8-KEarnings & ResultsFinancial EventsExhibits & Filings

PROGRESSIVE CORP/OH/ 8-K Report, Financial Results (Apr 15, 2009)

Filed April 15, 2009For Securities:PGR

Summary

The Progressive Corporation (PGR) filed an 8-K on April 15, 2009, primarily to disclose financial results for the month and year-to-date period ended March 2009, as detailed in an accompanying press release (Exhibit 99). A significant event reported under Item 2.06 is a material impairment charge of $216.5 million related to securities with "other-than-temporary" declines in market value as of March 31, 2009. This charge primarily impacted the preferred stock portfolio ($199.4 million), with smaller impacts on common equities and structured debt. While the impairment represents a realized loss, the company stated it does not anticipate future cash expenditures resulting from these charges. Investors should refer to the attached press release for a more comprehensive overview of the company's operational and financial performance during the reported period, as well as to the company's 2008 Form 10-K for further details on its accounting policies regarding other-than-temporary impairments.

Key Highlights

  • 1Progressive Corporation announced financial results for the period ending March 2009 via an attached press release.
  • 2The company recorded a $216.5 million charge for other-than-temporary impairments on securities as of March 31, 2009.
  • 3The majority of the impairment charge ($199.4 million) was related to the preferred stock portfolio.
  • 4Common equities and structured debt also experienced impairment charges of $15.7 million and $1.4 million, respectively.
  • 5The company indicated that these impairment charges are not expected to result in future cash expenditures.
  • 6Investors are directed to the press release (Exhibit 99) for detailed financial results and to the 2008 10-K for accounting policy explanations.

Frequently Asked Questions

The primary purpose of this 8-K filing is to report The Progressive Corporation's financial results for the month and year-to-date period ended March 2009, as detailed in an attached press release, and to disclose a material impairment charge.

Progressive Corporation wrote down $216.5 million in securities due to "other-than-temporary" declines in their market value as of March 31, 2009. This determination was based on fundamental issues with specific securities or issuers, or an inability to objectively confirm near-term recovery.

No, the company explicitly stated that it does not anticipate these impairment charges will result in future cash expenditures.

More detailed financial results are available in the press release attached as Exhibit 99 to this 8-K filing. For a deeper understanding of the company's 'Other-than-Temporary Impairment' accounting policy, investors should refer to the 'Management's Discussion and Analysis of Financial Condition and Results of Operations' section in the company's Annual Report on Form 10-K for the year ended December 31, 2008.