Auto and home insurer The Travelers Companies Inc (NYSE:TRV) topped Wall Street forecasts with its fourth quarter profits on Tuesday.
The Dow-30 company’s net income fell 42% to US$551mln, or US$1.98 per share, in the quarter ended December 31 and included a one-time charge of US$129mln related to the recently introduced tax reforms.
On an adjusted basis though, Travelers earned US$2.28 per share, comfortably beating the average Wall Street estimate of US$1.51.
The fall in profit was widely expected because of the wildfires in California – the most destructive on record – during the period.
Quarterly revenues rose 3.6% to US$7.45bn but the wildfires meant pre-tax catastrophe losses, net of reinsurance, more than tripled to US$499mln (Q4 2016: US$137mln).
That figure was still lower than the previous forecasts, which guided for losses of between US$525mln-US$675mln as a result of the fires.
With the profits beat and the costs from the wildfires not as bad as feared, Travelers share were up 1.5% to US$141.50 in pre-market trade.