- Earnings per diluted share: operating
income* $2.84, net income $2.46
- Full-year operating return on equity*
11 percent
- Continuing strong performance by Global
Financial Solutions (GFS) and International segments; much-improved
results in Canada
- Deployed approximately $500 million
toward block transactions and repurchased $375 million of shares
for the full year
- A stronger U.S. dollar reduced
operating EPS* by $0.18 in Q4 and $0.53 for the full year
Reinsurance Group of America, Incorporated (NYSE: RGA), a
leading global provider of life reinsurance, reported operating
income* of $188.0 million, or $2.84 per diluted share, compared to
$208.3 million, or $2.99 per diluted share, in the prior-year
quarter. A relatively stronger U.S. dollar adversely affected
fourth-quarter results by $0.18 per share. Enactment of the Active
Financing Exception (AFE) added $0.36 per diluted share in Q4;
there was no AFE impact for the full year. In the prior-year
period, tax-related adjustments benefited the fourth quarter by
$0.55 per share. Net income totaled $163.1 million, or $2.46
per diluted share, compared to $191.1 million, or $2.75 per
diluted share, the year before.
Quarterly Results
Year-to-Date Results ($ in thousands, except per share
data) 2015 2014 2015
2014 Net premiums $ 2,328,501 $ 2,217,772 $ 8,570,741
$ 8,669,854 Net income 163,127 191,091 502,166 684,047 Net income
per diluted share 2.46 2.75 7.46 9.78 Operating income* 187,950
208,288 567,084 638,049 Operating income per diluted share* 2.84
2.99 8.43 9.12 Book value per share 94.09 102.13
Book value per share (excl. Accumulated
Other Comprehensive Income “AOCI”)*
83.23
78.03
Total assets 50,383,152 44,654,300
* See ‘Use of Non-GAAP Financial Measures’
below
Full-year operating income decreased to $567.1 million, or $8.43
per diluted share, from $638.0 million, or $9.12 per diluted
share, the year before. Net adverse foreign currency fluctuations
reduced 2015 operating income by $55.2 million, or $0.53 per share.
Net premiums were down 1 percent for the current year in
reported U.S. dollars and up 4 percent in original currencies.
Excluding the adverse foreign currency fluctuations and the effect
of a large retrocession agreement executed in the fourth quarter of
2014, net premiums increased 8 percent in 2015. Full-year 2015 net
income totaled $502.2 million, or $7.46 per diluted share, versus
$684.0 million, or $9.78 per diluted share, in 2014.
For the fourth quarter, consolidated net premiums increased 5
percent and totaled $2.3 billion, including adverse foreign
currency effects of approximately $108 million. Original currency
premiums increased 10 percent over the prior-year quarter,
including contributions from new block transactions. Investment
income increased 4 percent to $467.5 million from $451.6 million a
year ago, primarily attributable to a growing asset base, although
the ongoing low interest rate environment continues to put pressure
on the portfolio yield and investment income. The average
investment yield, excluding spread businesses, was 4.96 percent
this quarter, slightly higher than the prior-year quarter, and 30
basis points higher than the third quarter, due primarily to higher
variable investment income and a fourth-quarter transaction that
included investment income retroactive to January 1.
The effective tax rate on operating income was 23.9 percent this
quarter, reflecting a significant decrease in the company’s tax
provision associated with Congress permanently enacting the AFE
legislation in December. As a result, the company’s tax provision
was reduced by $23.7 million, or $0.36 per diluted share. For the
full year, there was no AFE effect, and the effective tax rate was
33.1 percent.
Greig Woodring, chief executive officer, commented, “We are
pleased to close out the year on a high note, as our fourth-quarter
operating earnings of $2.84 per diluted share were strong, even
after excluding a tax benefit of $0.36 per share related to the
reversal of the AFE accruals. The quarter was highlighted by
excellent results in Asia Pacific and Canada, while contributions
from our ongoing in-force acquisitions and effective capital
management actions were important as well.
