Horace Mann Educators (HMN) Q3 2024 earnings summary

Executive summary

• Third quarter 2024 core EPS was $0.76 per diluted share, up 73% year-over-year, with total revenues increasing 9% and strong double-digit sales growth in auto, life, and supplemental lines.

• Net income for Q3 2024 rose 193% year-over-year to $34.3M, driven by improved Property & Casualty results and lower net investment losses.

• Full-year 2024 core EPS guidance remains at $2.40–$2.70, with a clear path to double-digit ROE in 2025 and a larger share of the education market.

• Book value per share grew 22.8% to $31.60, and adjusted book value per share reached $36.89 at quarter end.

• Catastrophe losses from Hurricane Helene totaled $22.5 million, but underlying loss ratios improved significantly due to multi-year profitability actions.

Financial highlights

• Core earnings for Q3 2024 were $31.3 million, or $0.76 per diluted share, compared to $0.44 in the prior year.

• Net written premiums in Property & Casualty rose 13% to $212 million; auto premiums up 14.4% and property up 19.2% year-over-year.

• Total net investment income was $113 million, down 5% year-over-year but flat year-to-date.

• Adjusted book value per share at quarter end was $36.89; dividend yield stands at 3.7%.

• Operating expenses increased 9.5% in Q3, reflecting inflation and infrastructure investments.

Outlook and guidance

• Full-year 2024 core EPS guidance is $2.40–$2.70, with core earnings expected between $100 million and $112 million.

• Property & Casualty segment expected to deliver $36–$39 million in full-year core earnings; life and retirement $50–$56 million; supplemental and group benefits $49–$52 million.

• Net premiums and contract charges earned projected to increase 8–9% for 2024, with net investment income expected between $440M–$450M.

• Operating expenses projected to rise about 6%, with $35 million in corporate interest expense.

• Confident in achieving sustainable double-digit ROE and target profitability in all segments by 2025.