MetLife, Inc. (NYSE:MET) today reported the following results
for the first quarter of 2015:
MetLife reported operating earnings* of $1.6 billion, up 5
percent over the first quarter of 2014, and up 10 percent on a
constant currency basis*. On a per share basis, operating earnings
were $1.44, up 5 percent over the prior year quarter. Operating
earnings in the Americas grew 4 percent on a reported basis and 6
percent on a constant currency basis. Operating earnings in Asia
decreased 2 percent on a reported basis, but were up 8 percent on a
constant currency basis. Operating earnings in Europe, the Middle
East and Africa (EMEA) decreased 1 percent on a reported basis, but
increased 35 percent on a constant currency basis.
First quarter 2015 operating earnings included the following
item:
- Unfavorable catastrophe experience
partially offset by favorable prior year development, which
resulted in a decrease in operating earnings of $16 million, or
$0.01 per share, after tax
MetLife’s operating return on equity (ROE), excluding
accumulated other comprehensive income (AOCI) other than foreign
currency translation adjustments (FCTA)*, was 11.7 percent for the
first quarter of 2015 and the company’s tangible operating ROE* was
14.4 percent.
On a GAAP basis, MetLife reported first quarter 2015 net income
of $2.1 billion, or $1.87 per share. Net income includes $534
million, after tax, in net derivative gains, reflecting the
weakening of foreign currencies against the dollar and lower
interest rates. MetLife uses derivatives as part of its broader
asset-liability management strategy to hedge certain risks, such as
movements in interest rates and foreign currencies. This hedging
activity often generates derivative gains or losses and creates
fluctuations in net income because the risk being hedged may not
have the same GAAP accounting treatment.
Premiums, fees & other revenues* were $12.1 billion,
essentially unchanged from the first quarter of 2014 (up 4 percent
on a constant currency basis).
Book value, excluding AOCI other than FCTA*, was $50.45 per
share, up 6 percent from $47.70 per share at March 31, 2014.
“MetLife had a good first quarter,” said Steven A. Kandarian,
chairman, president and chief executive officer of MetLife, Inc.
“While the continued strengthening of the U.S. dollar impacted
reported earnings, our businesses had solid underlying growth. We
are pleased with the success of our strategy to grow capital
efficient, protection oriented products. For example, accident and
health sales outside of the U.S. increased 24 percent and voluntary
product sales in the U.S. grew 57 percent.”
FIRST QUARTER 2015 SUMMARY
($ in millions, except per share
data)
Three months ended March 31 2015
2014 Change Premiums, fees & other
revenues $ 12,050 $ 12,031 Total operating revenues $ 17,032 $
17,116 Operating earnings $ 1,638 $ 1,562 5 % Operating
earnings per share $ 1.44 $ 1.37 5 % Net income $ 2,128 $
1,298 Net income per share $ 1.87 $ 1.14 Book value per
share, excluding AOCI other than FCTA $ 50.45 $ 47.70 6 % Book
value per share – tangible common stockholders’ equity $ 41.32 $
37.76 9 % Book value per share $ 64.37
$ 56.65 14 %
*Information regarding the non-GAAP financial measures included
in this news release and the reconciliation of the non-GAAP
financial measures to GAAP measures is provided in the Non-GAAP and
Other Financial Disclosures discussion below, as well as in the
tables that accompany this release and/or the First Quarter 2015
Financial Supplement (which is available on the MetLife Investor
Relations Web page at www.metlife.com).
BUSINESS DISCUSSIONS
All comparisons of the results for the first quarter of 2015 in
the business discussions that follow are with the first quarter of
2014, unless otherwise noted.
THE AMERICAS
Total operating earnings for the Americas were $1.4 billion, up
4 percent (6 percent on a constant currency basis), driven by
underwriting and business growth. Operating return on allocated
equity* was 14.1 percent for the first quarter and operating return
on allocated tangible equity* was 15.9 percent. Premiums, fees
& other revenues for the Americas were $9.2 billion, up 3
percent, and excluding pension closeouts, up 2 percent.
Retail
Operating earnings for Retail were $653 million, up 3 percent,
driven by separate account performance. Premiums, fees & other
revenues for Retail were $3.2 billion, up 1 percent, due to an
increase in life and disability sales.
Group, Voluntary & Worksite
Benefits
Operating earnings for Group, Voluntary & Worksite Benefits
were $228 million, up 20 percent, driven by favorable underwriting.
Premiums, fees & other revenues for Group, Voluntary &
Worksite Benefits were $4.4 billion, up 3 percent, due to higher
sales and persistency.
