Consolidated Statements of Changes in Shareholders’ Equity

(millions – except per share amounts)
For the years ended December 31, highlight year2009 2008 2007

Retained Earnings

                       
Balance, Beginning of year $ 2,697.8     $ 2,927.7     $ 4,646.9    
Cumulative effect of change in accounting principle   189.6                
Net income (loss)   1,057.5 $ 1,057.5   (70.0) $ (70.0)   1,182.5 $ 1,182.5
Cash dividends declared on common shares ($.1613, $0, and $2.1450 per share)   (108.5)             (1,507.6)    
Treasury shares purchased   (154.5)       (157.1)       (1,388.4)    
Other, net   1.2       (2.8)       (5.7)    
Balance, End of year $ 3,683.1     $ 2,697.8     $ 2,927.7    

Accumulated Other Comprehensive Income (Loss), Net of Tax

                       
Balance, Beginning of year $ (51.9)     $ 492.8     $ 604.3    
Cumulative effect of change in accounting principle   (189.6)                
Changes in:                        
Net unrealized gains (losses) on securities       722.7                
Portion of OTTI losses recognized in other comprehensive income (loss)       (26.1)                
Total net unrealized gains (losses) on securities       696.6       (541.8)       (131.8)
Net unrealized gains on forecasted transactions       (3.3)       (2.9)       20.3
Foreign currency translation adjustment       1.4            
Other comprehensive income (loss)   694.7   694.7   (544.7)   (544.7)   (111.5)   (111.5)
Balance, End of year $ 453.2     $ (51.9)     $ 492.8    
Comprehensive Income (Loss)     $ 1,752.2     $ (614.7)     $ 1,071.0

Common Shares, $1.00 Par Value

                       
Balance, Beginning of year $ 676.5     $ 680.2     $ 748.0    
Stock options exercised   3.5       3.5       3.4    
Treasury shares purchased   (11.1)       (9.9)       (72.9)    
Restricted stock issued, net of forfeitures   3.7       2.7       1.7    
Balance, End of year $ 672.6     $ 676.5     $ 680.2    

Paid-In Capital

                       
Balance, Beginning of year $ 892.9     $ 834.8     $ 847.4    
Stock options exercised   15.3       23.5       27.4    
Tax benefits from exercise/vesting of stock-based compensation   9.7       11.1       15.5    
Treasury shares purchased   (15.0)       (12.4)       (87.1)    
Restricted stock issued, net of forfeitures   (3.7)       (2.7)       (1.7)    
Amortization of stock-based compensation   39.2       35.1       28.0    
Other   1.3       3.5       5.3    
Balance, End of year $ 939.7     $ 892.9     $ 834.8    
Total Shareholders' Equity $ 5,748.6     $ 4,215.3     $ 4,935.5    

There are 20.0 million Serial Preferred Shares authorized; no such shares are issued or outstanding.

There are 5.0 million Voting Preference Shares authorized; no such shares have been issued.

See notes to consolidated financial statements.

 

The Progressive Corporation   6300 Wilson Mills Road   Mayfield Village, Ohio 44143   440.461.5000   progressive.com