- Earnings per diluted share: $3.47 from
net income, $3.44 from adjusted operating income*
- EPS from net income and adjusted
operating income* driven by U.S. segment performance
- ROE 10 percent and adjusted operating
ROE* 12 percent for the trailing twelve months
- Reported net premiums increased 11
percent in the third quarter
Reinsurance Group of America, Incorporated (NYSE: RGA), a
leading global provider of life reinsurance, reported third-quarter
net income of $227.6 million, or $3.47 per diluted share, compared
with $198.7 million, or $3.07 per diluted share, in the
prior-year quarter. Adjusted operating income* totaled
$226.0 million, or $3.44 per diluted share, compared with
$159.4 million, or $2.46 per diluted share, the year before.
Net foreign currency fluctuations had a favorable effect of $0.02
per diluted share on net income and on adjusted operating income.
Book value per share at September 30 was $125.79 including AOCI,
and $100.54 excluding AOCI*.
Quarterly Results
Year-to-Date Results ($ in thousands, except per share
data) 2017 2016 2017
2016 Net premiums $ 2,489,797 $ 2,251,758 $ 7,335,944
$ 6,755,708 Net income 227,591 198,719 605,293 511,294 Net income
per diluted share 3.47 3.07 9.23 7.87 Adjusted operating income*
226,048 159,361 541,787 461,339 Adjusted operating income per
diluted share* 3.44 2.46 8.26 7.10 Book value per share 125.79
124.50 Book value per share, excluding accumulated other
comprehensive income (AOCI)* 100.54 90.04 Total assets 58,694,031
54,832,498 * See ‘Use of Non-GAAP Financial Measures’ below
Consolidated net premiums totaled $2.5 billion, up 11 percent
from last year’s third quarter, with favorable net foreign currency
effects of approximately $18.3 million. Excluding spread-based
businesses and the value of associated derivatives, investment
income rose 16 percent over year-ago levels, reflecting a
7 percent increase in average invested assets. Variable
investment income was strong this quarter compared to the year-ago
quarter and the second quarter of this year. The average investment
yield, excluding spread businesses, was up 38 basis points from the
third quarter of 2016 to 4.81 percent, reflecting the strong
variable investment income. The average investment yield was 21
basis points higher than the second-quarter yield due primarily to
a higher level of variable investment income. The effective tax
rate was approximately 33 percent on pre-tax GAAP income and
pre-tax adjusted operating income for the third quarter, within an
expected range of 33 to 34 percent.
Anna Manning, president and chief executive officer, commented,
“This was an exceptionally good quarter, as bottom-line results
were particularly strong and our top line remained vibrant.
Furthermore, diversity of earnings sources, inherent to our global
model, continues to be an important contributor to our success.
“A highlight of the quarter was the strong performance of the
U.S. segment, driven primarily by very favorable individual
mortality experience and above-average variable investment income.
Earnings in our U.S. Traditional business segment reached a record
level.
“We closed a number of smaller in-force and other transactions
during the quarter, and we remain optimistic about the pipeline. We
ended the quarter with an excess capital position of approximately
$1.0 billion, after repurchasing approximately 209,000 shares
for $26.9 million.
“Looking forward, we are well positioned in our markets, we have
a proven strategy, and we are confident about our ability to
continue to deliver attractive financial returns.”
SEGMENT RESULTS
U.S. and Latin America
Traditional
The U.S. and Latin America Traditional segment reported pre-tax
income of $160.5 million, compared with $77.1 million in
the third quarter of 2016. Pre-tax adjusted operating income
totaled $162.0 million for the quarter, compared with
$80.5 million in last year’s third quarter. Results for the
current quarter reflected very favorable mortality experience and
above-average variable investment income.
Traditional net premiums increased 4 percent from last year’s
third quarter to $1,327.2 million.
Financial Solutions
The Asset-Intensive business reported pre-tax income of
$67.1 million compared with $88.7 million last year.
Third-quarter pre-tax adjusted operating income improved to $72.6
million from $58.7 million last year, attributable to favorable
experience on payout annuities and above-average variable
investment income.
The Financial Reinsurance business reported pre-tax income and
pre-tax adjusted operating income of $22.0 million, up from $14.0
million the year before due to strong, recent new business
volumes.
