10-KPeriod: FY2007

ALLSTATE CORP Annual Report, Year Ended Dec 31, 2007

Filed February 27, 2008For Securities:ALLALL-PJALL-PBALL-PHALL-PI

Summary

Allstate Corporation's 2007 10-K filing highlights a strong financial performance with net income of $4.64 billion, demonstrating resilience despite a slight decrease from the prior year. Total revenues grew to $36.77 billion, driven by significant realized capital gains and an increase in net investment income. The company continued its commitment to shareholder returns through substantial stock repurchases totaling $3.55 billion, signaling confidence in its financial position. The Allstate Protection segment, which represents the core of the business, saw a slight decrease in premiums earned but maintained underwriting income. However, the segment's combined ratio increased to 89.8 from 83.6 in the prior year, primarily due to higher catastrophe losses and increased claim frequency and severity in auto and homeowners insurance. The Allstate Financial segment reported stable net income, with growth in investment income offset by lower premiums and contract charges, reflecting a strategic shift and divestiture of variable annuity business. Management's focus remains on consumer centricity, operational excellence, and robust capital management, with ongoing efforts to innovate products and manage catastrophe exposure effectively.

Financial Highlights

23 data points
Beta

Revenue

$36.77B

Net Income

$4.64B

12.6% Net Margin

EPS (Diluted)

$7.76

Cash & Equivalents

$422.00M

Free Cash Flow

$5.16B

Financial Statements
Beta
Revenue$36.77B
Interest Expense$333.00M
Net Income$4.64B
EPS (Basic)$7.80
EPS (Diluted)$7.76
Shares Outstanding (Basic)594.20M
Shares Outstanding (Diluted)597.50M

Key Highlights

  • 1Net income for 2007 was $4.64 billion, a slight decrease from $4.99 billion in 2006.
  • 2Total revenues increased to $36.77 billion from $35.80 billion in 2006.
  • 3Realized capital gains on a pre-tax basis significantly increased to $1.24 billion in 2007 from $286 million in 2006.
  • 4Book value per diluted share increased by 10.7% to $38.58 as of December 31, 2007.
  • 5Share repurchases totaled $3.55 billion in 2007, with an additional $2.00 billion program announced in February 2008.
  • 6The Allstate Protection segment's combined ratio rose to 89.8 in 2007, up from 83.6 in 2006, due to increased catastrophe losses and higher claim severity.
  • 7Allstate Financial segment's net income was stable at $465 million, demonstrating consistent performance.

Frequently Asked Questions

Allstate's net income for 2007 was $4.64 billion, a decrease from $4.99 billion in 2006, but still representing a strong financial performance.

Allstate actively managed its capital by returning $3.55 billion to shareholders through stock repurchases and increasing its book value per diluted share by 10.7%. The company also announced a new $2.00 billion share repurchase program, indicating continued confidence in its financial strength.

The combined ratio for the Allstate Protection segment increased primarily due to higher catastrophe losses totaling $1.41 billion in 2007 compared to $810 million in 2006, coupled with increases in auto and homeowners claim frequency and severity, and the higher cost of catastrophe reinsurance.

The Allstate Financial segment delivered a stable net income of $465 million in 2007, comparable to the prior year. While premiums and contract charges decreased slightly, net investment income saw an increase, and the segment successfully managed its operational costs.