RICHMOND, Va., April 28, 2016 /PRNewswire/ --
- Solid Loss Ratio Performance And Maintained Strong Capital
Positions In U.S., Canada &
Australia Mortgage Insurance (MI) Businesses
- Progress Made On U.S. Life Insurance Restructuring Plan:
- Sales Suspended For Traditional Life Insurance And Fixed
Annuity Products
- Cash Expenses Reduced By Approximately $135 Million Pre-Tax On An Annualized Basis
- Additional Steps Taken Toward Repatriation Of Bermuda
Subsidiary
- Progress Made On Isolation Of Long Term Care Insurance (LTC)
Business With Successful Completion Of Bond Consent
Solicitation
- Net Income1 And Net Operating Income2
Include Litigation Settlement And Legal Expenses Of $0.11 Per Diluted Share
- Holding Company Debt Reduction Of $326
Million
Genworth Financial, Inc. (NYSE: GNW) today reported results for
the period ended March 31, 2016. The
company reported net income of $53
million, or $0.11 per diluted
share, in the first quarter of 2016, compared with net income of
$154 million, or $0.31 per diluted share, in the first quarter of
2015. Net operating income for the first quarter of 2016 was
$103 million, or $0.21 per diluted share, compared with net
operating income of $154 million, or
$0.31 per diluted share, in the first
quarter of 2015. Net income and net operating income in the quarter
included $54 million after-tax, or
$0.11 per diluted share, of
litigation settlement and legal expenses.
Strategic Update
On February 4,
2016, the company announced a restructuring plan for its
U.S. life insurance businesses to: (1) suspend sales of its
traditional life insurance and fixed annuity products; (2) further
reduce expense levels in 2016; (3) repatriate existing business
from Brookfield Life and Annuity
Insurance Company Limited (BLAIC), its primary Bermuda domiciled reinsurance subsidiary, to
its U.S. life insurance companies in 2016; and (4) separate and
potentially isolate its LTC business. The company made progress on
this plan in the quarter including:
- Suspending all sales of traditional life insurance and fixed
annuity products on March 7,
2016;
- Reducing cash expenses by approximately $135 million pre-tax on an annualized basis. The
company still expects to achieve total expected annualized cash
expense reductions of $150 million or
more by the end of the second quarter of 2016;
- Recapturing a block of universal life insurance business from
BLAIC to the U.S. life insurance companies, effective April 1, 2016, representing an additional step
completed toward the repatriation of BLAIC; and
- Successfully completing a bond consent solicitation providing
additional strategic and financial flexibility and demonstrating
progress toward the isolation of the LTC business.
In January 2016, the company
completed the sale of certain blocks of term life insurance to
Protective Life Insurance Company. This transaction is expected to
generate capital in excess of $150
million in aggregate to Genworth, including an anticipated
tax payment of approximately $175
million to the holding company that is scheduled to be
settled in July 2016 and is committed
to be used to facilitate the separation and potential isolation of
the LTC business.
During the fourth quarter of 2015, the company announced it had
entered into an agreement to sell its European mortgage insurance
business to AmTrust Financial Services, Inc., which is currently
expected to result in net proceeds of approximately $50 million to the U.S. MI business. The
transaction is now expected to close in the second quarter of 2016
and is subject to customary conditions, including requisite
regulatory approvals.
"We are pleased with the continued strong performance of our MI
businesses and improved results in our U.S. life insurance
businesses during the quarter," said Tom
McInerney, President and CEO. "We also enhanced our
strategic and financial flexibility by proactively reducing holding
company debt, successfully completing a bond consent solicitation
and making progress on our U.S. life insurance restructuring
plan."
Consolidated Net
Income &
|
Net Operating
Income
|
|
|
Three months ended
March 31
|
|
|
|
(Unaudited)
|
|
|
|
2016
|
|
2015
|
|
|
|
|
|
Per
|
|
|
|
Per
|
|
|
|
|
|
diluted
|
|
|
|
diluted
|
|
Total
|
(Amounts in
millions, except per share)
|
|
Total
|
|
share
|
|
Total
|
|
share
|
|
%
change
|
|
|
|
Net income available
to Genworth's common stockholders
|
|
$
|
53
|
|
$
|
0.11
|
|
$
|
154
|
|
$
|
0.31
|
(66) %
|
Net operating
income
|
|
$
|
103
|
|
$
|
0.21
|
|
$
|
154
|
|
$
|
0.31
|
(33) %
|
Weighted average
diluted shares
|
|
|
499.4
|
|
498.9
|
|
|
|
|
|
|
|
Three months ended
March 31
|
|
|
|
(Unaudited)
|
|
|
|
2016
|
|
2015
|
|
Book value per
share
|
|
|
$
|
28.19
|
|
$
|
30.81
|
|
Book value per share,
excluding accumulated other comprehensive income
(loss)
|
|
|
$
|
19.80
|
|
$
|
21.38
|
|
|
In the first quarter of 2016, net income was primarily impacted
by a net after-tax loss of $11
million related to the early extinguishment of Genworth
Holdings' senior notes, an after-tax loss of $6 million from a life block transaction, an
after-tax expense of $9 million
related to restructuring costs and after-tax fees incurred related
to the bond consent solicitation of $12
million.
Net income was also impacted by net investment losses, net of
taxes and other adjustments, of $13
million in the quarter, compared to $1 million in the prior year. Total impairments,
net of tax, were $7 million in the
quarter, compared to $2 million in
the prior year.
Net investment income increased to $789
million in the quarter, compared to $781 million in both the prior quarter and prior
year primarily from favorable prepayment speed adjustments related
to residential mortgage-backed securities. The reported yield for
the current quarter was 4.51 percent. The core yield2
was 4.36 percent, up slightly from the prior quarter.
