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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 1, 2023
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Aflac Incorporated
_________________________________________________________________________________________________________________________________________________________
(Exact name of registrant as specified in its charter)
 
Georgia001-07434  58-1167100
(State or other jurisdiction(Commission  (IRS Employer
of incorporation)File Number)  Identification No.)
1932 Wynnton RoadColumbusGeorgia31999
(Address of principal executive offices)  (Zip Code)
706.323.3431
_________________________________________________________________________________________________________________________________________________________
(Registrant’s telephone number, including area code)
 
_________________________________________________________________________________________________________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $.10 Par ValueAFLNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨



Item 2.02 Results of Operations and Financial Condition.
Aflac Incorporated (the "Company") is furnishing its press release dated November 1, 2023 in which it reported its 2023 third quarter results herein as Exhibit 99.1 to this report. The Company is also furnishing its third quarter supplemental earnings materials as Exhibit 99.2 to this report.
On November 1, 2023, the Company posted to its investor relations website at investors.aflac.com a video presentation by Max Brodén, the Company's Executive Vice President and Chief Financial Officer, discussing the Company's 2023 third quarter earnings. The Company is furnishing a transcript of Mr. Brodén's comments and a copy of the slides referenced in the presentation as Exhibit 99.3 and Exhibit 99.4, respectively, to this report.
In accordance with General Instruction B.2 of Form 8-K, the information included or incorporated in this report (Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be set forth by specific reference in such filing.


Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit NumberExhibit Title or Description
Press release of Aflac Incorporated dated November 1, 2023
Financial Supplement for Third Quarter 2023
Transcript of comments in video presentation by Max Brodén, Executive Vice President and Chief Financial Officer of Aflac Incorporated.
Slides referenced in video presentation by Max Brodén, Executive Vice President and Chief Financial Officer of Aflac Incorporated.
104
Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
  Aflac Incorporated
November 1, 2023  /s/ June Howard
  (June Howard)
  Senior Vice President, Financial Services
  Chief Accounting Officer


2

    



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News Release


Aflac Incorporated Announces Third Quarter Results,
Reports Third Quarter Net Earnings of $1.6 Billion,
Declares Fourth Quarter Dividend,
Increases First Quarter 2024 Dividend 19%


COLUMBUS, Ga. - November 1, 2023 - Aflac Incorporated (NYSE: AFL) today reported its third quarter results.

Total revenues were $5.0 billion in the third quarter of 2023, compared with $4.7 billion in the third quarter of 2022. Net earnings were $1.6 billion, or $2.64 per diluted share, compared with $1.8 billion, or $2.82 per diluted share a year ago.

Net earnings in the third quarter of 2023 included net investment gains of $423 million, or $0.71 per diluted share, compared with net investment gains of $199 million, or $0.31 per diluted share a year ago. These net investment gains were driven by net gains on certain derivatives and foreign currency activities of $381 million, largely driven by changes in exchange rates, a $47 million gain from an increase in the fair value of equity securities and $24 million of net gains from sales and redemptions. Net investment losses included a $29 million increase in the company's current expected credit losses (CECL) reserves and impairments.

Adjusted earnings* in the third quarter were $1.1 billion, compared with $910 million in the third quarter of 2022, reflecting an increase of 20.3%. Adjusted earnings per diluted share* increased 27.8% to $1.84 in the quarter. Variable investment income ran $13 million, or $0.02 per share, below the company's long-term return expectations. The weaker yen/dollar exchange rate negatively impacted adjusted earnings per share by $0.06.

The average yen/dollar exchange rate in the third quarter of 2023 was 144.97, or 5.4% weaker than the average rate of 137.08 in the third quarter of 2022. For the first nine months, the average exchange rate was 138.38, or 8.5% weaker than the rate of 126.65 a year ago.

Total investments and cash at the end of September 2023 were $111.3 billion, compared with $114.5 billion at September 30, 2022. The decline in the carrying amount of the portfolio is principally driven by the rise in interest rates and weakening of yen exchange rates.

Shareholders’ equity was $22.7 billion, or $38.63 per share, at September 30, 2023, compared with $19.9 billion, or $31.97 per share, at September 30, 2022. Shareholders’ equity at the end of the third quarter included a cumulative decrease of $866 million for the effect of the change in discount rate assumptions on insurance reserves, compared with a corresponding cumulative decrease of $4.1 billion at September 30, 2022 and a net unrealized loss on investment securities and derivatives of $427 million, compared with a net unrealized gain of $1.1 billion at September 30, 2022. Shareholders’ equity at the end of the third quarter also included an unrealized foreign currency translation loss of $4.5 billion, compared with an unrealized foreign currency translation loss of $4.4 billion at September 30, 2022. The annualized return on average shareholders’ equity in the third quarter was 29.1%.

For the first nine months of 2023, total revenues were down 1.8% to $14.9 billion, compared with $15.2 billion in the first nine months of 2022. Net earnings were $4.4 billion, or $7.28 per diluted share, compared with $4.2 billion, or $6.57 per diluted share, for the first nine months of 2022. Adjusted earnings for the first nine months of 2023 were $3.0 billion, or $4.97 per diluted share, compared with $2.8 billion, or $4.35 per diluted share, in 2022. Excluding the negative impact of $0.17 per share from the weaker yen/dollar exchange rate, adjusted earnings per diluted share increased 18.2% to $5.14 for the first nine months of 2023.




    



Shareholders’ equity excluding AOCI (or adjusted book value*) was $28.4 billion, or $48.44 per share at September 30, 2023, compared with $27.5 billion, or $44.00 per share, at September 30, 2022. The annualized adjusted return on equity excluding foreign currency impact* in the third quarter was 16.1%.

AFLAC JAPAN

In yen terms, Aflac Japan's net earned premiums were ¥285.3 billion for the quarter, or 2.8% lower than a year ago, mainly due to limited pay products reaching paid-up status and a reinsurance transaction in the first quarter partially offset by an unlock of future deferred profit liability assumptions. Adjusted net investment income increased 7.2% to ¥98.9 billion, mainly due to higher variable investment income and floating rate income. Total adjusted revenues in yen declined 0.5% to ¥385.4 billion. Pretax adjusted earnings in yen for the quarter increased 11.4% on a reported basis to ¥126.4 billion, primarily due to lower benefits and expenses partially offset by decreased revenue during the quarter. Pretax adjusted earnings increased 7.0% on a currency-neutral basis. The pretax adjusted profit margin for the Japan segment increased to 32.8%, compared with 29.3% a year ago.

