For Immediate Release



For Immediate Release

Contact: Michael Trevino

Media Relations

(847) 402-5600

Robert Block

Phil Dorn

Investor Relations

(847) 402-2800

ALLSTATE REPORTS 2000 FOURTH QUARTER RESULTS

NORTHBROOK, Ill., February 7, 2001 -- The Allstate Corporation (NYSE: ALL) today reported that operating income per diluted share for the fourth quarter of 2000 increased 51.9 percent to $.79 from $.52 in the fourth quarter of 1999. The growth was driven by increases in both the Property-Liability business and Allstate Financial.

“Both the quarter and the year 2000 were marked by successful execution of our key initiatives, particularly our multi-access strategy and our profit improvement actions,” said Chairman, President and CEO Edward M. Liddy. “We had a tremendous year that was filled with accomplishments despite the many challenges we faced. Execution continues to be the key and we remain focused on implementing what we know is a solid business model.”

Operating income increased 43.1 percent to $584 million in the fourth quarter of 2000, compared to $408 million in the fourth quarter of 1999. Before the impact of restructuring charges incurred in both 2000 and 1999, and acquisition charges incurred in the fourth quarter of 1999, operating income for the quarter increased 12.4 percent to $589 million ($.80 per diluted share) compared to $524 million ($.66 per diluted share) for the same period in 1999. This increase reflects earned premium growth in Allstate’s Property-Liability business and Allstate Financial. Consolidated revenues for the fourth quarter were $7.2 billion, an increase of 3.0 percent from the 1999 fourth quarter revenue of $7.0 billion. Consolidated net income for the quarter was $547 million or $.74 per diluted share, compared to $425 million or $.54 per diluted share for the same period in 1999, reflecting increases in operating income, partly offset by realized capital losses.

For the year ended December 31, 2000, consolidated revenues were $29.1 billion, operating income was $2.0 billion ($2.68 per diluted share), and net income was $2.2 billion ($2.95 per diluted share), compared to consolidated revenues of $27.0 billion, operating income of $2.1 billion ($2.59 per diluted share), and net income of $2.7 billion ($3.38 per diluted share) in 1999. Catastrophe losses during 2000 totaled $629 million after tax, compared to $530 million after tax in the previous year. Realized capital gains during 2000 decreased to $248 million after-tax, compared to $691 million after-tax in 1999, due to changing market conditions during both years.

“We successfully launched our multi-access strategy in several more states in the quarter,” continued Liddy. “The strategy continues to be on plan and on budget. About 40% of the U.S. population can now reach Allstate anytime, through our agents, customer information centers or the Internet.

“We continue to see positive results from our strategic initiatives to improve the profitability of our Property-Liability business. In the quarter, we had solid written premium growth for standard auto and homeowners versus the fourth quarter of the prior year. While overall written premium is lower for the quarter compared to the same period in 1999, the decline is largely due to planned profitability actions in our non-standard auto book of business.

“In the quarter, the Allstate Life Group of Companies became ‘Allstate Financial.’ The name change was made in recognition of our expansion beyond traditional life insurance to include financial and investment products. Already, 2,500 of Allstate’s approximately 13,000 exclusive agents are licensed to provide personal financial products and mutual funds.

“In the quarter we repurchased another 8.5 million shares of our stock, bringing the total shares repurchased this year to just more than 71 million at a total cost $1.8 billion.”

Property-Liability Business

Property-Liability written premiums for the fourth quarter of 2000 were $5.3 billion versus $5.4 billion during the same period of 1999. Excluding the impacts of Encompasssm Insurance, written premiums were $4.8 billion during the fourth quarter of 2000, compared to 1999 fourth quarter premiums of $4.9 billion. Fourth quarter premiums written, excluding Encompass, increased 1.9 percent in the standard auto business due to increases in policies in force, increased 10.1 percent in the homeowners business due to increases in both policies in force and average premiums, and decreased 22.6 percent in non-standard auto due to planned actions implemented during 2000 aimed at improving profitability.

Property-Liability revenues in the fourth quarter of 2000 were $5.9 billion, the same as in the 1999 fourth quarter. Operating income for the quarter was $485 million versus 1999 fourth quarter operating income of $328 million, an increase of 47.9 percent. Operating income, excluding the impacts of restructuring charges incurred in both 2000 and 1999 and acquisition charges incurred in 1999, increased 18.6 percent to $490 million in the fourth quarter of 2000, compared to $413 million in the same period of 1999. This increase reflects increased net investment income and earned premium growth, partially offset by increased pressure on claims severity. The combined ratio for the quarter was 97.5. Excluding catastrophe losses and restructuring charges, the combined ratio was 95.1. Property-Liability realized capital losses were $3 million after-tax in the fourth quarter of 2000, compared to realized capital gains of $30 million after-tax for the same period in 1999. Net income was $482 million for the quarter, compared to $358 million for the same period in the previous year.

