Assurant Q3 2020 Earnings Report
Key Takeaways
Assurant reported a net loss of $34.9 million, or $0.58 per share, compared to a net loss of $59.5 million, or $0.96 per share, in the prior year period. Net operating income was $84.8 million, or $171.8 million excluding reportable catastrophes. The company is raising its 2020 outlook to 17 to 21 percent growth in net operating income per share, excluding catastrophe losses.
Net loss of $34.9 million, or $0.58 per share, compared to the prior year period net loss of $59.5 million or $0.96 per share
Net operating income of $84.8 million, or $171.8 million excluding reportable catastrophes, down 19 percent and up 22 percent, respectively
Net operating income per diluted share of $1.41, or $2.85 excluding reportable catastrophes, down 17 percent and up 25 percent, respectively
$460 million of holding company liquidity available at quarter end
Assurant
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Assurant Revenue by Segment
Forward Guidance
The company’s outlook for 2020 is based on its current assumptions regarding market and business conditions, including the impacts of COVID-19, and does not reflect Assurant’s pending acquisition of HYLA Mobile and related financing, nor the company’s ongoing evaluation of strategic alternatives for Global Preneed.
Positive Outlook
- Assurant net operating income per diluted share, excluding reportable catastrophes, to increase 17 percent to 21 percent from $9.21 in 2019
- This will be driven by profitable growth and ongoing expense management across all business segments.
- Double-digit growth in net operating income, excluding reportable catastrophes, mainly driven by Global Lifestyle and Global Housing.
- Earnings growth to be driven by Connected Living as well as Global Automotive, partially offset by continued declines in legacy Global Financial Services and investments to support growth.
- Global Housing earnings, excluding catastrophe losses, to expand, mainly from lower non-catastrophe losses, improved results in specialty and other, and growth in multifamily housing.
Challenges Ahead
- Mandatory convertible shares are expected to be dilutive for the year versus anti-dilutive in 2019.
- Global Housing growth to be partially offset by the previously disclosed loss of loans from a financially insolvent client and lower real estate owned volumes in lender-placed insurance.
- Continued pressure from lower investment income and foreign exchange volatility are also expected to impact results.
- Corporate and Other full-year net operating loss to approximate $90 million, reflecting reduced investment income primarily from lower yields partially offset by lower general expenses.
- Interest expense and preferred dividends are expected to be approximately $81 million and $19 million, respectively.