Total new annualized premiums up
7%
Capital and liquidity remain
above target levels
CARMEL,
Ind., May 1, 2023 /PRNewswire/ -- CNO Financial
Group, Inc. (NYSE: CNO) today reported a net loss of $0.8 million, or $0.01 per diluted share, in 1Q23 compared to net
income of $183.4 million, or
$1.52 per diluted share, in
1Q22. Non-economic accounting impacts of market volatility
often result in significant increases and decreases to our
non-operating income and drove the net loss in 1Q23. Net
operating income (1), which excludes these non-economic
accounting impacts, was $58.6
million, or $0.51 per diluted
share, in 1Q23 compared to $64.5
million, or $0.54 per diluted
share, in 1Q22.
"Strengthening insurance margins, solid customer persistency and
significant growth in fee income substantiate the fundamental
health of CNO's operating businesses," said Gary C. Bhojwani, chief executive officer. "We
posted record direct-to-consumer Life sales, record Medicare growth
and continued sales momentum across nearly all insurance product
categories. Successful agent recruiting generated producing agent
count growth for both our Consumer and Worksite Divisions,
evidencing a critical inflection point since the pandemic."
"Our capital and liquidity positions are above target levels.
Our cash flow remains robust. We continue to be confident in our
operating plan and reiterate our full-year operating guidance."
First Quarter 2023 Highlights (as compared to the
corresponding period in the prior year where applicable)
- Total new annualized premiums ("NAP") (4) up 7%
- Medicare Supplement NAP up 20%; Medicare Advantage sales up
55%
- Consumer Division field producing agent count up 1%; Worksite
Division producing agent count up 38%
- Returned $32.2 million to
shareholders
- Return on equity ("ROE") of 21.8%; operating ROE, as adjusted
(6), of 10.3%
Adoption of New Accounting Standard
Effective January 1, 2023, we
adopted ASU 2018-12 related to targeted improvements to the
accounting for long-duration insurance contracts. We selected the
modified retrospective transition method except for market risk
benefits where we were required to use the full retrospective
approach. All prior periods presented have been recast in
accordance with the new standard. As a result of the adoption of
the new guidance, shareholders' equity as of December 31, 2022, increased $368.0 million and was comprised of increases to
retained earnings and accumulated other comprehensive income (loss)
of $232.2 million and $135.8 million, respectively. Net income and
operating earnings (1) for the first quarter of 2022
increased $71.1 million and
$13.4 million, respectively.
Concurrent with the adoption of the new guidance, we updated the
method of determining non-operating earnings for our fixed indexed
annuities to better identify the volatile non-economic accounting
impacts of that line of business.
FINANCIAL
SUMMARY Quarter End (Amounts in millions, except
per share data)
(Unaudited)
|
|
Net operating income, a
non-GAAP(a) financial measure, is used consistently by
CNO's management to evaluate the operating performance of the
Company and is a measure commonly used in the life insurance
industry. It differs from net income primarily because it
excludes certain non-operating items such as net realized
investment gains (losses) from sales and change in the allowance
for credit losses, changes in fair values of embedded derivatives
and market risk benefits and the liability for a deferred
compensation plan, and certain significant and unusual items
included in net income. Management believes an analysis of
net operating income is important in understanding the
profitability and operating trends of the Company's business.
Net income is the most directly comparable GAAP measure.
|
|
|
Per diluted
share
|
|
|
|
|
|
|
|
|
Quarter
ended
|
|
Quarter
ended
|
|
March
31,
|
|
March
31,
|
|
2023
|
|
|
2022
|
|
%
change
|
|
2023
|
|
|
2022
|
|
%
change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from insurance
products (b)
|
$
0.56
|
|
|
$
0.52
|
|
8
|
|
$ 63.7
|
|
|
$ 62.4
|
|
2
|
Fee income
|
0.13
|
|
|
0.08
|
|
63
|
|
15.5
|
|
|
9.9
|
|
57
|
Investment income not
allocated to product lines (c)
|
0.14
|
|
|
0.22
|
|
(36)
|
|
15.5
|
|
|
27.0
|
|
(43)
|
Expenses not allocated
to product lines (d)
|
(0.16)
|
|
|
(0.12)
|
|
33
|
|
(18.3)
|
|
|
(14.8)
|
|
24
|
Operating earnings
before taxes
|
0.67
|
|
|
0.70
|
|
|
|
76.4
|
|
|
84.5
|
|
|
Income tax expense on
operating income
|
(0.16)
|
|
|
(0.16)
|
|
—
|
|
(17.8)
|
|
|
(20.0)
|
|
(11)
|
Net operating income
(1)
|
0.51
|
|
|
0.54
|
|
(6)
|
|
58.6
|
|
|
64.5
|
|
(9)
|
Net realized investment
gains (losses) from sales and change in allowance for credit
losses
|
(0.11)
|
|
|
(0.06)
|
|
|
|
(12.7)
|
|
|
(7.2)
|
|
|
Net change in market
value of investments recognized in earnings
|
(0.02)
|
|
|
(0.21)
|
|
|
|
(1.9)
|
|
|
(25.5)
|
|
|
Changes in fair value
of embedded derivative liabilities and market risk
benefits
|
(0.57)
|
|
|
1.37
|
|
|
|
(65.1)
|
|
|
165.4
|
|
|
Other
|
0.02
|
|
|
0.19
|
|
|
|
2.3
|
|
|
23.1
|
|
|
Non-operating income
(loss) before taxes
|
(0.68)
|
|
|
1.29
|
|
|
|
(77.4)
|
|
|
155.8
|
|
|
Income tax (expense)
benefit on non-operating income
|
0.16
|
|
|
(0.31)
|
|
|
|
18.0
|
|
|
(36.9)
|
|
|
Net non-operating
income (loss)
|
(0.52)
|
|
|
0.98
|
|
|
|
(59.4)
|
|
|
118.9
|
|
|
Net income
(loss)
|
$
(0.01)
|
|
|
$
1.52
|
|
|
|
$
(0.8)
|
|
|
$
183.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted shares outstanding
|
114.5
|
|
|
121.0
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
GAAP is defined as
accounting principles generally accepted in the United States of
America.
|
(b)
|
Income from insurance
products is the sum of the insurance margins of the annuity, health
and life segments, less allocated insurance administrative
expenses. It excludes the fee income segment, investment
income not allocated to product lines, expenses not allocated to
product lines and income taxes. Insurance margin is
management's measure of the profitability of its annuity, health
and life segments' performance and consists of insurance policy
income plus allocated investment income less insurance policy
benefits, interest credited, commissions, advertising expense and
amortization of acquisition costs.
|
(c)
|
Investment income not
allocated to product lines is defined as net investment income
less: (i) equity returns credited to policyholder account balances;
(ii) the investment income allocated to our product lines; (iii)
impact of annual option forfeitures related to fixed indexed
annuity surrenders; (iv) interest expense on notes payable and
investment borrowings; (v) expenses related to the funding
agreement-backed notes ("FABN") program; and (vi) certain expenses
related to benefit plans that are offset by special-purpose
investment income.
