COLUMBUS, Ga., July 29, 2014 /PRNewswire/ -- Aflac Incorporated
(NYSE: AFL) today reported its second quarter results.
Reflecting the weaker yen/dollar exchange rate, total revenues
fell 3.4% to $5.8 billion during the
second quarter of 2014, compared with $6.0
billion in the second quarter of 2013. Net earnings were
$810 million, or $1.78 per diluted share, compared with
$889 million, or $1.90 per share, a year ago.
Net earnings in the second quarter of 2014 included after-tax
net realized investment gains of $60
million, or $.13 per diluted
share, compared with net after-tax gains of $130 million, or $.28 per diluted share, a year ago. After-tax
realized investment gains from securities transactions in the
quarter were $63 million, or
$.14 per diluted share. On an
after-tax basis, impairments were $18
million in the quarter, or $.04 per diluted share. Hedging costs related to
certain dollar investments of Aflac Japan on an after-tax basis,
were $16 million in the quarter, or
$.04 per diluted share. Realized
after-tax net investment gains from other derivative and hedging
activities in the quarter were $31
million, or $.07 per diluted
share. In addition, net earnings included a loss of
$7 million, or $.01 per diluted share, from other and
nonrecurring items.
Aflac believes that an analysis of operating earnings, a
non-GAAP financial measure, is vitally important to an
understanding of the company's underlying profitability drivers.
Aflac defines operating earnings as the profits derived from
operations, inclusive of interest cash flows associated with notes
payable, but before realized investment gains and losses from
securities transactions, impairments, and derivative and hedging
activities, as well as other and nonrecurring items. Aflac's
derivative activities are primarily used to hedge foreign exchange
and interest rate risk in our investment portfolio as well as
manage foreign exchange risk in certain notes payable and
forecasted cash flows denominated in yen. Management uses operating
earnings to evaluate the financial performance of Aflac's insurance
operations because realized gains and losses from securities
transactions, impairments, and derivative and hedging activities,
as well as other and nonrecurring items, tend to be driven by
general economic conditions and events or related to infrequent
activities not directly associated with the company's insurance
operations, and therefore may obscure the underlying fundamentals
and trends in Aflac's insurance operations.
Furthermore, because a significant portion of Aflac's business
is in Japan, where the functional
currency is the yen, the company believes it is equally important
to understand the impact on operating earnings from translating yen
into dollars. Aflac Japan's yen-denominated income statement is
translated from yen into dollars using an average exchange rate for
the reporting period, and the balance sheet is translated using the
exchange rate at the end of the period. However, except for certain
transactions such as profit repatriation and the Aflac Japan dollar
investment program, the company does not actually convert yen into
dollars. As a result, Aflac views foreign currency translation as a
financial reporting issue rather than an economic event for the
company or its shareholders. Because changes in exchange rates
distort the growth rates of operations, readers of Aflac's
financial statements are also encouraged to evaluate financial
performance excluding the impact of foreign currency translation.
The chart toward the end of this release presents a comparison of
selected income statement items with and without foreign currency
changes to illustrate the effect of currency.
The average yen/dollar exchange rate in the second quarter of
2014 was 102.15, or 3.3% weaker than the average rate of 98.76 in
the second quarter of 2013. For the first six months, the average
exchange rate was 102.42, or 6.7% weaker than the rate of 95.60 a
year ago. Aflac Japan's growth rates in dollar terms for the second
quarter and first six months were suppressed as a result of the
weaker yen/dollar exchange rate.
Operating earnings in the second quarter were $757 million, compared with $759 million in the second quarter of 2013.
Operating earnings per diluted share in the quarter increased by
2.5% to $1.66 in the quarter,
compared with $1.62 a year ago. The
weaker yen/dollar exchange rate decreased operating earnings per
diluted share by $.03 for the second
quarter. Excluding the impact from the weaker yen, operating
earnings per diluted share increased 4.3%.
