Property and casualty insurer Travelers Cos Inc reported a 21 percent fall in quarterly net profit due to lower net investment income and a drop in underwriting gains.
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Shares of Travelers, a Dow Jones Industrial Average component, fell 2 percent to $104.02 in premarket trading.
The company said net income fell to $833 million, or $2.55 per share, for the first quarter ended March 31, from $1.05 billion, or $2.95 per share, a year earlier.
Pretax net investment income fell nearly 20 percent to $592 million, while underwriting gains fell 21.6 percent to $620 million.
Travelers said on Tuesday a drop in reinvestment rates and lower interest rates hurt fixed-income investments.
The company said its private equity returns were hit in the quarter by lower valuations for energy-related investments.
On an operating basis, Travelers earned $2.53 per share. Analysts expected the insurer to earn $2.54 per share, according to Thomson Reuters I/B/E/S.
Travelers' combined ratio, the percentage of premium revenue an insurer has to pay out in claims, rose to 90.3 percent in the quarter from 88.2 percent a year earlier. A combined ratio of under 100 indicates an underwriting profit.
Pretax catastrophe losses, net of reinsurance, rose to $162 million from $149 million.
The company said it will buy back an additional $5 billion shares and raised its quarterly cash dividend to 61 cents per share from 55 cents.
Travelers' shares closed at $106.14 on the New York Stock Exchange on Monday. (Reporting by Avik Das in Bengaluru; Editing by Sriraj Kalluvila)