For 2000, Property-Liability written premiums increased 7.2 percent to $21.9 billion compared to $20.4 billion for 1999, primarily due to the acquisition of Encompass during 1999. Revenues for 2000 were $24.2 billion, operating income was $1.5 billion, realized capital gains totaled $326 million after-tax, and net income was $1.9 billion. These totals compare to Property-Liability revenues of $22.8 billion, operating income of $1.7 billion, realized capital gains of $609 million after-tax, and net income of $2.3 billion for 1999.

Allstate Financial Business

For the fourth quarter of 2000, Allstate Financial revenues were $1.3 billion, compared to $1.1 billion for the same period in the previous year, due to increased premiums and contract charges and increased net investment income, partly offset by realized capital losses during the quarter. Net income for the fourth quarter of 2000 was $93 million, the same as in the fourth quarter of 1999. Allstate Financial operating income for the quarter was $115 million compared to $83 million for the same period in 1999. Excluding the impact of restructuring charges incurred in both 2000 and 1999 and acquisition charges incurred in 1999, Allstate Financial operating income was $115 million in the fourth quarter of 2000, compared to $114 million in the same period of 1999. Statutory premiums and deposits were $2.7 billion in the quarter, the same as in the fourth quarter of 1999.

Allstate Financial revenues for 2000 were $4.9 billion, operating income was $520 million and net income was $469 million. These totals compare to revenues of $4.1 billion, operating income of $384 million and net income of $485 million for 1999. Statutory premiums for 2000 were $12.2 billion compared to $8.5 billion for 1999. Much of the increase was attributable to $2.0 billion in sales through the company’s alliance with Putnam Investments along with increases in fixed annuity sales and the acquisition of American Heritage Life.

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer. Widely known through its “You’re In Good Hands With Allstate®” slogan, Allstate provides insurance products to more than 14 million households and has approximately 13,000 exclusive agents in the U.S. and Canada. Customers can access Allstate products and services through Allstate agents, or in select states at and 1-800-Allstate. Encompass and Deerbrook Insurance brand property and casualty products are sold exclusively through independent agents. Allstate Financial Group includes the businesses that provide life insurance, retirement and investment products.

The Allstate Corporation prepares an interim investor supplement, containing standard information that is not available at the time of the earnings release. A supplement will be posted to the company’s website in approximately 10 days, and can be accessed by going to the Allstate web site at and clicking on “About Allstate.” From there, go to the “Find Financial Information” button.

# # #

Summary of results for the quarter and year ended December 31, 2000:

|Consolidated Highlights |

| |Quarter Ended |Year Ended |

| |December 31 |December 31 |

| |Est. | | |Est. | | |

| |2000 |1999 |Change |2000 |1999 |Change |

|($ In millions, except per-share amounts) |$ |$ |% |$ |$ |% |

|Consolidated Revenues |7,220 |7,009 |3.0 |29,134 |26,959 |8.1 |

|Restructuring Charges After-tax |5 |53 |(90.6) |38 |53 |(28.3) |

|Acquisition Charges After-tax |-- |63 |-- |-- |63 |-- |

|Operating Income Before Restructuring and Acquisition Charges | | | | | | |

| |589 |524 |12.4 |2,042 |2,198 |(7.1) |

|Operating Income Per Share (Diluted) Before Restructuring and | | | | | | |

|Acquisition Charges | | | | | | |

| |.80 |.66 |21.2 |2.73 |2.73 |-- |

|Operating Income |584 |408 |43.1 |2,004 |2,082 |(3.7) |

|Operating Income Per Share (Diluted) |.79 |.52 |51.9 |2.68 |2.59 |3.5 |

|Realized Capital Gains (Losses) After-tax |(28) |27 |-- |248 |691 |(64.1) |

|Dividends on Preferred Securities of Subsidiary Trusts | | | | | | |

| |(9) |(10) |(10.0) |(41) |(39) |5.1 |

|Net Income |547 |425 |28.7 |2,211 |2,720 |(18.7) |

|Net Income Per Share (Diluted) |.74 |.54 |37.0 |2.95 |3.38 |(12.7) |

|Weighted Average Shares Outstanding (Diluted) | | | | | | |

| |734.5 |794.1 |(7.5) |748.7 |803.8 |(6.9) |

• For the fourth quarter of 2000, consolidated revenues increased to $7.2 billion, an increase of 3.0 percent over the fourth quarter of 1999.

• Consolidated operating income increased 43.1 percent during the fourth quarter of 2000 to $584 million or $.79 per share, on a diluted basis. Prior year fourth quarter operating income was $408 million or $.52 per diluted share. Excluding the impacts of restructuring charges in 2000 and 1999, and acquisition charges in 1999, operating income increased 12.4 percent during the quarter compared to the fourth quarter of 1999, due to increased investment income and premium income. Increased investment income during the quarter was due to increased income from partnership interests and increased investment yields and balances.