Canada
Traditional
The Canada Traditional segment reported pre-tax income of $28.8
million, compared with $34.3 million the year before. Pre-tax
adjusted operating income totaled $27.4 million, compared with
$30.6 million in the third quarter of 2016. Mortality
experience in the current quarter was moderately unfavorable while
the year-ago quarter was in line with expectations. Foreign
currency exchange rates had a favorable effect of $1.5 million on
pre-tax income and $1.4 million on pre-tax adjusted operating
income.
Reported net premiums totaled $225.8 million for the quarter,
down from $231.2 million in the year-ago period due to the
continued effects of an expected reduction in creditor business.
Net foreign currency fluctuations had a favorable effect of $9.0
million on net premiums.
Financial Solutions
The Canada Financial Solutions business segment, which consists
of longevity and fee-based transactions, reported third-quarter
pre-tax income and pre-tax adjusted operating income of $4.5
million, compared with $1.2 million a year ago, attributable mainly
to favorable longevity experience. Net foreign currency
fluctuations favorably affected pre-tax income and pre-tax adjusted
operating income by $0.2 million.
Europe, Middle East and Africa (EMEA)
Traditional
The EMEA Traditional segment reported pre-tax income and pre-tax
adjusted operating income of $15.4 million, compared with $8.5
million in last year’s third quarter. The current-period results
were slightly above expectations while the previous period
reflected unfavorable underwriting experience. Net foreign currency
fluctuations favorably affected pre-tax income and pre-tax adjusted
operating income by $0.7 million.
Reported net premiums increased 25 percent from the prior-year
period to $344.2 million, due to new business across the segment
and growth of existing treaties. Foreign currency exchange rates
favorably affected net premiums by $7.3 million.
Financial Solutions
The EMEA Financial Solutions business segment includes
longevity, asset-intensive and fee-based transactions. Pre-tax
income totaled $31.0 million, compared with $43.8 million in the
year-ago period. Pre-tax adjusted operating income totaled $29.7
million, compared with $33.9 million the year before.
Current-period results reflected favorable longevity experience,
compared with favorable experience in both asset-intensive and
longevity in the prior-year period. Net foreign currency
fluctuations favorably affected pre-tax income and pre-tax adjusted
operating income by $0.1 million.
Asia Pacific
Traditional
The Asia Pacific Traditional segment reported pre-tax income and
pre-tax adjusted operating income of $26.6 million, compared
with $19.8 million in the prior-year period. Results in Asia for
the current year period were slightly below expectations, and
Australia had a modest loss. The year-ago period results reflected
favorable experience in Asia and unfavorable results in Australia.
Net foreign currency fluctuations had an adverse effect of $1.0
million on pre-tax income and pre-tax adjusted operating
income.
Reported net premiums rose 33 percent to $536.9 million,
with strong growth across Asia, primarily from new and existing
treaties in Hong Kong and Southeast Asia. Foreign currency exchange
rates had a favorable effect of $1.0 million on net premiums.
Financial Solutions
The Asia Pacific Financial Solutions business segment includes
asset-intensive and fee-based transactions. Pre-tax losses totaled
$0.2 million, compared with pre-tax income of $7.5 million in
the prior-year period. Pre-tax adjusted operating losses totaled
$0.2 million, compared with pre-tax adjusted operating income of
$2.3 million in the prior-year quarter. Current-period results
reflected losses in line with expectations from a treaty that is in
runoff. Net foreign currency fluctuations had a favorable effect of
$0.1 million on pre-tax losses and $0.2 million on pre-tax adjusted
operating losses.
Corporate and Other
The Corporate and Other segment’s pre-tax loss totaled $15.4
million, compared with a pre-tax loss of $7.3 million the year
before. Pre-tax adjusted operating losses were $21.7 million,
relatively in line with expectations, versus year-ago pre-tax
adjusted operating losses of $19.0 million.
Dividend Declaration
The board of directors declared a regular dividend of $0.50,
payable November 28 to shareholders of record as of November 7.