Net operating income (loss) results are summarized in the table
below:
Net Operating
Income (Loss)
|
|
(Amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
U.S. Mortgage
Insurance
|
|
$
|
61
|
|
$
|
41
|
|
$
|
52
|
Canada Mortgage
Insurance
|
|
|
33
|
|
|
37
|
|
|
40
|
Australia Mortgage
Insurance
|
|
|
19
|
|
|
22
|
|
|
30
|
U.S. Life
Insurance
|
|
|
91
|
|
|
(135)
|
|
|
81
|
Runoff
|
|
|
4
|
|
|
11
|
|
|
11
|
Corporate and
Other
|
|
|
(105)
|
|
|
(58)
|
|
|
(60)
|
Total Net
Operating Income (Loss)
|
|
$
|
103
|
|
$
|
(82)
|
|
$
|
154
|
Net operating income (loss) represents net operating income
(loss) from continuing operations excluding net investment gains
(losses), goodwill impairments, gains (losses) on the sale of
businesses, gains (losses) on the early extinguishment of debt,
gains (losses) on insurance block transactions, restructuring costs
and other adjustments, net of taxes. A reconciliation of net
operating income (loss) of segments and Corporate and Other
activities to net income (loss) is included at the end of this
press release.
Unless specifically noted in the discussion of results for the
MI businesses in Canada and
Australia, references to
percentage changes exclude the impact of translating foreign
denominated activity into U.S. dollars (foreign exchange).
Percentage changes, which include the impact of foreign exchange,
are found in a table at the end of this press release. The impact
of foreign exchange on results in the first quarter of 2016 was an
unfavorable $6 million and
$3 million versus the prior year in
the MI businesses in Canada and
Australia, respectively.
U.S. Mortgage Insurance
Operating
Metrics
|
(Dollar amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
Net operating
income
|
|
$
|
61
|
|
$
|
41
|
|
$
|
52
|
New insurance
written
|
|
|
|
|
|
|
|
|
|
Primary Flow
|
|
$
|
7,400
|
|
$
|
7,800
|
|
$
|
6,300
|
Loss ratio
|
|
|
24%
|
|
|
39%
|
|
|
33%
|
U.S. MI net operating income was $61
million, compared with $41
million in the prior quarter and $52
million in the prior year. The loss ratio in the current
quarter was 24 percent, down 15 points sequentially from a seasonal
decrease in new delinquencies, favorable net cures and aging of
existing delinquencies and the continued growth in insurance in
force resulting in higher earned premiums. The loss ratio was down
nine points from the prior year primarily reflecting the continued
decline in delinquencies from the 2005 to 2008 book years. Results
versus the prior year also reflected lower net investment income,
primarily related to the affiliated preferred securities that were
exchanged with the holding company in July
2015.
Flow new insurance written (NIW) of $7.4
billion decreased five percent from the prior quarter from a
seasonally smaller purchase originations market but increased 17
percent versus the prior year primarily from a larger purchase
originations market and growth in market share. During the first
quarter of 2016, the company's concentration of single premium flow
NIW was slightly higher than the prior quarter, and modestly lower
than the prior year as it continues its selective participation in
this market. Future volumes of its single premium products
will vary in part depending on the company's evaluation of the risk
return profile of these products.
Canada Mortgage Insurance
Operating
Metrics
|
|
(Dollar amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
Net operating
income
|
|
$
|
33
|
|
$
|
37
|
|
$
|
40
|
New insurance
written
|
|
|
|
|
|
|
|
|
|
Flow
|
|
$
|
2,500
|
|
$
|
4,700
|
|
$
|
3,300
|
Bulk
|
|
$
|
3,200
|
|
$
|
7,300
|
|
$
|
5,000
|
Loss ratio
|
|
|
24%
|
|
|
23%
|
|
|
22%
|
Canada MI reported net operating income of $33 million versus $37
million in the prior quarter and $40
million in the prior year. The loss ratio in the quarter was
24 percent, up one point from the prior quarter and up two points
compared to the prior year primarily driven by an increase in new
delinquencies, net of cures, primarily from experience in
Alberta. Results versus the prior
year included unfavorable foreign exchange of $6 million and higher expenses, partially offset
by higher premiums.
Flow NIW was down 45 percent3 sequentially
primarily from a seasonally smaller originations market and down 12
percent3 from the prior year primarily from targeted
underwriting changes and a slowing housing market in oil producing
regions. In addition, the company completed several bulk
transactions in the quarter of approximately $3.2 billion, consisting of low loan-to-value
prime loans.
Australia Mortgage Insurance
Operating
Metrics
|
|
|
|
|
|
|
|
|
|
(Dollar amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
Net operating
income
|
|
$
|
19
|
|
$
|
22
|
|
$
|
30
|
New insurance
written
|
|
|
|
|
|
|
|
|
|
Flow
|
|
$
|
4,400
|
|
$
|
4,600
|
|
$
|
5,800
|
Loss ratio
|
|
|
26%
|
|
|
17%
|
|
|
15%
|
Australia MI reported net operating income of $19 million versus $22
million in the prior quarter and $30
million in the prior year. The loss ratio in the quarter was
26 percent, up nine points sequentially and up 11 points from the
prior year. Sequentially, aging of existing delinquencies was
unfavorable and new delinquencies were up 12 percent from normal
seasonal variation, primarily from Queensland and Western Australia. Results in the prior year
included an accrual for expected recoveries relating to paid
claims, favorably impacting the loss ratio in the prior year by
nine points. Results versus the prior year were impacted by an
unfavorable $7 million related to the
company's further sell down of approximately 14 percent of its
ownership in the Australia MI business in May 2015 and $3
million of unfavorable foreign exchange.
Flow NIW was down four percent3 sequentially and down
16 percent3 from the prior year from a smaller high
loan-to-value originations market primarily driven by regulatory
focus on the market and tightened lender risk appetite as well as
the impact from the termination of a customer contract in the
second quarter of 2015.
U.S. Life Insurance
Operating
Metrics
|
|
|
|
|
|
|
|
|
|
(Amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
Net operating income
(loss)
|
|
|
|
|
|
|
|
|
|
|
Long Term Care
Insurance
|
|
$
|
34
|
|
$
|
19
|
|
$
|
10
|
|
Life
Insurance
|
|
|
31
|
|
|
(173)
|
|
|
40
|
|
Fixed
Annuities
|
|
|
26
|
|
|
19
|
|
|
31
|
|
Total U.S. Life
Insurance
|
|
$
|
91
|
|
$
|
(135)
|
|
$
|
81
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
|
|
|
|
|
|
|
|
Long Term Care
Insurance
|
|
|
|
|
|
|
|
|
|
|
|
Individual
|
|
$
|
5
|
|
$
|
8
|
|
$
|
10
|
|
|
Group
|
|
|
2
|
|
|
2
|
|
|
1
|
|
Life
Insurance
|
|
|
|
|
|
|
|
|
|
|
|
Term Life
|
|
|
5
|
|
|
6
|
|
|
9
|
|
|
Universal
Life
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
Linked
Benefits
|
|
|
2
|
|
|
1
|
|
|
4
|
|
Fixed
Annuities
|
|
|
168
|
|
|
314
|
|
|
326
|
Long Term Care Insurance
LTC had net operating
income of $34 million, compared with
$19 million in the prior quarter and
$10 million in the prior year.
