• Net income of $42.5 million ($1.28 per diluted share), adjusted net income of $31.2 million ($0.94 per diluted share).
• Gross premiums written of $186.4 million, up 1% year-over-year,
• Net earned premiums of $178.0 million, up 4% year-over-year.
• Underwriting income of $25.6 million versus $11.5 million a year ago.
• Combined ratio of 85.6%, combined ratio before the impact of the LPT of 89.5%.

RENO, Nev.--(BUSINESS WIRE)--Jul. 25, 2018-- Employers Holdings, Inc. (“EHI” or the “Company”) (NYSE:EIG) today reported the following for the second quarter of 2018: (i) net income of $42.5 million ($1.28 per diluted share); (ii) net income before the impact of the LPT of $35.6 million ($1.07 per diluted share); and (iii) adjusted net income of $31.2 million ($0.94 per diluted share).

The Company's adjusted net income for the second quarter of 2018 increased $11.5 million year-over-year. This increase primarily reflects: (i) strong underwriting results highlighted by a 62.5% current accident year loss ratio and $16.5 million of favorable prior year loss reserve development, and (ii) a reduction in our effective income tax rate from 23.9% to 17.2%, primarily reflecting the favorable impact of the December 2017 Tax Cuts and Job Act.

The Company's net income and net income before the impact of the LPT for the second quarter of 2018 increased by $17.7 million and $13.9 million, respectively, year-over-year. These second quarter 2018 net income measures were each favorably impacted by the items previously mentioned, as well as $2.8 million of after tax unrealized investment gains relating to the Company’s equity investments. Prior to January 1, 2018, the Company’s unrealized gains and losses on equity securities were not a component of its net income or net income before the impact of the LPT.

The Company’s book value per share of $29.20, book value per share including the Deferred Gain of $33.92 and adjusted book value per share of $34.33 increased by 1.8%, 0.7%, and 12.8% during the first half of 2018, respectively, each computed after taking into account dividends declared. The Company's book value per share and book value per share including the Deferred Gain at June 30, 2018 were each adversely impacted by $46.7 million of after tax unrealized losses relating to the Company’s fixed maturity investments caused by an increase in market interest rates.

Chief Executive Officer Douglas Dirks commented on the results: “EMPLOYERS has performed well throughout the first half of 2018. We grew written premiums by 4%, lowered our current accident year loss provision and recognized favorable development on our prior year loss reserves.

“As a result of our nearly-completed buildout of our nationwide platform, an enhanced sales force and greater leveraging of our partnerships and alliances, we were able to increase our top line despite declining rates in nearly all of the markets in which we do business. Loss costs and frequency trends continue to be favorable, despite highly competitive market conditions.”

Summary ofSecond Quarter 2018 Operating Results
(All comparisons vs. second quarter 2017, unless noted otherwise).

Gross premiums written were $186.4 million, an increase of 1%. The increase was due primarily to new business writings, partially offset by rate declines on renewal business. Net earned premiums were $178.0 million, an increase of 4% year-over-year.

The loss and LAE ratio before the impact of the LPT of 53.2% decreased 10.4 percentage points reflecting observed favorable paid loss trends, including those resulting from our key business initiatives including: an emphasis on settling open claims; diversifying our risk exposure across geographic markets; and leveraging data-driven strategies to target, underwrite and price profitable classes of business across all of our markets. Favorable prior year loss reserve development represented 9.3 percentage points of the decline.

The commission expense ratio of 13.8% increased 1.3 percentage points, primarily as a result of an increase in the percentage of business produced by our partnerships and alliances, which is subject to a higher commission rate, as well as an increase in projected 2018 agency incentive commissions.

The underwriting and other operating expense ratio of 22.5% increased 3.5 percentage points due largely to expenses associated with the development and implementation of new technologies and capabilities.

Net investment income of $20.3 million increased 12%, primarily as a result of higher pre-tax book yields.

The income tax expense was $8.8 million (a 17.2% effective rate) versus $7.8 million (a 23.9% effective rate). The decrease in the effective rate is due to a reduction in the statutory Federal income tax rate from 35% to 21% as a result of the 2017 Tax Cuts and Job Act.

Stockholders’ Equity including the Deferred Gain, Second Quarter 2018 Dividend Declaration

Stockholders’ equity including the Deferred Gain was $1,111.2 million, an increase of 1.8% from March 31, 2018 and 4.0% from June 30, 2017.

