The Hartford Financial Services Group, Inc. (NYSE:HIG.WS) Q1 2016 Earnings Conference Call - Final Transcript

Apr 29, 2016 • 09:00 am ET


The Hartford Financial Services Group, Inc. (NYSE:HIG.WS) Q1 2016 Earnings Conference Call - Final Transcript


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Good morning. My name is Chris and I will be your conference operator today. At this time I'd like to welcome everyone to The Hartford's first-quarter 2016 financial results conference call. [Operator Instructions]

Thank you. Sabra Purtill, Head of Investor Relations, you may begin your conference.

Sabra Purtill

Thank you. Good morning and welcome to The Hartfords webcast for first quarter 2016 financial results. The news release, investor financial supplement slides and 10-Q for this quarter were all released yesterday afternoon and that posted on our Web site. I did want to take this opportunity to apologize for the technical difficulties that delayed the posting of the supplement yesterday. While we do not expect to have this issue again, I wanted you all to know that we file the 8-K with the news release and supplement before we post the supplement on the website. And that's usually within just a few minutes after the news release goes out.

So even without yesterday's snafu you can always find the supplement in the 8-K before you will see it posted in the financial results section of our website. Just a heads up because we know that earnings nights are pretty hectic.

Our speakers today include Chris Swift, Chairman and CEO of The Hartford; Doug Elliot, President; and Beth Bombara, CFO. Following their prepared remarks we will have about 30 minutes for Q&A. Just a few notes before Chris begins, today's call includes forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and actual results could be materially different. We do not assume any obligation to update forward-looking statements and investors should consider the risks and uncertainties that could cause actual results to differ from these statements. A detailed description of those risks and uncertainties can be found in our SEC filings, which are available on our website.

Our presentation today also includes several non-GAAP financial measures. Explanations and reconciliations of these measures to the comparable GAAP measure are included in our SEC filings as well as in the news release and financial supplements.

I will now turn the call over to Chris.

Chris Swift

Thanks, Sabra. Good morning, everyone, and thank you for joining the call. I'm generally pleased with our results for this quarter, particularly in commercial lines and group benefits each of which delivered strong margins. We grew book value per share, excluding AOCI, 7% over the past year and achieved a 10.3% core earnings ROE, excluding Talcott. We repurchased $350 million of shares during the quarter and plan to complete our buyback program by the end of 2016.

However, core earnings were down 15% over last year as we continued to face some of the same headwinds from the second half of 2015. First, personal auto loss cost trends remain challenging, which impacted margins and led to strengthening reserves for the 2014 and 2015 accident years. Second, Commercial Lines performance has been very strong but competition continues to intensify, making it more