State Auto Starts Q1 with Strong Showing

Ohio-based State Auto Financial Corporation reported record quarterly net income of $40.8 million or $1.00 per diluted share, versus $32.4 million or $0.80 per diluted share for the first quarter of 2004. Net operating earnings(a) per diluted share were also a quarterly record, $0.96 versus $0.71, for the same 2004 period.

STFC’s GAAP combined ratio for the quarter was 84.6 versus 89.6 for the first quarter of 2004. Catastrophe losses contributed 2.7 points to the loss ratio during the first quarter this year, compared to 1.0 points for the same period in 2004. STFC’s first quarter revenue of $285.9 million was up from $273.1 million for the same period in 2004. STFC’s book value per share increased to a new high of $16.89 per share. Return on stockholders’ equity for the 12 months ending 3/31/05 was a robust 18.7%.

STFC Chairman and CEO Bob Moone stated, “It is always a plus to start a new year with positive results. Therefore, we are pleased to report excellent performance in all lines of our business during the first quarter. Our responsible pricing and disciplined underwriting strategies continued to produce outstanding combined ratios, allowing us to build shareholder value. STFC has produced record quarterly net operating earnings(a) in eight of the last ten quarters. We are confident that adherence to our core strategies will position us for success, despite periodic changes in the market landscape.”