|
FINANCIAL SUMMARY
(continued) Management vs. GAAP Measures (Dollars
in millions, except per share data)
(Unaudited)
|
|
Shareholders' equity,
excluding accumulated other comprehensive income (loss), and book
value per share, excluding accumulated other comprehensive income
(loss), are non-GAAP measures that are utilized by management to
view the business without the effect of accumulated other
comprehensive income (loss) which is primarily attributable to
fluctuations in interest rates associated with fixed maturities,
available for sale. Management views the business in this
manner because the Company has the ability and generally, the
intent, to hold investments to maturity and meaningful trends can
be more easily identified without the fluctuations. In
addition, shareholders' equity excludes net operating loss
carryforwards in our non-GAAP return on equity measures as such
assets are not discounted and, accordingly, will not provide a
return to shareholders until after it is realized as a reduction to
taxes that would otherwise be paid. Management believes that
excluding this value from the equity component of this measure
enhances the understanding of the effect these non-discounted
assets have on operating returns.
|
|
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
|
|
|
|
Trailing twelve months
return on equity (a)
|
21.8 %
|
|
14.1 %
|
Trailing twelve months
operating return on equity, excluding accumulated other
comprehensive income (loss)
and net operating loss
carryforwards (a non-GAAP financial measure) (6)
|
10.3 %
|
|
12.2 %
|
Trailing twelve months
operating return, excluding significant items, on equity, excluding
accumulated other
comprehensive income
(loss) and net operating loss carryforwards (a non-GAAP financial
measure) (6)
|
9.8 %
|
|
12.3 %
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
$ 2,031.8
|
|
$
2,818.4
|
Accumulated other
comprehensive loss
|
1,664.4
|
|
561.5
|
|
|
|
|
Shareholders' equity,
excluding accumulated other comprehensive loss
|
3,696.2
|
|
3,379.9
|
Net operating loss
carryforwards
|
(152.4)
|
|
(238.2)
|
Shareholders' equity,
excluding accumulated other comprehensive loss and net operating
loss carryforwards
|
$ 3,543.8
|
|
$
3,141.7
|
|
|
|
|
Book value per diluted
share
|
$
17.49
|
|
$
23.58
|
Accumulated other
comprehensive loss
|
14.33
|
|
4.70
|
|
|
|
|
Book value per diluted
share, excluding accumulated other comprehensive loss (a non-GAAP
financial measure) (2)
|
$
31.82
|
|
$
28.28
|
|
|
(a)
|
Calculated using
average shareholders' equity for the measurement period.
|
INSURANCE OPERATIONS
Annuity products accounted for 26 percent of the Company's
margin for the quarter and annuity premiums collected increased 1
percent in 1Q23 compared to 1Q22.
Health products accounted for 53 percent of the Company's
insurance margin for the quarter and 64 percent of insurance policy
income.
Life products accounted for 21 percent of the Company's
insurance margin for the quarter and 35 percent of insurance policy
income.
Sales of health products were up 14 percent and sales of life
products were up 2 percent in 1Q23 compared to 1Q22.
ANNUITY COLLECTED
PREMIUMS
(Dollars in
millions)
(Unaudited)
|
|
|
Quarter ended March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Annuity collected
premiums
|
$
370.9
|
|
$
368.6
|
|
1
|
INSURANCE POLICY
INCOME
(Dollars in
millions)
(Unaudited)
|
|
|
Quarter ended March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Annuity
|
$
5.1
|
|
$
5.0
|
|
2
|
Health
|
401.4
|
|
406.7
|
|
(1)
|
Life
|
219.0
|
|
213.3
|
|
3
|
Total insurance
policy income
|
$
625.5
|
|
$
625.0
|
|
—
|
SALES MEASURED AS
NEW ANNUALIZED PREMIUMS FOR
LIFE AND HEALTH
PRODUCTS
(Dollars in
millions)
(Unaudited)
|
|
|
Quarter ended March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Health
|
$
39.5
|
|
$
34.8
|
|
14
|
Life
|
57.1
|
|
55.8
|
|
2
|
Total new
annualized premiums (4)
|
$
96.6
|
|
$
90.6
|
|
7
|
INSURANCE
MARGIN
(Amounts in millions,
except per share data)
(Unaudited)
|
|
Insurance margin is
management's measure of profitability of its annuity, health and
life segments' performance and consists of insurance policy income
plus allocated investment income less insurance policy benefits,
interest credited, commissions, advertising expense and
amortization of acquisition costs. Income from insurance products
is the sum of the insurance margins of the annuity, health and life
segments, less allocated insurance administrative expenses.
It excludes the fee income segment, investment income not allocated
to product lines, expenses not allocated to product lines and
income taxes. Management believes this information helps provide a
better understanding of the business and a more meaningful analysis
of our operations. Insurance income, a non-GAAP measure, is a
component of net operating income, which is reconciled to net
income in the Financial Summary section above.
|
|
|
Quarter
ended
|
|
March 31,
2023
|
|
% of
insurance
policy
income
|
|
|
March 31,
2022
|
|
% of
insurance
policy
income
|
|
%
change
|
Margin
|
|
|
|
|
|
|
|
|
|
|
Annuity interest
margin
|
$
57.3
|
|
|
|
|
$
55.9
|
|
|
|
3
|
Life insurance
interest margin
|
1.1
|
|
|
|
|
1.1
|
|
|
|
—
|
Total
interest-sensitive margin
|
58.4
|
|
|
|
|
57.0
|
|
|
|
2
|
Insurance
margin
|
|
|
|
|
|
|
|
|
|
|
Health
|
116.5
|
|
29
|
|
|
115.3
|
|
28
|
|
1
|
Life (a)
|
46.3
|
|
21
|
|
|
34.9
|
|
16
|
|
33
|
Total other insurance
margin
|
162.8
|
|
26
|
|
|
150.2
|
|
24
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
Total insurance
margin
|
221.2
|
|
|
|
|
207.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocated
expenses
|
(157.5)
|
|
|
|
|
(144.8)
|
|
|
|
|
Income from
insurance products
|
$
63.7
|
|
|
|
|
$
62.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per diluted
share
|
$
0.56
|
|
|
|
|
$
0.52
|
|
|
|
|
Weighted average
diluted shares
|
114.5
|
|
|
|
|
121.0
|
|
|
|
|
|
|
(a)
|
Net of $28.7 million
and $29.3 million of non-deferred television advertising expense
related to our direct distribution channel in the 2023 and 2022
periods, respectively.
|
Total allocated expenses were $157.5
million, up 9 percent from 1Q22.
