St. Paul Travelers Issues Q1 Earnings Report

April 29, 2004

The St. Paul Travelers Companies, Inc. reported that net income for the first quarter ended March 31, 2004 increased 73 percent to $587.2 million, or $1.34 per share diluted ($1.35 per share basic) compared to the prior year quarter.

The newly formed noted that “All share and per share amounts have been restated to reflect the second quarter exchange of one share of Travelers Property Casualty Corp. (Travelers) common stock for 0.4334 shares of St. Paul Travelers common stock, which took place on April 1, 2004.

“For accounting purposes, Travelers is the accounting acquirer. Accordingly, in this press release and going forward, the stand-alone results of operations of Travelers for the quarter ended March 31, 2004 and all prior periods will be presented as the results of St. Paul Travelers for those periods. The results of the combined operations will be consolidated for all future periods beginning in the second quarter.

“For the first quarter 2004, St. Paul’s stand-alone net income, which is not included in the St. Paul Travelers results described above, increased to $188.0 million from $181.0 million in the prior year quarter.”

The bulletin then listed the following “Highlights:
— Achieved record operating income of $614.4 million, an 82 percent increase from the prior year quarter. Earnings include a significant increase in net investment income due to higher returns on alternative investments and continued strong current accident year results for both Commercial and Personal Lines. The combined ratio improved to 91.9 percent.
— Reported a record operating return on equity of 21.9 percent (excluding FAS 115).
— Increased net written premiums by 10 percent to $3.47 billion with growth in both Commercial and Personal Lines.

“Generally, market conditions remain strong. The combination of current rate levels and anticipated loss trends continue to generate significant margins in our businesses,” stated CEO Jay S. Fishman.” While we are in the early days of the merger, the integration is going very well. We are enthusiastic about the support we are receiving from our agents, brokers and employees and have a high degree of confidence that we will achieve our goals and objectives.”

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