Results versus the prior quarter reflected favorable experience
driven by seasonally higher terminations. The current quarter
also reflected a $4 million after-tax
unfavorable correction to the calculation for reduced benefit
options, partially offset by lower expenses. Results versus the
prior year reflected a more favorable benefit from rate actions,
partially offset by less favorable experience driven by lower
terminations and higher severity given the mix of new claims with a
higher average reserve. Prior quarter results included $10 million of after-tax favorable items. Prior
year results included $7 million of
after-tax unfavorable items. The loss ratio in the current quarter
was approximately 68 percent. Individual LTC sales were
$5 million in the quarter.
Life Insurance
Life insurance had net operating
income of $31 million, compared with
a net operating loss of $173 million
in the prior quarter and net operating income of $40 million in the prior year. Results in the
quarter reflected favorable prepayment speed adjustments related to
residential mortgage-backed securities. Results in the prior
quarter included an after-tax charge of $194
million related to the company's annual review of life
assumptions. Life insurance sales were $9
million in the quarter.
Fixed Annuities
Fixed annuities net operating
income was $26 million, compared with
$19 million in the prior quarter and
$31 million in the prior year.
Results in the quarter reflected favorable impacts from single
premium immediate annuity mortality experience versus the prior
quarter, but less favorable versus the prior year. Sales in the
quarter totaled $168 million.
Runoff
Runoff net operating income was $4 million, compared with $11 million in the prior quarter and the prior
year reflecting less favorable equity market performance versus
both the prior quarter and prior year.
Corporate And Other
Corporate and Other net operating
loss was $105 million, compared with
$58 million in the prior quarter and
$60 million in the prior year.
Results in the current quarter included expenses of $54 million after-tax related to litigation
settlement and legal expenses.
Capital & Liquidity
Genworth maintains solid capital positions in its operating
subsidiaries.
Key Capital &
Liquidity Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollar amounts in
millions)
|
|
Q1
16
|
|
Q4
15
|
|
Q1
15
|
|
U.S.
MI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Risk-To-Capital Ratio4
|
|
|
15.3:1
|
|
|
|
16.3:1
|
|
|
|
14.1:1
|
|
|
Genworth Mortgage
Insurance Corporation Risk-To-Capital
Ratio4
|
|
|
15.5:1
|
|
|
|
16.4:1
|
|
|
|
13.8:1
|
|
|
Private Mortgage
Insurer Eligibility Requirements (PMIERs) Sufficiency
Ratio5
|
|
|
113
|
%
|
|
|
109
|
%
|
|
|
N/A
|
|
Canada
MI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minimum Capital Test
(MCT) Ratio4
|
|
|
234
|
%
|
|
|
234
|
%
|
|
|
233
|
%
|
Australia
MI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prescribed Capital
Amount (PCA) Ratio4
|
|
|
168
|
%
|
|
|
159
|
%
|
|
|
163
|
%
|
U.S. Life Insurance
Companies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Risk-Based Capital (RBC)
Ratio4
|
|
|
390
|
%
|
|
|
393
|
%
|
|
|
453
|
%
|
|
Unassigned
Surplus4
|
|
$
|
(330)
|
|
|
$
|
(329)
|
|
|
$
|
138
|
|
Holding Company
Cash6 and Liquid Assets7
|
|
$
|
760
|
|
|
$
|
1,374
|
|
|
$
|
1,070
|
|
Key Points
- U.S. MI compliant with the PMIERs with a buffer as of
March 31, 2016;
- Canada and Australia continue to maintain solid capital
ratios in excess of management targets;
- U.S. life insurance companies' unassigned surplus and RBC ratio
were both in line with the prior quarter as favorable fixed
annuities performance was offset by the impact of lower interest
rates on variable annuity products and the life block transaction
completed in the quarter. RBC ratio also reflected unfavorable
credit migration;
- The holding company ended the quarter with approximately
$760 million of cash and liquid
assets, representing a buffer of approximately $300 million in excess of one and a half times
annual debt service and restricted cash. The holding company
continues to target maintaining cash balances of at least one and a
half times its annual debt service expense plus a risk buffer of
$350 million, but may go below the
target level at times to proactively address liabilities;
- Holding company cash and liquid assets decreased from the prior
quarter from $345 million utilized to
reduce Genworth Holdings' debt, $71
million of net other items and expenses, $69 million paid toward the litigation
settlement, an increase in cash margin posted for hedges of
$67 million, $61 million paid for debt interest expense, and
$61 million of fees paid related to
the bond consent solicitation, partially offset by $60 million of dividends from the operating
subsidiaries; and
- In March, the Australia
business announced a capital reduction initiative for shareholders
of A$202 million, subject to
shareholder approval.
About Genworth Financial
Genworth Financial, Inc. (NYSE: GNW) is a Fortune 500 insurance
holding company committed to helping families achieve the dream of
homeownership and address the financial challenges of aging through
its leadership positions in mortgage insurance and long term care
insurance. Headquartered in Richmond, Virginia, Genworth traces its roots
back to 1871 and became a public company in 2004. For more
information, visit genworth.com.
From time to time, Genworth releases important information via
postings on its corporate website. Accordingly, investors and other
interested parties are encouraged to enroll to receive automatic
email alerts and Really Simple Syndication (RSS) feeds regarding
new postings. Enrollment information is found under the "Investors"
section of genworth.com. From time to time, Genworth's
publicly traded subsidiaries, Genworth MI Canada Inc. and Genworth
Mortgage Insurance Australia Limited, separately release financial
and other information about their operations. This information can
be found at http://genworth.ca and
http://www.genworth.com.au.