For the first nine months, net earned premiums in yen were ¥855.7 billion, or 5.0% lower than a year ago. Adjusted net investment income increased 0.9% to ¥267.8 billion. Total adjusted revenues in yen were down 3.6% to ¥1.1 trillion. Pretax adjusted earnings were ¥344.1 billion, or 4.9% higher than a year ago.

In dollar terms, net earned premiums decreased 7.2% to $2.0 billion in the third quarter. Adjusted net investment income increased 2.4% to $679 million. Total adjusted revenues declined by 4.9% to $2.7 billion. Pretax adjusted earnings increased 6.4% to $869 million.

For the first nine months, net earned premiums in dollars were $6.2 billion, or 12.4% lower than a year ago. Adjusted net investment income decreased 6.7% to $1.9 billion. Total adjusted revenues were down 11.1% to $8.2 billion. Pretax adjusted earnings were $2.5 billion, or 3.2% lower than a year ago.

For the quarter, total new annualized premium sales (sales) increased 12.4% to ¥15.6 billion, or $108 million, primarily reflecting the continued rollout of the new cancer product through alliance partners, driven largely by a 23% increase in cancer insurance sales. For the first nine months, total new sales increased 16.6% to ¥44.9 billion, or $325 million.

AFLAC U.S.

Aflac U.S. net earned premiums increased 3.2% to $1.4 billion in the third quarter compared to the prior year, reflecting the strong contribution from growth initiatives. Adjusted net investment income increased 13.0% to $209 million, largely due to higher variable investment income and a shift to higher-yielding fixed-income investments as well as increased floating rate income. Total adjusted revenues were up 3.9% to $1.7 billion. Pretax adjusted earnings were $478 million, 38.6% higher than a year ago, primarily due to lower benefits driven by actuarial assumption unlocks and higher adjusted net investment income, partially offset by higher adjusted expenses. Higher expenses reflected ongoing investments in the U.S. platform, as well as a write-off of certain capitalized software development costs in the third quarter of 2023. The pretax adjusted profit margin for the U.S. segment was 28.8%, compared with 21.6% a year ago.

For the first nine months, net earned premiums increased 2.2% to $4.3 billion. Adjusted net investment income increased 8.2% to $609 million. Total adjusted revenues were up 2.4% to $5.0 billion. Pretax adjusted earnings were $1.2 billion, or 17.5% higher than a year ago.

Aflac U.S. sales increased 7.5% in the quarter to $359 million, reflecting continued improvement from investment in growth initiatives as well as productivity gains. For the first nine months of the year, total new sales increased 6.4% to $998 million.

CORPORATE AND OTHER

For the quarter, total adjusted revenues increased 57.5% to $115 million compared to the prior year, primarily due to the reinsurance transaction in the first quarter of 2023 resulting in an increase to total net earned premiums, partially offset by lower net investment income driven by a higher volume of tax credit investments. Pretax adjusted earnings were a loss of $49 million, compared with a loss of $56 million a year ago, reflecting the increase in adjusted revenue, partially offset by higher total net benefit and claims and other adjusted expenses.




    



For the first nine months, total adjusted revenues increased 103.2% to $384 million. Pretax adjusted earnings were a loss of $107 million, compared with a loss of $173 million a year ago.

DIVIDEND AND CAPITAL RETURNED TO SHAREHOLDERS

The board of directors declared the fourth quarter dividend of $0.42 per share, payable on December 1, 2023 to shareholders of record at the close of business on November 15, 2023, and the first quarter 2024 dividend of $0.50 per share, payable on March 1, 2024 to shareholders of record at the close of business on February 21, 2024.

In the third quarter, Aflac Incorporated deployed $700 million in capital to repurchase 9.4 million of its common shares. At the end of September 2023, the company had 86.4 million remaining shares authorized for repurchase.

OUTLOOK

Commenting on the company’s results, Chairman and Chief Executive Officer Daniel P. Amos stated: "Aflac delivered very strong earnings for both the quarter and the first nine months. We have continued to actively concentrate on numerous initiatives in the U.S. and Japan around new products and distribution strategies to set the stage for future growth.

"Looking at our operations in Japan, I am pleased that our sales results reflect improvements through agencies and alliances, including Japan Post, Dai-ichi Life and Daido Life. While it's too soon to provide details about the new medical product we introduced in mid-September, early indications show that it is being well-received. Additionally, we see products like WAYS and Child Endowment as door-openers to gain new customers, which increases opportunities to sell our third sector products.

"In the U.S., I remain encouraged by the continued improvement in the productivity of our agents and brokers as well as contribution from our growth initiatives, including group life and disability; network dental and vision; and consumer markets. As we enter into the fourth quarter, which is typically our strongest quarter of the year, we continue to work toward accelerating our momentum and reinforcing our leading position.

"We continue to generate strong capital and cash flows while maintaining our commitment to prudent liquidity and capital management. I am very pleased that 2023 marks 41 consecutive years of dividend increases, a record we treasure. Additionally, I am very happy with the Board's decision to increase the first quarter 2024 dividend 19%. We also remained in the market repurchasing shares at the historically high levels of the first three quarters of this year. We intend to continue our balanced approach of investing in growth initiatives and to drive long-term operating efficiencies while preserving the strength of underlying cash flows, which supports our dividend track record and tactical share repurchase."

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration insurance contracts.

*See Non-U.S. GAAP Financial Measures section for an explanation of foreign exchange and its impact on the financial statements and definitions of the non-U.S. GAAP financial measures used in this earnings release, as well as a reconciliation of such non-U.S. GAAP financial measures to the most comparable U.S. GAAP financial measures.