ANNUITY RESULTS BY
PRODUCT TYPE
(Dollars in
millions)
(Unaudited)
|
|
Annuity
margin
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
Fixed indexed
annuities
|
$
46.5
|
|
$
44.8
|
Fixed interest
annuities
|
9.1
|
|
8.5
|
Other
annuities
|
1.7
|
|
2.6
|
Total
|
$
57.3
|
|
$
55.9
|
Annuity collected
premiums
|
|
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
Annuity collected
premiums
|
$
370.9
|
|
$
368.6
|
Average net
insurance liabilities (5)
|
|
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
Fixed indexed
annuities
|
$
9,183.8
|
|
$
8,486.3
|
Fixed interest
annuities
|
1,630.9
|
|
1,761.2
|
Other
annuities
|
469.5
|
|
490.2
|
Total
|
$ 11,284.2
|
|
$ 10,737.7
|
Margin/average net
insurance liabilities (a)
|
|
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
Fixed indexed
annuities
|
2.03 %
|
|
2.11 %
|
Fixed interest
annuities
|
2.23 %
|
|
1.93 %
|
Other
annuities
|
1.45 %
|
|
2.12 %
|
Total
|
2.03 %
|
|
2.08 %
|
|
|
(a)
|
Defined as annualized
quarterly annuity margin divided by average net insurance
liabilities (5).
|
HEALTH INSURANCE
RESULTS BY PRODUCT TYPE
(Dollars in
millions)
(Unaudited)
|
|
Health
margin
|
|
Quarter
ended
|
|
March
31,
|
|
2023
|
|
2022
|
|
|
|
Amount
|
|
% of
insurance
policy
income
|
|
Amount
|
|
% of
insurance
policy
income
|
|
%
change
|
Supplemental health
and other health
|
$
63.3
|
|
35
|
|
$
56.1
|
|
32
|
|
13
|
Medicare
supplement
|
26.1
|
|
17
|
|
34.6
|
|
21
|
|
(25)
|
Long-term
care
|
27.1
|
|
41
|
|
24.6
|
|
37
|
|
10
|
Total
|
$
116.5
|
|
29
|
|
$
115.3
|
|
28
|
|
1
|
Health insurance
policy income
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Supplemental health
and other health
|
$
179.0
|
|
$
173.5
|
|
3
|
Medicare
supplement
|
156.5
|
|
166.8
|
|
(6)
|
Long-term
care
|
65.9
|
|
66.4
|
|
(1)
|
Total
|
$
401.4
|
|
$
406.7
|
|
(1)
|
Health NAP
(4)
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Supplemental health
and other health
|
$
25.5
|
|
$
21.5
|
|
19
|
Medicare
supplement
|
7.8
|
|
6.5
|
|
20
|
Long-term
care
|
6.2
|
|
6.8
|
|
(9)
|
Total
|
$
39.5
|
|
$
34.8
|
|
14
|
LIFE INSURANCE
RESULTS BY PRODUCT TYPE
(Dollars in
millions)
(Unaudited)
|
|
Life
margin
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
|
|
Amount
|
|
% of
insurance
policy
income
|
|
Amount
|
|
% of
insurance
policy
income
|
|
%
change
|
Life insurance
interest margin
|
$
1.1
|
|
|
|
$
1.1
|
|
|
|
—
|
Life insurance
margin:
|
|
|
|
|
|
|
|
|
|
Traditional
life
|
24.6
|
|
14
|
|
18.7
|
|
11
|
|
32
|
Interest sensitive
life
|
21.7
|
|
49
|
|
16.2
|
|
38
|
|
34
|
Subtotal
|
46.3
|
|
21
|
|
34.9
|
|
16
|
|
33
|
Total
margin
|
$
47.4
|
|
|
|
$
36.0
|
|
|
|
32
|
Life insurance
policy income
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Traditional
life
|
$
174.5
|
|
$
170.2
|
|
3
|
Interest sensitive
life
|
44.5
|
|
43.1
|
|
3
|
Total
|
$
219.0
|
|
$
213.3
|
|
3
|
Life NAP
(4)
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Traditional
life
|
$
49.7
|
|
$
48.2
|
|
3
|
Interest sensitive
life
|
7.4
|
|
7.6
|
|
(3)
|
Total
|
$
57.1
|
|
$
55.8
|
|
2
|
Average net
insurance liabilities (5) and interest margin
|
|
Quarter
ended
|
|
|
|
March
31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Interest sensitive
life products
|
$
1,032.0
|
|
$
1,009.4
|
|
2
|
Interest
margin/average net insurance liabilities (5)
|
0.43 %
|
|
0.44 %
|
|
(2)
|
QUARTERLY AVERAGE EXCLUSIVE PRODUCING
AGENTS
|
|
|
|
|
Average Exclusive Producing Agent
Count
|
|
|
Quarter ended
|
|
|
|
|
March 31,
|
|
%
|
|
|
2023
|
|
2022
|
|
change
|
|
Consumer
|
|
|
|
|
|
|
Field agents (a)
(c)
|
3,985
|
|
3,939
|
|
1
|
|
Registered agents (b)
(c)
|
695
|
|
663
|
|
5
|
|
Worksite (a) (c)
|
288
|
|
208
|
|
38
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Producing agents
represent the monthly average of exclusive agents that have
submitted at least one policy in the month.
|
(b)
|
Registered agents are
dually licensed as insurance agents and financial representatives
who can buy and sell securities for clients, and/or investment
advisors who can provide ongoing investment advice for
clients.
|
(c)
|
Agent counts represent
the average of the last 3 months.
|
INVESTMENTS
INVESTMENT INCOME NOT ALLOCATED TO PRODUCT
LINES (Dollars in millions, except per share
data)
|
|
Management uses
investment income not allocated to product lines as the measure to
evaluate the performance of the investment segment. It is
defined as net investment income less: (i) equity returns credited
to policyholder account balances; (ii) the investment income
allocated to our product lines; (iii) impact of annual option
forfeitures related to fixed indexed annuity surrenders; (iv)
interest expense on notes payable and investment borrowings; (v)
expenses related to the FABN program; and (vi) certain expenses
related to benefit plans that are offset by special-purpose
investment income. We also view investment income not allocated to
product lines per diluted share as an important and useful measure
to evaluate performance of the investment segment as it takes into
consideration our share repurchase program.