Results for the first six months of 2014 were also suppressed by
the weaker yen. Total revenues were down 6.3% to $11.5 billion, compared with $12.3 billion in the first half of 2013. Net
earnings were $1.5 billion, or
$3.38 per diluted share, compared
with $1.8 billion, or $3.80 per diluted share, for the first six months
of 2013. Operating earnings for the first half of 2014 were
$1.5 billion, or $3.36 per diluted share, compared with
$1.5 billion, or $3.31 per diluted share, in 2013. Excluding the
negative impact of $.13 per share
from the weaker yen, operating earnings per diluted share rose 5.4%
for the first six months of 2014.
Total investments and cash at the end of June 2014 were $114.7
billion, compared with $110.5
billion at March 31, 2014.
In the second quarter, Aflac repurchased $100 million, or 1.6 million shares, of its
common stock. For the first half of the year, the company purchased
$515 million, or 8.1 million of its
shares. At the end of June, the company had 41.1 million shares
available for purchase under its share repurchase
authorizations.
Shareholders' equity was $17.6
billion, or $38.76 per share,
at June 30, 2014, compared with
$15.7 billion, or $34.53 per share, at March
31, 2014. Shareholders' equity at the end of the second
quarter included a net unrealized gain on investment securities and
derivatives of $2.9 billion, compared
with a net unrealized gain of $1.9
billion at the end of March
2014. The annualized return on average shareholders' equity
in the second quarter was 19.5%. On an operating basis (excluding
total net realized investment gains/losses in net earnings,
unrealized investment gains/losses, and derivative gains/losses in
shareholders' equity), the annualized return on average
shareholders' equity was 21.3% for the second quarter of 2014, or
22.3%, excluding the impact of the yen.
AFLAC JAPAN
In yen terms, Aflac Japan's premium income fell .4% in the
second quarter. Net investment income increased 7.5%. Investment
income growth was magnified by the weaker yen/dollar exchange rate
because approximately 46% of Aflac Japan's second quarter
investment income was dollar-denominated, compared with 44% a year
ago. Total revenues were up .7% in the second quarter. The pretax
operating profit margin increased in the second quarter to 21.7%
from 21.5% in the prior year. Pretax operating earnings in yen
increased 2.0% on a reported basis and 1.2% on a currency-neutral
basis. For the first half of the year, premium income
in yen increased .5%, and net investment income rose 8.4%. Total
revenues in yen were up 1.5%, and pretax operating earnings grew
3.3%.
Aflac Japan's growth rates in dollar terms for the second
quarter were suppressed as a result of the weaker yen/dollar
exchange rate. Premium income decreased 3.8% to $3.6 billion in the second quarter. Net
investment income was up 4.0% to $680
million. Total revenues decreased 2.7% to $4.3 billion. Pretax operating earnings declined
1.3% to $927 million. For the first
six months, premium income was $7.1
billion, or 6.4% lower than a year ago. Net investment
income increased 1.1% to $1.3
billion. Total revenues were down 5.5% to $8.5 billion. Pretax operating earnings were
$1.9 billion, or 3.6% lower than a
year ago.
In the second quarter, total new annualized premium sales fell
7.7% to ¥28.0 billion, or $273
million. Third sector sales, which include cancer and
medical products, increased 4.5% in the quarter. Bank channel sales
declined 19.9%, primarily reflecting continued declines in sales of
the company's first sector WAYS product.
For the first six months of the year, new annualized premium
sales were down 34.0% to ¥55.5 billion, or $542 million. Third sector sales increased 3.2%
in the first half of the year.
AFLAC U.S.
Aflac U.S. premium income increased 1.2% to $1.3 billion in the second quarter. Net
investment income was up 2.5% to $161
million. Total revenues increased 1.3% to $1.5 billion. The pretax operating profit margin
increased to 20.3% from 19.5% a year ago, reflecting improvement in
the benefit ratio. Pretax operating earnings were $300 million, an increase of 5.7% for the
quarter. For the first six months, total revenues were up 1.2% to
$2.9 billion and premium income rose
1.1% to $2.6 billion. Net investment
income increased 2.5% to $322
million. Pretax operating earnings were $603 million, 6.8% higher than a year ago.