“For the year, operating earnings per share of $8.43 was also
strong, despite the sizeable negative effect of foreign currency
movements and a difficult year for our U.S. Mortality business. All
our International operations performed well, and our Global
Financial Solutions business continued to make a strong
contribution across our global platform. Our operating return on
equity was 11 percent in 2015, and our balance sheet remains
strong.
“Our strong capital position has allowed us to pursue and
execute attractive in-force transactions and manage capital
effectively through active share repurchases. For the year, we
deployed more than $500 million toward in-force transactions,
including approximately $250 million in the fourth quarter. We also
repurchased $375 million of common shares in 2015, including $51
million in the fourth quarter, and our board approved a new
authorization of $400 million, replacing the previous
authorization. Over the past two years, we have deployed a total of
$1.3 billion toward transactions and share repurchases, and have
reduced shares outstanding by roughly 8 percent. Our deployable
excess capital position is approximately $600 million.
“Looking forward, while the macro environment continues to be
challenging in certain respects, we are optimistic about our
ability to execute collectively across the organization.”
Book value per share at year-end 2015 was $94.09 including AOCI,
and $83.23 excluding AOCI, an 8 percent increase over 2014 on
a total return basis.
SEGMENT RESULTS
U.S. and Latin America
Traditional
The U.S. and Latin America Traditional segment reported
fourth-quarter pre-tax operating income of $79.0 million, down
from 2014’s unusually strong $134.1 million. Current-period
results were primarily driven by poor experience in the Group
business. Individual mortality experience was also unfavorable, but
to a lesser degree, due to higher average claim size on policies
under $1 million. The unfavorable experience was partly offset by
growing contributions from in-force transactions. For the full
year, pre-tax operating income decreased to $233.5 million compared
to $350.2 million in 2014. Pre-tax net income decreased to $79.5
million from $128.9 million during the fourth quarter, and
decreased 33 percent to $235.8 million for the full year.
Traditional net premiums increased 12 percent from last
year’s fourth quarter to $1.4 billion, including the effect of
several block transactions added during 2015. Excluding those new
transactions, net premiums were up 6 percent. For the full year,
net premiums increased 2 percent and totaled $4.8 billion.
Without the effect of the retrocession agreement executed in the
fourth quarter of 2014, net premiums rose 9 percent in 2015.
Non-Traditional
The Asset-Intensive business reported pre-tax operating income
of $47.6 million compared to a very strong $56.0 million
in the fourth quarter of 2014. The year-ago quarter benefited from
$12 million in commercial loan prepayments, while this year
reflected a contribution from the acquisition of Aurora National
Life Assurance Company completed earlier in 2015. Full-year pre-tax
operating income totaled $199.6 million compared to $199.0 million
in 2014, with both periods benefiting from favorable interest rate
spreads; the year-ago period also included unusually high mortgage
and bond prepayments. Pre-tax net income decreased 10 percent to
$30.9 million during the fourth quarter, and declined to $152.9
million from $250.7 million for the full year.
The Financial Reinsurance business reported pre-tax operating
income of $15.9 million, a 27 percent increase over last year’s
fourth quarter. For the year, pre-tax operating income rose 5
percent to $55.0 million. Pre-tax net income increased 29
percent to $15.9 million during the fourth quarter, and was up
modestly to $55.0 million from $52.3 million for the full year.
Canada
Traditional
The Canada Traditional business reported pre-tax operating
income of $45.1 million this quarter, versus $18.2 million in
the prior-year quarter, as individual mortality experience was much
better than expected and enough to overcome a foreign currency
headwind of $7.8 million. For the full year, pre-tax operating
income increased to $123.8 million from $92.3 million in 2014.
Pre-tax net income increased to $44.6 million from $19.8 million
during the fourth quarter, and 30 percent to $124.2 million
for the full year.
Fourth-quarter reported net premiums decreased 16 percent
to $201.4 million, primarily due to the weaker Canadian dollar, but
only 2 percent on an original currency basis. For the full year,
net premiums reported in U.S. dollars were down 12 percent, but up
2 percent in Canadian dollars.
