Mercury General Corporation Announces First Quarter Results and Declares Quarterly Dividend

Rhea-AI Summary

Mercury General (NYSE: MCY) reported Q1 2026 results: net income $190.4M versus a loss of $108.3M in Q1 2025, and net premiums earned $1.452B. Operating income was $194.0M and the combined ratio improved to 89.3%. The board declared a quarterly dividend of $0.3175 per share payable June 25, 2026 (record date June 11, 2026).

Book value per share was $46.76, total assets $9.873B, and net premiums written were $1.550B. Q1 included $93.0M of catastrophe losses and a net realized investment loss of $3.6M (net of tax).

Positive

• Net income of $190.4M (Q1 2026) versus loss of $108.3M in Q1 2025
• Combined ratio improved to 89.3%
• Net premiums written increased to $1.550B (+17.9% year-over-year)
• Declared dividend of $0.3175 per share payable June 25, 2026

Negative

• Net realized investment loss of $3.6M (net of tax) in Q1 2026
• Catastrophe losses net of reinsurance of $93.0M in Q1 2026
• Other operating expenses rose to $123.9M from $79.5M (Q1 2025)

News Market Reaction – MCY

-1.47%

-1.47% Session close to close

In the May 6 session, MCY declined 1.47%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement details a sharp turnaround in Q1 2026 performance, with net income of $190,421 (00...

Analysis

This announcement details a sharp turnaround in Q1 2026 performance, with net income of $190,421 (000s), a combined ratio of 89.3%, and catastrophe losses reduced to $93,000 (000s). Net premiums earned grew to $1,452,413 (000s), and the quarterly dividend of $0.3175 per share was maintained. Compared with prior wildfire-impacted quarters, the results highlight improved underwriting, though catastrophe risk, reserve development, and rate adequacy remain key metrics to watch.

Key Figures

Net premiums earned: $1,452,413 (000s) Net income: $190,421 (000s) Diluted EPS: $3.44 +5 more

8 metrics

Net premiums earned $1,452,413 (000s) Three months ended March 31, 2026; vs $1,283,069 (000s) in 2025

Net income $190,421 (000s) Q1 2026; vs net loss $(108,327) (000s) in Q1 2025

Diluted EPS $3.44 Net income (loss) per diluted share, Q1 2026; vs $(1.96) in 2025

Combined ratio 89.3% GAAP combined ratio Q1 2026; vs 119.2% in Q1 2025

Catastrophe losses $93,000 (000s) Catastrophe losses net of reinsurance Q1 2026; vs $447,000 (000s) 2025

Net investment income $85,636 (000s) Before income taxes, Q1 2026; vs $81,479 (000s) in 2025

Dividend per share $0.3175 Quarterly dividend declared, payable June 25, 2026

Book value per share $46.76 March 31, 2026; vs $43.64 at December 31, 2025

Previous Dividends,earnings Reports

5 past events · Latest: Nov 04 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Nov 04	Q3 2025 earnings	Positive	+2.5%	Third quarter 2025 results release and declaration of quarterly dividend.
Jul 29	Q2 2025 earnings	Positive	+0.7%	Strong Q2 2025 net income, premium growth, lower catastrophe losses, dividend.
May 06	Q1 2025 earnings	Negative	-3.4%	Wildfire-driven net loss, elevated catastrophe losses, weaker combined ratio, dividend maintained.
Feb 11	Q4/FY 2024 earnings	Positive	+9.3%	Q4 and full-year 2024 growth, better combined ratio, California rate approval, dividend.
Oct 29	Q3 2024 earnings	Positive	+5.0%	Strong Q3 2024 net income, premium growth, improved combined ratio, dividend declaration.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Prior earnings/dividend releases for MCY have mostly seen positive share reactions, including strong moves on reports of improved combined ratios and net income.

Recent Company History

Over the last five tagged dividends/earnings events, Mercury General has repeatedly highlighted improving underwriting results and steady dividends of $0.3175 per share. Q3 2024 and Q4 2024 showed strong net income and better combined ratios, while Q1 2025 reflected wildfire-driven losses and a negative reaction. Subsequent Q2 and Q3 2025 results pointed to recovery with higher net premiums earned and lower catastrophe losses, setting context for today’s improved first-quarter metrics and maintained dividend.