Corporate Benefit Funding
Operating earnings for Corporate Benefit Funding were $369
million, up 9 percent, due to favorable underwriting and business
growth. Premiums, fees & other revenues for Corporate Benefit
Funding were $543 million, up 27 percent, due to pension closeouts
and structured settlements.
Latin America
Operating earnings for Latin America were $131 million, down 17
percent and down 3 percent on a constant currency basis, as
business growth and underwriting improvement were offset by lower
inflation, higher taxes and U.S. Direct expenses. Premiums, fees
& other revenues in Latin America were $1.0 billion,
essentially unchanged from the prior year quarter, but up 13
percent on a constant currency basis. Total sales for the region
increased 11 percent on a constant currency basis, driven by
Brazil, Mexico and U.S. Direct.
ASIA
Operating earnings for Asia were $327 million, down 2 percent,
but up 8 percent on a constant currency basis, driven by business
growth. Operating return on allocated equity was 11.4 percent for
the first quarter and operating return on allocated tangible equity
was 19.6 percent. Premiums, fees & other revenues in Asia were
$2.2 billion, down 6 percent on a reported basis, but up 6 percent
on a constant currency basis, driven by business growth and solid
persistency in all core markets. Total sales for the region
increased 4 percent on a constant currency basis, driven by a 32
percent increase in accident and health sales in Japan, partially
offset by a decline in retirement product sales across the
region.
EMEA
Operating earnings for EMEA were $70 million, down 1 percent,
but up 35 percent on a constant currency basis, driven by business
growth, favorable underwriting and lower expenses. Operating return
on allocated equity was 8.4 percent for the first quarter and
operating return on allocated tangible equity was 15.4 percent.
Premiums, fees & other revenues were $620 million, down 14
percent, but up 2 percent on a constant currency basis. Total sales
for the region increased 14 percent on a constant currency basis,
due to strong growth in employee benefit and accident and health
sales.
INVESTMENTS
Net investment income was $5.0 billion, down 2 percent. Variable
investment income was $371 million ($241 million, after tax and
deferred acquisition costs (DAC)), compared with $429 million ($274
million, after tax and DAC) in the first quarter of 2014.
Changes in foreign currencies and long-term interest rates
contributed to derivative net gains of $394 million, after tax and
other adjustments. Derivative net gains in the first quarter of
2014 were $78 million, after tax and other adjustments.
CORPORATE & OTHER
Corporate & Other reported an operating loss of $140
million, compared to an operating loss of $166 million in the first
quarter of 2014.
Conference Call
MetLife will hold its first quarter 2015 earnings conference
call and audio webcast on Thursday, May 7, 2015, from 8-9 a.m. EDT.
The conference call will be available live via telephone and the
Internet. To listen via telephone, dial 800-230-1074 (U.S.) or
612-234-9959 (outside the U.S.). To listen to the conference call
via the Internet, visit www.metlife.com through a link on the
Investor Relations page. Those who want to listen to the call via
telephone or the Internet should dial in or go to the website at
least 15 minutes prior to the call to register, and/or download and
install any necessary audio software.
The conference call will be available for replay via telephone
and the Internet beginning at 10 a.m. EDT on Thursday, May 7, 2015,
until Thursday, May 14, 2015, at 11:59 p.m. EDT. To listen to a
replay of the conference call via telephone, dial 800-475-6701
(U.S.) or 320-365-3844 (outside the U.S.). The access code for the
replay is 344932. To access the replay of the conference call over
the Internet, visit the above-mentioned website.
A brief video of CFO John Hele discussing First Quarter 2015
results can be viewed by visiting the Investor Relations page of
www.metlife.com.
About MetLife
MetLife, Inc. (NYSE: MET), through its subsidiaries and
affiliates (“MetLife”), is one of the largest life insurance
companies in the world. Founded in 1868, MetLife is a global
provider of life insurance, annuities, employee benefits and asset
management. Serving approximately 100 million customers, MetLife
has operations in nearly 50 countries and holds leading market
positions in the United States, Japan, Latin America, Asia, Europe
and the Middle East. For more information, visit
www.metlife.com.
Non-GAAP and Other Financial
Disclosures
Any references in this news release (except in this section and
in the tables that accompany this release) to net income (loss),
net income (loss) per share, operating earnings, operating earnings
per share, book value per share, book value per share, excluding
AOCI, other than FCTA, book value per share-tangible common
stockholders’ equity, premiums, fees and other revenues, operating
return on equity, excluding AOCI, other than FCTA, and tangible
operating return on equity should be read as net income (loss)
available to MetLife, Inc.’s common shareholders, net income (loss)
available to MetLife, Inc.’s common shareholders per diluted common
share, operating earnings available to common shareholders,
operating earnings available to common shareholders per diluted
common share, book value per common share, book value per common
share, excluding AOCI, other than FCTA, book value per common
share-tangible common stockholders’ equity, premiums, fees and
other revenues (operating), operating return on MetLife, Inc.’s
common stockholders’ equity, excluding AOCI, other than FCTA, and
operating return on MetLife, Inc.’s tangible common stockholders’
equity, respectively.