Non-Traditional
The Canada Non-Traditional business segment, which consists of
longevity and fee-based transactions, posted pre-tax operating
income of $3.4 million this quarter, compared to $1.7 million in
the prior-year quarter. Full-year pre-tax operating income
increased to $13.9 million from $6.2 million in 2014. Pre-tax net
income increased to $3.4 million from $1.7 million during the
fourth quarter, and increased to $13.9 million from $6.3 million
for the full year.
Europe, Middle East and Africa (EMEA)
Traditional
The EMEA Traditional segment reported pre-tax operating income
of $12.9 million compared to $9.9 million the year before, as
underwriting experience in this year’s period was generally in line
with expectations. Net foreign currency fluctuations adversely
affected pre-tax operating income by $1.3 million this
quarter. For the full year, pre-tax operating income declined to
$48.1 million from $51.1 million in 2014. Pre-tax net income
decreased 3 percent to $12.9 million during the fourth quarter, and
20 percent to $48.4 million for the full year.
Net reported premiums were up 4 percent to $299.9 million from
$288.2 million in the prior-year quarter. Net premiums
increased 13 percent in original currencies. For the full year,
reported net premiums decreased 3 percent to $1,121.5 million,
while net premiums on an original currency basis increased
7 percent.
Non-Traditional
The EMEA Non-Traditional segment includes asset-intensive,
longevity and fee-based transactions. Fourth-quarter pre-tax
operating income of $18.8 million was solid, although below a
strong $23.9 million in the year-ago period. The
current-period result reflects adverse net foreign currency
fluctuations of $1.4 million. For the full year, pre-tax operating
income increased to $98.1 million from $85.3 million in 2014.
Pre-tax net income increased 5 percent to $28.1 million during the
fourth quarter, and increased 7 percent to $108.4 million for the
full year.
Asia Pacific
Traditional
Asia Pacific’s Traditional business pre-tax operating income was
very strong, totaling $35.7 million, versus $18.0 million in
the prior-year quarter. Overall claims experience was better than
expected, with strong performance in most markets, including
Australia. Net adverse foreign currency fluctuations lowered
pre-tax operating income by $4.2 million this period. For the full
year, pre-tax operating income increased to $105.7 million from
$87.7 million in 2014. Pre-tax net income increased to
$37.4 million from $19.2 million during the fourth quarter,
and increased 17 percent to $105.7 million for the full year. The
prior-year result was hampered by investment related losses.
Traditional net premiums decreased 1 percent to $388.7 million,
net of $43 million in adverse currency effects, compared to the
prior year. Net premiums were up 11 percent in original currencies
this quarter. For the year, net premiums were up 1 percent on a
U.S. dollar basis and 14 percent in original currencies.
Non-Traditional
Asia Pacific’s Non-Traditional business includes
asset-intensive, fee-based and various other transactions.
Current-quarter pre-tax operating income decreased to $5.4 million
from $7.2 million in the prior-year period due to unfavorable
experience on an existing treaty. For the full year, pre-tax
operating income increased to $22.5 million from $19.0 million in
2014. Pre-tax net income increased to $5.5 million from $1.4
million during the fourth quarter, and rose to $19.6 million from
$11.7 million for the full year.
Corporate and Other
The Corporate and Other segment posted a pre-tax operating loss
of $16.7 million contrasted with pre-tax operating income of
$22.6 million in the fourth quarter of 2014. The year-ago
period reflected a significant reduction in tax-related interest
expense. For the full year, pre-tax operating losses were $52.0
million versus $1.3 million in 2014. Pre-tax net losses were $51.5
million this quarter, including net investment related losses,
compared to pre-tax net income of $18.9 million a year ago.
For the full year, pre-tax net losses increased to $119.1 million
from $11.7 million in 2014.
