio. Prior year reserve reestimates are caused by unexpected loss development on historical reserves, which could increase or decrease current year net income. Amortization or impairment of purchased intangibles relates to the acquisition purchase price and is not indicative of our underlying insurance business results or trends. We believe it is useful for investors to evaluate these components separately and in the aggregate when reviewing our underwriting performance. The most directly comparable GAAP measure is the combined ratio. The underlying combined ratio should not be considered a substitute for the combined ratio and does not reflect the overall underwriting profitability of our business.
The following tables reconcile the respective combined ratio to the underlying combined ratio. Underwriting margin is calculated as 100% minus the combined ratio.
Property-Liability
Three months ended March 31,
2024
2023
Combined ratio
93.0
108.6
Effect of catastrophe losses
(5.7
)
(14.5
)
Effect of prior year non-catastrophe reserve reestimates
(0.1
)
(0.3
)
Effect of amortization of purchased intangibles
(0.3
)
(0.5
)
Underlying combined ratio*
86.9
93.3
Effect of prior year catastrophe reserve reestimates
(1.3
)
(0.4
)
Allstate Protection - Auto Insurance
Three months ended March 31,
2024
2023
Combined ratio
96.0
104.4
Effect of catastrophe losses
(1.2
)
(1.2
)
Effect of prior year non-catastrophe reserve reestimates
0.7
(0.1
)
Effect of amortization of purchased intangibles
(0.4
)
(0.5
)
Underlying combined ratio*
95.1
102.6
Effect of prior year catastrophe reserve reestimates
(0.1
)
(0.4
)
Allstate Protection - Homeowners Insurance
Three months ended March 31,
2024
2023
Combined ratio
82.1
119.0
Effect of catastrophe losses
(17.6
)
(51.6
)
Effect of prior year non-catastrophe reserve reestimates
1.3
0.5
Effect of amortization of purchased intangibles
(0.3
)
(0.3
)
Underlying combined ratio*
65.5
67.6
Effect of prior year catastrophe reserve reestimates
(4.7
)
(0.2
)
View source version on businesswire.com: https://www.businesswire.com/news/home/20240501923026/en/
Al Scott Media Relations (847) 402-5600
Brent Vandermause Investor Relations (847) 402-2800
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