Operating earnings is the measure of segment profit or loss that
MetLife uses to evaluate segment performance and allocate
resources. Consistent with accounting principles generally accepted
in the United States of America (GAAP) accounting guidance for
segment reporting, operating earnings is MetLife’s measure of
segment performance. Operating earnings is also a measure by
which MetLife senior management’s and many other employees’
performance is evaluated for the purposes of determining their
compensation under applicable compensation plans.
Operating earnings is defined as operating revenues less
operating expenses, both net of income tax. Operating earnings
available to common shareholders is defined as operating earnings
less preferred stock dividends.
Operating revenues and operating expenses exclude results of
discontinued operations and other businesses that have been or will
be sold or exited by MetLife and are referred to as divested
businesses. Operating revenues also excludes net investment gains
(losses) (NIGL) and net derivative gains (losses)
(NDGL). Operating expenses also excludes goodwill
impairments.
The following additional adjustments are made to GAAP revenues,
in the line items indicated, in calculating operating revenues:
- Universal life and investment-type
product policy fees excludes the amortization of unearned revenue
related to NIGL and NDGL and certain variable annuity guaranteed
minimum income benefits (GMIB) fees (GMIB fees);
- Net investment income: (i) includes
amounts for scheduled periodic settlement payments and amortization
of premium on derivatives that are hedges of investments or that
are used to replicate certain investments but do not qualify for
hedge accounting treatment, (ii) includes income from discontinued
real estate operations, (iii) excludes post-tax operating earnings
adjustments relating to insurance joint ventures accounted for
under the equity method, (iv) excludes certain amounts related to
contractholder-directed unit-linked investments, and (v) excludes
certain amounts related to securitization entities that are
variable interest entities (VIEs) consolidated under GAAP; and
- Other revenues are adjusted for
settlements of foreign currency earnings hedges.
The following additional adjustments are made to GAAP expenses,
in the line items indicated, in calculating operating expenses:
- Policyholder benefits and claims and
policyholder dividends excludes: (i) changes in the policyholder
dividend obligation related to NIGL and NDGL, (ii)
inflation-indexed benefit adjustments associated with contracts
backed by inflation-indexed investments and amounts associated with
periodic crediting rate adjustments based on the total return of a
contractually referenced pool of assets and other pass through
adjustments, (iii) benefits and hedging costs related to GMIBs
(GMIB costs), and (iv) market value adjustments associated with
surrenders or terminations of contracts (Market value
adjustments);
- Interest credited to policyholder
account balances includes adjustments for scheduled periodic
settlement payments and amortization of premium on derivatives that
are hedges of policyholder account balances but do not qualify for
hedge accounting treatment and excludes amounts related to net
investment income earned on contractholder-directed unit-linked
investments;
- Amortization of DAC and value of
business acquired (VOBA) excludes amounts related to: (i) NIGL and
NDGL, (ii) GMIB fees and GMIB costs and (iii) Market value
adjustments;
- Amortization of negative VOBA excludes
amounts related to Market value adjustments;
- Interest expense on debt excludes
certain amounts related to securitization entities that are VIEs
consolidated under GAAP; and
- Other expenses excludes costs related
to: (i) noncontrolling interests, (ii) implementation of new
insurance regulatory requirements, and (iii) acquisition and
integration costs.
Operating earnings also excludes the recognition of certain
contingent assets and liabilities that could not be recognized at
acquisition or adjusted for during the measurement period under
GAAP business combination accounting guidance. In addition to the
tax impact of the adjustments mentioned above, provision for income
tax (expense) benefit also includes the impact related to the
timing of certain tax credits, as well as certain tax reforms.
MetLife, Inc.’s tangible common stockholders’ equity is defined
as MetLife, Inc.’s common stockholders’ equity, excluding the net
unrealized investment gains (losses) and defined benefit plans
adjustment components of AOCI and is also reduced by the impact of
goodwill, value of distribution agreements (VODA) and value of
customer relationships acquired (VOCRA), all net of income tax.
MetLife, Inc.’s common stockholders’ equity, excluding AOCI, other
than FCTA, is defined as MetLife, Inc.’s common stockholders’
equity, excluding the net unrealized investment gains (losses) and
defined benefit plans adjustment components of AOCI, net of income
tax.