ABOUT AFLAC INCORPORATED

Aflac Incorporated (NYSE: AFL), a Fortune 500 company, has helped provide financial protection and peace of mind for more than 67 years to millions of policyholders and customers through its subsidiaries in the U.S. and Japan. In the U.S., Aflac is the No. 1 provider of supplemental health insurance products.1 In Japan, Aflac Life Insurance Japan is the leading provider of cancer and medical insurance policies in force. The Company takes pride in being there for its policyholders when they need us most, as well as being included in 2023 in the World’s Most Ethical Companies by Ethisphere for 17 consecutive years, Fortune’s World’s Most Admired Companies for 22 years and Bloomberg’s Gender-Equality Index for the fourth consecutive year. In addition, the Company became a signatory of the Principles for Responsible Investment (PRI) in 2021 and has been included in the Dow Jones Sustainability North America Index (2022) for nine years. To find out how to get help with expenses health insurance doesn't cover, get to know us at aflac.com or aflac.com/espanol. Investors may learn more about Aflac Incorporated and its commitment to corporate social responsibility and sustainability at investors.aflac.com under “Sustainability.”
1 LIMRA 2022 U.S. Supplemental Health Insurance Total Market Report




    



A copy of Aflac’s financial 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 8:00 a.m. (ET) on November 2, 2023.

Note: Tables within this document may not foot due to rounding.



    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED INCOME STATEMENT
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
THREE MONTHS ENDED SEPTEMBER 30,20232022% Change
Total revenues$4,950 $4,704 5.2 %
Benefits and claims, net1,860 2,076 (10.4)
Total acquisition and operating expenses1,285 1,299 (1.1)
Earnings before income taxes1,805 1,329 35.8 
Income taxes236 (452)
Net earnings$1,569 $1,781 (11.9)%
Net earnings per share – basic$2.65 $2.83 (6.4)%
Net earnings per share – diluted2.64 2.82 (6.4)
Shares used to compute earnings per share (000):
Basic591,246 629,350 (6.1)%
Diluted593,596 631,946 (6.1)
Dividends paid per share$0.42 $0.40 5.0 %

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.





    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED INCOME STATEMENT
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
NINE MONTHS ENDED SEPTEMBER 30,20232022% Change
Total revenues$14,923 $15,192 (1.8)%
Benefits and claims, net6,108 6,833 (10.6)
Total acquisition and operating expenses3,843 4,028 (4.6)
Earnings before income taxes4,972 4,331 14.8 
Income taxes581 109 
Net earnings$4,391 $4,222 4.0 %
Net earnings per share – basic$7.31 $6.60 10.8 %
Net earnings per share – diluted7.28 6.57 10.8 
Shares used to compute earnings per share (000):
Basic600,991 639,862 (6.1)%
Diluted603,419 642,597 (6.1)
Dividends paid per share$1.26 $1.20 5.0 %

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.



    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED BALANCE SHEET
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AMOUNTS)
SEPTEMBER 30,20232022% Change
Assets:
Total investments and cash$111,306 $114,528 (2.8)%
Deferred policy acquisition costs8,771 8,666 1.2 
Other assets5,034 5,521 (8.8)
Total assets$125,111 $128,715 (2.8)%
Liabilities and shareholders’ equity:
Policy liabilities$86,028 $92,586 (7.1)%
Notes payable and lease obligations6,961 7,518 (7.4)
Other liabilities9,453 8,665 9.1 
Shareholders’ equity22,669 19,946 13.7 
Total liabilities and shareholders’ equity$125,111 $128,715 (2.8)%
Shares outstanding at end of period (000)586,897 623,868 (5.9)%

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.



    



NON-U.S. GAAP FINANCIAL MEASURES

This document includes references to the Company’s financial performance measures which are not calculated in accordance with United States generally accepted accounting principles (U.S. GAAP) (non-U.S. GAAP). The financial measures exclude items that the Company believes may obscure the underlying fundamentals and trends in insurance operations because they tend to be driven by general economic conditions and events or related to infrequent activities not directly associated with insurance operations.

Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results. In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported. When the yen strengthens, translating yen into dollars results in more dollars being reported. Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior period. A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S. GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S. GAAP basis. Management evaluates the Company's financial performance both including and excluding the impact of foreign currency translation to monitor, respectively, cumulative currency impacts and the currency-neutral operating performance over time. The average yen/dollar exchange rate is based on the published MUFG Bank, Ltd. telegraphic transfer middle rate (TTM).

The company defines the non-U.S. GAAP financial measures included in this earnings release as follows:

Adjusted earnings are adjusted revenues less benefits and adjusted expenses. Adjusted earnings per share (basic or diluted) are the adjusted earnings for the period divided by the weighted average outstanding shares (basic or diluted) for the period presented. The adjustments to both revenues and expenses account for certain items that cannot be predicted or that are outside management’s control. Adjusted revenues are U.S. GAAP total revenues excluding adjusted net investment gains and losses. Adjusted expenses are U.S. GAAP total acquisition and operating expenses including the impact of interest cash flows from derivatives associated with notes payable but excluding any nonrecurring or other items not associated with the normal course of the Company’s insurance operations and that do not reflect the Company's underlying business performance. Management uses adjusted earnings and adjusted earnings per diluted share to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of these financial measures is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The most comparable U.S. GAAP financial measures for adjusted earnings and adjusted earnings per share (basic or diluted) are net earnings and net earnings per share, respectively.

Adjusted earnings excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. Adjusted earnings per diluted share excluding current period foreign currency impact is adjusted earnings excluding current period foreign currency impact divided by the weighted average outstanding diluted shares for the period presented. The Company considers adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact important because a significant portion of the Company's business is conducted in Japan and foreign exchange rates are outside management’s control; therefore, the Company believes it is important to understand the impact of translating foreign currency (primarily Japanese yen) into U.S. dollars. The most comparable U.S. GAAP financial measures for adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact are net earnings and net earnings per share, respectively.

Adjusted return on equity is adjusted earnings divided by average shareholders’ equity, excluding accumulated other comprehensive income (AOCI). Management uses adjusted return on equity to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of this financial measure is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The Company considers adjusted return on equity important as it excludes components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity.

Adjusted return on equity excluding foreign currency impact is adjusted earnings excluding the current period foreign currency impact divided by average shareholders’ equity, excluding AOCI. The Company considers adjusted return on equity excluding foreign currency impact important as it excludes changes in foreign currency and components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity excluding foreign currency impact is ROE as determined using net earnings and average total shareholders’ equity.

Amortized hedge costs/income represent costs/income incurred or recognized as a result of using foreign currency derivatives to hedge certain foreign exchange risks in the Company's Japan segment or in Corporate and other. These amortized hedge costs/ income are estimated at the inception of the derivatives based on the specific terms of each contract and are recognized on a straight-line basis over the term of the hedge. The Company believes that amortized hedge costs/income measure the periodic currency risk management costs/income related to hedging certain foreign currency exchange risks and are an important component of net investment income. There is no comparable U.S. GAAP financial measure for amortized hedge costs/ income.




