Investor Supplement | Statement of Operations
Net Income per Diluted Share up 37.4 percent for the Quarter and 37.0 percent Year to Date
Erie, Pa. - October 25, 2018 - Erie Indemnity Company (NASDAQ: ERIE) today announced financial results for the quarter ending September 30, 2018. Net income was $80.4 million, or $1.54 per diluted share, in the third quarter of 2018, compared to $58.5 million, or $1.12 per diluted share, in the third quarter of 2017. Net income was $225.9 million, or $4.32 per diluted share, in the first nine months of 2018, compared to $164.9 million, or $3.15 per diluted share, in the first nine months of 2017.
3Q and Nine Months 2018 |
||||||||||||||
(dollars in thousands) |
3Q'18 |
3Q'17 |
|
2018 |
2017 |
|
||||||||
Operating income |
$ |
96,695 |
|
$ |
81,239 |
|
|
$ |
269,585 |
|
$ |
231,627 |
|
|
Investment income |
8,431 |
|
8,418 |
|
|
20,801 |
|
21,458 |
|
|
||||
Interest expense and other, net |
655 |
|
792 |
|
|
1,708 |
|
2,031 |
|
|
||||
Income before income taxes |
104,471 |
|
88,865 |
|
|
288,678 |
|
251,054 |
|
|
||||
Income tax expense |
24,025 |
|
30,322 |
|
|
62,768 |
|
86,108 |
|
|
||||
Net income |
$ |
80,446 |
|
$ |
58,543 |
|
|
$ |
225,910 |
|
$ |
164,946 |
|
|
|
|
|
|
|
|
|
Operating income before taxes increased $15.5 million, or 19.0 percent, in the third quarter of 2018 compared to the third quarter of 2017, as the growth in total operating revenue outpaced the growth in total operating expenses.
Income from investments before taxes totaled $8.4 million in both the third quarters of 2018 and 2017. Net investment income was $7.7 million in the third quarter of 2018 compared to $6.0 million in the third quarter of 2017, while earnings on limited partnerships were $0.8 million in the third quarter of 2018 compared to $1.5 million in the third quarter of 2017.
Income before income taxes increased $15.6 million in the third quarter of 2018, while income tax expense decreased $6.3 million in the third quarter of 2018, due to the lower income tax rate of 21% which became effective January 1, 2018.
Nine Months 2018 Highlights
Operating income before taxes increased $38.0 million, or 16.4 percent, in the first nine months of 2018 compared to the first nine months of 2017, as the growth in total operating revenue outpaced the growth in total operating expenses.
Income from investments before taxes totaled $20.8 million in the first nine months of 2018 compared to $21.5 million in the first nine months of 2017. Net realized losses on investments were $0.5 million in the first nine months of 2018 compared to net realized gains of $1.5 million in the first nine months of 2017 and earnings on limited partnerships were $0.4 million in the first nine months of 2018 compared to $1.9 million in the first nine months of 2017, while net investment income was $21.6 million in the first nine months of 2018 compared to $18.2 million in the first nine months of 2017.
Income before income taxes increased $37.6 million in the first nine months of 2018, while income tax expense decreased $23.3 million in the first nine months of 2018, due to the lower income tax rate of 21% which became effective January 1, 2018.
Indemnity has scheduled a pre-recorded audio broadcast on the Web for 10:00 AM ET on October 26, 2018. Investors may access the pre-recorded audio broadcast by logging on to www.erieinsurance.com.
According to A.M. Best Company, Erie Insurance Group, based in Erie, Pennsylvania, is the 9th largest homeowners insurer and 11th largest automobile insurer in the United States based on direct premiums written and the 16th largest property/casualty insurer in the United States based on total lines net premium written. The Group, rated A+ (Superior) by A.M. Best Company, has more than 5 million policies in force and operates in 12 states and the District of Columbia. Erie Insurance Group is a FORTUNE 500 company.