|
|
|
Quarter ended March 31,
|
|
|
|
2023
|
|
2022
|
|
%
change
|
Net investment income
|
$
343.0
|
|
$
208.2
|
|
65
|
Allocated to product
lines:
|
|
|
|
|
|
Annuity
|
(125.4)
|
|
(117.5)
|
|
7
|
Health
|
(74.0)
|
|
(73.3)
|
|
1
|
Life
|
(36.3)
|
|
(35.5)
|
|
2
|
Equity returns credited
to policyholder account balances
|
(18.6)
|
|
71.9
|
|
(126)
|
Amounts allocated to product lines and credited to
policyholder account balances
|
(254.3)
|
|
(154.4)
|
|
65
|
Impact of annual option
forfeitures related to fixed indexed annuity surrenders
|
—
|
|
1.6
|
|
(100)
|
Amount related to
variable interest entities and other non-operating items
|
(20.9)
|
|
(7.2)
|
|
190
|
Interest expense on
corporate debt
|
(15.7)
|
|
(15.7)
|
|
—
|
Interest expense on
investment borrowings from the Federal Home Loan Bank
program
|
(21.7)
|
|
(2.4)
|
|
804
|
Expenses related to
FABN program
|
(7.6)
|
|
(7.3)
|
|
4
|
Less amounts credited
to deferred compensation plans (offsetting investment
income)
|
(7.3)
|
|
4.2
|
|
(274)
|
Total adjustments
|
(73.2)
|
|
(26.8)
|
|
|
Investment income not allocated to product
lines
|
$
15.5
|
|
$
27.0
|
|
(43)
|
|
|
|
|
|
|
Per diluted
share
|
$
0.14
|
|
$
0.22
|
|
|
INVESTMENT
PORTFOLIO
(Dollars in
millions)
|
|
The composition of the
investment portfolio at March 31, 2023 is as follows:
|
|
|
$
|
|
% of
total
|
Fixed maturities,
available for sale, at fair value
|
$ 21,107.1
|
|
83
|
Equity securities at
fair value
|
106.1
|
|
—
|
Mortgage
loans
|
1,676.1
|
|
7
|
Policy loans
|
123.0
|
|
1
|
Trading
securities
|
208.1
|
|
1
|
Investments held by
variable interest entities
|
1,017.9
|
|
4
|
Other invested
assets
|
1,097.1
|
|
4
|
Total investment
portfolio
|
$ 25,335.4
|
|
100
|
Fixed maturities,
available for sale, at amortized cost by asset class as of March
31, 2023 are as follows:
|
|
|
Investment
grade
|
|
Below
investment
grade
|
|
Total
|
Corporate
securities
|
$ 12,874.0
|
|
$
623.0
|
|
$ 13,497.0
|
United States Treasury
securities and obligations of the United States government and
agencies
|
174.7
|
|
—
|
|
174.7
|
States and political
subdivisions
|
2,778.8
|
|
10.6
|
|
2,789.4
|
Foreign
governments
|
88.8
|
|
—
|
|
88.8
|
Asset-backed
securities
|
1,335.6
|
|
123.0
|
|
1,458.6
|
Agency residential
mortgage-backed securities
|
213.3
|
|
—
|
|
213.3
|
Non-agency residential
mortgage-backed securities
|
1,212.4
|
|
565.8
|
(a)
|
1,778.2
|
Collateralized loan
obligations
|
954.3
|
|
—
|
|
954.3
|
Commercial
mortgage-backed securities
|
2,480.1
|
|
83.5
|
|
2,563.6
|
|
|
|
|
|
|
Total
|
$ 22,112.0
|
|
$
1,405.9
|
|
$ 23,517.9
|
|
|
|
|
|
|
|
|
(a)
|
Certain structured
securities rated below investment grade by Nationally Recognized
Statistical Rating Organizations may be assigned a NAIC 1 or NAIC 2
designation based on the cost basis of the security relative to
estimated recoverable amounts as determined by the National
Association of Insurance Commissioners (NAIC).
|
The fair value of CNO's available for sale fixed maturity
portfolio was $21.1 billion compared
with an amortized cost of $23.5
billion. Net unrealized losses were comprised of gross
unrealized gains of $143.7 million
and gross unrealized losses of $2,495.4
million. The allowance for credit losses was
$59.1 million at March 31, 2023.
At both amortized cost and fair value, 94 percent of fixed
maturities, available for sale, were rated "investment grade".
Non-Operating Items
Net investment losses in 1Q23 were
$12.7 million including the
unfavorable change in the allowance for credit losses of
$1.5 million which was recorded in
earnings. Net investment losses in 1Q22 were $7.2 million including the unfavorable change in
the allowance for credit losses of $30.7
million which was recorded in earnings.
During 1Q23 and 1Q22, we recognized a decrease in earnings of
$1.9 million and $25.5 million, respectively, due to the net
change in market value of investments recognized in earnings.
During 1Q23 and 1Q22, we recognized an increase (decrease) in
earnings of $(65.1) million and
$165.4 million, respectively,
resulting from changes in the estimated fair value of embedded
derivative liabilities and market risk benefits related to our
fixed indexed annuities. Such amounts include the impacts of
changes in market interest rates and equity impacts used to
determine the estimated fair values of the embedded derivatives and
market risk benefits.
In 1Q22, other non-operating items included an increase in
earnings of $22.7 million for the
mark-to-market change in the agent deferred compensation plan
liability which was impacted by changes in the underlying actuarial
assumptions used to value the liability. We recognize the
mark-to-market change in the estimated value of this liability
through earnings as assumptions change.
Statutory (based on non-GAAP measures) and GAAP Capital
Information
Our consolidated statutory risk-based capital
ratio was estimated at 380% at March 31,
2023, reflecting estimated 1Q23 statutory operating income
of $39 million and the payment of
insurance company dividends to the holding company of $34.2 million during 1Q23.
During 1Q23, we repurchased $15.1
million of common stock under our securities repurchase
program. We repurchased .6 million common shares at an
average cost of $23.87 per
share. As of March 31, 2023, we
had 114.9 million shares outstanding and had authority to
repurchase up to an additional $171.8
million of our common stock. During 1Q23, dividends
paid on common stock totaled $17.1
million.
Unrestricted cash and investments held by our holding company
were $158 million at March 31, 2023, compared to $167 million at December
31, 2022.
Book value per common share was $17.68 at March 31,
2023 compared to $15.47 at
December 31, 2022. Book value
per diluted share, excluding accumulated other comprehensive income
(loss) (2), was $31.82 at
March 31, 2023, compared to
$31.89 at December 31, 2022.
The debt-to-capital ratio was 35.9 percent and 39.2 percent at
March 31, 2023 and December 31, 2022, respectively. Our
debt-to-total capital ratio, excluding accumulated other
comprehensive income (loss) (3) was 23.6 percent at March 31, 2023, compared to 23.4 percent at
December 31, 2022.
Return on equity for the trailing four quarters ended
March 31, 2023 and 2022, was 21.8%
and 14.1%, respectively. Operating return, excluding
significant items, on equity, excluding accumulated other
comprehensive income (loss) and net operating loss carryforwards
(6) for the trailing four quarters ended March 31, 2023 and 2022, was 9.8% and 12.3%,
respectively.
In this news release, CNO includes non-GAAP measures to enhance
investors' understanding of management's view of the
business. The non-GAAP measures are not a substitute for
GAAP, but rather a supplement to increase transparency by providing
broader perspective. CNO's definitions of non-GAAP measures
may differ from other companies' definitions. More detailed
information including various GAAP and non-GAAP measurements are
located at CNOinc.com in the Investors section under SEC
Filings.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS:
This press release may contain forward-looking statements within
the meaning of federal securities laws. These prospective
statements reflect management's current expectations, but are not
guarantees of future performance. Accordingly, please refer
to CNO's cautionary statement regarding forward-looking statements,
and the business environment in which the Company operates,
contained in the Company's Form 10-K for the year ended
December 31, 2022 and any subsequent
Form 10-Q or Form 10-K on file with the Securities and Exchange
Commission and on the Company's website at CNOinc.com in the
Investors section. CNO specifically disclaims any obligation
to update or revise any forward-looking statement because of new
information, future developments or otherwise.