Conference Call and Financial Supplement
Information
This press release and the first quarter 2016
financial supplement are now posted on the company's website.
Additional information regarding business results and strategic
update will be posted on the company's website,
http://investor.genworth.com, by 7:30
a.m. on April 29, 2016.
Investors are encouraged to review these materials.
Genworth will conduct a conference call on April 29, 2016 at 8:00
a.m. (ET) to discuss business results and provide a progress
update on strategic priorities. The conference call will be
accessible via telephone and the Internet. The dial-in number for
the conference call is 877 888.4034 or 913 489.5101 (outside the
U.S.); conference ID # 6410174. To participate in the call by
webcast, register at http://investor.genworth.com at least 15
minutes prior to the webcast to download and install any necessary
software.
Replays of the call will be available through May 13, 2016 at 888 203.1112 or 719 457.0820
(outside the U.S.); conference ID # 6410174. The webcast will also
be archived on the company's website.
Use of Non-GAAP Measures
This press release includes the non-GAAP financial measures
entitled "net operating income (loss)" and "net operating income
(loss) per common share." Net operating income (loss) per common
share is derived from net operating income (loss). The chief
operating decision maker evaluates segment performance and
allocates resources on the basis of net operating income (loss).
The company defines net operating income (loss) as income (loss)
from continuing operations excluding the after-tax effects of
income attributable to noncontrolling interests, net investment
gains (losses), goodwill impairments, gains (losses) on the sale of
businesses, gains (losses) on the early extinguishment of debt,
gains (losses) on insurance block transactions, restructuring costs
and infrequent or unusual non-operating items. Gains (losses) on
insurance block transactions are defined as gains (losses) on the
early extinguishment of non-recourse funding obligations, early
termination fees for other financing restructuring and/or resulting
gains (losses) on reinsurance restructuring for certain blocks of
business. The company excludes net investment gains (losses) and
infrequent or unusual non-operating items because the company does
not consider them to be related to the operating performance of the
company's segments and Corporate and Other activities. A component
of the company's net investment gains (losses) is the result of
impairments, the size and timing of which can vary significantly
depending on market credit cycles. In addition, the size and timing
of other investment gains (losses) can be subject to the company's
discretion and are influenced by market opportunities, as well as
asset-liability matching considerations. Goodwill impairments,
gains (losses) on the sale of businesses, gains (losses) on the
early extinguishment of debt, gains (losses) on insurance block
transactions and restructuring costs are also excluded from net
operating income (loss) because, in the company's opinion, they are
not indicative of overall operating trends. Infrequent or unusual
non-operating items are also excluded from net operating income
(loss) if, in the company's opinion, they are not indicative of
overall operating trends.
While some of these items may be significant components of net
income (loss) available to Genworth's common stockholders in
accordance with GAAP, the company believes that net operating
income (loss) and measures that are derived from or incorporate net
operating income (loss), including net operating income (loss) per
common share on a basic and diluted basis, are appropriate measures
that are useful to investors because they identify the income
(loss) attributable to the ongoing operations of the business.
Management also uses net operating income (loss) as a basis for
determining awards and compensation for senior management and to
evaluate performance on a basis comparable to that used by
analysts. However, the items excluded from net operating income
(loss) have occurred in the past and could, and in some cases will,
recur in the future. Net operating income (loss) and net operating
income (loss) per common share on a basic and diluted basis are not
substitutes for net income (loss) available to Genworth's common
stockholders or net income (loss) available to Genworth's common
stockholders per common share on a basic and diluted basis
determined in accordance with GAAP. In addition, the company's
definition of net operating income (loss) may differ from the
definitions used by other companies.
In the first quarter of 2016, the company recorded an estimated
gain of $20 million, net of taxes,
related to the planned sale of the mortgage insurance business in
Europe. The company also
recognized an estimated loss of $134
million, net of taxes, in the fourth quarter of 2015 for the
planned sale of this business.
In January 2016, the company paid
a make-whole expense of $13 million,
net of taxes, related to the early redemption of Genworth Holdings,
Inc.'s 2016 notes. The company also repurchased $28 million principal amount of Genworth
Holdings, Inc.'s notes with various maturity dates for a gain of
$2 million, net of taxes, in the
first quarter of 2016. These transactions were excluded from net
operating income (loss) for the periods presented as they related
to a gain (loss) on the early extinguishment of debt.
In the first quarter of 2016, the company completed a life block
transaction resulting in an after-tax loss of $6 million in connection with the early
extinguishment of non-recourse funding obligations.
In the first quarter of 2016, the company recorded an after-tax
expense of $9 million related to
restructuring costs as part of an expense reduction plan as the
company evaluates and appropriately sizes its organizational needs
and expenses. In the fourth quarter of 2015, the company also
recorded an after-tax expense of $3
million related to restructuring costs.
There were no infrequent or unusual items excluded from net
operating income (loss) during the periods presented other than
fees incurred during the first quarter of 2016 related to Genworth
Holdings, Inc.'s bond consent solicitation of $12 million, net of taxes, for broker, advisor
and investment banking fees.
The tables at the end of this press release reflect net
operating income (loss) as determined in accordance with accounting
guidance related to segment reporting, and a reconciliation of net
operating income (loss) of the company's segments and Corporate and
Other activities to net income (loss) available to Genworth's
common stockholders for the three months ended March 31, 2016 and 2015, as well as for the three
months ended December 31, 2015.
Adjustments to reconcile net income (loss) attributable to
Genworth's common stockholders and net operating income (loss)
assume a 35 percent tax rate and are net of the portion
attributable to noncontrolling interests. Net investment gains
(losses) are also adjusted for DAC and other intangible
amortization and certain benefit reserves.
This press release includes the non-GAAP financial measure
entitled "core yield" as a measure of investment yield. The company
defines core yield as the investment yield adjusted for those items
that are not recurring in nature. Management believes that analysis
of core yield enhances understanding of the investment yield of the
company. However, core yield is not a substitute for investment
yield determined in accordance with GAAP. In addition, the
company's definition of core yield may differ from the definitions
used by other companies. A reconciliation of core yield to reported
GAAP yield is included in a table at the end of this press
release.
Definition of Selected Operating Performance Measures
The company reports selected operating performance measures
including "sales" and "insurance in force" or "risk in force" which
are commonly used in the insurance industry as measures of
operating performance.
