In This Article:
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Core EPS: $1.07 per share, a 73% increase over the prior year.
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Core Earnings: $45 million, reflecting a 73% increase over the prior year.
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Return on Equity: 10.6%, a 4.9% improvement over the prior year.
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Net Investment Income: $116 million, a 10% increase over the prior year.
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Property and Casualty Combined Ratio: 89.4%, a 10.5-point improvement over the prior year.
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Net Written Premiums: $185 million, an 8% increase over the prior year.
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Auto Sales: Up 8%.
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Individual Supplemental Sales: Up 61%.
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Annuity Net Contract Deposits: Up 6%.
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Share Repurchases: $7 million returned to shareholders year-to-date through May 2nd.
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Dividend Increase: 3% increase in annual dividend, marking the 17th consecutive year of increases.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Horace Mann Educators Corp (NYSE:HMN) reported a record first quarter core EPS of $1.07, a 73% increase over the prior year.
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The property and casualty segment showed strong performance with a combined ratio of 89.4%, a 10.5% improvement over the prior year.
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Total net investment income increased by 10% over the prior year, driven by higher limited partnership returns and strong fixed income portfolio performance.
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First quarter sales were robust, with individual supplemental sales up 61%, auto sales up 8%, and annuity net contract deposits up 6%.
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The company increased its annual dividend by 3%, marking the 17th consecutive year of dividend increases, and continued its share repurchase program.
Negative Points
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Earnings in the life and retirement segment were below the prior year, primarily due to higher mortality rates.
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The company experienced a marginal impact on auto new business due to cumulative rate increases in California.
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Catastrophe losses were slightly above the prior year, with significant impact from California wildfires.
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Household retention in the auto segment decreased slightly to 84%, in line with expectations.
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The commercial mortgage loan funds underperformed in the life and retirement segment, affecting earnings.
Q & A Highlights
Q: Could you talk a little bit about the run rate earnings power of the life and the supplemental group benefit segments? Was 2025 a good level? A: Ryan Greenier, Executive Vice President and Chief Financial Officer, explained that the life and retirement business is considered a "ballast" for the company, with occasional mortality fluctuations within actuarial expectations. He noted that a specific commercial mortgage loan fund underperformed this quarter, but normalizing returns to a mid-single-digit level provides a good run rate for contributions. For supplemental and group benefits, the benefit ratio was close to expectations, and a longer-term average gives a good sense of the business's performance.