Aflac U.S. total new annualized premium sales decreased 8.2% in
the quarter to $334 million.
Additionally, persistency in the quarter was 76.4%, compared with
76.3% a year ago. For the first half of the year, total new sales
declined 6.4% to $651 million.
DIVIDEND
The board of directors declared the third quarter cash dividend.
The third quarter dividend of $.37
per share is payable on September 2,
2014, to shareholders of record at the close of business on
August 20, 2014.
OUTLOOK
Commenting on the company's second quarter results, Chairman and
Chief Executive Officer Daniel P.
Amos stated: "We are pleased with our overall financial
results in the second quarter of 2014. Aflac Japan, our largest
earnings contributor, generated strong financial results for the
quarter. With respect to sales, we've seen the contribution from
traditional agencies slowing down, and we've developed partnerships
with new channels that have helped offset that decline. These
channels include Japan Post, and we are making gradual but steady
progress with advancing our sales through postal outlets. However,
the second half of the year will present us with difficult
comparisons due to sales of our revised medical product we
introduced in August of last year. Taking these factors into
account, we now anticipate third sector sales for the full year
will trend toward the low end of our expectation of a 2% to 7%
increase.
"From a financial perspective, Aflac U.S. continued to perform
well in the second quarter. However, our sales results remain
disappointing. Given sales production in the first half of the
year, we now expect sales for the full year will likely be down 4%
to down 8%.
"In order to drive future sales growth, we
believe it is crucial to ensure all levels of our sales
hierarchy have the potential to earn the best compensation in the
industry. At the same time, we must more effectively and
consistently execute on the U.S. sales strategy across all states.
To accomplish this, we are implementing several initiatives. For
example, we're enhancing compensation through an incentive bonus
for the first level of our sales management, district sales
coordinators, who are primarily responsible for selling Aflac
products and training new sales associates. Additionally, we've
made the decision to eliminate the commission-based position of
state sales coordinator. To better manage our state operations,
we've introduced the new position of market director. Market
directors will be salaried with the opportunity to earn
sales-related bonuses. These position changes begin on October 1, 2014. We currently estimate the
quarterly costs related to U.S. sales initiatives will be around
$.02 per diluted share beginning in
the fourth quarter of 2014. We will finalize the estimate for 2015
expenses from these initiatives in our budgeting process, and they
will be reflected in the 2015 guidance that we will provide in
October with our third quarter earnings release.
"We remain committed to maintaining strong capital ratios on
behalf of our policyholders and bondholders. Although we have not
yet finalized our statutory financial statements, we estimate our
second quarter 2014 risk-based capital, or RBC ratio, will exceed
800%. Additionally, we expect that Aflac Japan's estimated second
quarter solvency margin ratio, or SMR, will be above 800%. Given
the strength of our capital ratios, we will have repatriated ¥131.4
billion by the end of July. This reinforces our plan to repurchase
$1 billion of our common stock in
2014.
"We are pleased that our earnings per share for both the second
quarter and first half of the year were strong. However, we plan on
increasing spending significantly in the second half of the year
related to various initiatives in both the U.S. and Japan. As such, we narrowed this
year's initial annual EPS guidance of 2% to 5% per diluted share
and currently expect that 2014 operating earnings per diluted share
on a currency neutral basis will be up 3% to 4% for the full
year. If the yen averages 100 to 105 to the dollar for
the third quarter, we would expect earnings in the third quarter to
be approximately $1.38 to $1.47 per
diluted share. Using that same exchange rate assumption for the
remainder of 2014, we would expect full-year reported operating
earnings to be about $6.16 to $6.30
per diluted share."