Management regularly monitors and reports sales metrics as a
measure of volume of new and renewal business generated in a
period. Sales refer to: (1) new insurance written for mortgage
insurance; (2) annualized first-year premiums for long term care
and term life insurance products; (3) annualized first-year
deposits plus five percent of excess deposits for universal and
term universal life insurance products; (4) 10 percent of premium
deposits for linked-benefits products; and (5) new and additional
premiums/deposits for fixed annuities. Sales do not include renewal
premiums on policies or contracts written during prior periods. The
company considers new insurance written, annualized first-year
premiums/deposits, premium equivalents and new premiums/deposits to
be a measure of the company's operating performance because they
represent a measure of new sales of insurance policies or contracts
during a specified period, rather than a measure of the company's
revenues or profitability during that period.
Management regularly monitors and reports insurance in force and
risk in force. Insurance in force for the mortgage insurance
businesses is a measure of the aggregate face value of outstanding
insurance policies as of the respective reporting date. For risk in
force in the mortgage insurance businesses, the company has
computed an "effective" risk in force amount, which recognizes that
the loss on any particular loan will be reduced by the net proceeds
received upon sale of the property. Risk in force for the U.S.
mortgage insurance business is the obligation that is limited under
contractual terms to the amounts less than 100 percent of the
mortgage loan value. Effective risk in force has been calculated by
applying to insurance in force a factor of 35 percent that
represents the highest expected average per-claim payment for any
one underwriting year over the life of the company's businesses in
Canada and Australia. In Australia, the company has certain risk share
arrangements where it provides pro-rata coverage of certain loans
rather than 100 percent coverage. As a result, for loans with these
risk share arrangements, the applicable pro-rata coverage amount
provided is used when applying the factor. The company considers
insurance in force and risk in force to be measures of the
company's operating performance because they represent measures of
the size of the business at a specific date which will generate
revenues and profits in a future period, rather than measures of
the company's revenues or profitability during that period.
Management also regularly monitors and reports a loss ratio for
the company's businesses. For the mortgage insurance businesses,
the loss ratio is the ratio of incurred losses and loss adjustment
expenses to net earned premiums. For the long term care insurance
business, the loss ratio is the ratio of benefits and other changes
in reserves less tabular interest on reserves less loss adjustment
expenses to net earned premiums. The company considers the loss
ratio to be a measure of underwriting performance in these
businesses and helps to enhance the understanding of the operating
performance of the businesses.
An assumed tax rate of 35 percent is utilized in certain
adjustments to net operating income (loss) and in the explanation
of specific variances of operating performance and investment
results.
These operating performance measures enable the company to
compare its operating performance across periods without regard to
revenues or profitability related to policies or contracts sold in
prior periods or from investments or other sources.
Cautionary Note Regarding Forward-Looking Statements
This press release contains certain "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements may be identified by words such
as "expects," "intends," "anticipates," "plans," "believes,"
"seeks," "estimates," "will" or words of similar meaning and
include, but are not limited to, statements regarding the outlook
for the company's future business and financial performance.
Forward-looking statements are based on management's current
expectations and assumptions, which are subject to inherent
uncertainties, risks and changes in circumstances that are
difficult to predict. Actual outcomes and results may differ
materially due to global political, economic, business,
competitive, market, regulatory and other factors and risks,
including, but not limited to, the following:
- strategic risks including: the company's inability to
successfully execute strategic plans to effectively address its
current business challenges (including with respect to the
restructuring of the U.S. life insurance businesses, cost savings,
ratings and capital), the company's inability to complete the
planned sale of its European mortgage insurance business at all or
on the terms anticipated, and failure to attract buyers for any
other businesses or other assets the company may seek to sell, or
securities it may seek to issue, in each case, in a timely manner
on anticipated terms; failure to obtain any required regulatory,
stockholder and/or noteholder approvals or consents, or its
challenges changing or being more costly or difficult to
successfully address than currently anticipated or the benefits
achieved being less than anticipated; inability to achieve
anticipated cost-savings in a timely manner; or adverse tax or
accounting charges; and inability to increase the capital needed in
its businesses in a timely manner and on anticipated terms,
including through improved business performance, reinsurance or
similar transactions, asset sales, securities offerings or
otherwise, in each case as and when required;
- risks relating to estimates, assumptions and valuations
including: inadequate reserves and the need to increase reserves
(including as a result of any changes the company may make to its
assumptions, methodologies or otherwise in connection with periodic
or other reviews); inaccurate models; deviations from its estimates
and actuarial assumptions or other reasons in the long term care
insurance, life insurance and/or annuity businesses; accelerated
amortization of deferred acquisition costs (DAC) and present value
of future profits (PVFP) (including as a result of any changes the