On July 25, 2018, the Board of Directors declared a third quarter 2018 dividend of $0.20 per share. The dividend is payable on August 22, 2018 to stockholders of record as of August 8, 2018.

Conference Call and Webcast, Reports Filed With The Securities and Exchange Commission (the "SEC") and Supplemental Materials

The information in this press release should be read in conjunction with the Financial Supplement that is attached to this press release and is available on our website.

Reconciliation of Non-GAAP Financial Measures to GAAP

Within this earnings release we present various financial measures, some of which are a "non-GAAP financial measure" as defined in Regulation G pursuant to Section 401 of the Sarbanes - Oxley Act of 2002. A description of these non-GAAP financial measures, as well as a reconciliation of such non-GAAP measures to the Company's most directly comparable GAAP financial measures is included in the attached Financial Supplement. Management believes that these non-GAAP measures are meaningful to the Company's investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. These non-GAAP measures are not a substitute for GAAP measures and investors should be careful when comparing the Company's non-GAAP financial measures to similarly titled measures used by other companies. Other companies may calculate these measures differently, and, therefore, these measures may not be comparable.

The Company will host a conference call on Thursday, July 26, 2018, at 8:30 a.m. Pacific Daylight Time. The conference call will be available via a live web cast on the Company's web site at www.employers.com. An archived version will be available several hours after the call. The conference call replay number is (404) 537-3406 or (855) 859-2056 with a pass code of 6596627.

The Company provides its filings with the Securities and Exchange Commission and its investor presentations on its website at www.employers.com.

Forward-Looking Statements

In this press release, the Company and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections of, among other things, the Company's future performance, business growth, retention rates, loss costs, claim trends and the impact of key business initiatives, future technologies and planned investments. Certain of these statements may constitute "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and are often identified by words such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "target," "project," "intend," "believe," "estimate," "predict," "potential," "pro forma," "seek," "likely," or "continue," or other comparable terminology and their negatives. EHI and its management caution investors that such forward-looking statements are not guarantees of future performance. Risks and uncertainties are inherent in EHI's future performance. Factors that could cause the Company's actual results to differ materially from those indicated by such forward-looking statements include, among other things, those discussed or identified from time to time in EHI's public filings with the SEC, including the risks detailed in the Company's Quarterly Reports on Form 10-Q and the Company's Annual Reports on Form 10-K. Except as required by applicable securities laws, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

The SEC filings for EHI can be accessed through the “Investors” link on the Company's website, www.employers.com, or through the SEC's EDGAR Database at www.sec.gov (EHI EDGAR CIK No. 0001379041).

Copyright © 2018 EMPLOYERS. All rights reserved. EMPLOYERS^® and America's small business insurance specialist.^® are registered trademarks of Employers Insurance Company of Nevada. Employers Holdings, Inc. is a holding company with subsidiaries that are specialty providers of workers' compensation insurance and services focused on select, small businesses engaged in low to medium hazard industries. Insurance subsidiaries include Employers Insurance Company of Nevada, Employers Compensation Insurance Company, Employers Preferred Insurance Company, and Employers Assurance Company, all rated A- (Excellent) by A.M. Best Company.

Additional information can be found at: http://www.employers.com.

Employers Holdings, Inc.
Second Quarter 2018
Financial Supplement

EMPLOYERS HOLDINGS, INC.
Table of Contents
Page
1		Consolidated Financial Highlights
2		Summary Consolidated Balance Sheets
3		Summary Consolidated Income Statements
4		Return on Equity
5		Combined Ratios
6		Roll-forward of Unpaid Losses and LAE
7		Consolidated Investment Portfolio
8		Book Value Per Share
9		Earnings Per Share
10		Non-GAAP Financial Measures

