USF&G Corp. drastically cut its fourth-quarter losses in 1991, losing $40 million compared to $610 million in the fourth quarter of 1990, the company said today.
And those quarterly financial results contain the last major charges from USF&G's restructuring, Chairman Norman Blake said, noting that the corporate overhaul is virtually complete.
"It appears that the numbers came in slightly better than we were looking for, but not enough to cause any major investment decision changes," said Michael A. Lewis, insurance analyst for the investment firm Dean Witter Reynolds Inc. in New York.
The stock market agreed; stock in the Baltimore-based insurance company rose only 25 cents by midday, to $9.25 a share.
The fourth quarter loss in 1991 included $26 million of restructuring charges, and a $24 million loss primarily related to the fourth quarter decision to discontinue investment management operations, USF&G said. Those one-time losses were partly offset by $16 million of one-time gains.
The loss worked out to 62 cents a share, with 23 cents a share coming from continuing operations and the rest from the special charges. Mr. Lewis had expected the company to lose 49 cents on operations, including a $24 million loss on an investment management business that USF&G counted as non-continuing because it was scrapped during the quarter.
"USF&G ended 1991 with its business restructuring essentially completed," Mr. Blake said in a statement. "These actions, which were necessary to achieve long-term profitability for the company, continued to impact earnings in the latest quarter."
USF&G said its core property-casualty insurance business actually made a $17 million profit on operations during the fourth quarter of 1991, despite a soft insurance market.