Progressive Insurance doesn't provide earnings guidance. Instead, the insurer provides something few other companies do — complete financial statements to the public every month.
Plenty of companies give monthly sales figures or financial summaries, but Progressive is thought to be one of the only companies to provide a full set of financials. "We don't play the earnings game," says treasurer Thomas King. "But in our eyes, we do something better by laying all our cards on the table each month."
King explains that the company doesn't want earnings guidance to influence how loss reserves, which can have a massive impact on earnings, are calculated. "We want actuaries to be able to make adjustments without any concern over the accounting effects," he says.
The statements are unaudited and released about two weeks after the end of each month. King says they don't put any extra burden on the finance department, nor do they require additional staff. In fact, he says, this approach makes the quarterly close easier, because "we don't have the craziness of trying to get the quarterly financials out the door." King says the company just adds the last month in, and then the statements are ready to go.
Progressive, which began providing the monthly financial statements in 2001, says investors welcome the frequent reports. And, adds King, the monthly financials don't lead to a focus on the company's short-term results. "Investors get good insight into where we are each month, so there are no surprises," he explains.