EMPLOYERS HOLDINGS, INC.
Consolidated Financial Highlights (unaudited)
$ in millions, except per share amounts
		Three Months Ended											Six Months Ended
		June 30,											June 30,
		2018				2017				% change			2018				2017				% change
Selected financial highlights:
Gross premiums written		$	186.4			$	184.5			1	%		$	398.0			$	382.1			4	%
Net premiums written		185.0				183.0				1			395.2				379.1				4
Net premiums earned		178.0				171.7				4			354.6				347.1				2
Net investment income		20.3				18.2				12			39.7				36.9				8
Underwriting income(1)		25.6				11.5				123			44.0				20.5				115
Net income before impact of the LPT(1)		35.6				21.7				64			58.6				42.0				40
Adjusted net income(1)		31.2				19.7				58			60.6				38.6				57
Net income		42.5				24.8				71			68.1				48.0				42
Comprehensive income		31.2				32.5				(4	)		21.4				63.8				(66	)
Total assets													3,868.5				3,824.8				1
Stockholders' equity													956.5				899.2				6
Stockholders' equity including the Deferred Gain(2)													1,111.2				1,068.1				4
Adjusted stockholders' equity(2)													1,124.5				977.8				15
Annualized adjusted return on stockholders' equity(3)		11.3		%		8.1		%		40	%		11.4		%		8.0		%		43	%
Amounts per share:
Cash dividends declared per share		$	0.20			$	0.15			33	%		$	0.40			$	0.30			33	%
Earnings per diluted share(4)		1.28				0.75				71			2.05				1.46				40
Earnings per diluted share before impact of the LPT(4)		1.07				0.66				62			1.76				1.27				39
Adjusted earnings per diluted share(4)		0.94				0.60				57			1.82				1.17				56
Book value per share(2)													29.20				27.74				5
Book value per share including the Deferred Gain(2)													33.92				32.95				3
Adjusted book value per share(2)													34.33				30.17				14
Combined ratio before impact of the LPT:(5)
Loss and loss adjustment expense ratio:
Current year		62.5		%		63.8		%					62.5		%		63.8		%
Prior year		(9.3		)		(0.2		)					(8.2		)		(0.1		)
Loss and loss adjustment expense ratio		53.2		%		63.6		%					54.3		%		63.7		%
Commission expense ratio		13.8				12.5							13.6				12.4
Underwriting and other operating expenses ratio		22.5				19.0							22.3				19.8
Combined ratio before impact of the LPT		89.5		%		95.1		%					90.3		%		95.8		%

(1)		See Page 3 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(2)		See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(3)		See Page 4 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(4)		See Page 9 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(5)		See Page 5 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.
Summary Consolidated Balance Sheets (unaudited)
$ in millions, except per share amounts
		June 30,						December 31,
		2018						2017
ASSETS
Investments, cash and cash equivalents		$			2,752.6			$	2,752.0
Accrued investment income		18.6						19.6
Premiums receivable, net		355.6						326.7
Reinsurance recoverable on paid and unpaid losses and LAE		520.1						544.2
Deferred policy acquisition costs		51.7						45.8
Deferred income taxes, net		24.4						28.7
Contingent commission receivable—LPT Agreement		32.0						31.4
Other assets		113.5						91.7
Total assets		$			3,868.5			$	3,840.1
LIABILITIES
Unpaid losses and LAE		$			2,227.9			$	2,266.1
Unearned premiums		360.2						318.3
Commissions and premium taxes payable		58.9						55.3
Deferred Gain		154.7						163.6
Notes payable		20.0						20.0
Other liabilities		90.3						69.1
Total liabilities		$			2,912.0			$	2,892.4
STOCKHOLDERS' EQUITY
Common stock and additional paid-in capital		$			383.0			$	381.8
Retained earnings(2)		970.8						842.2
Accumulated other comprehensive (loss) income, net(2)		(13.3				)		107.4
Treasury stock, at cost		(384.0				)		(383.7		)
Total stockholders’ equity		956.5						947.7
Total liabilities and stockholders’ equity		$			3,868.5			$	3,840.1
Stockholders' equity including the Deferred Gain (1)		$			1,111.2			$	1,111.3
Adjusted stockholders' equity (1)		1,124.5						1,003.9
Book value per share (1)		$			29.20			$	29.07
Book value per share including the Deferred Gain(1)		33.92						34.09
Adjusted book value per share (1)		34.33						30.80

(1)		See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(2)		Adoption of a new accounting standard (ASU No. 2016-01) resulted in a $74.0 million reclassification adjustment from Accumulated other comprehensive income to Retained earnings as of January 1, 2018.