ABOUT AFLAC
When a policyholder gets sick or hurt, Aflac pays cash benefits
fast. For nearly six decades, Aflac insurance policies have given
policyholders the opportunity to focus on recovery, not financial
stress. In the United States,
Aflac is the leading provider of voluntary insurance at the
worksite. In Japan, Aflac is the
number one life insurance company in terms of individual policies
in force. Aflac individual and group insurance products help
provide protection to more than 50 million people worldwide. For
eight consecutive years, Aflac has been recognized by Ethisphere
magazine as one of the World's Most Ethical Companies. In 2014,
FORTUNE magazine recognized Aflac as one of the 100 Best Companies
to Work For in America for the 16th consecutive year. Also, in
2014, FORTUNE magazine included Aflac on its list of Most Admired
Companies for the 13th time, ranking the company number one in the
life and health insurance category. Aflac Incorporated is a FORTUNE
500 company listed on the New York Stock Exchange under the symbol
AFL. To find out more about Aflac, visit aflac.com or
espanol.aflac.com.
A copy of Aflac's Financial Analysts Briefing (FAB) supplement
for the quarter can be found on the "Investors" page at
aflac.com.
Aflac Incorporated will webcast its quarterly conference call
via the "Investors" page of aflac.com at 9:00 a.m. (EDT) on Wednesday, July 30, 2014.
AFLAC INCORPORATED
AND SUBSIDIARIES CONDENSED INCOME STATEMENT
|
(UNAUDITED – IN
MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
THREE MONTHS ENDED
JUNE 30,
|
|
2014
|
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
$
|
5,838
|
|
$
|
6,044
|
|
(3.4)
|
%
|
|
|
|
|
|
|
|
|
|
Benefits and
claims
|
|
3,293
|
|
|
3,411
|
|
(3.4)
|
|
|
|
|
|
|
|
|
|
|
Total acquisition and
operating expenses
|
|
1,307
|
|
|
1,275
|
|
2.3
|
|
|
|
|
|
|
|
|
|
|
Earnings before
income taxes
|
|
1,238
|
|
|
1,358
|
|
(8.8)
|
|
|
|
|
|
|
|
|
|
|
Income
taxes
|
|
428
|
|
|
469
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
810
|
|
$
|
889
|
|
(8.8)
|
%
|
|
|
|
|
|
|
|
|
|
Net earnings per
share – basic
|
$
|
1.79
|
|
$
|
1.91
|
|
(6.3)
|
%
|
|
|
|
|
|
|
|
|
|
Net earnings per
share – diluted
|
|
1.78
|
|
|
1.90
|
|
(6.3)
|
|
|
|
|
|
|
|
|
|
|
Shares used to
compute earnings per share (000):
|
|
|
|
|
|
|
|
|
|
Basic
|
452,559
|
|
465,213
|
|
(2.7)
|
%
|
|
Diluted
|
455,380
|
|
467,975
|
|
(2.7)
|
|
|
|
|
|
|
|
|
|
|
Dividends paid per
share
|
$
|
.37
|
|
$
|
.35
|
|
5.7
|
%
|
AFLAC INCORPORATED
AND SUBSIDIARIES CONDENSED INCOME STATEMENT
|
(UNAUDITED – IN
MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
SIX MONTHS ENDED
JUNE 30,
|
|
2014
|
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
$
|
11,478
|
|
$
|
12,252
|
|
(6.3)
|
%
|
|
|
|
|
|
|
|
|
|
Benefits and
claims
|
|
6,513
|
|
|
6,932
|
|
(6.0)
|
|
|
|
|
|
|
|
|
|
|
Total acquisition and
operating expenses
|
|
2,623
|
|
|
2,601
|
|
.8
|
|
|
|
|
|
|
|
|
|
|
Earnings before
income taxes
|
|
2,342
|
|
|
2,719
|
|
(13.9)
|