Key Terms

combined ratio, net premiums written, direct premiums written, catastrophe losses, +4 more

8 terms

combined ratio financial

"Combined ratio (5) | 89.3 % | | 119.2 %"

The combined ratio is a way insurance companies measure how well they are doing by adding up all their costs and claims and comparing them to the money they earn from premiums. If the ratio is below 100%, it means the company is making a profit; if it's above 100%, they are losing money. It helps see if an insurance company is financially healthy or not.

net premiums written financial

"Net premiums written (1) (2) | $ 1,550,118 | | $ 1,314,380"

Net premiums written is the total amount of insurance premium a company has agreed to collect from customers for new and renewed policies during a period, after subtracting premiums it passes on to other insurers (reinsurance) and cancellations. It matters to investors because it shows the insurer’s actual sales growth and risk retained—like a retailer’s sales after returns and wholesale transfers—so rising net premiums written can signal stronger future revenue and underwriting exposure.

direct premiums written financial

"Direct premiums written (1) | $ 1,572,741 | | $ 1,445,443"

Direct premiums written is the total dollar value of insurance policies an insurer sells during a specific period, measured before subtracting any amounts it passes to other insurers. Think of it as the full price tags on goods a store sells before accounting for any items it consigns to other shops; it shows sales volume, growth and market reach, and helps investors gauge revenue potential and the company’s exposure to underwriting risk.

catastrophe losses financial

"Catastrophe losses net of reinsurance (4) | $ 93,000 | | $ 447,000"

Catastrophe losses are large, unexpected insurance payouts that follow major disasters such as hurricanes, earthquakes, wildfires or pandemics. They matter to investors because they can sharply reduce an insurer’s profits, drain reserves and force special financing or rate increases — much like a sudden flood overwhelming a city’s budget — and can also ripple through markets by affecting reinsurers, bondholders and stock prices.

loss and loss adjustment expenses financial

"Losses and loss adjustment expenses | 932,950 | | 1,220,813"

Loss and loss adjustment expenses are the money an insurer pays out for claims (losses) plus the additional costs of handling those claims, such as investigation, legal fees, adjusters and claims processing. Think of it like the bill for fixing a damaged car plus the tow, mechanic diagnostics and paperwork — the total cost is what the insurer must cover. Investors watch this because high or rising claim-handling costs reduce profit, drain cash, and may signal that a company is underpricing risk or underestimating future payouts.

statutory surplus financial

"Statutory surplus (a) | $2.58 billion | | $2.39 billion"

Statutory surplus is the cushion an insurance company has after subtracting the amounts regulators say it must keep on hand to pay claims from the assets they allow for regulatory accounting. Think of it like a household emergency fund beyond the bills you’re legally required to pay; it shows extra financial strength. Investors watch it because a larger statutory surplus means a company is better able to absorb losses, support dividends or growth, and meet regulatory expectations.

deferred policy acquisition costs financial

"Deferred policy acquisition costs | 366,573 | | 359,724"

Deferred policy acquisition costs are upfront sales and onboarding expenses — such as commissions and underwriting costs — that an insurer records as an asset and then spreads out over the life of the insurance policies as the company earns premiums. For investors, these costs matter because how quickly they are written off affects reported profits and the apparent health of an insurer’s balance sheet, similar to spreading the cost of a season ticket over the months you use it.

net realized investment (losses) gains financial

"Net realized investment (losses) gains | (4,543) | | 23,321"

The net realized investment gains (or losses) are the actual profits or losses a company records after selling securities or other investments during a reporting period, after offsetting gains with losses. Think of it like a garage sale where only the cash you actually collected (not the estimated value of unsold items) counts; these realized amounts affect reported earnings and cash flow and can change an investor’s view of how much of a company’s income is recurring versus one-time.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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LOS ANGELES, May 5, 2026 /PRNewswire/ -- Mercury General Corporation (NYSE: MCY) reported today for the first quarter of 2026:

Consolidated Highlights
	Three Months Ended March 31,				Change
	2026		2025		$		%
(000's except per-share amounts and ratios)
Net premiums earned (2)	$   1,452,413		$   1,283,069		$   169,344		13.2
Net premiums written (1) (2)	$   1,550,118		$   1,314,380		$   235,738		17.9
Direct premiums written (1)	$   1,572,741		$   1,445,443		$   127,298		8.8
Net realized investment (losses) gains, net of tax (3)	$         (3,589)		$        18,424		$    (22,013)		(119.5)
Net income (loss)	$      190,421		$     (108,327)		$   298,748		NM
Net income (loss) per diluted share	$            3.44		$           (1.96)		$           5.4		NM
Operating income (loss) (1)	$      194,010		$     (126,751)		$   320,761		NM
Operating income (loss) per diluted share (1)	$            3.50		$           (2.29)		$         5.79		NM
Catastrophe losses net of reinsurance (4)	$        93,000		$      447,000		$  (354,000)		(79.2)
Combined ratio (5)	89.3 %		119.2 %		—		(29.9) pts

NM = Not Meaningful
(1)	These measures are not based on U.S. generally accepted accounting principles ("GAAP"), are defined in "Information Regarding GAAP and Non-GAAP Measures" and are reconciled to the most directly comparable GAAP measures in "Supplemental Schedules."
(2)	Net  premiums earned and net premiums written for the three months ended March 31, 2025 include $76 million and $127 million, respectively, of increased ceded reinsurance premiums due to the Company's reinsurance treaty being fully used up and from the reinstatement of the Company's catastrophe reinsurance benefits following the Palisades and Eaton wildfires in January 2025.
(3)	Net realized investment (losses) gains before tax was $(5) million and $23 million for the three months ended March 31, 2026 and 2025, respectively. The changes in fair value of the Company's investments are recorded as part of net realized investment gains or losses in its consolidated statements of operations due to the adoption of the fair value option under GAAP.
(4)	The majority of 2026 catastrophe losses resulted from adverse reserve development on the Palisades and Eaton wildfires, and storms in California, Texas and Oklahoma. The majority of 2025 catastrophe losses resulted from the Palisades and Eaton wildfires.
(5)	The Company experienced favorable development of approximately $9 million and $51 million on prior accident years' loss and loss adjustment expense reserves for the three months ended March 31, 2026 and 2025, respectively. The favorable development for the first quarter of 2026 was primarily attributable to lower than estimated losses in the automobile line of insurance business, partially offset by adverse development on the homeowners line of insurance business, including adverse development on the prior years' catastrophe losses. The favorable development for the first quarter of 2025 was primarily attributable to lower than estimated losses in the automobile line of insurance business, and the homeowners line of insurance business, including favorable development on prior years' catastrophe losses.

 

Investment Results
	Three Months Ended March 31,
	2026		2025
(000's except average annual yield)
Average invested assets at cost (1)	$    6,643,376		$    5,594,499
Net investment income (2) (3)
Before income taxes	$         85,636		$         81,479
After income taxes	$         72,859		$         67,850
Average annual yield on investments (2) (3)
Before income taxes	4.5 %		4.9 %
After income taxes	3.9 %		4.1 %

(1)	Fixed maturities and short-term bonds at amortized cost; equities and other short-term investments at cost. Average invested assets at cost are based on the monthly amortized cost of the invested assets excluding cash for each period.
(2)	Net investment income includes interest income earned on cash of approximately $11.2 million and $13.1 million ($8.9 million and $10.3 million after tax) for the three months ended March 31, 2026 and 2025, respectively. Average annual yield on investments does not include interest income earned on cash.
(3)	Higher net investment income before and after income taxes for the three months ended March 31, 2026 compared to the corresponding period in 2025 resulted largely from higher average invested assets. Average annual yield on investments before income taxes for the three months ended March 31, 2026 decreased from the corresponding period in 2025, primarily due to an increase in tax-exempt investments with lower pre-tax yields, combined with lower yields on floating rate investments resulting from lower short-term market interest rates. Average annual yield on investments after income taxes for the three months ended March 31, 2026 decreased from the corresponding period in 2025, primarily due to lower yields on floating rate investments resulting from lower short-term market interest rates.