MetLife believes the presentation of operating earnings and
operating earnings available to common shareholders as MetLife
measures it for management purposes enhances the understanding of
the company’s performance by highlighting the results of operations
and the underlying profitability drivers of the
business. Operating revenues, operating expenses, operating
earnings, operating earnings available to common shareholders,
operating earnings available to common shareholders per diluted
common share, investment portfolio gains (losses) and derivative
gains (losses) should not be viewed as substitutes for the
following financial measures calculated in accordance with
GAAP: GAAP revenues, GAAP expenses, income (loss) from
continuing operations, net of income tax, net income (loss)
available to MetLife, Inc.’s common shareholders, net income (loss)
available to MetLife, Inc.’s common shareholders per diluted common
share, net investment gains (losses) and net derivative gains
(losses), respectively. MetLife, Inc.’s tangible common
stockholders’ equity and MetLife, Inc.’s common stockholders’
equity, excluding AOCI, other than FCTA, should not be viewed as
substitutes for total MetLife, Inc.’s stockholders’ equity
calculated in accordance with GAAP. Reconciliations of these
measures to the most directly comparable GAAP measures are included
in the First Quarter 2015 Financial Supplement and/or in the tables
that accompany this earnings news release.
Operating return on MetLife, Inc.'s tangible common
stockholders' equity is defined as operating earnings available to
common shareholders, excluding amortization of VODA and VOCRA, net
of income tax, divided by MetLife, Inc.'s average tangible common
stockholders' equity.
Operating return on MetLife, Inc.'s common stockholders' equity,
excluding AOCI, other than FCTA is defined as operating earnings
available to common shareholders divided by MetLife, Inc.'s average
common stockholders' equity, excluding AOCI, other than FCTA.
Operating return on MetLife, Inc.'s common stockholders' equity
is defined as operating earnings available to common shareholders
divided by MetLife, Inc.'s average common stockholders' equity.
Return on MetLife, Inc.’s tangible common stockholders' equity
is defined as net income (loss) available to MetLife, Inc.’s common
shareholders, excluding goodwill impairment and amortization of
VODA and VOCRA, net of income tax, divided by MetLife, Inc.'s
average tangible common stockholders' equity.
Return on MetLife, Inc.'s common stockholders' equity, excluding
AOCI, other than FCTA, is defined as net income (loss) available to
MetLife, Inc.’s common shareholders divided by MetLife, Inc.'s
average common stockholders' equity, excluding AOCI, other than
FCTA.
Return on MetLife, Inc.’s common stockholders’ equity is defined
as net income (loss) available to MetLife, Inc.’s common
shareholders divided by MetLife, Inc.’s average common
stockholders’ equity.
Allocated equity is defined as the portion of MetLife, Inc.’s
common stockholders’ equity that management allocates to each of
its segments and sub-segments based on local capital requirements
and economic capital. Economic capital is an internally developed
risk capital model, the purpose of which is to measure the risk in
the business and to provide a basis upon which capital is deployed.
Allocated equity excludes the impact of AOCI, other than FCTA.
Operating return on allocated equity is defined as operating
earnings available to common shareholders divided by allocated
equity.
Operating return on allocated tangible equity is defined as
operating earnings available to common shareholders, excluding
amortization of VODA and VOCRA, net of income tax, divided by
allocated tangible equity.
Return on allocated equity is defined as net income (loss)
available to MetLife, Inc.’s common shareholders divided by
allocated equity.
Return on allocated tangible equity is defined as net income
(loss) available to MetLife, Inc.’s common shareholders, excluding
amortization of VODA and VOCRA, net of income tax, divided by
allocated tangible equity.
We sometimes refer to sales activity for various products. These
sales statistics do not correspond to revenues under GAAP, but are
used as relevant measures of business activity. Statistical sales
information for life insurance is calculated by MetLife using the
LIMRA definition of sales for core direct sales, excluding
company-sponsored internal exchanges, corporate-owned life
insurance, bank-owned life insurance, and private placement
variable universal life insurance. Individual annuities sales
consists of statutory premiums direct and assumed, excluding
company sponsored internal exchanges. Statistical sales information
for Latin America, Asia and EMEA is calculated using 10% of
single-premium deposits (mainly from retirement products such as
variable annuity, fixed annuity and pensions), 20% of
single-premium deposits from credit insurance and 100% of
annualized full-year premiums and fees from recurring-premium
policy sales of all products (mainly from risk and protection
products such as individual life, accident and health and
group).
All comparisons on a constant currency basis reflect the impact
of changes in foreign currency exchange rates and are calculated
using the average foreign currency exchange rates for the current
period and are applied to each of the comparable periods.
Operating expense ratio is calculated by dividing operating
expenses (other expenses, net of capitalization of DAC) by
operating premiums, fees and other revenues.