    



Adjusted book value is the U.S. GAAP book value (representing total shareholders’ equity), less AOCI as recorded on the U.S. GAAP balance sheet. Adjusted book value per common share is adjusted book value at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value and adjusted book value per common share important as they exclude AOCI, which fluctuates due to market movements that are outside management’s control. The most comparable U.S. GAAP financial measures for adjusted book value and adjusted book value per common share are total book value and total book value per common share, respectively.

Adjusted book value including unrealized foreign currency translation gains and losses is adjusted book value plus unrealized foreign currency translation gains and losses. Adjusted book value including unrealized foreign currency translation gains and losses per common share is adjusted book value plus unrealized foreign currency translation gains and losses at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value including unrealized foreign currency translation gains and losses, and its related per share financial measure, important as they exclude certain components of AOCI, which fluctuate due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measures for adjusted book value including unrealized foreign currency translation gains and losses and adjusted book value including unrealized foreign currency translation gains and losses per common share are total book value and total book value per common share, respectively.

Adjusted net investment income is net investment income adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, and ii) net interest cash flows from foreign currency and interest rate derivatives associated with certain investment strategies, which are reclassified from net investment gains and losses to net investment income. The Company considers adjusted net investment income important because it provides a more comprehensive understanding of the costs and income associated with the Company’s investments and related hedging strategies. The most comparable U.S. GAAP financial measure for adjusted net investment income is net investment income.

Adjusted net investment gains and losses are net investment gains and losses adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, ii) net interest cash flows from foreign currency and interest rate derivatives associated with certain investment strategies, which are both reclassified to net investment income, and iii) the impact of interest cash flows from derivatives associated with notes payable, which is reclassified to interest expense as a component of total adjusted expenses. The Company considers adjusted net investment gains and losses important as it represents the remainder amount that is considered outside management’s control, while excluding the components that are within management’s control and are accordingly reclassified to net investment income and interest expense. The most comparable U.S. GAAP financial measure for adjusted net investment gains and losses is net investment gains and losses.





    



RECONCILIATION OF NET EARNINGS TO ADJUSTED EARNINGS
(UNAUDITED – IN MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
THREE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net earnings$1,569 $1,781 (11.9)%
Items impacting net earnings:
Adjusted net investment (gains) losses(504)(222)
Other and non-recurring (income) loss
(3)(1)
Income tax (benefit) expense on items excluded
from adjusted earnings
1
33 (648)
Adjusted earnings 1,095 910 20.3 %
Current period foreign currency impact 2
33 N/A
Adjusted earnings excluding current period foreign
currency impact
3
$1,128 $910 24.0 %
Net earnings per diluted share$2.64 $2.82 (6.4)%
Items impacting net earnings:
Adjusted net investment (gains) losses(0.85)(0.35)
Other and non-recurring (income) loss
(0.01)— 
Income tax (benefit) expense on items excluded
from adjusted earnings
1
0.06 (1.03)
Adjusted earnings per diluted share1.84 1.44 27.8 %
Current period foreign currency impact 2
0.06 N/A
Adjusted earnings per diluted share excluding
current period foreign currency impact
3
$1.90 $1.44 31.9 %

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1    Primarily reflects release of $695 million in deferred taxes in the third quarter of 2022.
2    Prior period foreign currency impact reflected as “N/A” to isolate change for current period only.
3    Amounts excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes.




    



RECONCILIATION OF NET EARNINGS TO ADJUSTED EARNINGS
(UNAUDITED – IN MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
NINE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net earnings$4,391 $4,222 4.0 %
Items impacting net earnings:
Adjusted net investment (gains) losses(1,363)(923)
Other and non-recurring (income) loss
(38)(1)
Income tax (benefit) expense on items excluded
from adjusted earnings
1
12 (501)
Adjusted earnings 3,001 2,797 7.3 %
Current period foreign currency impact 2
100 N/A
Adjusted earnings excluding current period foreign
currency impact
3
$3,101 $2,797 10.9 %
Net earnings per diluted share$7.28 $6.57 10.8 %
Items impacting net earnings:
Adjusted net investment (gains) losses(2.26)(1.44)
Other and non-recurring (income) loss
(0.06)— 
Income tax (benefit) expense on items excluded
from adjusted earnings
1
0.02 (0.78)
Adjusted earnings per diluted share4.97 4.35 14.3 %
Current period foreign currency impact 2
0.17 N/A
Adjusted earnings excluding current period foreign
currency impact
3
$5.14 $4.35 18.2 %

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1 Primarily reflects release of $695 million in deferred taxes in the third quarter of 2022.
2    Prior period foreign currency impact reflected as “N/A” to isolate change for current period only.
3    Amounts excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes.



    



RECONCILIATION OF NET INVESTMENT (GAINS) LOSSES TO ADJUSTED NET INVESTMENT (GAINS) LOSSES
(UNAUDITED – IN MILLIONS)
THREE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net investment (gains) losses$(423)$(199)112.6 %
Items impacting net investment (gains) losses:
Amortized hedge costs(26)(28)
Amortized hedge income25 19 
Net interest cash flows from derivatives associated
     with certain investment strategies
(88)(26)
Interest rate component of the change in fair value of foreign
     currency swaps on notes payable1
13 
Adjusted net investment (gains) losses$(504)$(222)127.0 %
1    Amounts are included with interest expenses that are a component of adjusted expenses.



RECONCILIATION OF NET INVESTMENT INCOME TO ADJUSTED NET INVESTMENT INCOME
(UNAUDITED – IN MILLIONS)
THREE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net investment income$1,004 $920 9.1 %
Items impacting net investment income:
Amortized hedge costs(26)(28)
Amortized hedge income25 19 
Net interest cash flows from derivatives associated
     with certain investment strategies
(88)(26)
Adjusted net investment income$915 $885 3.4 %




    



RECONCILIATION OF NET INVESTMENT (GAINS) LOSSES TO ADJUSTED NET INVESTMENT (GAINS) LOSSES
(UNAUDITED – IN MILLIONS)
NINE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net investment (gains) losses$(1,101)$(885)24.4 %
Items impacting net investment (gains) losses:
Amortized hedge costs(148)(84)
Amortized hedge income92 44 
Net interest cash flows from derivatives associated
     with certain investment strategies
(239)(36)
Interest rate component of the change in fair value of foreign
     currency swaps on notes payable1
32 38 
Adjusted net investment (gains) losses$(1,363)$(923)47.7 %
1    Amounts are included with interest expenses that are a component of adjusted expenses.


