Chattanooga-based insurer Unum Group on Tuesday posted second quarter results which showed the impact of the coronavirus as the company took a hit on earnings.
After-tax adjusted operating income was $250.1 million in the quarter, or $1.23 per diluted common share, compared to $286.9 million, or $1.36 per diluted common share, a year ago.
Zacks estimated the company would come in at $1.19 earnings per share in the quarter.
Net income also fell to $265.5 million, or $1.30 per diluted common share, for the second quarter compared to net income of $281.2 million, or $1.33 per diluted common share, a year ago.
The company said it experienced high mortality in group life, voluntary life, and long-term care segments in the current pandemic environment.
Also, the company said after the close of the markets that it’s suspending financial guidance for the remainder of 2020 due to the uncertain economic environment caused by the COVID-19 pandemic.
Richard P. McKenney, president and chief executive officer of Chattanooga’s biggest publicly traded company, said the insurer’s team executed well in the middle of a challenging environment and he’s “proud of our responsiveness to our customers in this time of need.”
“We also produced solid second quarter financial results, with good operating profits and continued financial strength,” he said. “As we look to the second half of the year there is still uncertainty to the path of the pandemic and its corresponding effects. We will continue to adapt to the changing landscape as we serve the needs of our customers.”
Included in net income for the second quarter is an after-tax impairment loss of $10 million on the right-of-use asset related to one of its operating leases for office space that Unum is no longer using to support operations.
The company’s Unum US segment reported adjusted operating income of $231.9 million in the second quarter, down 8.8% from $254.3 million a year ago. Net investment income for the segment decreased 3.9% to $176.9 million in the second quarter of 2020, the company reported.
The segment’s group life and accidental death and dismemberment line of business reported adjusted operating income of $19.4 million in the second quarter, a drop of 69.1% over a year ago.
The Unum International segment reported adjusted operating income of $15.1 million in the quarter, down 50.8%.
Colonial Life reported a 7.7% increase in adjusted operating income to $90.9 million in the second quarter.
Unum’s stock closed Tuesday at $17.83 per share, down 27 cents, or 1.47% on the New York Stock Exchange.
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