Kemper Announces Schedule for Fourth Quarter 2023 Earnings Release and Preliminary Results
January 24 2024 - 4:05PM
Business Wire
Expects to report net income and net operating
earnings for the quarter
Kemper Corporation (NYSE: KMPR) today announced that after the
markets close on Thursday, February 1, 2024, Kemper will issue its
fourth quarter 2023 earnings release and financial supplement. The
company expects to file its annual report on Form 10-K with the
Securities and Exchange Commission approximately one week later.
Following their publication, these documents will be available in
the investor section of kemper.com.
PRELIMINARY RESULTS
Preliminary results for the fourth quarter of 2023 include
estimated net income and adjusted consolidated net operating income
of between $45 million and $55 million. Net income includes
approximately $15 million of after-tax net realized gains on
investments offset by approximately $14 million of after-tax costs
primarily related to our ongoing cost structure optimization
efforts.
Kemper Auto (Specialty
P&C)
- Preliminary fourth quarter recorded combined ratios are:
Combined Ratio
Underlying Combined Ratio1
Kemper Auto
98.5%
98.2%
Kemper Auto: Private Passenger Auto
(PPA)
99.5%
99.5%
Kemper Auto: Commercial Vehicle
94.9%
93.2%
Insurance Reserves
- No favorable or unfavorable prior-year reserve development in
the quarter for Kemper Auto in total.
Catastrophe Losses
- Pre-tax current-year catastrophe losses for the fourth quarter
of 2023 were approximately $3 million2.
Kemper Life
- After-tax income was approximately $15 million.
Capital and Liquidity:
- Parent liquidity was approximately $1.1 billion at the end of
the quarter, an increase of approximately $300 million from the
prior quarter.
- Insurance subsidiaries are well-capitalized.
Strategic Initiatives
- Bermuda Optimization: Paid approximately $330 million in Life
dividends to parent in fourth quarter; exceeding prior estimate of
$250+ million.
- Cost Structure Initiatives: Achieved multi-year goal of $150
million in run-rate savings in the first year of our initiative.
Further cost structure optimization will continue.
- Preferred P&C: Exit proceeding as planned; anticipate $175+
million capital release by year-end 2024.
- Reciprocal: Kemper Reciprocal exchange premium population
strategy is on-track.
CONFERENCE CALL DETAILS
Kemper will host its conference call to discuss fourth quarter
2023 results on Thursday, February 1, at 5:00 pm Eastern (4:00 pm
Central). The conference call will be accessible via the internet
and telephone at 888.259.6580, access code 47100078. To
listen via webcast, register online at the investor section of
kemper.com at least 15 minutes before the webcast to install any
necessary software. A replay of the webcast will be available
online at the investor section of kemper.com.
1 Non-GAAP financial measure. All non-GAAP financial measures
are denoted with footnote one throughout this release. See below
for further explanation on the use of non-GAAP financial
measures.
2 Pre-tax current-year catastrophe losses for the fourth quarter
of 2023 were approximately $11 million, including $8 million from
Kemper Personal Insurance reported within non-core operations.
USE OF NON-GAAP FINANCIAL MEASURES
Adjusted Consolidated Net Operating
Income1 is computed by excluding from Net Income
Attributable to Kemper Corporation the after-tax impact of:
(i) Income (Loss) from Change in Fair Value of Equity and
Convertible Securities; (ii) Net Realized Investment Gains
(Losses); (iii) Impairment (Losses) Gains; (iv) Acquisition and
Disposition Related Transaction, Integration, Restructuring and
Other Costs; (v) Debt Extinguishment, Pension Settlement and Other
Charges; (vi) Goodwill Impairment Charges; (vii) Non-Core
Operations; and (viii) Significant non-recurring or infrequent
items that may not be indicative of ongoing operations
Significant non-recurring items are excluded when (a) the nature
of the charge or gain is such that it is reasonably unlikely to
recur within two years and (b) there has been no similar charge or
gain within the prior two years. The most directly comparable GAAP
financial measure is Net Income Attributable to Kemper Corporation.
Kemper excluded no applicable significant non-recurring items from
the Adjusted Consolidated Net Operating Income calculation for the
three months ended December 31, 2023.