RECONCILIATION OF NET INVESTMENT INCOME TO ADJUSTED NET INVESTMENT INCOME
(UNAUDITED – IN MILLIONS)
NINE MONTHS ENDED SEPTEMBER 30,20232022% Change
Net investment income$2,946 $2,760 6.7 %
Items impacting net investment income:
Amortized hedge costs(148)(84)
Amortized hedge income92 44 
Net interest cash flows from derivatives associated
     with certain investment strategies
(239)(36)
Adjusted net investment income$2,651 $2,684 (1.2)%



    



RECONCILIATION OF U.S. GAAP BOOK VALUE TO ADJUSTED BOOK VALUE
(UNAUDITED - IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
SEPTEMBER 30,20232022% Change
U.S. GAAP book value $22,669 $19,946 
Less:
Unrealized foreign currency translation gains (losses)
(4,484)(4,374)
Unrealized gains (losses) on securities and derivatives
(427)1,102 
Effect of changes in discount rate assumptions(866)(4,075)
Pension liability adjustment
17 (158)
Total AOCI
(5,760)(7,505)
Adjusted book value$28,429 $27,451 
Add:
Unrealized foreign currency translation gains (losses)
(4,484)(4,374)
Adjusted book value including unrealized foreign currency translation gains (losses)$23,945 $23,077 
Number of outstanding shares at end of period (000)586,897 623,868 
U.S. GAAP book value per common share $38.63 $31.97 20.8 %
Less:
Unrealized foreign currency translation gains (losses) per common share
(7.64)(7.01)
Unrealized gains (losses) on securities and derivatives per common share
(0.73)1.77 
Effect of changes in discount rate assumptions
     per common share
(1.48)(6.53)
Pension liability adjustment per common share
0.03 (0.25)
Total AOCI per common share
(9.81)(12.03)
Adjusted book value per common share$48.44 $44.00 10.1 %
Add:
Unrealized foreign currency translation gains (losses) per common share
(7.64)(7.01)
Adjusted book value including unrealized foreign currency translation gains (losses) per common share$40.80 $36.99 10.3 %

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.




    



RECONCILIATION OF U.S. GAAP RETURN ON EQUITY (ROE) TO ADJUSTED ROE
(EXCLUDING IMPACT OF FOREIGN CURRENCY)
THREE MONTHS ENDED SEPTEMBER 30,20232022
U.S. GAAP ROE - Net earnings1
29.1 %36.1 %
Impact of excluding unrealized foreign currency translation gains (losses)
(4.5)(5.1)
Impact of excluding unrealized gains (losses) on securities and derivatives
0.8 2.7 
Impact of excluding effect of changes in discount rate assumptions(3.1)(7.1)
Impact of excluding pension liability adjustment
— (0.2)
Impact of excluding AOCI
(6.8)(9.7)
U.S. GAAP ROE - less AOCI22.3 26.4 
Differences between adjusted earnings and net earnings2
(6.7)(12.9)
Adjusted ROE - reported15.6 13.5 
Less: Impact of foreign currency3
(0.5)N/A
Adjusted ROE, excluding impact of foreign currency16.1 13.5 

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1    U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders' equity.
2    See separate reconciliation of net income to adjusted earnings.
3    Impact of foreign currency is calculated by restating all foreign currency components of the income statement to the weighted average foreign currency exchange rate for the comparable prior year period. The impact is the difference of the restated adjusted earnings compared to reported adjusted earnings. For comparative purposes, only current period income is restated using the weighted average prior period exchange rate, which eliminates the foreign currency impact for the current period. This allows for equal comparison of this financial measure.




    



RECONCILIATION OF U.S. GAAP RETURN ON EQUITY (ROE) TO ADJUSTED ROE
(EXCLUDING IMPACT OF FOREIGN CURRENCY)
NINE MONTHS ENDED SEPTEMBER 30,20232022
U.S. GAAP ROE - Net earnings1
27.4 %30.4 %
Impact of excluding unrealized foreign currency translation gains (losses)
(4.0)(3.7)
Impact of excluding unrealized gains (losses) on securities and derivatives
(0.6)6.2 
Impact of excluding effect of changes in discount rate assumptions(1.5)(11.5)
Impact of excluding pension liability adjustment
— (0.2)
Impact of excluding AOCI
(6.1)(9.2)
U.S. GAAP ROE - less AOCI21.3 21.3 
Differences between adjusted earnings and net earnings2
(6.7)(7.2)
Adjusted ROE - reported14.6 14.1 
Less: Impact of foreign currency3
(0.5)N/A
Adjusted ROE, excluding impact of foreign currency15.0 14.1 

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1    U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders' equity.
2    See separate reconciliation of net income to adjusted earnings.
3    Impact of foreign currency is calculated by restating all foreign currency components of the income statement to the weighted average foreign currency exchange rate for the comparable prior year period. The impact is the difference of the restated adjusted earnings compared to reported adjusted earnings. For comparative purposes, only current period income is restated using the weighted average prior period exchange rate, which eliminates the foreign currency impact for the current period. This allows for equal comparison of this financial measure.




    



EFFECT OF FOREIGN CURRENCY ON ADJUSTED RESULTS1
(SELECTED PERCENTAGE CHANGES, UNAUDITED)
THREE MONTHS ENDED SEPTEMBER 30, 2023Including
Currency
Changes
Excluding
Currency
Changes2
Net earned premiums3
(1.7)%2.4 %
Adjusted net investment income4
3.4 5.4 
Total benefits and expenses(6.7)(3.0)
Adjusted earnings20.3 24.0 
Adjusted earnings per diluted share27.8 31.9 

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1Refer to previously defined adjusted earnings and adjusted earnings per diluted share.
2Amounts excluding currency changes were determined using the same foreign currency exchange rate for the current period as the comparable period in the prior year, which eliminates dollar-based fluctuations driven solely from currency rate changes.
3Net of reinsurance
4Refer to previously defined adjusted net investment income.