EARNINGS RELEASE CONFERENCE CALL WEBCAST:
The Company will host a conference call to discuss results on
May 2, 2023 at 11:00 a.m. Eastern Time. During the call,
we will be referring to a presentation that will be available at
the Investors section of the company's website.
To participate by dial-in, please register at
https://www.netroadshow.com/events/login?show=e35d9938&confId=49849.
Upon registering, you will be provided with call details and a
registrant ID used to track attendance on the conference call.
Reminders will also be sent to registered participants via
email.
For those investors who prefer to listen to the call online, we
will be broadcasting the call live via webcast. The event can
be accessed through the Investors section of the company's website:
ir.CNOinc.com. Participants should go to the website at least
15 minutes before the event to register and download any necessary
audio software.
ABOUT CNO FINANCIAL GROUP
CNO Financial Group, Inc. (NYSE: CNO) secures the future of
middle-income America. CNO provides life and health
insurance, annuities, financial services, and workforce benefits
solutions through our family of brands, including Bankers Life,
Colonial Penn, Optavise and Washington National. Our
customers work hard to save for the future, and we help protect
their health, income and retirement needs with 3.2 million policies
and $34 billion in total assets. Our
3,400 associates, 4,300 exclusive agents and 4,000 independent
partner agents guide individuals, families and businesses through a
lifetime of financial decisions. For more information, visit
CNOinc.com.
CNO FINANCIAL GROUP,
INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEET
(Dollars in
millions)
(unaudited)
|
|
|
March 31,
2023
|
|
December 31,
2022
|
ASSETS
|
|
|
|
Investments:
|
|
|
|
Fixed maturities,
available for sale, at fair value (net of allowance for credit
losses: March 31, 2023 - $59.1 and
December 31, 2022
- $56.0; amortized cost: March 31, 2023 - $23,517.9 and
December 31, 2022 - $23,384.2)
|
$
21,107.1
|
|
$
20,353.4
|
Equity securities at
fair value
|
106.1
|
|
135.3
|
Mortgage loans (net of
allowance for credit losses: March 31, 2023 - $8.4 and
December 31, 2022 - $8.0)
|
1,676.1
|
|
1,411.9
|
Policy
loans
|
123.0
|
|
121.6
|
Trading
securities
|
208.1
|
|
207.9
|
Investments held by
variable interest entities (net of allowance for credit losses:
March 31, 2023 - $3.5 and
December 31, 2022
- $5.5; amortized cost: March 31, 2023 - $1,060.3 and
December 31, 2022 - $1,134.2)
|
1,017.9
|
|
1,077.6
|
Other invested
assets
|
1,097.1
|
|
1,034.7
|
Total
investments
|
25,335.4
|
|
24,342.4
|
Cash and cash
equivalents - unrestricted
|
425.0
|
|
575.7
|
Cash and cash
equivalents held by variable interest entities
|
97.1
|
|
69.2
|
Accrued investment
income
|
241.3
|
|
235.6
|
Present value of future
profits
|
197.6
|
|
203.7
|
Deferred acquisition
costs
|
1,811.3
|
|
1,770.9
|
Reinsurance receivables
(net of allowance for credit losses: March 31, 2023 - $2.0 and
December 31, 2022 - $2.0)
|
4,189.6
|
|
4,223.4
|
Market risk benefit
asset
|
57.8
|
|
65.3
|
Income tax assets,
net
|
988.1
|
|
1,063.4
|
Assets held in separate
accounts
|
2.8
|
|
2.7
|
Other assets
|
669.0
|
|
580.8
|
Total
assets
|
$
34,015.0
|
|
$
33,133.1
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Liabilities:
|
|
|
|
Liabilities for
insurance products:
|
|
|
|
Policyholder
account liabilities
|
$
15,302.9
|
|
$
15,234.2
|
Future policy
benefits
|
11,623.3
|
|
11,240.2
|
Market risk
benefit liability
|
17.6
|
|
11.3
|
Liability for
life insurance policy claims
|
67.6
|
|
64.1
|
Unearned and
advanced premiums
|
243.5
|
|
235.0
|
Liabilities
related to separate accounts
|
2.8
|
|
2.7
|
Other
liabilities
|
681.3
|
|
693.9
|
Investment
borrowings
|
1,839.6
|
|
1,639.5
|
Borrowings related to
variable interest entities
|
1,065.4
|
|
1,104.6
|
Notes payable – direct
corporate obligations
|
1,139.2
|
|
1,138.8
|
Total
liabilities
|
31,983.2
|
|
31,364.3
|
Commitments and
Contingencies
|
|
|
|
Shareholders'
equity:
|
|
|
|
Common stock ($0.01 par
value, 8,000,000,000 shares authorized, shares issued
and
outstanding:
March 31, 2023 – 114,905,172; December 31, 2022 –
114,343,070)
|
1.1
|
|
1.1
|
Additional paid-in
capital
|
2,021.1
|
|
2,033.8
|
Accumulated other
comprehensive loss
|
(1,664.4)
|
|
(1,957.3)
|
Retained
earnings
|
1,674.0
|
|
1,691.2
|
Total
shareholders' equity
|
2,031.8
|
|
1,768.8
|
Total
liabilities and shareholders' equity
|
$
34,015.0
|
|
$
33,133.1
|
CNO FINANCIAL GROUP,
INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENT OF OPERATIONS
(Dollars in millions,
except per share data)
(unaudited)
|
|
|
Three months
ended
|
|
March 31,
|
|
2023
|
|
2022
|
Revenues:
|
|
|
|
Insurance policy
income
|
$
625.5
|
|
$
625.0
|
Net investment
income:
|
|
|
|
General account
assets
|
292.2
|
|
277.5
|
Policyholder
and other special-purpose portfolios
|
50.8
|
|
(69.3)
|
Investment gains
(losses):
|
|
|
|
Realized
investment gains (losses)
|
(14.6)
|
|
18.8
|
Other
investment losses
|
—
|
|
(51.5)
|
Total investment
losses
|
(14.6)
|
|
(32.7)
|
Fee revenue and other
income
|
52.1
|
|
42.4
|
Total
revenues
|
1,006.0
|
|
842.9
|
Benefits and
expenses:
|
|
|
|
Insurance policy
benefits
|
609.7
|
|
333.9
|
Liability for future
policy benefits remeasurement loss
|
0.6
|
|
7.0
|
Change in fair value
of market risk benefits
|
14.8
|
|
(32.7)
|
Interest
expense
|
54.7
|
|
23.8
|
Amortization
|
55.5
|
|
52.3
|
Other operating costs
and expenses
|
271.7
|
|
218.3
|
Total benefits
and expenses
|
1,007.0
|
|
602.6
|
Income (loss)
before income taxes
|
(1.0)
|
|
240.3
|
Income tax expense
(benefit) on period income (loss)
|
(0.2)
|
|
56.9
|
Net income
(loss)
|
$
(0.8)
|
|
$
183.4
|
Earnings per common
share:
|
|
|
|
Basic:
|
|
|
|
Weighted average
shares outstanding
|
114,545,000
|
|
118,622,000
|
Net income
(loss)
|
$
(.01)
|
|
$
1.55
|
Diluted:
|
|
|
|
Weighted average
shares outstanding
|
114,545,000
|
|
121,002,000
|
Net income
(loss)
|
$
(.01)
|
|
$
1.52
|
NOTES
|
|
|
(1)
|
Management believes
that an analysis of Net income applicable to common stock before:
(i) net realized investment gains or losses from sales, impairments
and the change in allowance for credit losses, net of taxes; (ii)
net change in market value of investments recognized in earnings,
net of taxes; (iii) changes in fair value of embedded derivative
liabilities and market risk benefits related to our fixed indexed
annuities, net of taxes; (iv) fair value changes related to the
agent deferred compensation plan, net of taxes; (v) loss on
extinguishment of debt, net of taxes; (vi) changes in the valuation
allowance for deferred tax assets and other tax items; and (viii)
other non-operating items consisting primarily of earnings
attributable to variable interest entities, net of taxes ("Net
operating income," a non-GAAP financial measure) is important to
evaluate the financial performance of the company, and is a key
measure commonly used in the life insurance industry.
