Travelers Companies Q1 Earnings Beat Despite Higher Catastrophe Losses, Authorizes Share Repurchases, Boosts Dividend

The Travelers Companies Inc TRV reported first-quarter 2023 revenues of $9.70 billion, up 10% Y/Y, beating the consensus of $9.19 billion.
Net income declined 4% Y/Y to $975 million in Q1 2023, and core income declined 6% Y/Y due to higher catastrophe losses ($535 million pre-tax) and a decline in net favorable prior year reserve development.
Core EPS of $4.11 came above the consensus of $3.56.
Net written premium rose 12% Y/Y to $9.40 billion on growth across Business Insurance (+15% Y/Y) and Personal Insurance (+12% Y/Y) segments. In Bond & Specialty Insurance segment, net written premiums rose slightly Y/Y.
Buyback: The company's Board of Directors authorized an additional $5.0 billion of share repurchases. The company repurchased 2.5 million shares during the first quarter for $462 million.
Dividend: The company raised the quarterly dividend by 8% to $1.00 per share, payable on June 30, 2023, to shareholders of record on June 9, 2023.
Combined ratio for the quarter was 95.4%, up from 91.3% in Q1 2022, while underlying combined was 90.6%, compared to 91.2% year ago.
"The year is off to a terrific start with another strong quarter of profitability and growth driven by our underwriting and investment expertise. At the same time, we continue to successfully execute on our innovation strategy, which has contributed to significantly accelerated premium growth, superior returns and industry low volatility over the past decade," said Alan Schnitzer, Chairman and CEO.
Price Action: TRV shares closed higher by 0.42% at $172.00 on Tuesday.

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