Kemper believes that Adjusted Consolidated Net Operating Income
provides investors with a valuable measure of its ongoing
performance because it reveals underlying operational performance
trends that otherwise might be less apparent if the items were not
excluded. (Loss) Income from Change in Fair Value of Equity and
Convertible Securities, Net Realized Investment Gains and
Impairment Gains (Losses) related to investments included in
Kemper’s results may vary significantly between periods and are
generally driven by business decisions and external economic
developments such as capital market conditions that impact the
values of the Kemper’s investments, the timing of which is
unrelated to the insurance underwriting process. Acquisition and
Disposition Related Transaction, Integration, Restructuring and
Other Costs may vary significantly between periods and are
generally driven by the timing of acquisitions and business
decisions unrelated to the insurance underwriting process. Debt
Extinguishment, Pension Settlement and Other Charges relate to (i)
loss from early extinguishment of debt, which is driven by Kemper’s
financing and refinancing decisions and capital needs, as well as
external economic developments such as debt market conditions, the
timing of which is unrelated to the insurance underwriting process;
(ii) settlement of pension plan obligations which are business
decisions made by Kemper, the timing of which is unrelated to the
underwriting process; and (iii) other charges that are
non-standard, not part of the ordinary course of business, and
unrelated to the insurance underwriting process.
Goodwill impairment charges are excluded because they are
infrequent and non-recurring charges. Non-core operations include
the results of our Preferred Insurance business, which we expect to
fully exit. These results are excluded because they are not
relevant to our ongoing operations and do not qualify for
Discontinued Operations under Generally Accepted Accounting
Principles ("GAAP"). Significant non-recurring items are excluded
because, by their nature, they are not indicative of Kemper’s
business or economic trends. The preceding non-GAAP financial
measures should not be considered a substitute for the comparable
GAAP financial measures, as they do not fully recognize the
profitability of Kemper’s businesses.
Underlying Combined Ratio1 is
computed by adding the Current Year Non-catastrophe Losses and LAE
(Loss Adjustment Expense) Ratio with the Insurance Expense Ratio.
The most directly comparable GAAP financial measure is the Combined
Ratio, which is computed by adding Total Incurred Losses and LAE
Ratio, including the impact of catastrophe losses and loss and LAE
reserve development from prior years, with the Insurance Expense
Ratio.
Kemper believes Underlying Losses and LAE and the Underlying
Combined Ratio are useful to investors and uses these financial
measures to reveal the trends in Kemper’s Specialty Property &
Casualty Insurance segment that may be obscured by catastrophe
losses and prior-year reserve development. These catastrophe losses
may cause Kemper’s loss trends to vary significantly between
periods due to their incidence of occurrence and magnitude and can
have a significant impact on incurred losses, LAE and the Combined
Ratio. Prior-year reserve developments are caused by unexpected
loss development on historical reserves. Because reserve
development relates to the re-estimation of losses from earlier
periods, it has no bearing on the performance of Kemper’s insurance
products in the current period. Kemper believes it is useful for
investors to evaluate these components separately and in the
aggregate when reviewing Kemper’s underwriting performance.
Caution Regarding Forward-Looking
Statements
This press release may contain or incorporate by reference
information that includes or is based on forward-looking statements
within the meaning of the safe-harbor provisions of the Private
Securities Litigation Reform Act of 1995. We caution investors that
these forward-looking statements are not guarantees of future
performance, and actual results may differ materially. Such
statements involve known and unknown risks, uncertainties, and
other factors, including but not limited to:
- changes in the frequency and severity of insurance claims;
- claim development and the process of estimating claim
reserves;
- the impacts of inflation;
- changes in the interest rate environment;
- supply chain disruption;
- product demand and pricing;
- effects of governmental and regulatory actions;
- litigation outcomes and trends;
- investment risks;
- cybersecurity risks;
- impact of catastrophes; and
- other risks and uncertainties detailed in Kemper’s Annual
Report on Form 10-K and subsequent filings with the Securities and
Exchange Commission (“SEC”).
Kemper assumes no obligation to publicly correct or update any
forward-looking statements as a result of events or developments
subsequent to the date of this press release.
About Kemper
The Kemper family of companies is one of the nation's leading
specialized insurers. With approximately $13 billion in assets,
Kemper is improving the world of insurance by providing affordable
and easy-to-use personalized solutions to individuals, families and
businesses through its Kemper Auto and Kemper Life brands. Kemper
serves over 5.1 million policies, is represented by 25,000 agents
and brokers, and has 8,400 associates dedicated to meeting the
ever-changing needs of its customers. Learn more about
Kemper.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240124510001/en/
Investors: Karen Guerra, 312.668.9720, investors@kemper.com News
Media: Barbara Ciesemier, 312.661.4521, bciesemier@kemper.com
Kemper (NYSE:KMPR)
Historical Stock Chart
From Apr 2024 to May 2024
Kemper (NYSE:KMPR)
Historical Stock Chart
From May 2023 to May 2024