    



EFFECT OF FOREIGN CURRENCY ON ADJUSTED RESULTS1
(SELECTED PERCENTAGE CHANGES, UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30, 2023Including
Currency
Changes
Excluding
Currency
Changes2
Net earned premiums3
(5.6)%(0.6)%
Adjusted net investment income4
(1.2)1.3 
Total benefits and expenses(8.0)(3.2)
Adjusted earnings7.3 10.9 
Adjusted earnings per diluted share14.3 18.2 

All relevant prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2023 related to accounting for long-duration
insurance contracts.

1Refer to previously defined adjusted earnings and adjusted earnings per diluted share.
2Amounts excluding currency changes were determined using the same foreign currency exchange rate for the current period as the comparable period in the prior year, which eliminates dollar-based fluctuations driven solely from currency rate changes.
3Net of reinsurance
4Refer to previously defined adjusted net investment income.




    



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. The company desires 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,” "outlook" 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.

The company cautions 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, including inflation and the continued effects caused by COVID-19
defaults and credit downgrades of investments
global fluctuations in interest rates and exposure to significant interest rate risk
concentration of business in Japan
limited availability of acceptable yen-denominated investments
foreign currency fluctuations in the yen/dollar exchange rate
differing interpretations applied to investment valuations
significant valuation judgments in determination of expected credit losses recorded on the Company's investments
decreases in the Company's financial strength or debt ratings
decline in creditworthiness of other financial institutions
concentration of the Company's investments in any particular single-issuer or sector
major public health issues, including COVID-19 and any resulting or coincidental economic effects, on the Company's business and financial results
the Company's ability to attract and retain qualified sales associates, brokers, employees, and distribution partners
deviations in actual experience from pricing and reserving assumptions
ability to continue to develop and implement improvements in information technology systems and on successful execution of revenue growth and expense management initiatives
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
subsidiaries' ability to pay dividends to the Parent Company
inherent limitations to risk management policies and procedures
operational risks of third party vendors
tax rates applicable to the Company may change
failure to comply with restrictions on policyholder privacy and information security
extensive regulation and changes in law or regulation by governmental authorities
competitive environment and ability to anticipate and respond to market trends
catastrophic events, including, but not limited to, as a result of climate change, epidemics, pandemics (such as COVID-19), tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, terrorism or other acts of violence, and damage incidental to such events
ability to protect the Aflac brand and the Company's reputation
ability to effectively manage key executive succession
changes in accounting standards
level and outcome of litigation
allegations or determinations of worker misclassification in the United States



Analyst and investor contact - David A. Young, 706.596.3264; 800.235.2667 or dyoung@aflac.com

Media contact - Ines Gutzmer, 762.207.7601 or igutzmer@aflac.com



FINAL                     11/1/2023
aflaclogoa01a01a01a33.jpg

Financial Supplement
Third Quarter 2023

This document is a statistical supplement to Aflac’s quarterly earnings release. Throughout the presentation, amounts presented may not foot due to rounding. As you review the supplement, please note the non-U.S. GAAP financial measures and definitions found at the back of this document.

The Company adopted the Financial Accounting Standards Board’s Accounting Standard Update 2018-12 Financial Services - Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts, as clarified and amended by (i) ASU 2019-09 Financial Services - Insurance: Effective Date, and (ii) ASU 2020-11 Financial Services - Insurance: Effective Date and Early Application (collectively, “LDTI”) as of January 1, 2023. The amended guidance is applied as of the beginning of the earliest period presented in the Company’s quarterly and annual financial statements, which results in a January 1, 2021 Transition Date. In conjunction with the adoption of LDTI, the Company changed its practice of recording the change in the deferred profit liability (DPL) on products with limited-payment features from the benefits and claims, net line item to the net earned premiums line item in the consolidated statement of earnings. This change in presentation has no impact on net earnings. All quarterly and annual amounts for 2021 and 2022 presented herein reflect these changes for LDTI and DPL.
For more information, contact:
David Young
Phone. 706.596.3264
Aflacir@aflac.com
investors.aflac.com



Aflac Incorporated and Subsidiaries
Share Data
(In Thousands)
BeginningShares IssuedShares PurchasedEndingQTD Weighted Avg. SharesYTD Weighted Avg. Shares
SharesStk. Bon.Stk. Opt.Treas.Misc.SharesAvg.DilutiveAvg.Avg.DilutiveAvg.
PeriodOutstanding& DRP& Misc.Shares
Purch.(1)
OutstandingSharesSharesDilutedSharesSharesDiluted
2021692,454 387 1,684 13,440 378 680,707 688,938 3,002 691,940 688,938 3,002 691,940 
680,707 330 130 9,174 671,990 678,050 2,871 680,921 683,464 2,936 686,400 
671,990 250 188 9,572 39 662,817 668,762 3,163 671,925 678,509 3,012 681,521 
662,817 249 224 11,140 18 652,132 659,100 3,412 662,512 673,617 3,112 676,729 
2022652,132 259 1,308 8,007 343 645,349 649,753 3,074 652,827 649,753 3,074 652,827 
645,349 269 101 11,185 634,526 640,707 2,536 643,243 645,205 2,805 648,010 
634,526 258 144 11,057 623,868 629,350 2,597 631,946 639,862 2,735 642,597 
623,868 222 120 8,938 16 615,256 619,845 3,149 622,994 634,816 2,839 637,655 
2023615,256 239 1,152 10,348 347 605,952 611,205 2,745 613,950 611,205 2,745 613,950 
605,952 259 225 10,461 595,969 600,742 2,187 602,929 605,945 2,466 608,411 
3 595,969 210 115 9,390 7 586,897 591,246 2,350 593,596 600,992 2,427 603,419 
















(1) Includes previously owned shares used to purchase options (swapped shares) and/or shares purchased for deferred compensation program
2