• Property-Liability written premiums totaled $5.3 billion during the fourth quarter of 2000 versus $5.4 billion during the same period in 1999. Excluding the impacts of the acquisition of Encompass Insurance in the fourth quarter of 1999, Property-Liability written premiums totaled $4.8 billion during the fourth quarter of 2000 comparable to $4.9 billion during the same period of 1999, due to growth in standard auto and homeowners, offset by planned profitability actions in non-standard auto.

• Allstate Financial operating income increased 38.6 percent during the fourth quarter of 2000 to $115 million, compared to $83 million in the same period of 1999. Excluding the impacts of restructuring charges in 2000 and 1999, and acquisition charges in 1999, operating income was $115 million in the fourth quarter of 2000 compared to $114 million in the fourth quarter of 1999.

• During the fourth quarter of 2000, the company acquired approximately 8.5 million shares of its stock at a cost of $312 million as part of its current stock repurchase program. The cost of the year’s repurchases under the current program was $1.3 billion. The total cost of shares repurchased during the year was $1.8 billion.

|Property-Liability Highlights |

| |Quarter Ended |Year Ended |

| |December 31 |December 31 |

| | Est. 2000 | | |Est. | | |

| |$ |1999 |Change |2000 |1999 |Change |

|($ In millions, except ratios) | |$ |% |$ |$ |% |

|Property-Liability | | | | | | |

|Premiums Written |5,254 |5,365 |(2.1) |21,858 |20,389 |7.2 |

|Property-Liability Revenues |5,934 |5,892 |0.7 |24,191 |22,821 |6.0 |

|Restructuring Charges After-tax |5 |48 |(89.6) |47 |48 |(2.1) |

|Acquisition Charges After-tax |-- |37 |-- |-- |37 |-- |

|Operating Income before Restructuring and | | | | | | |

|Acquisition Charges | | | | | | |

| |490 |413 |18.6 |1,584 |1,802 |(12.1) |

|Operating Income |485 |328 |47.9 |1,537 |1,717 |(10.5) |

|Realized Capital Gains After-tax |(3) |30 |(110.0) |326 |609 |(46.5) |

|Net Income |482 |358 |34.6 |1,863 |2,312 |(19.4) |

|Catastrophes After-tax |80 |97 |(17.5) |629 |530 |18.7 |

|Combined Ratio before impacts of Catastrophes, | | | | | | |

|Restructuring and Acquisition Charges: | | | | | | |

| |95.1 |95.0 |0.1 pts |94.5 |92.6 |1.9 pts |

|Impact of Catastrophes | | | | | | |

|Impact of Restructuring and     |2.3 |2.7 |(0.4) pts |4.4 |4.1 |0.3 pts |

|Acquisition Charges | | | | | | |

| |0.1 |2.4 |(2.3) pts |0.3 |0.7 |(0.4) pts |

|Combined Ratio | | | | | | |

| |97.5 |100.1 |(2.6) pts |99.2 |97.4 |1.8 pts |

|Allstate Financial Highlights |

| |Quarter Ended |Year Ended |

| |December 31 |December 31 |

| |Est. | | |Est. | | |

| |2000 |1999 |Change |2000 |1999 |Change |

|($ In millions) |$ |$ |% |$ |$ |% |

|Statutory Premiums and Deposits |2,665 |2,669 |(0.1) |12,245 |8,497 |44.1 |

|Allstate Financial GAAP Revenues |1,266 |1,103 |14.8 |4,880 |4,076 |19.7 |

|Restructuring Charges After-tax |-- |5 |-- |(9) |5 |-- |

|Acquisition Charges After-tax |-- |26 |-- |-- |26 |-- |

|Operating Income before Restructuring and Acquisition| | | | | | |

|Charges | | | | | | |

| |115 |114 |0.9 |511 |415 |23.1 |

|Operating Income |115 |83 |38.6 |520 |384 |35.4 |

|Realized Capital Gains (Losses) After-tax | | | | | | |

| |(22) |10 |-- |(51) |101 |(150.5) |

|Net Income |93 |93 |-- |469 |485 |(3.3) |

|Investments including Separate Accounts | | | | | | |

| |55,552 |48,301 |15.0 |55,552 |48,301 |15.0 |

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Allstate Insurance Company Street City, State Zip T 888.555.1234 F 888.555.1256 E someone@

Allstate Insurance Company Street City, State Zip T 888.555.1234 F 888.555.1256 E someone@

Allstate Insurance Company Street City, State Zip T 888.555.1234 F 888.555.1256 E someone@

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