Company Guidance
On an annual basis, the company provides financial guidance
based upon the intermediate term rather than giving a range of
annual earnings per share for an upcoming year. This better
reflects the long-term nature of the business and the difficulty in
predicting the timing of shorter-term or periodic events such as
block transactions. The company accepts risks over very long
periods of time, up to 30 years or longer in some cases. While more
predictable over longer-term horizons, RGA’s business is subject to
inherent short-term volatility.
Over the intermediate term, the company targets growth in
operating income per share in the 5 to 8 percent range, and
operating return on equity of 10 to 12 percent. It is presumed that
there are no significant changes in the investment environment from
current levels, and the company will deploy $300 million to $400
million of excess capital, on average, annually. These guidance
ranges are based upon “normalized” results. The operating EPS
target range is unchanged from a year ago, while the operating
return on equity range was widened slightly from 11 to 12 percent.
The wider return on equity range better reflects the potential for
variability in the results due to influences from macro issues,
notably foreign exchange and interest rates.
Jack B. Lay, chief financial officer, commented, “We have faced
significant macro headwinds in terms of weak foreign currencies and
sustained low interest rates over the past several years, and we
assume this will continue to be the case for the foreseeable
future. However, we believe that our EPS range is appropriate and
we expect the combination of organic growth, execution of block
transactions and efficient capital management to mitigate those
headwinds and allow us to reach our financial targets.”
Stock Repurchase Authorization
The board of directors authorized a share repurchase program for
up to $400 million of the company’s outstanding common stock,
replacing the previous share repurchase authorization. This new
authorization is effective immediately and does not have an
expiration date. Repurchases would be made in accordance with
applicable securities laws and would be made through market
transactions, block trades, privately negotiated transactions or
other means, or a combination of these methods, with the timing and
number of shares repurchased dependent on a variety of factors,
including share price, corporate and regulatory requirements, and
market and business conditions. Repurchases may be commenced or
suspended from time to time without prior notice.
Dividend Declaration
The board of directors declared a regular quarterly dividend of
$0.37, payable March 1 to shareholders of record as of February
9.
Earnings Conference Call
A conference call to discuss fourth-quarter results will begin
at 9 a.m. Eastern Time on Friday, January 29. Interested
parties may access the call by dialing 1-877-548-7905 (domestic) or
719-325-4894 (international). The access code is 3331176. A live
audio webcast of the conference call will be available on the
company’s investor relations website at www.rgare.com. A replay of
the conference call will be available at the same address for
90 days following the conference call. A telephonic replay
also will be available through February 6 at 888-203-1112
(domestic) or 719-457-0820 (international), access code
3331176.
The company has posted to its website a Quarterly Financial
Supplement that includes financial information for all segments as
well as information on its investment portfolio. Additionally, the
company posts periodic reports, press releases and other useful
information on its investor relations website.
Use of Non-GAAP Financial Measures
RGA uses a non-GAAP financial measure called operating income as
a basis for analyzing financial results. This measure also serves
as a basis for establishing target levels and awards under RGA’s
management incentive programs. Management believes that operating
income, on a pre-tax and after-tax basis, better measures the
ongoing profitability and underlying trends of the company’s
continuing operations, primarily because that measure excludes
substantially all of the effect of net investment related gains and
losses, as well as changes in the fair value of certain embedded
derivatives and related deferred acquisition costs. These items can
be volatile, primarily due to the credit market and interest rate
environment, and are not necessarily indicative of the performance
of the company’s underlying businesses. Additionally, operating
income excludes any net gain or loss from discontinued operations,
the cumulative effect of any accounting changes, and other items
that management believes are not indicative of the company’s
ongoing operations. The definition of operating income can vary by
company and is not considered a substitute for GAAP net income.
Reconciliations to GAAP net income are provided in the following
tables. Additional financial information can be found in the
Quarterly Financial Supplement on RGA’s Investor Relations website
at www.rgare.com in the “Quarterly Results” tab and in the
“Featured Report” section.
Book value per share before impact of AOCI is a non-GAAP
financial measure that management believes is important in
evaluating the balance sheet in order to ignore the effects of
unrealized amounts primarily associated with mark-to-market
adjustments on investments and foreign currency translation.