Management uses this measure to evaluate performance because the
items excluded from net operating income can be affected by events
that are unrelated to the company's underlying fundamentals.
A reconciliation of Net operating income to Net income applicable
to common stock is provided in the table on page 2.
Additional information concerning this non-GAAP measure is included
in our periodic filings with the Securities and Exchange Commission
that are available in the "Investors - SEC Filings" section of
CNO's website, CNOinc.com.
|
|
|
(2)
|
Book value per diluted
share reflects the potential dilution that could occur if
outstanding stock options were exercised and restricted stock and
performance units were vested. The dilution from options,
restricted shares and performance units is calculated using the
treasury stock method. Under this method, we assume the
proceeds from the exercise of the options (or the unrecognized
compensation expense with respect to restricted stock and
performance units) will be used to purchase shares of our common
stock at the closing market price on the last day of the
period. In addition, the calculation of this non-GAAP measure
differs from the corresponding GAAP measure because accumulated
other comprehensive income (loss) has been excluded from the value
of capital used to determine this measure. Management
believes this non-GAAP measure is useful because it removes the
volatility that arises from changes in the unrealized appreciation
(depreciation) of our investments.
|
|
|
(3)
|
The calculation of this
non-GAAP measure differs from the corresponding GAAP measure
because accumulated other comprehensive income (loss) has been
excluded from the value of capital used to determine this
measure. Management believes this non-GAAP measure is useful
because it removes the volatility that arises from changes in the
unrealized appreciation (depreciation) of our
investments.
|
|
|
(4)
|
Measured by new
annualized premiums for life and health products, which includes
10% of single premium whole life deposits and 100% of all other
premiums (excluding annuities). Sales of third-party products
are excluded.
|
|
|
(5)
|
Net insurance
liabilities for the purpose of allocating investment income to
product lines are equal to: (i) policyholder account balances for
annuity products; (ii) total reserves before the fair value
adjustments reflected in accumulated other comprehensive income
(loss), if applicable, for all other products; less (iii) amounts
related to reinsurance business; (iv) deferred acquisition costs;
(v) the present value of future profits; and (vi) the value of
unexpired options credited to insurance liabilities.
|
|
|
(6)
|
The following
summarizes the calculations of: (i) operating return on equity,
excluding accumulated other comprehensive income (loss) and net
operating loss carryforwards (a non-GAAP financial measure); (ii)
operating return, excluding significant items, on equity, excluding
accumulated other comprehensive income (loss) and net operating
loss carryforwards (a non-GAAP financial measure); and (iii) return
on equity are as follows (dollars in millions):
|
|
|
|
|
|
Trailing twelve months
ended
|
|
|
|
1Q23
|
|
1Q22
|
Net operating
income
|
$
354.5
|
|
$ 369.7
|
|
|
|
|
|
|
Net operating income,
excluding significant items
|
$
336.6
|
|
$ 373.2
|
|
|
|
|
|
|
Net income
|
$
446.4
|
|
$ 491.7
|
|
|
|
|
|
|
Average common equity,
excluding accumulated other
|
|
|
|
|
comprehensive income
(loss) and net operating loss
|
|
|
|
|
carryforwards (a
non-GAAP financial measure)
|
$ 3,434.8
|
|
$
3,030.5
|
|
|
|
|
|
|
Average common
shareholders' equity
|
$ 2,046.3
|
|
$
3,495.0
|
|
|
|
|
|
|
Operating return on
equity, excluding accumulated other
|
|
|
|
|
comprehensive income
(loss) and net operating loss
|
|
|
|
|
carryforwards (a
non-GAAP financial measure)
|
10.3 %
|
|
12.2 %
|
|
|
|
|
|
|
Operating return,
excluding significant items, on equity, excluding
|
|
|
|
|
accumulated other
comprehensive income (loss) and net
|
|
|
|
|
operating loss
carryforwards (a non-GAAP financial measure)
|
9.8 %
|
|
12.3 %
|
|
|
|
|
|
|
Return on
equity
|
21.8 %
|
|
14.1 %
|
The following
summarizes: (i) operating earnings; (ii) significant items; (iii)
operating earnings, excluding significant items; and (iv) net
income (loss) (dollars in millions):
|
|
|
|
|
|
|
|
|
|
Net
operating
|
|
|
|
|
|
|
|
|
|
|
Net
operating
|
|
income,
|
|
|
|
|
|
|
|
|
|
|
income,
|
|
excluding
|
|
|
|
Net
|
|
|
|
|
|
|
excluding
|
|
significant
|
|
|
|
income -
|
|
|
Net
operating
|
|
Significant
|
|
significant
|
|
items -
trailing
|
|
Net
|
|
trailing
|
|
|
income
|
|
items
|
|
items (a)
|
|
four
quarters
|
|
income
(loss)
|
|
four
quarters
|
2Q21
|
|
$
94.0
|
|
$
3.5
|
(b)
|
$
97.5
|
|
N/A
|
|
$
47.7
|
|
N/A
|
3Q21
|
|
108.1
|
|
2.3
|
(c)
|
110.4
|
|
N/A
|
|
103.4
|
|
N/A
|
4Q21
|
|
103.1
|
|
(2.3)
|
(d)
|
100.8
|
|
$
410.0
|
|
157.2
|
|
$
570.3
|
1Q22
|
|
64.5
|
|
—
|
|
64.5
|
|
373.2
|
|
183.4
|
|
491.7
|
2Q22
|
|
135.1
|
|
(17.4)
|
(e)
|
117.7
|
|
393.4
|
|
233.3
|
|
677.3
|
3Q22
|
|
77.9
|
|
—
|
|
77.9
|
|
360.9
|
|
175.9
|
|
749.8
|
4Q22
|
|
82.9
|
|
(0.5)
|
(f)
|
82.4
|
|
342.5
|
|
38.0
|
|
630.6
|
1Q23
|
|
58.6
|
|
—
|
|
58.6
|
|
336.6
|
|
(0.8)
|
|
446.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
See note (7) for
additional information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Comprised of: (i) $4.5
million from legal and regulatory matters; and (ii) a decrease in
tax expense of $1.0 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
Comprised of: (i) $3.0
million from legal and regulatory matters; and (ii) a decrease in
tax expense of $.7 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(d)
|
Comprised of: (i) $3.0
million of net favorable adjustments arising from our review of
actuarial assumptions; and (ii) an increase in tax expense of $.7
million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(e)
|
Comprised of: (i) an
experience refund of $22.5 million related to a reinsurance
agreement; and (ii) an increase in tax expense of $5.1
million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(f)
|
Comprised of: (i) $.7
million of net favorable adjustments arising from our review of
actuarial assumptions; and (ii) an increase in tax expense of $.2
million.