company may make to its assumptions, methodologies or otherwise in
connection with periodic or other reviews); adverse impact on the
company's financial results as a result of projected profits
followed by projected losses (as is currently the case with the
long term care insurance business); and changes in valuation of
fixed maturity, equity and trading securities;
- risks relating to economic, market and political
conditions including: downturns and volatility in global
economies and equity and credit markets; interest rates and changes
in rates; deterioration in economic conditions or a decline in home
prices that adversely affect the company's loss experience in
mortgage insurance; political and economic instability or changes
in government policies; and fluctuations in foreign currency
exchange rates and international securities markets;
- regulatory and legal risks including: extensive
regulation of the company's businesses and changes in applicable
laws and regulations; litigation and regulatory investigations or
other actions, including not receiving court approval of the
planned settlement of In re Genworth Financial, Inc. Securities
Litigation; dependence on dividends and other distributions
from the company's subsidiaries (particularly its international
subsidiaries) and the inability of any subsidiaries to pay
dividends or make other distributions to the company, including as
a result of the performance of its subsidiaries and insurance,
regulatory or corporate law restrictions (including the
unwillingness or inability of the subsidiary that indirectly owns
most of the interests in the Australian and Canadian mortgage
insurance businesses to pay the dividends that it receives from
those businesses as a result of the impact on its financial
condition of its capital support for certain long term care
insurance related reinsurance arrangements); adverse change in
regulatory requirements, including risk-based capital; changes in
regulations adversely affecting the company's international
operations; inability to meet or maintain the PMIERs; inability of
the U.S. mortgage insurance subsidiaries to meet minimum statutory
capital requirements and hazardous financial condition standards;
the influence of Federal National Mortgage Association (Fannie
Mae), Federal Home Loan Mortgage Corporation (Freddie Mac) and a
small number of large mortgage lenders on the U.S. mortgage
insurance market and adverse changes to the role or structure of
Fannie Mae and Freddie Mac; adverse changes in regulations
affecting the mortgage insurance businesses; inability to continue
to implement actions to mitigate the impact of statutory reserve
requirements; impact of additional regulations pursuant to the
Dodd-Frank Wall Street Reform and Consumer Protection Act (the
Dodd-Frank Act); and changes in accounting and reporting
standards;
- liquidity, financial strength ratings, credit and
counterparty risks including: insufficient internal sources to
meet liquidity needs and limited or no access to capital (including
the company's inability to replace the company's credit facility);
recent or future adverse rating agency actions, including with
respect to rating downgrades or potential downgrades, or being put
on review for potential downgrade, all of which could have adverse
implications for the company, including with respect to key
business relationships, product offerings, business results of
operations, financial condition and capital needs, strategic plans,
collateral obligations and availability and terms of hedging,
reinsurance and borrowings; defaults by counterparties to
reinsurance arrangements or derivative instruments; defaults or
other events impacting the value of the company's fixed maturity
securities portfolio; and defaults on the company's commercial
mortgage loans or the mortgage loans underlying its investments in
commercial mortgage-backed securities and volatility in
performance;
- operational risks including: inability to retain,
attract and motivate qualified employees or senior management;
ineffective or inadequate risk management in identifying,
controlling or mitigating risks; reliance on, and loss of, key
customer or distribution relationships; availability, affordability
and adequacy of reinsurance to protect the company against losses;
competition; competition in the mortgage insurance businesses from
government and government-owned and government-sponsored
enterprises (GSEs) offering mortgage insurance; material weakness
in, or ineffective, internal control over financial reporting; and
failure or any compromise of the security of the company's computer
systems, disaster recovery systems and business continuity plans
and failures to safeguard, or breaches of, its confidential
information;
- insurance and product-related risks including: the
company's inability to increase sufficiently, and in a timely
manner, premiums on in force long term care insurance policies
and/or reduce in force benefits, and charge higher premiums on new
policies, in each case, as currently anticipated and as may be
required from time to time in the future (including as a result of
the failure to obtain any necessary regulatory approvals or
unwillingness or inability of policyholders to pay increased
premiums); the company's inability to reflect future premium
increases and other management actions in its margin calculation as
anticipated; failure to sufficiently increase new sales for the
long term care insurance products; inability to realize anticipated
benefits of the rescissions, curtailments, loan modifications or
other similar programs in the mortgage insurance businesses;
premiums for the significant portion of the mortgage insurance risk
in force with high loan-to-value ratios may not be sufficient to
compensate the company for the greater risks associated with those
policies; decreases in the volume of high loan-to-value mortgage
originations or increases in mortgage insurance cancellations;
increases in the use of alternatives to private mortgage insurance
and reductions in the level of coverage selected; potential
liabilities in connection with the U.S. contract underwriting
services; and medical advances, such as genetic research and
diagnostic imaging, and related legislation that impact
policyholder behavior in ways adverse to the company;
