The Phoenix Cos. Inc. posted a net profit for the second quarter, but without gains from investments and discontinued markets the Hartford insurer and financial-services provider actually lost money.
Phoenix earned $10.3 million, or 9 cents a share, in the three months ended June 30. The insurer lost a net $111.2 million, or 96 cents a share, in the second quarter of 2009.
The insurer reported Thursday net income included $15.1 million in realized investment gains and $15 million from its former Philadelphia Financial Group unit that has been sold.
Without those gains, Phoenix had a second-quarter operating loss of $19.8 million, or 17 cents a share, wider than the operating loss of $14.4 million, or 12 cents a share, suffered a year earlier.
Key drivers of the operating loss were: a $10.5 million charge for a renegotiated life reinsurance contract; an estimated $12 million impact on the annuity product line, largely due to equity market declines; ongoing start-up costs for Saybrus Partners; and adverse results in universal life, primarily from elevated lapses in the Phoenix Accumulator Universal Life product series.
“We continue to make progress against our four strategic goals of balance sheet strength, policyholder security, expense management and growth,” President and CEO James D. Wehr said in a statement. “With several quarters behind us, we have shown we can produce results in areas that are critical to our long-term success.”
At 11 a.m., The Phoenix was down 20 cents, or 8.1 percent, at $2.22.
