Hartford Financial posts 4th-quarter profit, beats estimates, provides 2010 outlook

Hartford Financial’s 4Q profit beats estimates

CHARLOTTE, N.C. — Insurer Hartford Financial Services Group said Monday it was profitable in the fourth quarter as its life and property-casualty businesses both improved.

The Hartford, Conn.-based company earned $557 million, or $1.19 per share in the final three months of the year. That compared with a loss of $806 million, or $2.71 per share, a year earlier.

Excluding investment gains and losses, core earnings rose to $689 million, or $1.51 per share, versus a loss of $208 million or 72 cents per share a year ago.

Hartford said last month that fourth-quarter core earnings would likely be $1.45 per share to $1.60 per share.

Results exceeded Wall Street’s expectations for earnings of $1.40 per share, according to a poll by Thomson Reuters.

Like most insurers, Hartford emphasizes operating income because it excludes investment gains and losses and is considered more reflective of the company’s performance.

“Although the company posted strong earnings in the fourth quarter, the economy and market conditions remain uncertain,” CEO Liam McGee said in a statement.

McGee joined Hartford Financial Services Group in October. He was the former head of consumer banking at Bank of America Corp.

Results in the most recent quarter got a boost from better results in Hartford Financial’s life insurance and property and casualty insurance businesses.

The company’s life unit posted net income of $118 million, compared with a net loss of $807 million in the prior year period. Its property and casualty insurance business had net income of $508 million, up 75 percent from the fourth quarter 2008.

Hartford Financial said its property and casualty ongoing operations also reported a combined ratio of 92.6 percent, excluding catastrophes. This compares with 85.3 percent in the year-ago quarter. The combined ratio measures the amount of money an insurer pays in claims and expenses compared with how much it receives from underwriting premiums. A ratio above 100 percent means the insurer is paying out more than it generates from premiums.

For the full year, Hartford reported a net loss of $887 million, or $2.93 per share, compared with a net loss of $2.75 billion, or $8.99 per share, in 2008.

Hartford said it sees 2010 core earnings coming in at $3.70 per share to $4 per share. Analysts expect earnings of $3.96 per share.

Shares lost 42 cents, or 1.8 percent, to $23.04 in after-hours trading. The stock lost 7 cents to $23.46 in the regular session.