EMPLOYERS HOLDINGS, INC.
Summary Consolidated Income Statements (unaudited)
$ in millions, except per share amounts
		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2018				2017				2018				2017
Underwriting revenues:
Gross premiums written		$	186.4			$	184.5			$	398.0			$	382.1
Premiums ceded		(1.4		)		(1.5		)		(2.8		)		(3.0		)
Net premiums written		185.0				183.0				395.2				379.1
Net premiums earned		178.0				171.7				354.6				347.1
Underwriting expenses:
Losses and LAE incurred		(87.8		)		(106.1		)		(183.2		)		(215.0		)
Commission expense		(24.5		)		(21.5		)		(48.2		)		(43.0		)
Underwriting and other operating expenses		(40.1		)		(32.6		)		(79.2		)		(68.6		)
Underwriting income		25.6				11.5				44.0				20.5
Net investment income		20.3				18.2				39.7				36.9
Net realized and unrealized gains (losses) on investments(2)		5.7				1.1				(2.4		)		3.3
Gain on redemption of notes payable		—				2.1				—				2.1
Other income		0.1				0.1				0.1				0.1
Interest and financing expenses		(0.4		)		(0.4		)		(0.7		)		(0.8		)
Income tax expense		(8.8		)		(7.8		)		(12.6		)		(14.1		)
Net income		42.5				24.8				68.1				48.0
Unrealized AFS investment (losses) gains arising during the period, net of tax(3)		(11.3		)		8.4				(47.1		)		17.9
Reclassification adjustment for realized AFS investment losses (gains) in net income, net of tax(3)		—				(0.7		)		0.4				(2.1		)
Comprehensive income		$	31.2			$	32.5			$	21.4			$	63.8
Net Income		$	42.5			$	24.8			$	68.1			$	48.0
Amortization of the Deferred Gain - losses		(3.6		)		(2.5		)		(5.7		)		(4.9		)
Amortization of the Deferred Gain - contingent commission		(0.6		)		(0.6		)		(1.1		)		(1.1		)
LPT reserve adjustment		(2.2		)		—				(2.2		)		—
LPT contingent commission adjustments		(0.5		)		—				(0.5		)		—
Net income before impact of the LPT Agreement (1)		35.6				21.7				58.6				42.0
Net realized and unrealized (gains) losses on investments		(5.7		)		(1.1		)		2.4				(3.3		)
Gain on redemption of notes payable		—				(2.1		)		—				(2.1		)
Amortization of intangibles		0.1				0.1				0.1				0.1
Income tax expense (benefit) related to items excluded from Net income		1.2				1.1				(0.5		)		1.9
Adjusted net income (1)		$	31.2			$	19.7			$	60.6			$	38.6

(1)		See Page 10 regarding our use of Non-GAAP Financial Measures.
(2)		Includes $3.5 million and $(9.4) million of unrealized gains (losses) on equity securities for the three and six months ended June 30, 2018, respectively.
(3)		AFS = Available for Sale securities.

EMPLOYERS HOLDINGS, INC.
Return on Equity (unaudited)
$ in millions, except per share amounts
				Three Months Ended								Six Months Ended
				June 30,								June 30,
				2018				2017				2018				2017
Net income		A		$	42.5			$	24.8			$	68.1			$	48.0
Impact of the LPT Agreement				(6.9		)		(3.1		)		(9.5		)		(6.0		)
Net realized and unrealized (gains) losses on investments				(5.7		)		(1.1		)		2.4				(3.3		)
Gain on redemption of notes payable				—				(2.1		)		—				(2.1		)
Amortization of intangibles				0.1				0.1				0.1				0.1
Income tax expense (benefit) related to items excluded from Net income				1.2				1.1				(0.5		)		1.9
Adjusted net income (1)		B		31.2				19.7				60.6				38.6
Stockholders' equity - end of period				$	956.5			$	899.2			$	956.5			$	899.2
Stockholders' equity - beginning of period				930.3				867.5				947.7				840.6
Average stockholders' equity		C		943.4				883.4				952.1				869.9
Stockholders' equity - end of period				$	956.5			$	899.2			$	956.5			$	899.2
Deferred Gain - end of period				154.7				168.9				154.7				168.9
Accumulated other comprehensive loss (income) - end of period				16.8				(138.9		)		16.8				(138.9		)
Income taxes related to accumulated other comprehensive gains and losses - end of period				(3.5		)		48.6				(3.5		)		48.6
Adjusted stockholders' equity - end of period				1,124.5				977.8				1,124.5				977.8
Adjusted stockholders' equity - beginning of period				1,093.3				956.9				1,003.9				941.0
Average adjusted stockholders' equity (1)		D		1,108.9				967.4				1,064.2				959.4
Return on stockholders' equity		A / C		4.5		%		2.8		%		7.2		%		5.5		%
Annualized return on stockholders' equity				18.0				11.2				14.3				11.0
Adjusted return on stockholders' equity (1)		B / D		2.8		%		2.0		%		5.7		%		4.0		%
Annualized adjusted return on stockholders' equity (1)				11.3				8.1				11.4				8.0