Operating income per diluted share is a non-GAAP financial
measure calculated as operating income divided by weighted average
diluted shares outstanding. Operating return on equity is a
non-GAAP financial measure calculated as operating income divided
by average shareholders’ equity excluding AOCI.
About RGA
Reinsurance Group of America, Incorporated is among the largest
global providers of life reinsurance, with operations in Australia,
Barbados, Bermuda, Canada, China, France, Germany, Hong Kong,
India, Ireland, Italy, Japan, Malaysia, Mexico, the Netherlands,
New Zealand, Poland, Singapore, South Africa, South Korea, Spain,
Taiwan, Turkey, the United Arab Emirates, the United Kingdom and
the United States. Worldwide, the company has approximately $3.0
trillion of life reinsurance in force, and assets of $50.4
billion.
Cautionary Statement Regarding Forward-looking
Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, among others, statements relating to projections of the
earnings, revenues, income or loss, future financial performance
and growth potential of Reinsurance Group of America, Incorporated
and its subsidiaries (which we refer to in the following paragraphs
as “we,” “us” or “our”). The words “intend,” “expect,” “project,”
“estimate,” “predict,” “anticipate,” “should,” “believe,” and other
similar expressions also are intended to identify forward-looking
statements. Forward-looking statements are inherently subject to
risks and uncertainties, some of which cannot be predicted or
quantified. Future events and actual results, performance and
achievements could differ materially from those set forth in,
contemplated by or underlying the forward-looking statements.
Numerous important factors could cause actual results and events
to differ materially from those expressed or implied by
forward-looking statements including, without limitation, (1)
adverse capital and credit market conditions and their impact on
the Company’s liquidity, access to capital and cost of capital, (2)
the impairment of other financial institutions and its effect on
the Company’s business, (3) requirements to post collateral or make
payments due to declines in market value of assets subject to the
Company’s collateral arrangements, (4) the fact that the
determination of allowances and impairments taken on the Company’s
investments is highly subjective, (5) adverse changes in mortality,
morbidity, lapsation or claims experience, (6) changes in the
Company’s financial strength and credit ratings and the effect of
such changes on the Company’s future results of operations and
financial condition, (7) inadequate risk analysis and underwriting,
(8) general economic conditions or a prolonged economic downturn
affecting the demand for insurance and reinsurance in the Company’s
current and planned markets, (9) the availability and cost of
collateral necessary for regulatory reserves and capital, (10)
market or economic conditions that adversely affect the value of
the Company’s investment securities or result in the impairment of
all or a portion of the value of certain of the Company’s
investment securities, that in turn could affect regulatory
capital, (11) market or economic conditions that adversely affect
the Company’s ability to make timely sales of investment
securities, (12) risks inherent in the Company’s risk management
and investment strategy, including changes in investment portfolio
yields due to interest rate or credit quality changes, (13)
fluctuations in U.S. or foreign currency exchange rates, interest
rates, or securities and real estate markets, (14) adverse
litigation or arbitration results, (15) the adequacy of reserves,
resources and accurate information relating to settlements, awards
and terminated and discontinued lines of business, (16) the
stability of and actions by governments and economies in the
markets in which the Company operates, including ongoing
uncertainties regarding the amount of United States sovereign debt
and the credit ratings thereof, (17) competitive factors and
competitors’ responses to the Company’s initiatives, (18) the
success of the Company’s clients, (19) successful execution of the
Company’s entry into new markets, (20) successful development and
introduction of new products and distribution opportunities, (21)
the Company’s ability to successfully integrate acquired blocks of
business and entities, (22) action by regulators who have authority
over the Company’s reinsurance operations in the jurisdictions in
which it operates, (23) the Company’s dependence on third parties,
including those insurance companies and reinsurers to which the
Company cedes some reinsurance, third-party investment managers and
others, (24) the threat of natural disasters, catastrophes,
terrorist attacks, epidemics or pandemics anywhere in the world
where the Company or its clients do business, (25) interruption or
failure of the Company’s telecommunication, information technology
or other operational systems, or the Company’s failure to maintain
adequate security to protect the confidentiality or privacy of
personal or sensitive data stored on such systems, (26) changes in
laws, regulations, and accounting standards applicable to the
Company, its subsidiaries, or its business, (27) the effect of the
Company’s status as an insurance holding company and regulatory
restrictions on its ability to pay principal of and interest on its
debt obligations, and (28) other risks and uncertainties described
in this document and in the Company’s other filings with the
SEC.
