the progressive corporation 2006 annual report
financial review
Consolidated Statements of Income | Consolidated Balance Sheets | Consolidated Statements of Changes in Shareholders' Equity | Consolidated Statements of Cash Flows | Notes to Consolidated Financial Statements
The Progressive Corporation and Subsidiaries
Consolidated Statements of Income
(millions - except per share amounts)
| For the years ended December 31, | 2006 | 2005 | 2004 | |||
|---|---|---|---|---|---|---|
Revenues |
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| Net premiums earned | $ | 14,117.9 | $ | 13,764.4 | $ | 13,169.9 |
| Investment income | 647.8 | 536.7 | 484.4 | |||
| Net realized gains (losses) on securities | (9.7) | (37.9) | 79.3 | |||
| Service revenues | 30.4 | 40.2 | 48.5 | |||
| Total revenues | 14,786.4 | 14,303.4 | 13,782.1 | |||
Expenses |
||||||
| Losses and loss adjustment expenses | 9,394.9 | 9,364.8 | 8,555.0 | |||
| Policy acquisition costs | 1,441.9 | 1,448.2 | 1,418.0 | |||
| Other underwriting expenses | 1,402.8 | 1,312.2 | 1,238.6 | |||
| Investment expenses | 11.9 | 12.1 | 13.9 | |||
| Service expenses | 24.4 | 24.6 | 25.0 | |||
| Interest expense | 77.3 | 82.6 | 80.8 | |||
| Total expenses | 12,353.2 | 12,244.5 | 11,331.3 | |||
Net Income |
||||||
| Income before income taxes | 2,433.2 | 2,058.9 | 2,450.8 | |||
| Provision for income taxes | 785.7 | 665.0 | 802.1 | |||
| Net income | $ | 1,647.5 | $ | 1,393.9 | $ | 1,648.7 |
Computation of Earnings Per Share |
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| Basic: | ||||||
| Average shares outstanding | 774.3 | 787.7 | 851.5 | |||
| Per share | $ | 2.13 | $ | 1.77 | $ | 1.94 |
| Diluted: | ||||||
| Average shares outstanding | 774.3 | 787.7 | 851.5 | |||
| Net effect of dilutive stock-based compensation | 9.5 | 11.6 | 13.3 | |||
| Total equivalent shares | 783.8 | 799.3 | 864.8 | |||
| Per share | $ | 2.10 | $ | 1.74 | $ | 1.91 |
All share and per share amounts were adjusted for the May 18, 2006, 4-for-1 stock split.
See notes to consolidated financial statements.