Aflac Incorporated and Subsidiaries
Summary of Adjusted Results by Business Segment
(In Millions, except per-share data and where noted)
Years Ended December 31,3 Months Ended September 30,9 Months Ended September 30,
%%
2018201920202021202220222023Change20222023Change
Aflac Japan$3,208 $3,261 $3,263 $3,755 $3,281 $817 $869 6.4 $2,560 $2,479 (3.2)
Aflac U.S.1,285 1,272 1,268 1,356 1,359 345 478 38.6 1,020 1,199 17.5 
Corporate and other (1)
(139)(72)(115)(293)(218)(56)(49)(173)(107)
Pretax adjusted earnings4,354 4,461 4,416 4,819 4,422 1,106 1,298 17.4 3,407 3,571 4.8 
Income taxes (1)
1,129 1,147 864 893 808 196 203 3.6 610 570 (6.6)
Adjusted earnings (2)
3,226 3,314 3,552 3,925 3,614 910 1,095 20.3 2,797 3,001 7.3 
Reconciling items:
Adjusted net investment gains (losses)(297)(15)(229)462 447 222 504 923 1,363 
Other and non-recurring income (loss) (3)
(75)(1)(28)(73)3 38 
Income tax benefit (expense) on items excluded from adjusted earnings (4)
83 72 (83)357 648 (33)501 (12)
Tax reform adjustment (5)
(18)— — — —  —  
Tax valuation allowance release (6)
— — 1,411 — — —  —  
Net earnings$2,920 $3,304 $4,778 $4,231 $4,418 $1,781 $1,569 (11.9)$4,222 $4,391 4.0 
Effective Tax rate26.7 %25.7 %(14.9)%18.7 %9.3 %(34.0)%13.1 %2.5 %11.7 %
Earnings per share of common stock:
Net earnings (basic)$3.79 $4.45 $6.69 $6.28 $6.96 $2.83 $2.65 (6.4)$6.60 $7.31 10.8 
Net earnings (diluted)3.77 4.43 6.67 6.25 6.93 2.82 2.64 (6.4)6.57 7.28 10.8 
Adjusted earnings (basic) (2)
$4.20 $4.46 $4.98 $5.83 $5.69 $1.45 $1.85 27.6 $4.37 $4.99 14.2 
Adjusted earnings (diluted) (2)
4.16 4.44 4.96 5.80 5.67 1.44 1.84 27.8 4.35 4.97 14.3 
(1) The change in value of federal historic rehabilitation and solar investments in partnerships of $64 and $19 for the three-month periods and $169 and $61 for the nine-month periods ended September 30, 2023, and 2022, respectively, is included as a reduction to net investment income. Tax credits on these investments of $63 and $19 for the three-month period and $171 and $63 for the nine-month periods ended September 30, 2023, and 2022, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
(2) See non-U.S. GAAP financial measures for definition of adjusted earnings.
(3) Foreign currency gains and losses for all periods have been reclassified from Other and non-recurring income (loss) to Net investment gains and losses.
(4) Primarily reflects release of $695 in deferred taxes in 2022
(5) The impact of Tax Reform was adjusted in 2018 for return-to-provision adjustments, various amended returns filed by the Company, and final true-ups of deferred tax liabilities. Further impacts were recorded in 2019 as a result of additional guidance released by the IRS.
(6) Tax benefit recognized in 2020 represents the release of valuation allowances on deferred tax benefits related to foreign tax credits.
3


Aflac Incorporated and Subsidiaries
Consolidated Statements of Earnings - U.S. GAAP
(In Millions, except per-share data)
Years Ended December 31,3 Months Ended September 30,9 Months Ended September 30,
%%
2018201920202021202220222023Change20222023Change
Revenues:
Net earned premiums
  Gross premiums$19,018 $19,122 $18,955 $17,305 $15,025 $3,565 $3,524 $11,472 $10,885 
  Assumed (ceded)(341)(342)(333)(210)(124)(30)(48)(93)(148)
    Total net earned premiums18,677 18,780 18,622 17,095 14,901 3,535 3,476 (1.7)11,379 10,737 (5.6)
Net investment income3,442 3,578 3,638 3,818 3,656 920 1,004 9.1 2,760 2,946 6.7 
Net investment gains (losses) (1)
(430)(135)(270)468 363 199 423 885 1,101 
Other income (1)
69 84 157 173 220 50 47 168 139 
     Total revenues21,758 22,307 22,147 21,554 19,140 4,704 4,950 5.2 15,192 14,923 (1.8)
Benefits and Claims:
Benefits and claims, net
  Incurred claims -direct9,121 9,279 9,364 8,949 8,271 2,112 1,871 6,445 6,034 
  Incurred claims -assumed (ceded)(421)(372)(296)(147)(108)(47)(33)(89)(114)
  Increase in FPB (2)-direct
3,167 2,952 2,707 1,819 888 63 231 575 499 
  Increase in FPB (2)-assumed (ceded)
133 83 21 51 41 (4)54 1 
Total net benefits and claims, excluding
  reserve remeasurement
N/AN/AN/A10,623 9,102 2,169 2,065 6,985 6,420 
Reserve remeasurement (gain) lossN/AN/AN/A(147)(215)(93)(205)(152)(312)
    Total net benefits and claims12,000 11,942 11,796 10,476 8,887 2,076 1,860 (10.4)6,833 6,108 (10.6)
Acquisition and operating expenses:
   Amortization of DAC (3)
1,245 1,282 1,214 835 792 194 201 598 608 
   Insurance commissions1,320 1,321 1,316 1,256 1,117 267 250 846 797 
   Insurance expenses2,988 3,089 3,420 3,541 3,249 779 785 2,413 2,290 
   Interest expense222 228 242 238 226 59 49 171 148 
     Total acquisition and operating expenses5,775 5,920 6,192 5,870 5,384 1,299 1,285 (1.1)4,028 3,843 (4.6)
     Total benefits and expenses17,775 17,862 17,988 16,346 14,271 3,375 3,145 (6.8)10,861 9,951 (8.4)
     Pretax earnings3,983 4,445 4,159 5,208 4,869 1,329 1,805 4,331 4,972 
Income tax expense (benefit) (4)
1,063 1,141 (619)977 451 (452)236 109 581 
     Net earnings$2,920 $3,304 $4,778 $4,231 $4,418 $1,781 $1,569 (11.9)$4,222 $4,391 4.0 
(1) Foreign currency gains and losses for all periods have been reclassified from Other income to Net investment gains and losses for consistency with current period presentation.
(2) Future policy benefits
(3) Deferred acquisition costs
(4) Primarily reflects release of $695 in deferred taxes in 2022
4