|
|
|
|
|
|
|
|
|
|
Income
taxes
|
|
800
|
|
|
938
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
1,542
|
|
$
|
1,781
|
|
(13.4)
|
%
|
|
|
|
|
|
|
|
|
|
Net earnings per
share – basic
|
$
|
3.40
|
|
$
|
3.82
|
|
(11.0)
|
%
|
|
|
|
|
|
|
|
|
|
Net earnings per
share – diluted
|
|
3.38
|
|
|
3.80
|
|
(11.1)
|
|
|
|
|
|
|
|
|
|
|
Shares used to
compute earnings per share (000):
|
|
|
|
|
|
|
|
|
|
Basic
|
453,639
|
|
465,834
|
|
(2.6)
|
%
|
|
Diluted
|
456,534
|
|
468,546
|
|
(2.6)
|
|
|
|
|
|
|
|
|
|
|
Dividends paid per
share
|
$
|
.74
|
|
$
|
.70
|
|
5.7
|
%
|
|
AFLAC INCORPORATED
AND SUBSIDIARIES CONDENSED BALANCE SHEET
(UNAUDITED – IN
MILLIONS, EXCEPT FOR SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
JUNE
30,
|
|
2014
|
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments and
cash
|
$
|
114,734
|
|
$
|
103,936
|
|
10.4
|
%
|
|
|
|
|
|
|
|
|
|
Deferred policy
acquisition costs
|
|
9,117
|
|
|
9,028
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
Other
assets
|
|
4,020
|
|
|
3,349
|
|
20.0
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
|
127,871
|
|
$
|
116,313
|
|
9.9
|
%
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policy
liabilities
|
$
|
95,424
|
|
$
|
90,626
|
|
5.3
|
%
|
|
|
|
|
|
|
|
|
|
Notes
payable
|
|
4,925
|
|
|
4,946
|
|
(.4)
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities
|
|
9,964
|
|
|
7,045
|
|
41.4
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
17,558
|
|
|
13,696
|
|
28.2
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
127,871
|
|
$
|
116,313
|
|
9.9
|
%
|
|
|
|
|
|
|
|
|
|
Shares outstanding at
end of period (000)
|
|
452,950
|
|
|
464,820
|
|
(2.6)
|
%
|
|
RECONCILIATION OF
OPERATING EARNINGS TO NET EARNINGS
(UNAUDITED – IN
MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THREE MONTHS
ENDED JUNE 30,
|
|
2014
|
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
$
|
757
|
|
$
|
759
|
|
(.1)%
|
|
|
|
|
|
|
|
|
|
|
Reconciling items,
net of tax:
|
|
|
|
|
|
|
|
|
Realized investment
gains (losses):
|
|
|
|
|
|
|
|
|
Securities transactions and
impairments
|
|
45
|
|
|
55
|
|
|
|
Hedge costs
related to
foreign
|
|
|
|
|
|
|
|
|
currency investments
|
|
(16)
|
|
|
(4)
|
|
|
|
Impact of other
derivative/hedging activities
|
|
31
|
|
|
79
|
|
|
|
Other and non-recurring income (loss)
|
|
(7)
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
810
|
|
$
|
889
|
|
(8.8)%
|
|
|
|
|
|
|
|
|
|
|
Operating earnings
per diluted share
|
$
|
1.66
|
|
$
|
1.62
|
|
2.5%
|
|
|
|
|
|
|
|
|
|
|
Reconciling items,
net of tax:
|
|
|
|
|
|
|
|
|
Realized investment gains
(losses):
|
|
|
|
|
|
|
|
|
Securities transactions and
impairments
|
|
.10
|
|
|
.12
|
|
|
|
Hedge
costs related to
foreign
|
|
|
|
|
|
|
|
|
currency
investments
|
|
(.04)
|
|
|
(.01)
|
|
|
|
Impact of other derivative/hedging activities
|
|
.07
|
|
|
.17
|
|
|
|
Other and
non-recurring income (loss)
|
|
(.01)
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
diluted share
|
$
|
1.78
|
|
$
|
1.90
|
|
