News Details

PORTLAND, Maine--(BUSINESS WIRE)-- In his comments to stockholders at the company's annual meeting today, Thomas R. Watjen, president and CEO of Unum Group (NYSE: UNM), said consistent operating results, a strong investment portfolio and prudent capital management have positioned Unum well in the current economy.

"Through the efforts of our 10,000 employees in the United States and United Kingdom, we have made significant strides forward," said Watjen. "We have a clear strategy and simple, focused plans to seize on the opportunities we see in the market. By consistently executing on these plans, we have diversified our business, significantly improved our operating results and strengthened our financial position, while at the same time maintaining our focus on customer service, risk management and continuous improvement."

Watjen pointed to the significant increase in operating income and the company's five-year total returns as evidence that the focus on profitable growth and financial flexibility is producing results. From 2004 to 2008, Unum stockholders earned a nearly 28-percent return while the S&P Life and Health Index was flat and the S&P 500 was down 11 percent.

Watjen also cited the increasingly important role the benefits industry plays in the economies of both the U.S. and the U.K. "Today more than ever, middle- and lower-income people face dangerous gaps in their financial security," he said. "Employer-sponsored benefits are one of the primary backstops against financial catastrophe for these people. For many of them, the only protection they receive is through the workplace."

He added that as individuals try to better live within their means and take greater responsibility for their future, it creates more demand for financial education and personal protection products.

"The employer-sponsored benefits market represents, in my view, the single most effective way to provide all workers - but especially lower- and middle-income people - with the information and options to protect themselves and their families."

Looking ahead, Watjen said the company will focus on maintaining disciplined, profitable growth while continuing to invest in the business. "This is no time to be complacent," he said. "While we have not seen any material impact on our operating results from the economy or from aggressive competitive actions, we are not immune to either one. I'm confident, though, that by continuing to execute on our business plan, we can successfully meet the challenges that lie ahead and create further value for our stockholders."

Separately, taking into consideration Unum's financial flexibility and strong operating earnings, the company's board of directors today announced a 10-percent increase in the dividend to be paid to its common stockholders. "With our consistent operating performance and solid capital position, we believe the time is right to increase the dividend we pay to stockholders," said Watjen. "This is a significant milestone, coming six years after we reduced our dividend while we focused on restructuring the company and rebuilding our financial strength. We can take this action without impacting our financial flexibility or the capital guidance we have provided in the past."

Watjen also told stockholders that the search for a successor to Chief Financial Officer Robert Greving, who in February announced he is retiring later this year, continues to go well. "While we certainly hate to see Bob go, I am pleased to report that we are making good progress in a search for his successor," Watjen said. "We have met with some very strong candidates and hope to be in a position to announce a decision in the coming months."

Additionally, Chairman of the Board Jon Fossel announced that Watjen discussed with the board of directors his intention to sell a portion of his current holdings of Unum stock through the adoption of a prearranged trading plan under the guidelines specified by Rule 10b5-1. "We encouraged him to put in place a plan that will allow him to slightly diversify his holdings of Unum stock," said Fossel. He added that any sales would be modest and would be solely for personal financial planning purposes. Fossel also said that Watjen's personal ownership position after completion of the plan will remain well in excess of company ownership guidelines. "My ownership will continue to be substantial, and I remain extremely confident in the company's future," said Watjen.

Also at today's meeting, Unum stockholders elected four directors to terms expiring in 2012. They are: Pamela H. Godwin, president of Change Partners, Inc.; Thomas Kinser, retired president and chief executive officer of BlueCross BlueShield of Tennessee; A.S. (Pat) MacMillan, Jr., chief executive officer of Triaxia Partners, Inc.; and Edward J. Muhl, retired national leader, PricewaterhouseCoopers LLP. All are currently serving on the board. Stockholders also ratified Ernst & Young LLP as the company's independent registered public accounting firm for 2009.

About Unum

Unum (www.unum.com) is one of the leading providers of employee benefits products and services in the United States and the United Kingdom. Through its subsidiaries, Unum Group provided more than $6 billion in total benefits to customers in 2008.

Safe Harbor Statement

Statements in this press release that are not historical facts, such as management's statements about the Company's financial flexibility, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based on management's expectations, plans and beliefs concerning future developments. These forward-looking statements are not a guarantee of future performance and involve risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include such matters as (1) unfavorable economic or business conditions, both domestic and foreign, including the continued financial market disruption; (2) investment results, including but not limited to, realized investment losses resulting from impairments that differ from our assumptions and historical experience; (3) rating agency actions, state insurance department market conduct examinations and other inquiries, other government investigations and actions, and negative media attention; (4) changes in interest rates, credit spreads, and securities prices; (5) currency exchange rates; (6) changes in our financial strength and credit ratings; (7) changes in claim incidence and recovery rates due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, and the effectiveness of claims management operations; (8) increased competition from other insurers and financial services companies due to industry consolidation or other factors; (9) legislative, regulatory, or tax changes, both domestic and foreign, including the effect of potential legislation and increased regulation in the current political environment; (10) effectiveness of our risk management program; (11) the level and results of litigation; (12) effectiveness in supporting new product offerings and providing customer service; (13) actual experience in pricing, underwriting, and reserving that deviates from our assumptions; (14) lower than projected persistency and lower sales growth; (15) fluctuation in insurance reserve liabilities; (16) ability and willingness of reinsurers to meet their obligations; (17) changes in assumptions related to intangible assets such as deferred acquisition costs, value of business acquired, and goodwill; (18) ability of our subsidiaries to pay dividends as a result of regulatory restrictions; (19) events or consequences relating to terrorism and acts of war, both domestic and foreign; (20) changes in accounting standards, practices, or policies; and (21) ability to recover our systems and information in the event of a disaster or unanticipated event.

For further information about risks and uncertainties that could affect actual results, see the Company's filings with the Securities and Exchange Commission, including information in the sections titled "Cautionary Statement Regarding Forward-Looking Statements" and "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 and subsequently filed Form 10-Q. The forward-looking statements in this press release are being made as of the date of this press release, and the Company expressly disclaims any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise.

    Source: Unum Group