Chattanooga-based Unum Group posted third-quarter earnings Tuesday that met analyst expectations as the insurer cited strong results in its Unum US and Colonial Life units.
The company earned $220.8 million, or 68 cents per share, in the quarter. A year ago, the company earned $221.1 million, or 66 cents per share.
Tom Watjen, president and CEO of Unum, said the positive results stemmed from good performance at the company's Unum US and Colonial life divisions, though United Kingdom results remained under pressure.
"While some businesses are performing at or above expectations, others are below expectations," he said.
Operating income for Unum US, which makes up the majority of the insurance giant's earnings, increased 4 percent to $204.7 million, while Colonial Life reported a 5.8 percent increase to $74.5 million, the company reported.
But quarterly operating income at Unum UK declined 19.6 percent to $47.2 million from $58.7 million the prior year.
"Premium pressure along with unfavorable risk results adversely impacted the quarter, but I know that our UK team is working hard to reverse these trends," Watjen said in a letter to employees.
Meanwhile, the company continued to invest excess capital by buying back 9.5 million shares in the third quarter, though investment gains fell to $900,000, down from $9.5 million in the third quarter of 2009.
Looking ahead, Watjen said he sees "very little near-term change in the environment, and the best thing we can do is to stay focused on executing our business plan, and on taking the steps needed to maintain our leadership position - something we have continued to do well."
Steven Schwartz, a life and health insurance equity analyst with Raymond James, called the results "solid, just solid."
"The numbers were very much in line with what we were looking for," Schwartz said. "The key number for these guys is the benefit ratio for group disability, and that came in at 84.6 percent, and that's a very, very strong number."
The biggest worry in a recession for a company like Unum, he said, is that claims could start to go up. But "for any number of reasons that's not happening," Schwartz added.
Parking garage
As the company rounded out another solid quarter, construction crews put the finishing touches on Unum's 1,400 space parking garage in downtown Chattanooga.
The garage is slated to be finished in January, according to spokeswoman Mary Clarke Guenther.
"There will be 1,400 or more very happy employees who no longer have to park blocks away from work," Guenther said. "Once the new garage is open, almost all employees will be parking in one of the two garages on campus."
This will free up the company to transform the surface lots between Lookout and Walnut streets into "a new multiuse outdoor area, complete with green spaces, a small parking lot and new front entrance to the company," she added, which will tie the insurer's buildings and garages into a "cohesive campus."
Unum shares closed at $22.82 for the day, up 35 cents.
Contact Ellis Smith at esmith@timesfreepress.com or 423-757-6315. Follow him on Twitter at twitter.com/ellisthered.