(1)		See Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.
Combined Ratios (unaudited)
$ in millions, except per share amounts
				Three Months Ended								Six Months Ended
				June 30,								June 30,
				2018				2017				2018				2017
Net premiums earned		A		$	178.0			$	171.7			$	354.6			$	347.1
Losses and LAE incurred		B		87.8				106.1				183.2				215.0
Amortization of the Deferred Gain - losses				3.6				2.5				5.7				4.9
Amortization of the Deferred Gain - contingent commission				0.6				0.6				1.1				1.1
LPT reserve adjustment				2.2				—				2.2				—
LPT contingent commission adjustments				0.5				—				0.5				—
Losses and LAE before impact of the LPT (1)		C		94.7				109.2				192.7				221.0
Prior accident year favorable loss reserve development				(16.5		)		(0.3		)		(28.9		)		(0.3		)
Losses and LAE before impact of the LPT - current accident year		D		$	111.2			$	109.5			$	221.6			$	221.3
Commission expense		E		$	24.5			$	21.5			$	48.2			$	43.0
Underwriting and other operating expenses		F		40.1				32.6				79.2				68.6
Combined ratio:
Loss and LAE ratio		B/A		49.3		%		61.8		%		51.7		%		61.9		%
Commission expense ratio		E/A		13.8				12.5				13.6				12.4
Underwriting and other operating expenses ratio		F/A		22.5				19.0				22.3				19.8
Combined ratio				85.6		%		93.3		%		87.6		%		94.1		%
Combined ratio before impact of the LPT: (1)
Loss and LAE ratio before impact of the LPT		C/A		53.2		%		63.6		%		54.3		%		63.7		%
Commission expense ratio		E/A		13.8				12.5				13.6				12.4
Underwriting and other operating expenses ratio		F/A		22.5				19.0				22.3				19.8
Combined ratio before impact of the LPT				89.5		%		95.1		%		90.3		%		95.8		%
Combined ratio before impact of the LPT: current accident year (1)
Loss and LAE ratio before impact of the LPT		D/A		62.5		%		63.8		%		62.5		%		63.8		%
Commission expense ratio		E/A		13.8				12.5				13.6				12.4
Underwriting and other operating expenses ratio		F/A		22.5				19.0				22.3				19.8
Combined ratio before impact of the LPT: current accident year				98.8		%		95.3		%		98.4		%		95.9		%

(1)		See Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.
Roll-forward of Unpaid Losses and LAE (unaudited)
$ in millions
		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2018				2017				2018				2017
Unpaid losses and LAE at beginning of period		$	2,258.1			$	2,298.2			$	2,266.1			$	2,301.0
Reinsurance recoverable on unpaid losses and LAE		531.1				572.9				537.0				580.0
Net unpaid losses and LAE at beginning of period		1,727.0				1,725.3				1,729.1				1,721.0
Losses and LAE incurred:
Current year losses		111.2				109.4				221.6				221.3
Prior year losses on voluntary business		(16.5		)		—				(28.5		)		—
Prior year losses on involuntary business		—				(0.3		)		(0.4		)		(0.3		)
Total losses incurred		94.7				109.1				192.7				221.0
Losses and LAE paid:
Current year losses		20.0				17.0				25.9				21.7
Prior year losses		86.3				92.3				180.5				195.2
Total paid losses		106.3				109.3				206.4				216.9
Net unpaid losses and LAE at end of period		1,715.4				1,725.1				1,715.4				1,725.1
Reinsurance recoverable on unpaid losses and LAE		512.5				559.8				512.5				559.8
Unpaid losses and LAE at end of period		$	2,227.9			$	2,284.9			$	2,227.9			$	2,284.9

Total losses and LAE shown in the above table exclude amortization of the Deferred Gain, LPT Reserve Adjustments, and LPT Contingent Commission Adjustments, which totaled $6.9 million and $3.1 million for the three months ended June 30, 2018 and 2017, respectively, and $9.5 million and $6.0 million for the six months ended June 30, 2018 and 2017, respectively.