The Board of Directors declared a quarterly dividend of $0.3175 per share. The dividend will be paid on June 25, 2026 to shareholders of record on June 11, 2026.

Mercury General Corporation and its subsidiaries are a multiple line insurance organization offering predominantly personal automobile and homeowners insurance through a network of independent producers and direct-to-consumer sales in many states. For more information, visit the Company's website at www.mercuryinsurance.com.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. Certain statements contained in this report are forward-looking statements based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the Company) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the demand for the Company's insurance products, inflation and general economic conditions, including general market risks associated with the Company's investment portfolio; the accuracy and adequacy of the Company's pricing methodologies; catastrophes in the markets served by the Company; uncertainties related to estimates, assumptions and projections generally; the possibility that actual loss experience may vary adversely from the actuarial estimates made to determine the Company's loss reserves in general, including subrogation recovery estimates; the Company's ability to obtain and the timing of the approval of premium rate changes for insurance policies issued in the states where it operates; legislation adverse to the automobile or homeowners insurance industry or business generally that may be enacted in the states where the Company operates; the Company's success in managing its business in non-California states; the presence of competitors with greater financial resources and the impact of competitive pricing and marketing efforts; the Company's ability to successfully allocate the resources used in the states with reduced or exited operations to its operations in other states; changes in driving patterns and loss trends; acts of war and terrorist activities; effects of changing climate conditions; pandemics, epidemics, widespread health emergencies, or outbreaks of infectious diseases; court decisions and trends in litigation and health care and auto repair costs; changes in global trade policies, including trade barriers or restrictions; and legal, cybersecurity, regulatory and litigation risks. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see the Company's Annual Report on Form 10-K filed with the United States Securities and Exchange Commission on February 17, 2026.

MERCURY GENERAL CORPORATION AND SUBSIDIARIES SUMMARY OF OPERATING RESULTS (000's except per-share amounts and ratios) (unaudited)
	Three Months Ended March 31,
	2026		2025
Revenues:
Net premiums earned	$         1,452,413		$         1,283,069
Net investment income	85,636		81,479
Net realized investment (losses) gains	(4,543)		23,321
Other	6,303		6,010
Total revenues	1,539,809		1,393,879
Expenses:
Losses and loss adjustment expenses	932,950		1,220,813
Policy acquisition costs	240,502		228,720
Other operating expenses	123,887		79,453
Interest	6,817		7,189
Total expenses	1,304,156		1,536,175
Income (loss) before income taxes	235,653		(142,296)
Income tax expense (benefit)	45,232		(33,969)
Net income (loss)	$            190,421		$          (108,327)
Basic average shares outstanding	55,389		55,389
Diluted average shares outstanding	55,389		55,389
Basic Per Share Data
Net income (loss)	$                  3.44		$                 (1.96)
Net realized investment (losses) gains, net of tax	$                 (0.06)		$                  0.33
Diluted Per Share Data
Net income (loss)	$                  3.44		$                 (1.96)
Net realized investment (losses) gains, net of tax	$                 (0.06)		$                  0.33
Operating Ratios-GAAP Basis
Loss ratio	64.2 %		95.1 %
Expense ratio	25.1 %		24.0 %
Combined ratio (a)	89.3 %		119.2 %

(a)	Combined ratio for the three months ended March 31, 2025 does not sum due to rounding.

 

