On October 31, 2019, State Auto Financial Corporation (the “Company”)>issued a press release disclosing the Company’s results of operations for the three and nine month periods>ended September 30, 2019>(the “Release”). The full text of the Release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

The Release included a non-GAAP financial measure, net income (loss) from operations per diluted share. The Company uses net income (loss) from operations because it believes this calculation better indicates the Company’s operating performance than GAAP net income (loss) in that net income (loss) from operations excludes the sometimes volatile investment gains/losses, net of applicable federal income taxes, that can produce inconsistent results.

The Release included a non-GAAP financial measure, net income (loss) from operations per diluted share. Net income (loss) from operations differs from GAAP net income (loss) only by the exclusion of net investment gains (losses), net of applicable taxes, on investment activity for the periods being reported. For the three and nine>month periods ended September 30, 2019, GAAP net income from operations was $0.34>per diluted share, respectively, while net income per share from operations was $0.44 per diluted share and $0.53 per diluted share, respectively, for the same 2018>periods. For the three and nine>month periods ended September 30, 2019, net investment (loss) gain, net of applicable taxes, impacted the GAAP net income per diluted share by $(0.09)>and $0.91, respectively, while net investment gain, net of applicable taxes, impacted the GAAP net income per diluted share by $0.32>and $0.33, respectively, for the same 2018>periods.

Management uses net income (loss) from operations because it believes this calculation better indicates the Company’s operating performance than GAAP net income (loss) in that net income (loss) from operations excludes the sometimes volatile realized capital gains/losses, net of applicable federal income taxes, that can produce inconsistent results.

State Auto Financial CORP Exhibit
EX-99.01 2 a3q2019pressrelease.htm PRESS RELEASE Exhibit EXHIBIT 99.1State Auto Financial reports third quarter 2019 results•Quarterly earnings of $0.25 per share•Quarterly net income from operations1 of $0.34 per share•Quarterly GAAP combined ratio of 99.5 •Return on equity of 3.4% •Book value per share of $21.68 COLUMBUS,…
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About STATE AUTO FINANCIAL CORPORATION (NASDAQ:STFC)

State Auto Financial Corporation (State Auto Financial) is a property and casualty insurance holding company. The Company is engaged in writing personal, business and specialty insurance. Its segments include personal insurance, business insurance, specialty insurance and investment operations. Its personal insurance, business insurance and specialty insurance are known as insurance segments of the Company. It writes standard insurance covering personal exposures to individuals in the personal insurance segment. The Company writes insurance covering small-to-medium sized commercial exposures in the business insurance segment. The specialty insurance segment offers commercial coverages requiring product underwriting, claims handling and/or risk management services through a distribution channel of retail agents and wholesale brokers, which include program administrators and other sources. Its investment portfolio is managed by its subsidiary, Stateco Financial Services, Inc.