EMPLOYERS HOLDINGS, INC.
Consolidated Investment Portfolio (unaudited)
$ in millions
		June 30, 2018																	December 31, 2017
		Cost or
		Amortized				Net Unrealized
Investment Positions:		Cost				(Loss) Gain				Fair Value				%					Fair Value				%
Fixed maturities		$	2,418.0			$	(16.8	)		$	2,401.2					87	%		$	2,463.4					90	%
Equity securities		119.9				84.2				204.1						7			210.3						8
Short-term investments		—				—				—						—			4.0						—
Cash and cash equivalents		146.3				—				146.3						5			73.3						3
Restricted cash and cash equivalents		1.0				—				1.0						—			1.0						—
Total investments and cash		$	2,685.2			$	67.4			$	2,752.6					100	%		$	2,752.0					100	%
Breakout of Fixed Maturities:
U.S. Treasuries and Agencies		$	131.7			$	(0.8	)		$	130.9					5	%		$	148.8					6	%
States and Municipalities		555.0				13.7				568.7						24			642.5						26
Corporate Securities		1,095.9				(16.4		)		1,079.5						45			1,118.0						45
Mortgage-Backed Securities		550.0				(12.9		)		537.1						22			495.3						20
Asset-Backed Securities		67.6				(0.3		)		67.3						3			58.8						2
Other		17.8				(0.1		)		17.7						1			—						—
Total fixed maturities		$	2,418.0			$	(16.8	)		$	2,401.2					100	%		$	2,463.4					100	%
Weighted average book yield										3.3%									3.1%
Average credit quality (S&P)										AA-									AA-
Duration										4.4									4.2

EMPLOYERS HOLDINGS, INC.
Book Value Per Share (unaudited)
$ in millions, except per share amounts
				June 30,				December 31,				June 30,				December 31,
				2018				2017				2017				2016
Numerators:
Stockholders' equity		A		$	956.5			$	947.7			$	899.2			$	840.6
Plus: Deferred Gain				154.7				163.6				168.9				174.9
Stockholders' equity including the Deferred Gain (1)		B		1,111.2				1,111.3				1,068.1				1,015.5
Accumulated other comprehensive loss (income)				16.8				(136.0		)		(138.9		)		(114.6		)
Income taxes related to accumulated other comprehensive gains and losses				(3.5		)		28.6				48.6				40.1
Adjusted stockholders' equity (1)		C		$	1,124.5			$	1,003.9			$	977.8			$	941.0
Denominator (shares outstanding)		D		32,759,575				32,597,819				32,412,997				32,128,922
Book value per share (1)		A / D		$	29.20			$	29.07			$	27.74			$	26.16
Book value per share including the Deferred Gain(1)		B / D		33.92				34.09				32.95				31.61
Adjusted book value per share (1)		C / D		34.33				30.80				30.17				29.29
Cash dividends declared per share				$	0.40			$	0.60			$	0.30			$	0.36
YTD Change in: (2)
Book value per share				1.8		%						7.2		%
Book value per share including the Deferred Gain				0.7								5.2
Adjusted book value per share				12.8								4.0

(1)		See Page 10 for information regarding our use of Non-GAAP Financial Measures.
(2)		Reflects the change in book value per share after taking into account dividends declared in the period.