MERCURY GENERAL CORPORATION AND SUBSIDIARIES CONDENSED BALANCE SHEETS AND OTHER INFORMATION (000's except per-share amounts and ratios)
	March 31, 2026		December 31, 2025
	(unaudited)
ASSETS
Investments, at fair value:
Fixed maturity securities (amortized cost $5,534,785; $5,449,726)	$         5,499,834		$         5,430,251
Equity securities (cost $801,687; $728,460)	883,623		812,787
Short-term investments (cost $441,810; $336,978)	441,841		336,992
Total investments	6,825,298		6,580,030
Cash	1,350,883		1,315,574
Receivables:
Premiums	825,000		751,554
Allowance for credit losses on premiums receivable	(6,100)		(6,000)
Premiums receivable, net of allowance for credit losses	818,900		745,554
Accrued investment income	73,380		73,004
Other	86,557		86,508
Total receivables	978,837		905,066
Reinsurance recoverables (net of allowance for credit losses $2; $39)	47,771		109,672
Deferred policy acquisition costs	366,573		359,724
Fixed assets, net	150,854		146,880
Operating lease right-of-use assets	12,153		12,125
Deferred income taxes	31,821		30,637
Goodwill	42,796		42,796
Other intangible assets, net	6,613		6,827
Other assets	59,266		51,338
Total assets	$         9,872,865		$         9,560,669
LIABILITIES AND SHAREHOLDERS' EQUITY
Loss and loss adjustment expense reserves	$         3,646,201		$         3,633,338
Unearned premiums	2,353,558		2,255,935
Notes payable	574,626		574,527
Accounts payable and accrued expenses	394,423		448,703
Operating lease liabilities	12,652		12,328
Current income taxes	77,180		30,770
Other liabilities	224,115		187,793
Shareholders' equity	2,590,110		2,417,275
Total liabilities and shareholders' equity	$         9,872,865		$         9,560,669
OTHER INFORMATION
Common stock shares outstanding	55,389		55,389
Book value per share	$                46.76		$                43.64
Statutory surplus (a)	$2.58 billion		$2.39 billion
Net premiums written to surplus ratio (a)	2.31		2.39
Debt to total capital ratio (b)	18.2 %		19.2 %
Portfolio duration (including all short-term instruments) (a) (c)	4.4 years		4.4 years
Policies-in-force (company-wide "PIF") (a)
Personal Auto PIF	1,057		1,044
Homeowners PIF	906		883
Commercial Auto PIF	34		34
All Other PIF (d)	311		304
Total PIF	2,308		2,265

(a)	Unaudited.
(b)	Debt to Debt plus Shareholders' Equity (Debt at face value).
(c)	Modified duration reflecting anticipated early calls.
(d)	All Other PIF represents the combined PIF of all the other smaller lines of insurance business, which in aggregate accounted for only 6.1% of the total company-wide direct premiums written for the three months ended March 31, 2026.

 

SUPPLEMENTAL SCHEDULES
(000's except per-share amounts and ratios) (unaudited)
	Three Months Ended March 31,
	2026		2025
Reconciliations of Comparable GAAP Measures to Operating Measures (a)
Net premiums earned	$         1,452,413		$         1,283,069
Change in net unearned premiums	97,705		31,311
Net premiums written	$         1,550,118		$         1,314,380
Assumed premiums written	$             (39,965)		$             (25,733)
Ceded premiums written	$              62,588		$            156,796
Direct premiums written	$         1,572,741		$         1,445,443
Incurred losses and loss adjustment expenses	$            932,950		$         1,220,813
Change in net loss and loss adjustment expense reserves	(13,422)		(285,112)
Paid losses and loss adjustment expenses	$            919,528		$            935,701
Net income (loss)	$            190,421		$           (108,327)
Less: Net realized investment (losses) gains	(4,543)		23,321
Tax on net realized investment (losses) gains (b)	(954)		4,897
Net realized investment (losses) gains, net of tax	(3,589)		18,424
Operating income (loss)	$            194,010		$           (126,751)
Per diluted share:
Net income (loss)	$                  3.44		$                 (1.96)
Less: Net realized investment (losses) gains, net of tax	(0.06)		0.33
Operating income (loss)	$                  3.50		$                 (2.29)
Combined ratio	89.3 %		119.2 %
Effect of estimated prior periods' loss development	0.6 %		4.0 %
Combined ratio-accident period basis (c)	89.9 %		123.1 %

(a)	See "Information Regarding GAAP and Non-GAAP Measures."
(b)	Based on federal statutory rate of 21%.
(c)	Combined ratio-accident period basis for the three months ended March 31, 2025 does not sum due to rounding.

Information Regarding GAAP and Non-GAAP Measures

The Company has presented information within this document containing operating measures which in management's opinion provide investors with useful, industry specific information to help them evaluate, and perform meaningful comparisons of, the Company's performance, but that may not be presented in accordance with GAAP. These measures are not intended to replace, and should be read in conjunction with, the GAAP financial results.