Forward-looking statements should be evaluated together with the
many risks and uncertainties that affect our business, including
those mentioned in this document and described in the periodic
reports we file with the Securities and Exchange Commission. These
forward-looking statements speak only as of the date on which they
are made. We do not undertake any obligations to update these
forward-looking statements, even though our situation may change in
the future. We qualify all of our forward-looking statements by
these cautionary statements. For a discussion of the risks and
uncertainties that could cause actual results to differ materially
from those contained in the forward-looking statements, you are
advised to review the risk factors in our Annual Report on Form
10-K for the year ended December 31, 2014.
REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
Reconciliation of Consolidated Net Income to Operating Income
(Dollars in thousands)
(Unaudited) Three Months Ended Twelve
Months Ended December 31, December 31,
2015
2014 2015 2014 GAAP net
income $ 163,127 $ 191,091 $ 502,166 $ 684,047 Reconciliation to
operating income: Capital (gains) losses, derivatives and other,
included in investment related (gains) losses, net 40,203 (15,281 )
30,020 (64,625 ) Capital (gains) losses on funds withheld, included
in investment income 161 (891 ) (10,640 ) (8,590 ) Embedded
derivatives: Included in investment related (gains) losses, net
(6,004 ) 43,826 85,789 (44,941 ) Included in interest credited (917
) (236 ) (8,178 ) (274 ) DAC offset, net (8,542 ) (9,914 ) (31,996
) 72,721 Non-investment derivatives (78 ) (307 )
(77 ) (289 ) Operating income $ 187,950 $
208,288 $ 567,084 $ 638,049
Reconciliation of Consolidated Pre-tax Net Income to
Pre-tax Operating Income (Dollars in thousands)
(Unaudited) Three Months Ended Twelve Months Ended December 31,
December 31,
2015 2014 2015
2014 Income before income taxes $ 206,743 $ 276,743 $
744,795 $ 1,008,533 Reconciliation to pre-tax operating income:
Capital (gains) losses, derivatives and other, included in
investment related (gains) losses, net 64,034 (22,453 ) 49,586
(95,308 ) Capital (gains) losses on funds withheld, included in
investment income 246 (1,371 ) (16,370 ) (13,215 ) Embedded
derivatives: Included in investment related (gains) losses, net
(9,236 ) 67,424 131,984 (69,141 ) Included in interest credited
(1,412 ) (362 ) (12,582 ) (421 ) DAC offset, net (13,142 ) (15,253
) (49,225 ) 111,879 Non-investment derivatives (120 )
(472 ) (118 ) (444 ) Pre-tax operating income $
247,113 $ 304,256 $ 848,070 $ 941,883
REINSURANCE GROUP OF AMERICA, INCORPORATED AND
SUBSIDIARIES Reconciliation of Pre-tax Net Income to Pre-tax
Operating Income (Dollars in thousands)
(Unaudited) Three Months Ended
December 31, 2015 Capital Change in (gains) losses, value of
Pre-tax Pre-tax net derivatives embedded operating
income
(loss) and other, net derivatives,
net income (loss) U.S. and Latin America:
Traditional $ 79,483 $ 203 $ (696 ) $ 78,990 Non-Traditional: Asset
Intensive 30,874 124,163 (1) (107,441 ) (2) 47,596 Financial
Reinsurance 15,936 - -
15,936 Total U.S. and Latin America 126,293 124,366