|
A reconciliation of
pre-tax operating earnings (a non-GAAP financial measure) to net
income is as follows (dollars in millions):
|
|
|
|
|
Twelve months
ended
|
|
|
|
1Q23
|
|
1Q22
|
Pre-tax operating
earnings (a non-GAAP financial measure)
|
$
458.6
|
|
$
476.9
|
Income tax
expense
|
(104.1)
|
|
(107.2)
|
Net operating
income
|
354.5
|
|
369.7
|
Non-operating
items:
|
|
|
|
Net realized
investment gains (losses) from sales, impairments and change in
allowance for credit losses
|
(67.7)
|
|
25.7
|
Net change in market
value of investments recognized in earnings
|
(49.6)
|
|
(36.5)
|
Changes in fair value
of embedded derivative liabilities and market risk
benefits
|
209.7
|
|
148.9
|
Fair value changes
related to the agent deferred compensation plan
|
26.2
|
|
18.4
|
Other
|
(2.0)
|
|
3.4
|
Non-operating income
before taxes
|
116.6
|
|
159.9
|
Income tax expense on non-operating income
|
(24.7)
|
|
(37.9)
|
Net non-operating
income
|
91.9
|
|
122.0
|
Net income
|
$
446.4
|
|
$
491.7
|
A reconciliation of
consolidated capital, excluding accumulated other comprehensive
income (loss) and net operating loss carryforwards (a non-GAAP
financial measure) to common shareholders' equity, is as follows
(dollars in millions):
|
|
|
|
|
1Q21
|
|
2Q21
|
|
3Q21
|
|
4Q21
|
Consolidated capital,
excluding accumulated other comprehensive
|
|
|
|
|
|
|
|
|
income (loss) and net
operating loss carryforwards
|
|
|
|
|
|
|
|
|
(a non-GAAP financial
measure)
|
$
3,003.2
|
|
$
2,989.0
|
|
$
2,993.3
|
|
$
3,067.3
|
Net operating loss
carryforwards
|
323.1
|
|
292.9
|
|
266.9
|
|
243.7
|
Accumulated other
comprehensive income
|
73.1
|
|
306.7
|
|
337.5
|
|
373.7
|
Common shareholders'
equity
|
$
3,399.4
|
|
$
3,588.6
|
|
$
3,597.7
|
|
$
3,684.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1Q22
|
|
2Q22
|
|
3Q22
|
|
4Q22
|
Consolidated capital,
excluding accumulated other comprehensive
|
|
|
|
|
|
|
|
|
income (loss) and net
operating loss carryforwards
|
|
|
|
|
|
|
|
|
(a non-GAAP financial
measure)
|
$
3,141.7
|
|
$
3,329.0
|
|
$
3,510.3
|
|
$
3,557.1
|
Net operating loss
carryforwards
|
238.2
|
|
214.7
|
|
190.9
|
|
169.0
|
Accumulated other
comprehensive loss
|
(561.5)
|
|
(1,415.8)
|
|
(1,837.8)
|
|
(1,957.3)
|
Common shareholders'
equity
|
$
2,818.4
|
|
$
2,127.9
|
|
$
1,863.4
|
|
$
1,768.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1Q23
|
|
|
|
|
|
|
Consolidated capital,
excluding accumulated other comprehensive
|
|
|
|
|
|
|
|
|
income (loss) and net
operating loss carryforwards
|
|
|
|
|
|
|
|
|
(a non-GAAP financial
measure)
|
$
3,543.8
|
|
|
|
|
|
|
Net operating loss
carryforwards
|
152.4
|
|
|
|
|
|
|
Accumulated other
comprehensive loss
|
(1,664.4)
|
|
|
|
|
|
|
Common shareholders'
equity
|
$
2,031.8
|
|
|
|
|
|
|
A reconciliation of
consolidated capital, excluding accumulated other comprehensive
income (loss) and net operating loss carryforwards (a non-GAAP
financial measure) to common shareholders' equity, is as follows
(dollars in millions):
|
|
|
|
|
Trailing four quarter
average
|
|
|
|
1Q23
|
|
1Q22
|
Consolidated capital,
excluding accumulated other comprehensive
|
|
|
|
|
income (loss) and net
operating loss carryforwards
|
|
|
|
|
(a non-GAAP financial
measure)
|
$
3,434.8
|
|
$
3,030.5
|
Net operating loss
carryforwards
|
192.5
|
|
271.1
|
Accumulated other
comprehensive income (loss)
|
(1,581.0)
|
|
193.4
|
Common shareholders'
equity
|
$
2,046.3
|
|
$
3,495.0
|
|
|
(7)
|
The tables below
summarize the financial impact of significant items on our net
operating income. Management believes that identifying the
impact of these items enhances the understanding of our operating
results (dollars in millions, except per share data).
|
|
|
|
|
Three months
ended
|
|
|
December 31,
2022
|
|
|
Actual
results
|
|
Significant
items
|
|
Excluding
significant
items
|
Insurance product
margin
|
|
|
|
|
|
|
Annuity
margin
|
|
$
50.8
|
|
$
3.2
|
(a)
|
$
54.0
|
Health
margin
|
|
140.4
|
|
(18.3)
|
(a)
|
122.1
|
Life margin
|
|
43.3
|
|
14.4
|
(a)
|
57.7
|
Total insurance product
margin
|
|
234.5
|
|
(0.7)
|
|
233.8
|
Allocated
expenses
|
|
(149.1)
|
|
—
|
|
(149.1)
|
Income from insurance
products
|
|
85.4
|
|
(0.7)
|
|
84.7
|
Fee income
|
|
9.2
|
|
—
|
|
9.2
|
Investment income not
allocated to product lines
|
|
25.2
|
|
—
|
|
25.2
|
Expenses not allocated
to product lines
|
|
(12.8)
|
|
—
|
|
(12.8)
|
Operating earnings
before taxes
|
|
107.0
|
|
(0.7)
|
|
106.3
|
Income tax (expense)
benefit on operating income
|
|
(24.1)
|
|
0.2
|
|
(23.9)
|
Net operating
income
|
|
$
82.9
|
|
$
(0.5)
|
|
$
82.4
|
|
|
|
|
|
|
|
Net operating income
per diluted share
|
|
$
0.71
|
|
$
—
|
|
$
0.71
|
|
|
|
|
|
|
|
|
(a)
|
Adjustments arising
from our comprehensive annual actuarial review of
assumptions.
