Summary
This 10-Q filing for The Progressive Corporation (PGR) as of March 30, 2011, indicates a consistent approach to capital allocation and executive compensation. The company continued its share repurchase program, buying back over 6.8 million shares in the first three months of 2011, aligning with its policy to neutralize dilution from equity-based compensation and return underleveraged capital to investors. The average purchase price during this period was approximately $20.29 per share. Furthermore, the filing details significant grants of equity awards to management employees, including executive officers. These awards are structured as time-based restricted stock units and performance-based restricted stock units, with vesting tied to both continued employment and specific company performance metrics such as premium growth and profitability. The performance-based awards have a potential payout ranging from 0% to 200% of the initial award value, contingent upon achieving defined growth and combined ratio targets.
Financial Highlights
34 data points| Revenue | $3.89B |
| Interest Expense | $31.50M |
| Net Income | $362.90M |
| EPS (Basic) | $0.56 |
| EPS (Diluted) | $0.55 |
| Shares Outstanding (Basic) | 651.80M |
| Shares Outstanding (Diluted) | 655.80M |
Key Highlights
- 1Progressive repurchased 6,801,484 shares of common stock in the first quarter of 2011, at an average price of $20.29 per share, as part of an ongoing program to offset dilution and return capital.
- 2The company granted 1,677,090 time-based restricted stock units to 676 management employees in March 2011, with an aggregate value of approximately $34.4 million, vesting in installments from 2014 to 2016.
- 3Performance-based restricted stock units were also granted to 40 executives and senior managers, with an initial aggregate value of approximately $13.9 million (assuming 100% vesting).
- 4The vesting of performance-based awards depends on Progressive exceeding market growth rates in private passenger auto and commercial auto direct written premiums and achieving a combined ratio of 96 or lower, over a three-year period.
- 5The payout for performance-based awards can range from 0% to 200% of the initial award value, based on the degree of outperformance in growth and profitability.
- 6Non-employee directors received time-based restricted stock awards covering 85,919 common shares, with an aggregate value of approximately $1.9 million, vesting in March 2012.
- 7No material changes in risk factors were reported compared to the company's December 31, 2010, Form 10-K filing.