Unum Group on Tuesday reported that positive investment returns and improved coronavirus dynamics helped drive higher second quarter operating income.
After-tax adjusted operating income was $286.2 million, or $1.39 per common share in the quarter, compared to $250.1 million, or $1.23 per common share in the same year-ago period, the company reported on Tuesday.
That beat the consensus earning estimate of $1.12 per share on Seeking Alpha.
Richard P. McKenney, president and chief executive officer of the Chattanooga-based disability insurer, said the favorable results are spurring an improvement in its outlook for the full year, which officials expect to continue to be influenced by the pandemic.
“We are very pleased with our strong second quarter results, highlighted by positive investment returns and aided by improved COVID dynamics relative to the first quarter,” he said after earnings were released following the close of the markets. “Our core business segments exhibited solid underlying fundamental trends, with improving sales and overall stable benefits experience.”
The company said it expects a drop of about 1% to 3% in after-tax adjusted operating income per share for full-year 2021 relative to 2020. That’s compared to its previous expectation of a 5% to 6% decline.
Unum’s stock traded on the New York Stock Exchange closed Tuesday at $27.25 per share, up 5 cents, or 0.18%.
Still, net income of $182.9 million, or 89 cents per common share, for the second quarter was down from $265.5 million, or $1.30 per common share a year ago.
Included in net income for the second quarter are the after-tax cost related to the early retirement of debt of $53.2 million and an after-tax impairment loss of $11 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 general operations, the company reported.
The Unum US segment reported adjusted operating income of $179.3 million in the second quarter, a decrease of 22.7% from $231.9 million a year ago. Net investment income for the segment increased 3.8% to $183.6 million in the second quarter compared to $176.9 million in the year-ago period.
Colonial Life reported a 5.4% increase in adjusted operating income to $95.8 million in the second quarter. Premium income fell 4.3% to $419.7 million in the second quarter of 2021.
The Unum International segment reported adjusted operating income of $24.8 million in the second quarter, up 64.2% from a year ago. Premium income increased 16.8% to $183.5 million in the second quarter.
– Compiled by Mike Pare