Liberty Mutual Posts $265 Million Q3 Net Income; $1 Billion for 9 Months

October 28, 2009

Liberty Mutual Group’s results for the third quarter of 2009 are in sharp contrast to the same period of 2008. The group reported net income for the period of $265 million for the period. Its pre-tax operating income before private equity (loss) income for the nine months ended Sept. 30 was $1.094 billion, a 17.6 percent increase of $164 million.

Liberty’s Chairman, President and CEO Edmund F. Kelly pointed out that his firm and the industry “benefited in the quarter from improved asset values and favorable weather.”

The company listed third quarter highlights as follows:
— Revenues for the three months ended September 30, 2009 were $7.916 billion, an increase of $1.045 billion or 15.2 percent over the same period in 2008.
— Net written premium for the three months ended September 30, 2009 was $7.207 billion, an increase of $661 million or 10.1 percent over the same period in 2008.
— Pre-tax operating income before private equity (loss) income for the three months ended September 30, 2009 was $263 million, an increase of $114 million or 76.5 percent over the same period in 2008.
— Pre-tax operating income for the three months ended September 30, 2009 was $258 million, an increase of $99 million or 62.3 percent over the same period in 2008.
— Net income for the three months ended September 30, 2009 was $265 million, an increase of $259 million from the same period in 2008.
— Cash flow from operations for the three months ended September 30, 2009 was $580 million, a decrease of $300 million or 34.1 percent from the same period in 2008.
— The combined ratio before catastrophes and net incurred losses, attributable to prior years for the three months ended September 30, 2009 was 97.9 percent, an increase of 3.0 points over the same period in 2008. Including the impact of catastrophes and net incurred losses attributable to prior years, the Company’s combined ratio for the three months ended September 30, 2009 decreased 2.8 points to 100.6 percent.

For the first 9 months of 2009 Liberty listed the following highlights:
— Revenues for the nine months ended September 30, 2009 were $23.152 billion, an increase of $2.448 billion or 11.8 percent over the same period in 2008.
— Net written premium for the nine months ended September 30, 2009 was $21.139 billion, an increase of $2.058 billion or 10.8 percent over the same period in 2008.
— Pre-tax operating income before private equity (loss) income for the nine months ended September 30, 2009 was $1.094 billion, an increase of $164 million or 17.6 percent over the same period in 2008.
— Pre-tax operating income for the nine months ended September 30, 2009 was $696 million, a decrease of $362 million or 34.2 percent from the same period in 2008.
— Net income for the nine months ended September 30, 2009 was $567 million, a decrease of $99 million or 14.9 percent from the same period in 2008.
— Cash flow from operations for the nine months ended September 30, 2009 was $1.568 billion, a decrease of $1.004 billion or 39.0 percent from the same period in 2008.
— The combined ratio before catastrophes and net incurred losses attributable to prior years for the nine months ended September 30, 2009 was 98.0 percent, an increase of 0.7 points from the same period in 2008. Including the impact of catastrophes and net incurred losses attributable to prior years, the Company’s combined ratio for the nine months ended September 30, 2009 decreased 1.9 points to 100.1 percent.

A full presentation of the financial results is available on the company’s Web site.

Liberty held a conference call on Tuesday Oct. 27, hosted by Kelly. A replay of the call will be available until 5:00 p.m. on November 3, 2009 at 866-473-2109.

Source: Liberty Mutual Group – www.libertymutualgroup.com

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