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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 13, 1999
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Commission File Number 0-5544
OHIO CASUALTY CORPORATION
(Exact name of registrant as specified in its charter)
OHIO
(State or other jurisdiction of incorporation or organization)
31-0783294
(I.R.S. Employer Identification No.)
136 North Third Street, Hamilton, Ohio
(Address of principal executive offices)
45025
(Zip Code)
(513) 867-3000
(Registrant's telephone number)
Not Applicable
(Former name or former address, if changed since last report)
Exhibit Index - Page 4
Page 1 of 4 Pages
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ITEM 5. Other Events
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On July 13, 1999, Ohio Casualty Corporation (the "Corporation")
announced that as a result of catastrophe losses due to severe
weather, the Corporation is expecting to post an operating loss for
the quarter ended June 30, 1999.
Also the Corporation announced that during the second quarter it
completed a strategic asset reallocation of its investment portfolio,
resulting in recognition of approximately $145 million in realized
gains before tax.
A copy of the press release issued by Ohio Casualty Corporation on
July 13, 1999, announcing these events is attached hereto as Exhibit
99.1 and is incorporated herein by reference.
Page 2 of 4 Pages
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ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
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Exhibits
99.1 Press Release dated July 13, 1999, announcing significant
financial events for the second quarter of 1999.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
OHIO CASUALTY CORPORATION
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(Registrant)
July 13, 1999 /s/ Barry S. Porter
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Barry S. Porter, CFO/Treasurer
(on behalf of Registrant and
as Principal Accounting Officer)
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EXHIBIT INDEX
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Current Report on Form 8-K
Dated July 13, 1999
OHIO CASUALTY CORPORATION
Exhibit No. Description
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99.1 Press Release dated July 13, 1999, announcing significant
financial events for the second quarter of 1999.
Page 4 of 4 Pages
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Exhibit 99.1
FOR IMMEDIATE RELEASE Analyst Contact: Dale A. Thatcher
- --------------------- (513) 867-3034
Media Contact: Cindy Denney
(513) 867-3695
OHIO CASUALTY ANTICIPATES SECOND
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QUARTER OPERATING LOSS
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HAMILTON, Ohio, July 13, 1999 --- Ohio Casualty today announced that as a
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result of severe weather, the Corporation is expected to post an operating
loss for the quarter ended June 30, 1999. The devastating tornadoes in
Cincinnati and Oklahoma City have developed to total $17.9 million in net
losses for the Company. The Cincinnati tornadoes struck on April 9 and
resulted in net losses of $9.6 million. The Oklahoma City tornadoes struck
almost a month later on May 3 resulting in net losses of $8.3 million. Gross
losses from the two events totaled $25.8 million. Second quarter catastrophe
losses are expected to total approximately $23.8 million net of reinsurance or
6.3 points on the combined ratio, making it the second worst quarter in the
Corporation's history.
In other unrelated developments, the Corporation has completed a
strategic asset reallocation of its investment portfolio. A combination of
share repurchases and outstanding growth in the equity portfolio caused the
relationship of asset classes to fall outside the Corporation's long-standing
investment guidelines. The Corporation responded by selling approximately
$200 million in equity securities during the quarter for a realized gain of
approximately $145 million before tax or $1.54 per split-adjusted share after
tax. The after-tax proceeds have been invested in fixed income instruments
which we anticipate will increase investment income in subsequent quarters.
According to CFO Barry Porter, "This brings our equity portfolio down to $700
million and rebalances our asset allocation in line with our historical
investment posture. Given the robust equity valuations in the second quarter,
we felt it an appropriate time to make the adjustment. We remain committed to
our historical investment philosophy and risk profile which have served us so
well for so long. Underwriting losses in the quarter and certain tax-loss
carryforwards will mitigate, somewhat, the incurred capital gains tax
liability."
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Ohio Casualty Corporation publishes forward-looking statements relating
to such matters as anticipated financial performance, business prospects and
plans, regulatory developments and similar matters. The statements contained
in this news release that are not historical information, are forward-looking
statements. The Private Securities Litigation Reform Act of 1995 provides a
safe harbor under The Securities Act of 1933 and The Securities Exchange Act
of 1934 for forward-looking statements. The risks and uncertainties that may
affect the operations, performance, development and results of the
Corporation's business including the forcasted results described herein and
the results of the acquisition described herein, include the following:
changes in property and casualty reserves; catastrophe losses; premium and
investment growth; product pricing environment; availability of credit;
changes in government regulation; performance of financial markets;
fluctuations in interest rates; availability and pricing of reinsurance;
litigation and administrative proceedings; year 2000 issues; and general
economic and market conditions.
On December 1, 1998 a subsidiary of Ohio Casualty Group completed the
acquisition of substantially all of the Commercial Lines Division of Great
American Insurance Company. This acquisition places Ohio Casualty among the
top 40 property and casualty insurance groups in the United States. The
combined organization offers businesses and individuals a range of property-
casualty products. Ohio Casualty Group is active in more than 40 states,
operates primarily through the independent agency system, and has assets of
approximately $5 billion. Ohio Casualty Corporation trades on the NASDAQ
Stock Market under the symbol OCAS, and through 1999, has increased
shareholder dividends for 53 consecutive years.
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