Forward-Looking Statements
This news release may contain or incorporate by reference
information that includes or is based upon forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements give expectations or
forecasts of future events. These statements can be identified by
the fact that they do not relate strictly to historical or current
facts. They use words such as “anticipate,” “estimate,” “expect,”
“project,” “intend,” “plan,” “believe” and other words and terms of
similar meaning, or are tied to future periods, in connection with
a discussion of future operating or financial performance. In
particular, these include statements relating to future actions,
prospective services or products, future performance or results of
current and anticipated services or products, sales efforts,
expenses, the outcome of contingencies such as legal proceedings,
trends in operations and financial results.
Any or all forward-looking statements may turn out to be wrong.
They can be affected by inaccurate assumptions or by known or
unknown risks and uncertainties. Many such factors will be
important in determining the actual future results of MetLife,
Inc., its subsidiaries and affiliates. These statements are based
on current expectations and the current economic environment. They
involve a number of risks and uncertainties that are difficult to
predict. These statements are not guarantees of future performance.
Actual results could differ materially from those expressed or
implied in the forward-looking statements. Risks, uncertainties,
and other factors that might cause such differences include the
risks, uncertainties and other factors identified in MetLife,
Inc.’s filings with the U.S. Securities and Exchange Commission
(the “SEC”). These factors include: (1) difficult conditions
in the global capital markets; (2) increased volatility and
disruption of the capital and credit markets, which may affect our
ability to meet liquidity needs and access capital, including
through our credit facilities, generate fee income and
market-related revenue and finance statutory reserve requirements
and may require us to pledge collateral or make payments related to
declines in value of specified assets, including assets supporting
risks ceded to certain of our captive reinsurers or hedging
arrangements associated with those risks; (3) exposure to
financial and capital market risks, including as a result of the
disruption in Europe and possible withdrawal of one or more
countries from the Euro zone; (4) impact of comprehensive
financial services regulation reform on us, as a non-bank
systemically important financial institution, or otherwise;
(5) numerous rulemaking initiatives required or permitted by
the Dodd-Frank Wall Street Reform and Consumer Protection Act which
may impact how we conduct our business, including those compelling
the liquidation of certain financial institutions;
(6) regulatory, legislative or tax changes relating to our
insurance, international, or other operations that may affect the
cost of, or demand for, our products or services, or increase the
cost or administrative burdens of providing benefits to employees;
(7) adverse results or other consequences from litigation,
arbitration or regulatory investigations; (8) potential
liquidity and other risks resulting from our participation in a
securities lending program and other transactions;
(9) investment losses and defaults, and changes to investment
valuations; (10) changes in assumptions related to investment
valuations, deferred policy acquisition costs, deferred sales
inducements, value of business acquired or goodwill;
(11) impairments of goodwill and realized losses or market
value impairments to illiquid assets; (12) defaults on our
mortgage loans; (13) the defaults or deteriorating credit of
other financial institutions that could adversely affect us;
(14) economic, political, legal, currency and other risks
relating to our international operations, including with respect to
fluctuations of exchange rates; (15) downgrades in our claims
paying ability, financial strength or credit ratings; (16) a
deterioration in the experience of the “closed block” established
in connection with the reorganization of Metropolitan Life
Insurance Company; (17) availability and effectiveness of
reinsurance or indemnification arrangements, as well as any default
or failure of counterparties to perform; (18) differences
between actual claims experience and underwriting and reserving
assumptions; (19) ineffectiveness of risk management policies
and procedures; (20) catastrophe losses; (21) increasing
cost and limited market capacity for statutory life insurance
reserve financings; (22) heightened competition, including
with respect to pricing, entry of new competitors, consolidation of
distributors, the development of new products by new and existing
competitors, and for personnel; (23) exposure to losses
related to variable annuity guarantee benefits, including from
significant and sustained downturns or extreme volatility in equity
markets, reduced interest rates, unanticipated policyholder
behavior, mortality or longevity, and the adjustment for
nonperformance risk; (24) our ability to address difficulties,
unforeseen liabilities, asset impairments, or rating agency actions
arising from business acquisitions, including our acquisition of
American Life Insurance Company and Delaware American Life
Insurance Company, and integrating and managing the growth of such
acquired businesses, or arising from dispositions of businesses or
legal entity reorganizations; (25) regulatory and other
restrictions affecting MetLife, Inc.’s ability to pay dividends and
repurchase common stock; (26) MetLife, Inc.’s primary
reliance, as a holding company, on dividends from its subsidiaries
to meet debt payment obligations and the applicable regulatory
restrictions on the ability of the subsidiaries to pay such
dividends; (27) the possibility that MetLife, Inc.’s Board of
Directors may influence the outcome of stockholder votes through
the voting provisions of the MetLife Policyholder Trust;
(28) changes in accounting standards, practices and/or
policies; (29) increased expenses relating to pension and
postretirement benefit plans, as well as health care and other
employee benefits; (30) inability to protect our intellectual
property rights or claims of infringement of the intellectual
property rights of others; (31) inability to attract and
retain sales representatives; (32) provisions of laws and our
incorporation documents may delay, deter or prevent takeovers and
corporate combinations involving MetLife; (33) the effects of
business disruption or economic contraction due to disasters such
as terrorist attacks, cyberattacks, other hostilities, or natural
catastrophes, including any related impact on the value of our
investment portfolio, our disaster recovery systems, cyber- or
other information security systems and management continuity
planning; (34) the effectiveness of our programs and practices
in avoiding giving our associates incentives to take excessive
risks; and (35) other risks and uncertainties described from
time to time in MetLife, Inc.’s filings with the SEC.
