The Hanover Insurance (THG) - 2025 Q3 - Quarterly Results

Financial Performance - Gross premiums written for Q3 2025 reached $1,752.6 million, an increase from $1,663.4 million in Q3 2024, representing a growth of 5.4% year-over-year[8] - Net income for Q3 2025 was $178.7 million, compared to $102.1 million in Q3 2024, reflecting a significant increase of 75.7%[8] - Operating income after taxes for Q3 2025 was $185.6 million, up from $111.3 million in Q3 2024, marking a growth of 66.7%[8] - Total revenues for the nine months ended September 30, 2025, reached $4,922.6 million, reflecting a 5.8% increase from $4,653.1 million in the same period of 2024[11] - Net income for Q3 2025 was $178.7 million, a significant increase of 75.0% from $102.1 million in Q3 2024[11] - The company reported a net income of $464.0 million for the nine months ended September 30, 2025, compared to $258.1 million for the same period in 2024, reflecting a year-over-year increase of 79.5%[56] Assets and Equity - Total assets as of September 30, 2025, were $16,774.2 million, an increase from $15,367.0 million as of December 31, 2024, indicating a growth of 9.2%[8] - Total shareholders' equity increased to $3,426.3 million as of September 30, 2025, compared to $2,877.7 million as of September 30, 2024, representing a growth of 19.1%[8] - Cash and cash equivalents surged by 110.3% to $915.7 million compared to $435.5 million at the end of 2024[14] - Total liabilities increased by 7.4% to $13,347.9 million as of September 30, 2025, from $12,432.7 million at the end of 2024[14] - Retained earnings grew by 11.5% to $3,577.3 million as of September 30, 2025, compared to $3,209.6 million at the end of 2024[14] Premiums and Underwriting - The company reported net premiums earned of $1,550.7 million in Q3 2025, up from $1,479.2 million in Q3 2024, a growth of 4.8%[8] - Premiums earned for Q3 2025 increased to $1,550.7 million, a 4.8% rise from $1,479.2 million in Q3 2024[11] - Gross premiums written increased to $5,356.0 million in 2025 from $5,136.7 million in 2024, representing a growth of 4.3%[18] - Net premiums written rose to $4,833.5 million in 2025, up from $4,638.5 million in 2024, indicating an increase of 4.2%[18] - Net premiums earned reached $4,604.5 million in 2025, compared to $4,401.0 million in 2024, reflecting a growth of 4.6%[18] Investment Income - Net investment income rose by 27.5% to $117.0 million in Q3 2025, compared to $91.8 million in Q3 2024[11] - Net investment income increased to $328.6 million in 2025, compared to $271.9 million in 2024, showing a growth of 20.8%[18] - The total net investment income for Q1 2025 is projected to be $106.1 million, up from $100.7 million in Q4 2024, indicating a growth of 4.3%[44] - The pre-tax yield for total investments is expected to increase to 4.14% in Q1 2025 from 3.97% in Q4 2024, reflecting a positive trend in investment performance[44] Ratios and Performance Metrics - The premium to surplus ratio improved to 1.92:1 as of September 30, 2025, down from 2.07:1 a year earlier, indicating enhanced financial strength[8] - The combined ratio for Q3 2025 was 97.3%, compared to 84.9% in Q3 2024, indicating a decline in underwriting performance[16] - The combined ratio for 2025 was 92.6%, an improvement from 96.7% in 2024, indicating enhanced operational efficiency[21] - The loss and LAE ratio for 2025 was 61.7%, an improvement from 65.8% in 2024, indicating better loss management[21] - The expense ratio remained stable at 30.9% for both 2024 and 2025, reflecting consistent cost management[21] Catastrophe Losses - Current year catastrophe losses for 2025 were $267.3 million, down from $386.9 million in 2024, a decrease of 30.8%[18] - Current year catastrophe losses for Q1 2024 amounted to $24.5 million, contributing to total losses and LAE of $320.9 million[23] - Current year catastrophe losses for Q1 2025 amounted to $17.2 million, compared to $10.2 million in Q1 2024[28] - The current year catastrophe losses accounted for 6.9% of total losses in 2025, down from 13.6% in 2024[36] Stock and Dividends - The Hanover reported a quarterly dividend of $0.900 per share for Q3 2025, compared to $0.850 per share for the same quarter in 2024[69] - The stock price range for Q3 2025 was between $162.08 and $182.10, reflecting an increase from the previous year's range of $123.93 to $149.58[69] - The Hanover's financial strength ratings include an A rating from A.M. Best and a BBB rating from S&P Global[70] - The company’s common stock is traded on the New York Stock Exchange under the symbol "THG"[71] Strategic Focus - The company continues to focus on expanding its core commercial and specialty segments, targeting growth in specific industry sectors[5] - Future outlook suggests continued growth in net premiums written, with a projected increase of 3.9% for the full year 2025[25]