(6.3)%
|
|
RECONCILIATION OF
OPERATING EARNINGS TO NET EARNINGS
|
(UNAUDITED – IN
MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
SIX MONTHS
ENDED JUNE 30,
|
|
2014
|
|
|
2013
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
Operating
earnings
|
$
|
1,531
|
|
$
|
1,549
|
|
(1.1)%
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciling items,
net of tax:
|
|
|
|
|
|
|
|
|
|
Realized investment
gains (losses):
|
|
|
|
|
|
|
|
|
|
Securities transactions and
impairments
|
|
70
|
|
|
97
|
|
|
|
|
Hedge costs
related to
foreign
|
|
|
|
|
|
|
|
|
|
currency investments
|
|
(22)
|
|
|
(7)
|
|
|
|
|
Impact of other
derivative/hedging activities
|
|
(24)
|
|
|
142
|
|
|
|
|
Other and non-recurring income (loss)
|
|
(13)
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
1,542
|
|
$
|
1,781
|
|
(13.4)%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating earnings
per diluted share
|
$
|
3.36
|
|
$
|
3.31
|
|
1.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciling items,
net of tax:
|
|
|
|
|
|
|
|
|
|
Realized investment gains
(losses):
|
|
|
|
|
|
|
|
|
|
Securities transactions and
impairments
|
|
.15
|
|
|
.20
|
|
|
|
|
Hedge
costs related to
foreign
|
|
|
|
|
|
|
|
|
|
currency
investments
|
|
(.05)
|
|
|
(.02)
|
|
|
|
|
Impact of other derivative/hedging activities
|
|
(.05)
|
|
|
.31
|
|
|
|
|
Other and
non-recurring income (loss)
|
|
(.03)
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
diluted share
|
$
|
3.38
|
|
$
|
3.80
|
|
(11.1)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EFFECT OF FOREIGN
CURRENCY ON OPERATING RESULTS1
(SELECTED PERCENTAGE
CHANGES, UNAUDITED)
|
|
|
|
THREE MONTHS ENDED
JUNE 30, 2014
|
Including
Currency
Changes
|
|
Excluding
Currency
Changes2
|
|
|
|
|
Premium
income
|
(2.5)
|
%
|
|
.1
|
%
|
|
|
|
|
|
|
Net investment
income
|
3.8
|
|
|
5.3
|
|
|
|
|
|
|
|
Total benefits and
expenses
|
(1.9)
|
|
|
.6
|
|
|
|
|
|
|
Operating
earnings
|
(.1)
|
|
|
1.7
|
|
|
|
|
|
|
Operating earnings
per diluted share
|
2.5
|
|
|
4.3
|
|
|
1 The
numbers in this table are presented on an operating basis, as
previously described.
|
2 Amounts
excluding currency changes were determined using the same
yen/dollar exchange rate for the current period as the comparable
period in the prior year.
|
EFFECT OF FOREIGN
CURRENCY ON OPERATING RESULTS1
(SELECTED PERCENTAGE
CHANGES, UNAUDITED)
|
|
|
|
SIX MONTHS ENDED
JUNE 30, 2014
|
Including
Currency
Changes
|
|
Excluding
Currency
Changes2
|
|
|
|
|
Premium
income
|
(4.5)
|
%
|
|
.6
|
%
|
|
|
|
|
|
|
Net investment
income
|
1.5
|
|
|
4.7
|
|
|
|
|
|
|
|
Total benefits and
expenses
|
(4.2)
|
|
|
.8
|
|
|
|
|
|
|
|
Operating
earnings
|
(1.1)
|
|
|
2.9
|
|
|
|
|
|
|
|
Operating earnings
per diluted share
|
1.5
|
|
|
5.4
|
|
|
1 The
numbers in this table are presented on an operating basis, as
previously described.
|
2 Amounts
excluding currency changes were determined using the same
yen/dollar exchange rate for the current period as the comparable
period in the prior year.