- other risks including: occurrence of natural or man-made
disasters or a pandemic; impairments of or valuation allowances
against the company's deferred tax assets; the possibility that in
certain circumstances the company will be obligated to make
payments to General Electric Company (GE) under the tax matters
agreement with GE even if its corresponding tax savings are never
realized and payments could be accelerated in the event of certain
changes in control; and provisions of the company's certificate of
incorporation and bylaws and the tax matters agreement with GE may
discourage takeover attempts and business combinations that
stockholders might consider in their best interests; and
- risks relating to the company's common stock including:
the continued suspension of payment of dividends; and stock price
fluctuations.
The company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future developments or otherwise.
Condensed
Consolidated Statements of Income
|
(Amounts in
millions, except per share amounts)
|
|
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
2016
|
|
2015
|
Revenues:
|
|
|
|
|
|
|
Premiums
|
|
$
|
794
|
|
$
|
1,143
|
Net investment
income
|
|
|
789
|
|
|
781
|
Net investment gains
(losses)
|
|
|
(19)
|
|
|
(16)
|
Policy fees and other
income
|
|
|
221
|
|
|
227
|
Total
revenues
|
|
|
1,785
|
|
|
2,135
|
Benefits and
expenses:
|
|
|
|
|
|
|
Benefits and other
changes in policy reserves
|
|
|
860
|
|
|
1,192
|
Interest
credited
|
|
|
177
|
|
|
180
|
Acquisition and
operating expenses, net of deferrals
|
|
|
394
|
|
|
267
|
Amortization of
deferred acquisition costs and intangibles
|
|
|
99
|
|
|
95
|
Interest
expense
|
|
|
105
|
|
|
107
|
Total
benefits and expenses
|
|
|
1,635
|
|
|
1,841
|
Income from
continuing operations before income taxes
|
|
|
150
|
|
|
294
|
Provision for income
taxes
|
|
|
23
|
|
|
91
|
Income from
continuing operations
|
|
|
127
|
|
|
203
|
Income (loss) from
discontinued operations, net of taxes
|
|
|
(19)
|
|
|
1
|
Net
income
|
|
|
108
|
|
|
204
|
Less: net income
attributable to noncontrolling interests
|
|
|
55
|
|
|
50
|
Net income available
to Genworth Financial, Inc.'s common stockholders
|
|
$
|
53
|
|
$
|
154
|
|
|
|
|
|
|
|
Income from
continuing operations available to Genworth Financial, Inc.'s
|
|
|
|
|
|
|
common
stockholders per common share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.14
|
|
$
|
0.31
|
Diluted
|
|
$
|
0.14
|
|
$
|
0.31
|
Net income available
to Genworth Financial, Inc.'s common stockholders per
|
|
|
|
|
|
|
common
share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.11
|
|
$
|
0.31
|
Diluted
|
|
$
|
0.11
|
|
$
|
0.31
|
Weighted-average
shares outstanding:
|
|
|
|
|
|
|
Basic
|
|
|
498.0
|
|
|
497.0
|
Diluted
|
|
|
499.4
|
|
|
498.9
|
Reconciliation of
Net Operating Income (Loss) to Net Income
(Loss)
|
(Amounts in
millions, except per share amounts)
|
|
|
Three
|
|
Three
|
|
months
ended
|
|
months
ended
|
|
March
31,
|
|
December
31,
|
|
2016
|
|
2015
|
|
2015
|
Net operating income
(loss):
|
|
|
|
|
|
|
|
|
U.S. Mortgage
Insurance segment
|
$
|
61
|
|
$
|
52
|
|
$
|
41
|
Canada Mortgage
Insurance segment
|
|
33
|
|
|
40
|
|
|
37
|
Australia Mortgage
Insurance segment
|
|
19
|
|
|
30
|
|
|
22
|
U.S. Life Insurance
segment:
|
|
|
|
|
|
|
|
|
Long
Term Care Insurance
|
|
34
|
|
|
10
|
|
|
19
|
Life
Insurance
|
|
31
|
|
|
40
|
|
|
(173)
|
Fixed
Annuities
|
|
26
|
|
|
31
|
|
|
19
|
Total
U.S. Life Insurance segment
|
|
91
|
|
|
81
|
|
|
(135)
|
Runoff
segment
|
|
4
|
|
|
11
|
|
|
11
|
Corporate and
Other
|
|
(105)
|
|
|
(60)
|
|
|
(58)
|
Net operating income
(loss)
|
|
103
|
|
|
154
|
|
|
(82)
|
Adjustments to net
operating income (loss):
|
|
|
|
|
|
|
|
|
Net investment gains
(losses), net (see below for reconciliation)
|
|
(13)
|
|
|
(1)
|
|
|
—
|
Gains (losses) on
sale of business, net
|
|
20
|
|
|
—
|
|
|
(134)
|
Gains (losses) on
early extinguishment of debt, net
|
|
(11)
|
|
|
—
|
|
|
—
|
Gains (losses) from
life block transactions, net
|
|
(6)
|
|
|
—
|
|
|
—
|
Expenses related to
restructuring, net
|
|
(9)
|
|
|
—
|
|
|
(3)
|
Fees associated with
bond consent solicitation, net
|
|
(12)
|
|
|
—
|
|
|
—
|
Income (loss) from
continuing operations available to Genworth
|
|
|
|
|
|
|
|
|
Financial,
Inc.'s common stockholders
|
|
72
|
|
|
153
|
|
|
(219)
|
Net income
attributable to noncontrolling interests
|
|
55
|
|
|
50
|
|
|
52
|
Income (loss) from
continuing operations
|
|
127
|
|
|
203
|
|
|
(167)
|
Income (loss) from
discontinued operations, net of taxes
|
|
(19)
|
|
|
1
|
|
|
(73)
|
Net income
(loss)
|
|
108
|
|
|
204
|
|
(240)
|
Less: net income
attributable to noncontrolling interests
|
|
55
|
|
|
50
|
|
|
52
|
Net income (loss)
available to Genworth Financial, Inc.'s common
|
|
|
|
|
|
|
|
|
stockholders
|
$
|
53
|
|
$
|
154
|
|
$
|
(292)
|
|
|
|
|
|
|
|
|
|
Net income (loss)
available to Genworth Financial, Inc.'s common
|
|
|
|
|
|
|
|
|
stockholders
per common share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.11
|
|
$
|
0.31
|
|
$
|
(0.59)
|
Diluted
|
$
|
0.11
|
|
$
|
0.31
|
|
$
|
(0.59)
|
Net operating income
(loss) per common share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.21
|
|
$
|
0.31
|
|
$
|
(0.17)
|
Diluted
|
$
|
0.21
|
|
$
|
0.31
|
|
$
|
(0.17)
|
Weighted-average
shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
498.0
|
|
|
497.0
|
|
|
497.6
|
Diluted8
|
|
499.4
|
|
|
498.9
|
|
|
497.6
|
|
|
|
|
|
|
|
|
|
Reconciliation of net
investment gains (losses):
|
|
|
|
|
|
|
|
|
Net investment gains
(losses), gross
|
$
|
(19)
|
|
$
|
(16)
|
|
$
|
(16)
|
Adjustments
for:
|
|
|
|
|
|
|
Deferred
acquisition costs and other intangible amortization and
certain
|
|
|
|
|
|
|
benefit
reserves
|
9
|
|
6
|
|
12
|
Net
investment gains (losses) attributable to noncontrolling
interests
|
(9)
|
|
7
|
|
3
|
Taxes
|
6
|
|
2
|
|
1
|
Net investment gains
(losses), net of taxes and other adjustments
|
$
|
(13)
|
|
$
|
(1)
|
|
$
|
—
|
Condensed
Consolidated Balance Sheets
|
(Amounts in
millions)
|
|
|
March
31,
|
|
December
31,
|
|
2016
|
|
2015
|
Assets
|
|
|
|
Cash,
cash equivalents and invested assets
|
$
|
76,728
|
|
$
|
75,746
|
Deferred
acquisition costs
|
|
4,235
|
|
|
4,398
|
Intangible
assets and goodwill
|
|
291
|
|
|
357
|
Reinsurance
recoverable
|
|
17,587
|
|
|
17,245
|
Deferred