|
|
|
Three months
ended
|
|
|
June 30,
2022
|
|
|
Actual
results
|
|
Significant
items
|
|
Excluding
significant
items
|
Insurance product
margin
|
|
|
|
|
|
|
Annuity
margin
|
|
$
60.1
|
|
$
—
|
|
$
60.1
|
Health
margin
|
|
125.4
|
|
—
|
|
125.4
|
Life margin
|
|
70.2
|
|
—
|
|
70.2
|
Total insurance product
margin
|
|
255.7
|
|
—
|
|
255.7
|
Allocated
expenses
|
|
(152.2)
|
|
—
|
|
(152.2)
|
Income from insurance
products
|
|
103.5
|
|
—
|
|
103.5
|
Fee income
|
|
3.2
|
|
—
|
|
3.2
|
Investment income not
allocated to product lines
|
|
64.6
|
|
—
|
|
64.6
|
Expenses not allocated
to product lines
|
|
2.9
|
|
(22.5)
|
(a)
|
(19.6)
|
Operating earnings
before taxes
|
|
174.2
|
|
(22.5)
|
|
151.7
|
Income tax (expense)
benefit on operating income
|
|
(39.1)
|
|
5.1
|
|
(34.0)
|
Net operating
income
|
|
$
135.1
|
|
$
(17.4)
|
|
$
117.7
|
|
|
|
|
|
|
|
Net operating income
per diluted share
|
|
$
1.15
|
|
$
(0.15)
|
|
$
1.00
|
|
|
|
|
|
|
|
|
(a)
|
Comprised of an
experience refund of $22.5 million related to a reinsurance
agreement.
|
|
|
Three months
ended
|
|
|
December 31,
2021
|
|
|
Actual
results
|
|
Significant
items
|
|
Excluding
significant
items
|
Insurance product
margin
|
|
|
|
|
|
|
Annuity
margin
|
|
$
65.6
|
|
$
0.7
|
(a)
|
$
66.3
|
Health
margin
|
|
126.2
|
|
(7.1)
|
(a)
|
119.1
|
Life margin
|
|
53.4
|
|
3.4
|
(a)
|
56.8
|
Total insurance product
margin
|
|
245.2
|
|
(3.0)
|
|
242.2
|
Allocated
expenses
|
|
(143.3)
|
|
—
|
|
(143.3)
|
Income from insurance
products
|
|
101.9
|
|
(3.0)
|
|
98.9
|
Fee income
|
|
2.9
|
|
—
|
|
2.9
|
Investment income not
allocated to product lines
|
|
44.4
|
|
—
|
|
44.4
|
Expenses not allocated
to product lines
|
|
(17.4)
|
|
—
|
|
(17.4)
|
Operating earnings
before taxes
|
|
131.8
|
|
(3.0)
|
|
128.8
|
Income tax (expense)
benefit on operating income
|
|
(28.7)
|
|
0.7
|
|
(28.0)
|
Net operating
income
|
|
$
103.1
|
|
$
(2.3)
|
|
$
100.8
|
|
|
|
|
|
|
|
Net operating income
per diluted share
|
|
$
0.83
|
|
$
(0.02)
|
|
$
0.81
|
|
|
|
|
|
|
|
|
(a)
|
Adjustments arising
from our comprehensive annual actuarial review of
assumptions.
|
|
|
Three months
ended
|
|
|
September 30,
2021
|
|
|
Actual
results
|
|
Significant
items
|
|
Excluding
significant
items
|
Insurance product
margin
|
|
|
|
|
|
|
Annuity
margin
|
|
$
58.5
|
|
$
—
|
|
$
58.5
|
Health
margin
|
|
122.8
|
|
—
|
|
122.8
|
Life margin
|
|
60.8
|
|
—
|
|
60.8
|
Total insurance product
margin
|
|
242.1
|
|
—
|
|
242.1
|
Allocated
expenses
|
|
(140.5)
|
|
—
|
|
(140.5)
|
Income from insurance
products
|
|
101.6
|
|
—
|
|
101.6
|
Fee income
|
|
2.6
|
|
—
|
|
2.6
|
Investment income not
allocated to product lines
|
|
51.9
|
|
—
|
|
51.9
|
Expenses not allocated
to product lines
|
|
(17.3)
|
|
3.0
|
(a)
|
(14.3)
|
Operating earnings
before taxes
|
|
138.8
|
|
3.0
|
|
141.8
|
Income tax (expense)
benefit on operating income
|
|
(30.7)
|
|
(0.7)
|
|
(31.4)
|
Net operating
income
|
|
$
108.1
|
|
$
2.3
|
|
$
110.4
|
|
|
|
|
|
|
|
Net operating income
per diluted share
|
|
$
0.84
|
|
$
0.02
|
|
$
0.86
|
|
|
|
|
|
|
|
|
(a)
|
Comprised of $3.0
million from legal and regulatory matters.
|
|
|
Three months
ended
|
|
|
June 30,
2021
|
|
|
Actual
results
|
|
Significant
items
|
|
Excluding
significant
items
|
Insurance product
margin
|
|
|
|
|
|
|
Annuity
margin
|
|
$
60.0
|
|
$
—
|
|
$
60.0
|
Health
margin
|
|
121.7
|
|
—
|
|
121.7
|
Life margin
|
|
50.3
|
|
—
|
|
50.3
|
Total insurance product
margin
|
|
232.0
|
|
—
|
|
232.0
|
Allocated
expenses
|
|
(141.6)
|
|
—
|
|
(141.6)
|
Income from insurance
products
|
|
90.4
|
|
—
|
|
90.4
|
Fee income
|
|
6.6
|
|
—
|
|
6.6
|
Investment income not
allocated to product lines
|
|
48.6
|
|
—
|
|
48.6
|
Expenses not allocated
to product lines
|
|
(23.8)
|
|
4.5
|
(a)
|
(19.3)
|
Operating earnings
before taxes
|
|
121.8
|
|
4.5
|
|
126.3
|
Income tax (expense)
benefit on operating income
|
|
(27.8)
|
|
(1.0)
|
|
(28.8)
|
Net operating
income
|
|
$
94.0
|
|
$
3.5
|
|
$
97.5
|
|
|
|
|
|
|
|
Net operating income
per diluted share
|
|
$
0.70
|
|
$
0.03
|
|
$
0.73
|
|
|
|
|
|
|
|
|
(a)
|
Comprised of $4.5
million from legal and regulatory matters.
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/cno-financial-group-reports-first-quarter-2023-results-301812330.html
SOURCE CNO Financial Group, Inc.