MetLife, Inc. does not undertake any obligation to publicly
correct or update any forward-looking statement if MetLife, Inc.
later becomes aware that such statement is not likely to be
achieved. Please consult any further disclosures MetLife, Inc.
makes on related subjects in reports to the SEC.
MetLife, Inc. Consolidated
Statements of Operating Earnings Available to Common
Shareholders (Unaudited) For the Three Months
Ended March 31, 2015 2014 (In millions)
OPERATING REVENUES Premiums $ 9,253 $ 9,217 Universal life
and investment-type product policy fees 2,294 2,323 Net investment
income 4,982 5,085 Other revenues 503 491
Total operating revenues 17,032 17,116
OPERATING EXPENSES Policyholder benefits and
claims and policyholder dividends 9,447 9,373 Interest credited to
policyholder account balances 1,331 1,401 Capitalization of DAC
(968 ) (1,046 ) Amortization of DAC and VOBA 953 1,050 Amortization
of negative VOBA (90 ) (103 ) Interest expense on debt 297 294
Other expenses 3,800 3,951 Total
operating expenses 14,770 14,920
Operating earnings before provision for income tax 2,262 2,196
Provision for income tax expense (benefit) 594
604 Operating earnings 1,668 1,592 Preferred stock dividends
30 30
OPERATING EARNINGS AVAILABLE
TO COMMON SHAREHOLDERS $ 1,638 $ 1,562
Reconciliation to
Net Income (Loss) and Financial Statement Line Item Adjustments
from GAAP
Operating earnings $ 1,668 $ 1,592 Adjustments from operating
earnings to income (loss) from continuing operations, net of income
tax: Net investment gains (losses) (1) 286 (411 ) Net derivative
gains (losses) 821 343 Premiums - 2 Universal life and
investment-type product policy fees 100 98 Net investment income
479 (50 ) Other revenues (8 ) (13 ) Policyholder benefits and
claims and policyholder dividends (149 ) (254 ) Interest credited
to policyholder account balances (664 ) (68 ) Capitalization of DAC
- - Amortization of DAC and VOBA (72 ) (8 ) Amortization of
negative VOBA 10 12 Interest expense on debt (1 ) (18 ) Other
expenses (5 ) (3 ) Goodwill impairment - - Provision for income tax
(expense) benefit (302 ) 120 Income (loss)
from continuing operations, net of income tax 2,163 1,342 Income
(loss) from discontinued operations, net of income tax -
(3 ) Net income (loss) 2,163 1,339 Less: Net income
(loss) attributable to noncontrolling interests 5
11 Net income (loss) attributable to MetLife, Inc.
2,158 1,328 Less: Preferred stock dividends 30
30 Net income (loss) available to MetLife, Inc.'s common
shareholders $ 2,128 $ 1,298 See footnotes on
last page.