tax and other assets
|
|
577
|
|
|
675
|
Separate
account assets
|
|
7,624
|
|
|
7,883
|
Assets
held for sale
|
|
131
|
|
|
127
|
Total
assets
|
$
|
107,173
|
|
$
|
106,431
|
Liabilities and
equity
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
Future
policy benefits
|
$
|
36,776
|
|
$
|
36,475
|
Policyholder
account balances
|
|
26,354
|
|
|
26,209
|
Liability
for policy and contract claims
|
|
8,177
|
|
|
8,095
|
Unearned
premiums
|
|
3,378
|
|
|
3,308
|
Deferred
tax and other liabilities
|
|
4,045
|
|
|
3,028
|
Borrowings
related to securitization entities
|
|
173
|
|
|
179
|
Non-recourse
funding obligations
|
|
310
|
|
|
1,920
|
Long-term
borrowings
|
|
4,232
|
|
|
4,570
|
Separate
account liabilities
|
|
7,624
|
|
|
7,883
|
Liabilities
held for sale
|
|
131
|
|
|
127
|
Total
liabilities
|
|
91,200
|
|
|
91,794
|
Equity:
|
|
|
|
|
|
Common
stock
|
|
1
|
|
|
1
|
Additional
paid-in capital
|
|
11,952
|
|
|
11,949
|
Accumulated
other comprehensive income (loss):
|
|
|
|
|
|
Net
unrealized investment gains (losses):
|
|
|
|
|
|
Net
unrealized gains (losses) on securities not other-than-temporarily
impaired
|
|
2,043
|
|
|
1,236
|
Net
unrealized gains (losses) on other-than-temporarily impaired
securities
|
|
14
|
|
|
18
|
Net
unrealized investment gains (losses)
|
|
2,057
|
|
|
1,254
|
Derivatives
qualifying as hedges
|
|
2,302
|
|
|
2,045
|
Foreign
currency translation and other adjustments
|
|
(174)
|
|
|
(289)
|
Total
accumulated other comprehensive income (loss)
|
|
4,185
|
|
|
3,010
|
Retained
earnings
|
|
617
|
|
|
564
|
Treasury
stock, at cost
|
|
(2,700)
|
|
|
(2,700)
|
Total
Genworth Financial, Inc.'s stockholders' equity
|
|
14,055
|
|
|
12,824
|
Noncontrolling
interests
|
|
1,918
|
|
|
1,813
|
Total
equity
|
|
15,973
|
|
|
14,637
|
Total
liabilities and equity
|
$
|
107,173
|
|
$
|
106,431
|
Impact of Foreign
Exchange on Operating Results9
Three months ended
March 31, 2016
|
|
|
|
Percentages
|
|
|
Percentages
|
|
|
|
Including
Foreign
|
|
|
Excluding
Foreign
|
|
|
|
Exchange
|
|
|
Exchange10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canada Mortgage
Insurance (MI):
|
|
|
|
|
|
|
Flow new insurance
written
|
|
(24)
|
%
|
|
(12)
|
%
|
Flow new insurance
written (1Q16 vs. 4Q15)
|
|
(47)
|
%
|
|
(45)
|
%
|
|
|
|
|
|
|
|
Australia
MI:
|
|
|
|
|
|
|
Flow new insurance
written
|
|
(24)
|
%
|
|
(16)
|
%
|
Flow new insurance
written (1Q16 vs. 4Q15)
|
|
(4)
|
%
|
|
(4)
|
%
|
|
|
|
|
|
|
|
Reconciliation of
Core Yield to Reported Yield
|
|
|
Three
|
|
months
ended
|
|
March
31,
|
(Assets - amounts
in billions)
|
2016
|
Reported Total
Invested Assets and Cash
|
$
|
76.0
|
|
Subtract:
|
|
|
Securities
lending
|
0.4
|
|
Unrealized
gains (losses)
|
6.3
|
|
Adjusted end of
period invested assets
|
$
|
69.3
|
|
|
|
|
Average Invested
Assets Used in Reported Yield Calculation
|
$
|
70.0
|
|
Subtract:
|
|
|
Restricted
commercial mortgage loans and other invested assets related
to
|
|
|
securitization
entities11
|
0.2
|
|
Average Invested
Assets Used in Core Yield Calculation
|
$
|
69.8
|
|
|
|
|
(Income - amounts
in
millions)
|
|
|
Reported Net
Investment Income
|
$
|
789
|
|
Subtract:
|
|
Bond
calls and commercial mortgage loan prepayments
|
11
|
|
Other
non-core items12
|
15
|
|
Restricted
commercial mortgage loans and other invested assets related
to
|
|
|
securitization
entities11
|
3
|
|
Core Net Investment
Income
|
$
|
760
|
|
|
Reported
Yield
|
|
4.51
|
%
|
Core Yield
|
4.36
|
%
|
1 Unless otherwise stated, all references in this
press release to net income (loss), net income (loss) per share,
book value, book value per share and stockholders' equity should be
read as net income (loss) available to Genworth's common
stockholders, net income (loss) available to Genworth's common
stockholders per share, book value available to Genworth's common
stockholders, book value available to Genworth's common
stockholders per share and stockholders' equity available to
Genworth's common stockholders, respectively.
2 This is a financial measure not calculated based on
U.S. Generally Accepted Accounting Principles (Non-GAAP). See
the Use of Non-GAAP Measures section of this press release for
additional information.
3 Percent change excludes the impact of foreign
exchange.
4 Company estimate for the first quarter of 2016, due to
timing of the filing of statutory statements.
5 Calculated as available assets divided by required
assets as defined within PMIERs. Company estimate for the first
quarter of 2016.
6 Holding company cash & liquid assets comprises
assets held in Genworth Holdings, Inc. (the issuer of outstanding
public debt) which is a wholly-owned subsidiary of Genworth
Financial, Inc.
7 Comprises cash and cash equivalents of $760 million, $1,124
million and $820 million,
respectively, and U.S. government bonds of zero, $250 million and $250
million, respectively, as of March
31, 2016, December 31, 2015,
and March 31, 2015.
8 Under applicable accounting guidance, companies in a
loss position are required to use basic weighted-average common
shares outstanding in the calculation of diluted loss per share.
Therefore, as a result of the loss from continuing operations, the
company was required to use basic weighted-average common shares
outstanding in the calculation of diluted loss per share as the
inclusion of shares for stock options, restricted stock units and
stock appreciation rights of 1.4 million for the three months ended
December 31, 2015 would have been
antidilutive to the calculation. If the company had not incurred a
loss from continuing operations in these periods, dilutive
potential weighted-average common shares outstanding would have
been 499.0 million for the three months ended December 31, 2015.
9 All percentages are comparing the first quarter of
2016 to the first quarter of 2015 unless otherwise stated.
10 The impact of foreign exchange was calculated using
the comparable prior period exchange rates.
11 Represents the incremental assets and investment
income related to restricted commercial mortgage loans and other
invested assets.
12 Includes cost basis adjustments on structured
securities and various other immaterial items.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/genworth-financial-announces-first-quarter-2016-results-300259691.html
SOURCE Genworth Financial, Inc.