|
2014 OPERATING
EARNINGS PER SHARE SCENARIOS
|
|
Average
Exchange
Rate
|
|
Annual
Operating
EPS
|
|
% Growth
Over 2013
|
|
Yen
Impact
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
95
|
|
$
|
6.40
|
-
|
6.58
|
|
3.6
|
-
|
6.5%
|
|
$ .09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
97.54*
|
|
|
6.31
|
-
|
6.49
|
|
2.1
|
-
|
5.0
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100
|
|
|
6.22
|
-
|
6.40
|
|
.6
|
-
|
3.6
|
|
(.09)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
105
|
|
|
6.06
|
-
|
6.24
|
|
(1.9)
|
-
|
1.0
|
|
(.25)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
110
|
|
|
5.91
|
-
|
6.09
|
|
(4.4)
|
-
|
(1.5)
|
|
(.40)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Actual 2013
weighted-average exchange rate
|
FORWARD-LOOKING INFORMATION
The Private Securities Litigation Reform Act of 1995 provides
a "safe harbor" to encourage companies
to provide prospective information, so long as those informational
statements are identified as forward-looking and are accompanied by
meaningful cautionary statements identifying important factors that
could cause actual results to differ materially from those included
in the forward-looking statements. We desire to take advantage of
these provisions. This document contains cautionary
statements identifying important factors that could cause actual
results to differ materially from those projected herein, and in
any other statements made by company officials in
communications with the financial community and contained in
documents filed with the Securities and Exchange Commission
(SEC).
Forward-looking statements are not based on historical
information and relate to future operations, strategies, financial
results or other developments. Furthermore, forward-looking
information is subject to numerous assumptions, risks and
uncertainties. In particular, statements containing words such
as "expect," "anticipate,"
"believe," "goal,"
"objective," "may,"
"should," "estimate,"
"intends," "projects,"
"will," "assumes,"
"potential," "target" or similar
words as well as specific projections of future
results, generally qualify as forward-looking. Aflac
undertakes no obligation to update such forward-looking
statements. We caution readers that the following factors,
in addition to other factors mentioned from time to time, could
cause actual results to differ materially from those contemplated
by the forward-looking statements: difficult conditions in global
capital markets and the economy; governmental actions for the
purpose of stabilizing the financial markets; defaults and credit
downgrades of securities in our investment portfolio; exposure to
significant financial and capital markets risk; fluctuations in
foreign currency exchange rates; significant changes in investment
yield rates; credit and other risks associated with Aflac's
investment in perpetual securities; differing judgments applied to
investment valuations; significant valuation judgments in
determination of amount of impairments taken on our investments;
limited availability of acceptable yen-denominated investments;
concentration of our investments in any particular single-issuer or
sector concentration of business in Japan; decline in creditworthiness of other
financial institutions; deviations in actual experience from
pricing and reserving assumptions; subsidiaries' ability to pay
dividends to Aflac Incorporated; changes in law or regulation by
governmental authorities; ability to attract and retain qualified
sales associates and employees; decreases in our financial strength
or debt ratings; ability to continue to develop and implement
improvements in information technology systems; interruption in
telecommunication, information technology and other operational
systems, or a failure to maintain the security, confidentiality or
privacy of sensitive data residing on such systems; changes in U.S.
and/or Japanese accounting standards; failure to comply with
restrictions on patient privacy and information security; inability
to recognize tax benefits associated with capital loss
carryforwards; level and outcome of litigation; ability to
effectively manage key executive succession; catastrophic events
including, but not necessarily limited to, epidemics, pandemics,
tornadoes, hurricanes, earthquakes, tsunamis, acts of terrorism and
damage incidental to such events; ongoing changes in our industry;
events that damage our reputation; and failure of internal controls
or corporate governance policies and procedures.
Analyst and investor contact – Robin Y.
Wilkey, 706.596.3264 or 800.235.2667; FAX: 706.324.6330 or
rwilkey@aflac.com
Media contact – Catherine Blades,
706.596.3014; FAX: 706.320.2288 or cblades@aflac.com
Logo -
http://photos.prnewswire.com/prnh/20100423/CL92305LOGO
SOURCE Aflac Incorporated