MetLife, Inc. (Unaudited)
For
the Three Months Ended March 31, 2015 2014 Earnings Per
Earnings Per
Weighted
Weighted
Average
Average
Common
Common
Shares
Shares
Diluted Diluted (In millions, except per share data)
Reconciliation to Net Income (Loss) Available to MetLife, Inc.'s
Common Shareholders Operating earnings available to common
shareholders $ 1,638 $ 1.44 $ 1,562 $ 1.37 Adjustments from
operating earnings available to common shareholders to net income
(loss) available to MetLife, Inc.'s common shareholders: Add: Net
investment gains (losses) (1) 286 0.25 (411 ) (0.36 ) Add: Net
derivative gains (losses) 821 0.72 343 0.30 Add: Goodwill
impairment - - - - Add: Other adjustments to continuing operations
(310 ) (0.27 ) (302 ) (0.27 ) Add: Provision for income tax
(expense) benefit (302 ) (0.27 ) 120 0.11 Add: Income (loss) from
discontinued operations, net of income tax - - (3 ) - Less: Net
income (loss) attributable to noncontrolling interests 5
- 11 0.01 Net
income (loss) available to MetLife, Inc.'s common shareholders $
2,128 $ 1.87 $ 1,298 $ 1.14
Weighted average common shares outstanding - diluted 1,135.8
1,140.5 For the Three Months Ended March 31,
2015 2014 (In millions)
Reconciliation to GAAP Premiums, Fees and Other Revenues
Total operating premiums, fees and other revenues $ 12,050 $ 12,031
Add: Adjustments to premiums, fees and other revenues 92
87 Total premiums, fees and other revenues $
12,142 $ 12,118
Reconciliation to
GAAP Revenues and GAAP Expenses Total operating revenues
$ 17,032 $ 17,116 Add: Net investment gains (losses) (1) 286 (411 )
Add: Net derivative gains (losses) 821 343 Add: Adjustments related
to net investment gains (losses) and net derivative gains (losses)
4 3 Add: Other adjustments to revenues 567 34
Total revenues $ 18,710 $ 17,085 Total
operating expenses $ 14,770 $ 14,920 Add: Adjustments related to
net investment gains (losses) and net derivative gains (losses) 95
1 Add: Goodwill impairment - - Add: Other adjustments to expenses
786 338 Total expenses $ 15,651
$ 15,259 See footnotes on last page.
MetLife, Inc. (Unaudited)
March 31,
Book Value (2) 2015
2014 Book value per common share $ 64.37 $ 56.65
Less: Net unrealized investment gains (losses), net of income tax
15.94 10.39 Less: Defined benefit plans adjustment, net of income
tax (2.02 ) (1.44 ) Book value per common share,
excluding AOCI other than FCTA $ 50.45 $ 47.70 Less: Goodwill, net
of income tax 8.61 9.20 Less: VODA and VOCRA, net of income tax
0.52 0.74 Book value per common share -
tangible common stockholders' equity (excludes AOCI other than
FCTA) $ 41.32 $ 37.76 Common shares
outstanding, end of period (in millions) 1,114.3 1,124.8
For the Three Months Ended March 31,
Return on Equity
(3) 2015 2014 Operating return on
MetLife, Inc.'s: Common stockholders' equity 9.2 % 10.1 % Common
stockholders' equity, excluding AOCI other than FCTA 11.7 % 11.7 %
Tangible common stockholders' equity (excludes AOCI other than
FCTA) 14.4 % 15.0 % Return on MetLife, Inc.'s: Common
stockholders' equity 12.0 % 8.4 % Common stockholders' equity,
excluding AOCI other than FCTA 15.2 % 9.8 % Tangible common
stockholders' equity (excludes AOCI other than FCTA) 18.7 % 12.5 %
Operating Return on Allocated Equity: Americas 14.1 %
14.2 % Asia 11.4 % 11.4 % EMEA 8.4 % 8.2 % Operating
Return on Allocated Tangible Equity: Americas 15.9 % 16.1 % Asia
19.6 % 19.7 % EMEA 15.4 % 15.7 % Return on Allocated
Equity: Americas 18.0 % 10.5 % Asia 12.1 % 14.5 % EMEA 7.8 % 9.9 %
Return on Allocated Tangible Equity: Americas 20.2 %
12.0 % Asia 20.8 % 25.0 % EMEA 14.4 % 18.9 % See footnotes
on last page.
