Unum (NYSE:UNM) is succeeding at providing both valuable financial protection benefits to millions of working people and strong returns to stakeholders in what continues to be a challenging economic environment, according to President and CEO Thomas R. Watjen. Mr. Watjen made his comments to shareholders at the company’s annual meeting Thursday in Portland, Maine.
“We grew the businesses we targeted for growth, generated strong profitability in our core businesses and maintained a solid financial foundation while delivering on our commitments to customers and shareholders,” Mr. Watjen said. “We finished the year well-positioned for the future.”
Unum paid more than $6 billion in benefits in 2012 to help protect the future of workers and their families and helped more than 230,000 individuals return to work and a productive lifestyle.
“The financial protection we provide through the workplace has never been more important than it is today,” he added, noting 40 percent of Americans live paycheck to paycheck and half of all households couldn’t raise $2,000 within a month if they had to. “When people need them most, benefits such as disability, life, accident and critical illness insurance protect against financial hardships that can derail the stability of individuals and families.”
Executive Vice President and CFO Richard P. McKenney, who also addressed shareholders at today’s meeting, said Unum continues to execute in a sound, sustainable manner that creates steady value, with a total return to shareholders that has significantly outperformed the industry over the past five years. The company repurchased $500 million of its stock in 2012 and increased its dividend by 24 percent. Since 2007, the company has repurchased $2.2 billion in stock and increased its dividend by 73 percent.
He also noted the significance of financial strength ratings upgrades by both Moody’s and Standard & Poor’s in 2012.
“The company’s solid earnings growth, increased shareholder returns and significant risk-based capital demonstrate the success of our commitment to a disciplined management and operating approach,” Mr. McKenney said. “Unum has outperformed its peers over the past several years in key industry measures through a focus on operating discipline, which leads to a strong balance sheet and capital position.”
Unum achieved operating earnings per share growth of 5.7 percent in 2012. The company’s total operating return on equity across all business lines was 12.2 percent.
“Each year brings its own unique challenges and changes, but I’m confident the approach we’ve taken to managing the business can continue to create long-term value for shareholders,” said Mr. McKenney.
Mr. Watjen added that the company’s success has gone well beyond financial results to include very high customer satisfaction survey results, increased community and social responsibility efforts, and an elevated stature as a leading voice in its industry.
Also at Thursday’s meeting, Unum shareholders voted to re-elect four directors for terms expiring in 2016: E. Michael Caulfield, former president of Mercer Human Resource Consulting; Ronald E. Goldsberry, automotive industry consultant; Kevin T. Kabat, vice chairman and chief executive officer of Fifth Third Bancorp; and Michael J. Passarella, former audit partner of PricewaterhouseCoopers LLP.
Shareholders also voted in favor of an amended and restated certificate of incorporation to declassify Unum’s board of directors, approved the compensation of the company’s named executive officers, approved the annual incentive plan, and ratified the appointment of Ernst & Young LLP as the company’s independent registered public accounting firm.