Aflac Incorporated and Subsidiaries
Analysis of Net Earnings and Net Earnings Per Diluted Share
(In Millions, except for per-share data)
Other andForeign
NetOther and Non-ForeignNetNetNon-RecurringCurrency
NetInvestmentRecurringCurrencyEarningsInvestmentItemsImpact
PeriodEarnings
Gains (Losses) (1)
Items (1)(3)(4)
Impact (2)
Per Share
Gains (Losses) (1)
Per Share (1)(3)(4)
Per Share (2)
20182,920 (230)(76)28 3.77 (.30)(.09).04 
20193,304 (13)15 4.43 (.02).01 .02 
20204,778 (181)1,407 31 6.67 (.25)1.96 .04 
20214,231 365 (59)(42)6.25 .54 (.09)(.06)
20224,418 803 (262)6.93 1.26 — (.41)
202111,224 240 (5)1.77 .35 (.01).01 
21,027 67 (42)(6)1.51 .10 (.06)(.01)
3915 (136)(7)(12)1.36 (.20)(.01)(.02)
41,065 194 (5)(29)1.61 .29 (.01)(.04)
202211,047 106 (1)(35)1.60 .16 — (.05)
21,394 448 — (59)2.17 .70 — (.09)
31,781 871 (97)2.82 1.38 — (.15)
4196 (621)— (70).31 (1.00)— (.11)
202311,188 235 — (41)1.94 .38 — (.07)
21,634 653 28 (25)2.71 1.08 .05 (.04)
31,569 472 2 (33)2.64 .80  (.06)
(1) Items are presented net of tax.
(2) See non-U.S. GAAP financial measures for definition of adjusted earnings excluding current period foreign currency impact
(3) Foreign currency gains and losses and amortized hedge costs/income for all periods have been reclassified from Other income to Net investment gains and losses for consistency with current period presentation.
(4 )Tax benefit recognized in the third quarter of 2020 represents the release of valuation allowances on deferred tax benefits related to foreign tax credits.

5


Aflac Incorporated and Subsidiaries
Consolidated Balance Sheets
(In Millions, except per-share data)
December 31,September 30,
Assets:2018201920202021202220222023
Investments and cash:
Securities available for sale:
Fixed maturity securities available for sale, at fair value$78,429 $86,950 $101,286 $94,206 $71,936 $70,026 $66,369 
Fixed maturity securities available for sale - consolidated variable interest entities, at fair value4,466 4,312 4,596 4,490 3,805 3,617 3,432 
Fixed maturity securities held to maturity, at amortized cost, net of allowance for credit losses30,318 30,085 24,464 22,000 19,056 17,466 16,899 
Equity securities, at fair value987 802 1,283 1,603 1,091 1,064 990 
Commercial mortgage and other loans, net of allowance for credit losses6,919 9,569 10,554 11,786 13,496 13,459 12,873 
Other investments787 1,477 2,429 3,842 4,070 4,186 5,241 
Cash and cash equivalents4,337 4,896 5,141 5,051 3,943 4,710 5,502 
   Total investments and cash126,243 138,091 149,753 142,978 117,397 114,528 111,306 
Receivables, net of allowance for credit losses (1)
844 816 778 672 647 629 712 
Accrued investment income773 772 780 737 745 684 687 
Deferred policy acquisition costs9,875 10,128 10,441 9,848 9,239 8,666 8,771 
Property and equipment, net443 581 601 538 530 488 445 
Other assets, net of allowance for credit losses (1)(2)
2,228 2,380 2,733 3,377 3,180 3,720 3,190 
Total assets$140,406 $152,768 $165,086 $158,150 $131,738 $128,715 $125,111 
Liabilities and Shareholders' Equity:
Liabilities:
Total policy liabilities$103,188 $106,554 $114,391 $126,331 $96,910 $92,586 $86,028 
Notes payable5,778 6,569 7,899 7,956 7,442 7,518 6,961 
Income taxes, primarily deferred4,020 5,370 4,661 30 698 764 869 
Other liabilities3,958 5,316 4,576 6,802 6,548 7,901 8,584 
Total liabilities116,944 123,809 131,527 141,119 111,598 108,769 102,442 
Shareholders' equity:
Common stock135 135 135 135 135 135 136 
Additional paid-in capital2,177 2,313 2,410 2,529 2,641 2,615 2,729 
Retained earnings31,788 34,291 37,984 40,963 44,367 44,680 48,257 
Accumulated other comprehensive income (loss):
Unrealized foreign currency translation gains (losses)(1,847)(1,623)(1,109)(1,985)(3,564)(4,374)(4,484)
Unrealized gains (losses) on fixed maturity securities4,234 8,548 10,361 9,602 (702)1,131 (403)
Unrealized gains (losses) on derivatives(24)(33)(34)(30)(27)(29)(24)
Effect on change in discount rate assumption(s)N/AN/AN/A(15,832)(2,100)(4,075)(866)
Pension liability adjustment(212)(277)(284)(166)(36)(158)17 
Treasury stock(12,789)(14,395)(15,904)(18,185)(20,574)(19,979)(22,693)
Total shareholders' equity23,462 28,959 33,559 17,031 20,140 19,946 22,669 
Total liabilities & shareholders' equity$140,406 $152,768 $165,086 $158,150 $131,738 $128,715 $125,111 
(1) Certain reclassifications have been made to prior-year amounts to conform to current-year reporting classifications. These reclassifications had no impact on net earnings or total shareholders' equity.
(2) Includes goodwill of $269 million in 2023, $265 million in 2022, $268 in 2021, $269 in 2020, $140 million in 2019 and $67 million in 2018
6


Aflac Incorporated and Subsidiaries
Quarterly Financial Results
(Dollars In Millions, except per-share data)
Total
NetNetBenefitsAcquisitionsTotalNet EPS
Adj. EPS (1)
EarnedInv.Total&&PretaxNetAdjusted
PeriodPremiumsIncomeRevenuesClaims, NetAdj. Exp.Earn.Earn.
Earn. (1)
BasicDil.BasicDil.
201818,677 3,442 21,758 12,000 5,775 3,983 2,920 3,226 3.79 3.77 4.20 4.16 
201918,780 3,578 22,307 11,942 5,920 4,445 3,304 3,314 4.45 4.43 4.46 4.44 
202018,622 3,638 22,147 11,796 6,192 4,159 4,778 3,552 6.69 6.67 4.98 4.96 
202117,095 3,818 21,554 10,476 5,870 5,208 4,231 3,925 6.28 6.25 5.83 5.80 
202214,901 3,656 19,140 8,887 5,384