MetLife, Inc. Reconciliations
to Net Income (Loss) Available to Common Shareholders
(Unaudited) For the Three Months
Ended March 31, 2015 2014 (In millions)
Total Americas Operations: Operating earnings available to common
shareholders $ 1,381 $ 1,324 Add: Net investment gains (losses) (1)
274 (517 ) Add: Net derivative gains (losses) 577 286 Add: Other
adjustments to continuing operations (268 ) (275 ) Add: Provision
for income tax (expense) benefit (205 ) 169 Add: Income (loss) from
discontinued operations, net of income tax - (3 ) Less: Net income
(loss) attributable to noncontrolling interests 3
5 Net income (loss) available to MetLife, Inc.'s
common shareholders $ 1,756 $ 979 Retail:
Operating earnings available to common shareholders $ 653 $ 636
Add: Net investment gains (losses) 68 6 Add: Net derivative gains
(losses) 313 71 Add: Other adjustments to continuing operations
(192 ) (147 ) Add: Provision for income tax (expense) benefit (66 )
25 Add: Income (loss) from discontinued operations, net of income
tax - (2 ) Net income (loss) available to
MetLife, Inc.'s common shareholders $ 776 $ 589
Group, Voluntary & Worksite Benefits: Operating earnings
available to common shareholders $ 228 $ 190 Add: Net investment
gains (losses) 3 (11 ) Add: Net derivative gains (losses) 205 116
Add: Other adjustments to continuing operations (42 ) (39 ) Add:
Provision for income tax (expense) benefit (58 ) (23
) Net income (loss) available to MetLife, Inc.'s common
shareholders $ 336 $ 233 Corporate Benefit
Funding: Operating earnings available to common shareholders $ 369
$ 340 Add: Net investment gains (losses) (1) 205 (541 ) Add: Net
derivative gains (losses) 80 103 Add: Other adjustments to
continuing operations (39 ) (2 ) Add: Provision for income tax
(expense) benefit (86 ) 148 Add: Income (loss) from discontinued
operations, net of income tax - (1 ) Net
income (loss) available to MetLife, Inc.'s common shareholders $
529 $ 47 Latin America: Operating earnings
available to common shareholders $ 131 $ 158 Add: Net investment
gains (losses) (2 ) 29 Add: Net derivative gains (losses) (21 ) (4
) Add: Other adjustments to continuing operations 5 (87 ) Add:
Provision for income tax (expense) benefit 5 19 Less: Net income
(loss) attributable to noncontrolling interests 3
5 Net income (loss) available to MetLife, Inc.'s
common shareholders $ 115 $ 110 Asia:
Operating earnings available to common shareholders $ 327 $ 333
Add: Net investment gains (losses) 68 157 Add: Net derivative gains
(losses) 18 (7 ) Add: Other adjustments to continuing operations
(55 ) (12 ) Add: Provision for income tax (expense) benefit (10 )
(41 ) Less: Net income (loss) attributable to noncontrolling
interests - 6 Net income (loss)
available to MetLife, Inc.'s common shareholders $ 348 $ 424
EMEA: Operating earnings available to common
shareholders $ 70 $ 71 Add: Net investment gains (losses) 3 (9 )
Add: Net derivative gains (losses) 1 38 Add: Other adjustments to
continuing operations 19 (1 ) Add: Provision for income tax
(expense) benefit (26 ) (13 ) Less: Net income (loss) attributable
to noncontrolling interests 2 - Net
income (loss) available to MetLife, Inc.'s common shareholders $ 65
$ 86 Corporate & Other: Operating earnings
available to common shareholders $ (140 ) $ (166 ) Add: Net
investment gains (losses) (59 ) (42 ) Add: Net derivative gains
(losses) 225 26 Add: Other adjustments to continuing operations (6
) (14 ) Add: Provision for income tax (expense) benefit (61
) 5 Net income (loss) available to MetLife, Inc.'s
common shareholders $ (41 ) $ (191 ) See footnotes on last
page.
MetLife, Inc.
GAAP Interim Condensed Consolidated Statements of Operations
(Unaudited) For the Three Months Ended March 31,
2015 2014 (In millions)
Revenues
Premiums $ 9,253 $ 9,219 Universal life and investment-type product
policy fees 2,394 2,421 Net investment income 5,461 5,035 Other
revenues 495 478 Net investment gains (losses):
Other-than-temporary impairments on fixed maturity securities (8 )
(14 ) Other-than-temporary impairments on fixed maturity securities
transferred to other comprehensive income (loss) (10 ) 4 Other net
investment gains (losses) (1) 304 (401 ) Total
net investment gains (losses) 286 (411 ) Net derivative gains
(losses) 821 343 Total revenues
18,710 17,085
Expenses
Policyholder benefits and claims 9,257 9,324 Interest credited to
policyholder account balances 1,995 1,469 Policyholder dividends
339 303 Other expenses 4,060 4,163
Total expenses 15,651 15,259
Income (loss) from continuing operations before provision for
income tax 3,059 1,826 Provision for income tax expense (benefit)
896 484 Income (loss) from continuing
operations, net of income tax 2,163 1,342 Income (loss) from
discontinued operations, net of income tax -
(3 ) Net income (loss) 2,163 1,339 Less: Net income (loss)
attributable to noncontrolling interests 5 11
Net income (loss) attributable to MetLife, Inc. 2,158 1,328
Less: Preferred stock dividends 30 30
Net income (loss) available to MetLife, Inc.'s common shareholders
$ 2,128 $ 1,298 (1)
The three months ended March 31, 2014
includes a pre-tax net investment loss of $495 million related to
the sale of MetLife, Inc.'s wholly-owned subsidiary, MetLife
Assurance Limited.
(2) Book value excludes $2,043 million of equity related to
preferred stock. (3) Annualized using quarter-to-date
results.
MetLifeMedia:John Calagna, 212-578-6252orInvestors:Edward
Spehar, 212-578-7888
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