View:
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Commission file number 0-4604
CINCINNATI FINANCIAL CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Ohio 31-0746871
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6200 S. Gilmore Road, Fairfield, Ohio 45014-5141
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (513) 870-2000
Item 9. Regulation FD Disclosure (Disclosure of Results of Operations and
Financial Condition).
On July 14, 2003, Cincinnati Financial Corporation issued the attached press
release. In accordance with the procedural guidance in SEC Release No. 33-8216,
the information in this 8-K and the Exhibit attached to this Form 8-K are being
furnished under "Item 9. Regulation FD Disclosure" to satisfy the requirements
of "Item 12. Disclosure of Results of Operations and Financial Condition." The
press release is furnished as Exhibit 99.1 hereto and is incorporated herein by
reference.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CINCINNATI FINANCIAL CORPORATION
/s/ Kenneth W. Stecher
-----------------------------------------------
Kenneth W. Stecher
Chief Financial Officer, Senior Vice President,
Secretary and Treasurer
(Principal Accounting Officer)
July 14, 2003
Exhibit 99.1
Cincinnati Financial Corporation Comments on
Second-Quarter And Full-Year 2003 Outlook
* Second-quarter net written premiums expected to rise approximately 16%
* Quarterly statutory combined ratio estimated in range of 99%, including
$47 million in catastrophe losses
* Book value expected to be between $36.25 and $36.75 at June 30, 2003
CINCINNATI, July 14 -- Cincinnati Financial Corporation (Nasdaq: CINF) today
announced that it expects strong second-quarter 2003 results as momentum carries
over from 2002 and the first quarter of 2003. Based on preliminary data,
management expects second quarter 2003 property casualty net written premiums
will increase approximately 16 percent over the second quarter of last year. The
statutory combined ratio is expected to be approximately 99 percent, including
approximately 7.1 percentage points due to catastrophe losses, improved from
107.2 percent, including 8.1 percentage points due to catastrophe losses, in the
comparable quarter of 2002.
Chairman and Chief Executive Officer John J. Schiff, Jr., CPCU, commented
that the strong second quarter results build upon re-underwriting programs and
rate actions that have been under way for some time. "With an excellent second
half of 2002 and a very healthy first quarter of 2003, we see the anticipated
second-quarter results as further indication that our actions of the past two
years have begun to bear fruit. Our goal continues to be profitable growth.
What we are seeing reflects the attention to detail our local independent
agents, headquarters underwriters and field marketing representatives are
giving to each individual risk, and it demonstrates that we are finding an
effective balance between growth and profitability that will allow us to
achieve our long-term goals."
Schiff noted that the anticipated increase in premiums reflects growth in
both commercial lines and personal lines. He added that the impact of
catastrophe losses on this year's second quarter is expected to be
$47 million, net of reinsurance, reflecting the $48 million preliminary storm
loss estimate issued on May 14, 2003, as well as favorable development from
earlier periods. The impact on after-tax earnings per share of these
catastrophe losses for the second quarter would be approximately 18 cents.
Catastrophe losses of $47 million in last year's second quarter reduced
after-tax earnings per share by 19 cents.
Bond and Equity Market Recoveries Should Lower Impairments and Enhance
Book Value
During the second quarter, a variety of economic and other external
factors contributed to increasing values in the bond and equity markets. As a
result of these gains, the company anticipates that other-than-temporary
impairments for the second quarter will be below the $30 million to
$55 million estimate it had earlier announced. In addition, gains in the
equity portfolio are expected to help restore book value to the $36.25 to
$36.75 range at June 30, 2003, compared with $32.10 at March 31, 2003.
Schiff noted, "We appreciate the favorable impact of bond and equity
market gains on our second quarter results. Our long-term investment strategy
looks beyond short-term fluctuations to the potential for sustained growth and
income. Over time, this strategy has proven its value for our shareholders."
Positive Full-Year Outlook Reiterated
Schiff reiterated the company's positive full-year outlook. "We are
pleased with the continuing improvement in our non-catastrophe underwriting
results and are determined to achieve further improvements. At this stage, we
remain comfortable with our target for the full-year combined ratio of 99.0
percent or below on a GAAP basis, or 98.5 percent or below on a statutory
basis."
Weather-related property losses are typical during the second and third
quarters of the year. Achievement of the company's combined ratio target
assumes that full-year storm losses will be approximately $75 million, or in
the range of 3 percentage points. For the first six months of 2003, the
company presently estimates total catastrophe losses are $49 million, or about
4 percentage points.
Cincinnati Financial plans to report final second-quarter results on
Tuesday, July 29. A conference call to discuss the results will be held at
2:30 p.m. EDT on that day. Details regarding the Internet broadcast of the
conference call are posted at www.cinfin.com on the Investors page.
Cincinnati Financial Corporation offers property and casualty insurance,
its main business, through The Cincinnati Insurance Company, The Cincinnati
Indemnity Company and The Cincinnati Casualty Company. The Cincinnati Life
Insurance Company markets life, disability income and long-term care insurance
and annuities. CFC Investment Company supports the insurance subsidiaries and
their independent agent representatives through commercial leasing and
financing activities. CinFin Capital Management Company provides asset
management services to institutions, corporations and individuals.
This is a "Safe Harbor" statement under the Private Securities Litigation
Reform Act of 1995. Certain forward-looking statements contained herein
involve potential risks and uncertainties. The company's future results could
differ materially from those discussed. Factors that could cause or contribute
to such differences include, but are not limited to: unusually high levels of
catastrophe losses due to changes in weather patterns or other causes;
increased frequency and/or severity of claims; environmental events or
changes; insurance regulatory actions, legislation or court decisions that
increase expenses or place the company at a disadvantage in the marketplace;
adverse outcomes from litigation or administrative proceedings; recession or
other economic conditions resulting in lower demand for insurance products;
sustained decline in overall stock market values negatively affecting the
company's equity portfolio, in particular a sustained decline in market value
of Fifth Third Bancorp shares; events that lead to a significant decline in
the market value of a particular security and impairment of the asset; delays
in the development, implementation and benefits of technology enhancements;
and decreased ability to generate growth in investment income.
Further, the company's insurance businesses are subject to the effects of
changing social, economic and regulatory environments. Public and regulatory
initiatives have included efforts to adversely influence and restrict premium
rates, restrict the ability to cancel policies, impose underwriting standards
and expand overall regulation. The company also is subject to public and
regulatory initiatives that can affect the market value for its common stock,
such as recent measures impacting corporate financial reporting and
governance. The ultimate changes and eventual effects, if any, of these
initiatives are uncertain.
| Request Electronic Delivery |
| If you are a shareholder, consider enrolling in Electronic Delivery. You will receive email alerts instead of paper mailings, saving your company's dollars. |
| Receive Email Alerts |
| When the company posts new information to this site, you can receive instant email alerts. Sign up now! |