(108,137 ) 142,522 Canada Traditional 44,640 446 - 45,086 Canada
Non-Traditional 3,420 - -
3,420 Total Canada 48,060 446 - 48,506 EMEA
Traditional 12,859 - - 12,859 EMEA Non-Traditional 28,145
(9,366 ) - 18,779 Total
EMEA 41,004 (9,366 ) - 31,638 Asia Pacific Traditional 37,415
(1,706 ) - 35,709 Asia Pacific Non-Traditional 5,467
(17 ) - 5,450 Total Asia Pacific
42,882 (1,723 ) - 41,159 Corporate and Other (51,496 )
34,784 - (16,712 ) Consolidated
$ 206,743 $ 148,507 $ (108,137 ) $ 247,113
(1) Asset Intensive is net of $84,347 DAC offset. (2) Asset
Intensive is net of $(97,489) DAC offset. (Unaudited)
Three Months Ended December 31, 2014 Capital Change in
(gains) losses, value of Pre-tax Pre-tax net derivatives embedded
operating
income and other, net
derivatives, net income U.S. and Latin
America: Traditional $ 128,852 $ 4,235 $ 1,033 $ 134,120
Non-Traditional: Asset Intensive 34,478 48,572 (1) (27,036 ) (2)
56,014 Financial Reinsurance 12,368 162
- 12,530 Total U.S. and Latin America
175,698 52,969 (26,003 ) 202,664 Canada Traditional 19,833 (1,635 )
- 18,198 Canada Non-Traditional 1,739 (8 )
-
1,731 Total Canada 21,572 (1,643 ) - 19,929
EMEA Traditional 13,229 (3,330 ) 9,899 EMEA Non-Traditional
26,710 (2,826 ) - 23,884
Total EMEA 39,939 (6,156 ) - 33,783 Asia Pacific Traditional 19,220
(1,193 )
-
18,027 Asia Pacific Non-Traditional 1,423
5,803
-
7,226 Total Asia Pacific 20,643 4,610 - 25,253
Corporate and Other 18,891 3,736
- 22,627 Consolidated $ 276,743 $
53,516 $ (26,003 ) $ 304,256 (1) Asset
Intensive is net of $77,812 DAC offset. (2) Asset Intensive is net
of $(93,065) DAC offset. REINSURANCE GROUP OF
AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Pre-tax
Net Income to Pre-tax Operating Income (Dollars in thousands)
(Unaudited) Twelve Months Ended December 31, 2015
Capital Change in (gains) losses, value of Pre-tax Pre-tax
net derivatives embedded operating
income (loss)
and other, net derivatives, net
income (loss) U.S. and Latin America: Traditional $
235,771 $ 201 $ (2,507 ) $ 233,465 Non-Traditional: Asset Intensive
152,946 (37,872 )
(1)
84,488 (2) 199,562 Financial Reinsurance 55,017
- - 55,017 Total U.S. and
Latin America 443,734 (37,671 ) 81,981 488,044 Canada Traditional
124,175 (364 ) - 123,811 Canada Non-Traditional 13,902
- - 13,902 Total
Canada 138,077 (364 ) - 137,713 EMEA Traditional 48,410 (338 ) -
48,072 EMEA Non-Traditional 108,445 (10,359 )
- 98,086 Total EMEA 156,855 (10,697 ) -
146,158 Asia Pacific Traditional 105,654 - - 105,654 Asia Pacific
Non-Traditional 19,619 2,899 -
22,518 Total Asia Pacific 125,273 2,899 -
128,172 Corporate and Other (119,144 ) 67,127
- (52,017 ) Consolidated $ 744,795 $
21,294 $ 81,981 $ 848,070 (1) Asset
Intensive is net of $(11,804) DAC offset. (2) Asset Intensive is
net of $(37,421) DAC offset. (Unaudited) Twelve
Months Ended December 31, 2014 Capital Change in (gains)
losses, value of Pre-tax Pre-tax net derivatives embedded operating
income (loss) and other, net
derivatives, net income (loss) U.S. and
Latin America: Traditional $ 351,645 $ (4,542 ) $ 3,099 $ 350,202
Non-Traditional: Asset Intensive 250,686 61,020
(1)
(112,684 ) (2) 199,022 Financial Reinsurance 52,258
111 - 52,369 Total U.S.