Net income (loss) is the GAAP measure that is most directly comparable to operating income (loss). Operating income (loss) is net income (loss) excluding realized investment gains and losses, net of tax. Operating income (loss) is used by management along with the other components of net income (loss) to assess the Company's performance. Management uses operating income (loss) as an important measure to evaluate the results of the Company's insurance business. Management believes that operating income (loss) provides investors with a valuable measure of the Company's ongoing performance as it reveals trends in the Company's insurance business that may be obscured by the effect of net realized investment gains and losses. Realized investment gains and losses may vary significantly between periods and are generally driven by external economic developments such as capital market conditions. Accordingly, operating income (loss) highlights the results from ongoing operations and the underlying profitability of the Company's core insurance business. Operating income (loss), which is provided as supplemental information and should not be considered as a substitute for net income (loss), does not reflect the overall profitability of the Company's business. It should be read in conjunction with the GAAP financial results. See "Supplemental Schedules" above for a reconciliation of net income (loss) to operating income (loss).

Net premiums earned, the most directly comparable GAAP measure to net premiums written and direct premiums written, represents the portion of premiums written that is recognized as revenue in the financial statements for the periods presented and earned on a pro-rata basis over the term of the policies. Net premiums written is a statutory financial measure which represents the premiums charged on policies issued during a fiscal period net of any applicable reinsurance; direct premiums written is such a measure before any applicable reinsurance. Net premiums written and direct premiums written are designed to determine production levels and are meant as supplemental information and not intended to replace net premiums earned. Such information should be read in conjunction with the GAAP financial results. See "Supplemental Schedules" above for a reconciliation of net premiums earned to net premiums written and direct premiums written.

Incurred losses and loss adjustment expenses is the most directly comparable GAAP measure to paid losses and loss adjustment expenses. Paid losses and loss adjustment expenses excludes the effects of changes in the loss reserve accounts. Paid losses and loss adjustment expenses is provided as supplemental information and is not intended to replace incurred losses and loss adjustment expenses. It should be read in conjunction with the GAAP financial results. See "Supplemental Schedules" above for a reconciliation of incurred losses and loss adjustment expenses to paid losses and loss adjustment expenses.

Combined ratio is the most directly comparable measure to combined ratio-accident period basis. Combined ratio-accident period basis is computed as the difference between two GAAP operating ratios: the combined ratio and prior accident periods' loss development ratio. Management believes that combined ratio-accident period basis is useful to investors and it is used to reveal the trends in the Company's results of operations that may be obscured by development on prior accident periods' loss reserves. Combined ratio-accident period basis is meant as supplemental information and is not intended to replace the GAAP combined ratio. It should be read in conjunction with the GAAP financial results. See "Supplemental Schedules" above for a reconciliation of GAAP combined ratio to combined ratio-accident period basis. 

 

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SOURCE Mercury General Corporation

FAQ

What were Mercury General (MCY) Q1 2026 results and net income?

Mercury General reported Q1 2026 net income of $190.4 million. According to the company, total revenues were $1.540 billion and operating income was $194.0 million for the quarter.

How did Mercury General's combined ratio for Q1 2026 compare to Q1 2025?

The combined ratio for Q1 2026 was 89.3%. According to the company, this compares with 119.2% in Q1 2025, reflecting lower loss experience and favorable underwriting development in the quarter.

What dividend did Mercury General (MCY) declare in May 2026 and when is payment?

Mercury declared a quarterly dividend of $0.3175 per share. According to the company, the dividend is payable June 25, 2026 to shareholders of record on June 11, 2026.

What were Mercury General's catastrophe losses in Q1 2026 and main causes?

Catastrophe losses net of reinsurance totaled $93.0 million in Q1 2026. According to the company, losses stemmed from adverse reserve development on wildfires and storms in California, Texas and Oklahoma.

How did Mercury General's investment income and realized gains perform in Q1 2026?

Net investment income after tax was $72.9 million, while net realized investment losses net of tax were $3.6 million. According to the company, higher invested assets increased income but fair-value changes produced the loss.