Exhibit 99
January 24, 1994 - THE ST. PAUL COMPANIES REPORTS RECORD
1993 EARNINGS
St. Paul, Minn. - The St. Paul Companies (NYSE:SPC) reported
record operating earnings of $386.6 million, or $8.55 per
share, for 1993, compared with last year's operating loss of
$333.8 million, or $8.08 per share.
"What a pleasure it is to report record operating
earnings after last year's record loss," said Douglas W.
Leatherdale, chairman and chief executive officer. "In
1993, we reaped the benefits of corrective actions in our
underwriting and insurance brokerage operations. In fact,
improvement in results was virtually across-the-board.
"In addition, 1993 was an average year in terms of
catastrophic storms - nothing like 1992, which brought us
Hurricane Andrew, the most expensive storm in history.
"The decrease in catastrophe losses helped turn around
our reinsurance operation, which cut its losses by almost
$270 million in 1993.
"The John Nuveen Company performed exceptionally well
in 1993, reporting record results last week. Based on the stock price
at year-end, our 74% ownership of Nuveen was valued at $718 million.
"1993 was notable as well for our purchase of Economy
Fire & Casualty Company from Kemper Corporation. Economy is
a successful personal insurance company and a good fit with
our strategy - and it maintained its strong performance in
1993," Leatherdale said.
"Not surprisingly, our financial position has never
been stronger. Common shareholders' equity at year-end
reached a new high of $3.0 billion, or $70.95 per share.
Our assets at year-end were $17.1 billion. Debt comprised
17.6 percent of our total capital."
Net income for 1993 was a record $427.6 million, or
$9.47 per share, compared with a net loss of $156.0 million,
or $3.88 per share, for 1992. 1993 net income included
after-tax realized investment gains of $41.0 million, or
$0.92 per share. The net loss for 1992 included the
cumulative effects of two accounting changes adopted in
first-quarter 1992, which reduced the net loss by $76.5
million, or $1.81 per share, as well as after-tax realized
investment gains of $101.3 million, or $2.39 per share,
which included a $65 million gain from the sale of a
minority interest in the John Nuveen Company.
Fourth-quarter results
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For the fourth quarter of 1993, operating earnings were
$79.8 million, or $1.76 per share, compared with a loss of
$426.3 million, or $10.20 per share (including a $365
million write-down of Minet goodwill), for the fourth
quarter of 1992. Fourth quarter operating earnings included
a one-time pretax restructuring charge of $21 million, or
$0.31 per share (after-tax), related to the company's
restructuring of its U.S. underwriting operations.
Net income for the fourth quarter of 1993 was $89.7
million, or $1.98 per share, compared with a loss of $417.5
million, or $9.99 per share, for the fourth quarter of 1992.
Net income for the fourth quarter of 1993 included after-tax
realized investment gains of $9.9 million, or $0.22 per
share, compared with $8.7 million, or $0.21 per share, in
1992.
Underwriting Operations
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THE ST. PAUL COMPANIES
TWELVE-MONTHS UNDERWRITING OPERATIONS
HIGHLIGHTS
Twelve months ended Dec. 31 1993 1992
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Written premiums $3,178,545,000 $3,142,419,000
Underwriting loss ($150,255,000) ($566,886,000)
Net investment income $646,396,000 $642,301,000
Pretax operating earnings* $457,752,000 $20,781,000
Statutory combined ratio 104.5 117.8
*excluding realized investment gains
THE ST. PAUL COMPANIES
FOURTH-QUARTER UNDERWRITING OPERATIONS
HIGHLIGHTS
Three months ended Dec. 31 1993 1992
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Written premiums $842,991,000 $780,036,000
Underwriting loss ($33,397,000) ($212,631,000)
Net investment income $156,518,000 $162,349,000
Pretax operating earnings (loss)* $98,422,000 ($87,729,000)
Statutory combined ratio 104.2 127.4
*excluding realized investment gains
Insurance Brokerage Operations
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The Minet Group, The St. Paul's London-based insurance
brokerage operation, had a pretax loss of $12.6 million in
1993, compared with a pretax loss of $432.5 million in 1992.
The 1992 loss included a $365 million write-down of Minet
goodwill and one-time Minet reorganization and other
nonrecurring charges of $39 million.
For the fourth quarter of 1993, Minet had pretax income
of $395,000, compared with a pretax loss of $380.9 million,
including the goodwill write-down, in the fourth quarter of
1992.
The John Nuveen Company
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The St. Paul's portion of The John Nuveen Company's
1993 pretax earnings totaled $82.6 million, compared with
pretax earnings of $82.5 million for 1992. The St. Paul's
portion of Nuveen's 1993 earnings was flat when compared
with 1992 due to the sale of a minority interest in May
1992. The St. Paul now owns 74 percent of Nuveen. Nuveen's
pretax income was actually up 14 percent over 1992.
For fourth quarter 1993, The St. Paul's portion of
Nuveen's pretax earnings was $20.5 million, compared with
$18.6 million for the fourth-quarter 1992.
At the end of 1993, Nuveen had a record $32.7 billion
in assets under management, compared with $27.3 billion one
year ago.
Consolidated Financial Position
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Consolidated assets of The St. Paul Companies as of
Dec. 31, 1993, were $17.1 billion, compared with $15.4
billion as of Dec. 31, 1992.
Common shareholders' equity was $3.0 billion on Dec.
31, 1993, compared with $2.2 billion on Dec. 31, 1992. Book
value per common share on Dec. 31, 1993, was $70.95,
compared with $52.37 on Dec. 31, 1992.
The adoption of Statement of Financial Accounting
Standards (SFAS) No. 115 increased 1993 assets by about $764
million and equity by $497 million. SFAS No. 115 requires
that the bond portfolio be reported at market value with the
corresponding unrealized appreciation (net of taxes)
included in shareholders' equity.
THE ST. PAUL COMPANIES 1993 RESULTS
1993 1992
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Revenues $4,460,172,000 $4,498,692,000
Operating Earnings (Loss) $386,628,000 ($333,791,000)
Per Common Share (Fully Diluted) $8.55 ($8.08)
Realized Investment Gains, Net of Taxes
Investments $40,981,000 $36,436,000
Gain on Sale of Nuveen Shares $0 $64,834,000
Total $40,981,000 $101,270,000
Per Common Share (Fully Diluted) $0.92 $2.39
Cumulative Effects of Accounting Changes $0 $76,483,000
Per Common Share (Fully Diluted) $0 $1.81
Net Income (Loss)* $427,609,000 ($156,038,000)
Per Common Share (Fully Diluted) $9.47 ($3.88)
THE ST. PAUL COMPANIES FOURTH-QUARTER RESULTS
1993 1992
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Revenues $1,171,831,000 $1,101,412,000
Operating Earnings (loss) $79,816,000 ($426,263,000)
Per Common Share (Fully Diluted) $1.76 ($10.20)
Realized Investment Gains, Net of Taxes $9,877,000 $8,718,000
Per Common Share (Fully Diluted) $0.22 $0.21
Net Income (loss)* $89,693,000 ($417,545,000)
Per Common Share (Fully Diluted) $1.98 ($9.99)
*Primary earnings per common share are:
Fourth Quarter Twelve Months
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1993 1992 1993 1992
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Income (loss) before cumulative effects
of accounting change $2.05 ($9.99) $9.84 ($5.69)
Cumulative effects of accounting changes $0 $0 $0 $1.81
Net Income (Loss) $2.05 ($9.99) $9.84 ($3.88)