EMPLOYERS HOLDINGS, INC.
Earnings Per Share (unaudited)
$ in millions, except per share amounts
				Three Months Ended								Six Months Ended
				June 30,								June 30,
				2018				2017				2018				2017
Numerators:
Net income		A		$	42.5			$	24.8			$	68.1			$	48.0
Impact of the LPT Agreement				(6.9		)		(3.1		)		(9.5		)		(6.0		)
Net income before impact of the LPT (1)		B		35.6				21.7				58.6				42.0
Net realized and unrealized (gains) losses on investments				(5.7		)		(1.1		)		2.4				(3.3		)
Gain on redemption of notes payable				—				(2.1		)		—				(2.1		)
Amortization of intangibles				0.1				0.1				0.1				0.1
Income tax expense (benefit) related to items excluded from Net income				1.2				1.1				(0.5		)		1.9
Adjusted net income (1)		C		$	31.2			$	19.7			$	60.6			$	38.6
Denominators:
Average common shares outstanding (basic)		D		32,880,023				32,469,137				32,843,448				32,398,858
Average common shares outstanding (diluted)		E		33,222,706				32,992,598				33,259,759				32,982,928
Earnings per share:
Basic		A / D		$	1.29			$	0.76			$	2.07			$	1.48
Diluted		A / E		1.28				0.75				2.05				1.46
Earnings per share before impact of the LPT: (1)
Basic		B / D		$	1.08			$	0.67			$	1.78			$	1.30
Diluted		B / E		1.07				0.66				1.76				1.27
Adjusted earnings per share: (1)
Basic		C / D		$	0.95			$	0.61			$	1.85			$	1.19
Diluted		C / E		0.94				0.60				1.82				1.17

(1)		See Page 10 for information regarding our use of Non-GAAP Financial Measures.

Glossary of Financial Measures

Within this earnings release we present the following measures, each of which are "non-GAAP financial measures." A reconciliation of these measures to the Company's most directly comparable GAAP financial measures is included herein. Management believes that these non-GAAP measures are important to the Company's investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. Management further believes that these measures are more relevant than comparable GAAP measures in evaluating our financial performance.

The LPT Agreement is a non-recurring transaction that does not result in any significant ongoing cash benefits to the Company. Management believes that providing non-GAAP measures that exclude the effects of the LPT Agreement (amortization of deferred reinsurance gain, adjustments to LPT Agreement ceded reserves and adjustments to contingent commission receivable) is useful in providing investors, analysts and other interested parties a meaningful understanding of the Company's ongoing underwriting performance.

Deferred reinsurance gain (Deferred Gain) reflects the unamortized gain from the LPT Agreement. This gain has been deferred and is being amortized using the recovery method, whereby the amortization is determined by the proportion of actual reinsurance recoveries to total estimated recoveries, except for the contingent profit commission, which is being amortized through June 30, 2024. Amortization is reflected in losses and LAE incurred.

Adjusted net income (see Page 4 for calculations)is net income excluding the effects of the LPT Agreement, net realized and unrealized gains (losses) on investments (net of tax), amortization of intangible assets (net of tax) and gain on redemption of notes payable (net of tax). Management believes that providing this non-GAAP measures is helpful to investors, analysts and other interested parties in identifying trends in the Company's operating performance because such items have limited significance to its ongoing operations or can be impacted by both discretionary and other economic factors and may not represent operating trends. The Company previously referred to Adjusted net income as Operating income.

Stockholders' equity including the Deferred Gain is stockholders' equity including the Deferred Gain. Management believes that providing this non-GAAP measure is useful in providing investors, analysts and other interested parties a meaningful measure of the Company's total underwriting capital.

Adjusted stockholders' equity (see Page 8 for calculations) is stockholders' equity including the Deferred Gain, less accumulated other comprehensive income (net of tax). Management believes that providing this non-GAAP measure is useful to investors, analysts and other interested parties since it serves as the denominator to the Company's operating return on equity metric.

Return on stockholders' equity and Adjusted return on stockholders' equity (see Page 4 for calculations). Management believes that these profitability measures are widely used by our investors, analysts and other interested parties. The Company previously referred to Adjusted return on stockholders' equity as Operating return on adjusted stockholders' equity.

Book value per share, Book value per share including the Deferred Gain, and Adjusted book value per share (see Page 8 for calculations). Management believes that these valuation measures are widely used by our investors, analysts and other interested parties. The Company previously referred to Book value per share as GAAP book value per share, and Book value per share including Deferred Gain as Book value per share.

Net income, Combined ratio, and Combined ratio before impact of the LPT (see Pages 3 and 5 for calculations). Management believes that these performance and underwriting measures are widely used by our investors, analysts and other interested parties.

View source version on businesswire.com: https://www.businesswire.com/news/home/20180725005792/en/

Source: Employers Holdings, Inc.

Employers Holdings, Inc.
Media:
Ty Vukelich, 775-327-2677
tvukelich@employers.com
or
Analysts:
Mike Paquette, 775-327-2562
mwoodard@employers.com