and Latin America 654,589 56,589 (109,585 ) 601,593 Canada
Traditional 95,435 (3,106 ) - 92,329 Canada Non-Traditional
6,265 (80 )
-
6,185 Total Canada 101,700 (3,186 ) - 98,514
EMEA Traditional 60,305 (9,188 )
-
51,117 EMEA Non-Traditional 101,337 (16,034 )
- 85,303 Total EMEA 161,642 (25,222 ) -
136,420 Asia Pacific Traditional 90,602 (2,939 )
-
87,663 Asia Pacific Non-Traditional 11,693
7,326
-
19,019 Total Asia Pacific 102,295 4,387 -
106,682 Corporate and Other (11,693 ) 10,367
- (1,326 ) Consolidated $ 1,008,533 $
42,935 $ (109,585 ) $ 941,883 (1) Asset
Intensive is net of $151,902 DAC offset. (2) Asset Intensive is net
of $(40,023) DAC offset. REINSURANCE GROUP OF
AMERICA, INCORPORATED AND SUBSIDIARIES Per Share and Shares Data
(In thousands, except per share data)
(Unaudited) Three Months
Ended Twelve Months Ended December 31, December 31,
2015 2014 2015
2014 Diluted earnings per share from operating income
$ 2.84 $ 2.99 $ 8.43 $ 9.12 Earnings per share from net
income: Basic earnings per share $ 2.49 $ 2.78 $ 7.55 $ 9.88
Diluted earnings per share $ 2.46 $ 2.75 $ 7.46 $ 9.78
Weighted average number of common and
common equivalent shares outstanding
66,247 69,550 67,292 69,962 (Unaudited) At or
For the Twelve Months Ended December 31,
2015
2014 Treasury shares 13,933 10,365 Common shares
outstanding 65,205 68,773 Book value per share outstanding $
94.09
$ 102.13 Book value per share outstanding, before impact of AOCI $
83.23 $ 78.03 REINSURANCE GROUP OF AMERICA,
INCORPORATED AND SUBSIDIARIES Condensed Consolidated Statements of
Income (Dollars in thousands)
(Unaudited) Three Months
Ended Twelve Months Ended December 31, December 31, Revenues:
2015 2014 2015
2014 Net premiums $ 2,328,501 $ 2,217,772 $ 8,570,741
$ 8,669,854 Investment income, net of related expenses 467,468
451,603 1,734,495 1,713,691 Investment related gains (losses), net:
Other-than-temporary impairments on fixed maturity securities
(27,605 ) (6,347 ) (57,380 ) (7,766 ) Other investment related
gains (losses), net (17,204 ) (32,876 )
(107,370 ) 193,959 Total investment related gains
(losses), net (44,809 ) (39,223 ) (164,750 ) 186,193 Other revenue
77,431 67,261 277,692
334,456 Total revenues 2,828,591
2,697,413 10,418,178 10,904,194
Benefits and expenses: Claims and other policy benefits
2,015,929 1,866,042 7,489,382 7,406,641 Interest credited 105,032
103,523 336,964 451,031 Policy acquisition costs and other
insurance expenses 300,329 290,775 1,127,486 1,391,433 Other
operating expenses 158,556 166,280 554,044 538,415 Interest expense
35,820 (9,660 ) 142,863 96,700 Collateral finance and
securitization expense 6,182 3,710
22,644 11,441 Total benefits and
expenses 2,621,848 2,420,670
9,673,383 9,895,661 Income before
income taxes 206,743 276,743 744,795 1,008,533 Provision for income
taxes 43,616 85,652 242,629
324,486 Net income $ 163,127 $ 191,091
$ 502,166 $ 684,047
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160128006482/en/
Reinsurance Group of America, IncorporatedJeff Hopson,
636-736-7000Senior Vice President – Investor Relations
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