Earnings Conference Call
A conference call to discuss third-quarter results will begin at
11 a.m. Eastern Time on Friday, October 27. Interested parties may
access the call by dialing 877-545-1402 (domestic) or 719-325-4904
(international). The access code is 2443753. A live audio webcast
of the conference call will be available on the Company’s Investor
Relations website at www.rgare.com. A replay of the conference call
will be available at the same address for 90 days following the
conference call. A telephonic replay also will be available through
Saturday, November 4, at 888-203-1112 (domestic) or 719-457-0820
(international), access code 2443753.
The Company has posted to its website a Quarterly Financial
Supplement that includes financial information for all segments as
well as information on its investment portfolio. Additionally, the
Company posts periodic reports, press releases and other useful
information on its Investor Relations website.
Use of Non-GAAP Financial Measures
RGA uses a non-GAAP financial measure called adjusted operating
income as a basis for analyzing financial results. Beginning with
the announcement of first-quarter 2017 results, the Company
modified the labeling of its non-GAAP measure “operating income” to
“adjusted operating income.” This measure also serves as a basis
for establishing target levels and awards under RGA’s management
incentive programs. Management believes that adjusted operating
income, on a pre-tax and after-tax basis, better measures the
ongoing profitability and underlying trends of the Company’s
continuing operations, primarily because that measure excludes
substantially all of the effect of net investment related gains and
losses, as well as changes in the fair value of certain embedded
derivatives and related deferred acquisition costs. These items can
be volatile, primarily due to the credit market and interest rate
environment, and are not necessarily indicative of the performance
of the Company’s underlying businesses. Additionally, adjusted
operating income excludes any net gain or loss from discontinued
operations, the cumulative effect of any accounting changes, and
other items that management believes are not indicative of the
Company’s ongoing operations. The definition of adjusted operating
income can vary by company and is not considered a substitute for
GAAP net income.
Book value per share excluding the impact of AOCI is a non-GAAP
financial measure that management believes is important in
evaluating the balance sheet in order to ignore the effects of
unrealized amounts primarily associated with mark-to-market
adjustments on investments and foreign currency translation.
Adjusted operating income per diluted share is a non-GAAP
financial measure calculated as adjusted operating income divided
by weighted average diluted shares outstanding. Adjusted operating
return on equity is a non-GAAP financial measure calculated as
adjusted operating income divided by average shareholders’ equity
excluding AOCI. Similar to adjusted operating income, management
believes these non-GAAP financial measures better reflect the
ongoing profitability and underlying trends of the Company’s
continuing operations, they also serve as a basis for establishing
target levels and awards under RGA’s management incentive
programs.
Reconciliations from GAAP net income, book value per share, net
income per diluted share and average stockholders’ equity are
provided in the following tables. Additional financial information
can be found in the Quarterly Financial Supplement on RGA’s
Investor Relations website at www.rgare.com in the “Financial Information”
section.
About RGA
Reinsurance Group of America, Incorporated (RGA), a Fortune 500
company, is among the leading global providers of life reinsurance
and financial solutions, with approximately $3.3 trillion of life
reinsurance in force and assets of $58.7 billion as of September
30, 2017. Founded in 1973, RGA today is recognized for its deep
technical expertise in risk and capital management, innovative
solutions, and commitment to serving its clients. With headquarters
in St. Louis, Missouri, and operations in 26 countries, RGA
delivers expert solutions in individual life reinsurance,
individual living benefits reinsurance, group reinsurance, health
reinsurance, facultative underwriting, product development, and
financial solutions. To learn more about RGA and its businesses,
visit the company’s website at www.rgare.com.
Cautionary Note Regarding Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, among others, statements relating to projections of the
earnings, revenues, income or loss, ratios, future financial
performance, and growth potential of Reinsurance Group of America,
Incorporated and its subsidiaries (which we refer to in the
previous paragraphs as “we,” “us” or “our”). The words “intend,”
“expect,” “project,” “estimate,” “predict,” “anticipate,” “should,”
“believe,” and other similar expressions also are intended to
identify forward-looking statements. Forward-looking statements are
inherently subject to risks and uncertainties, some of which cannot
be predicted or quantified. Future events and actual results,
performance and achievements could differ materially from those set
forth in, contemplated by, or underlying the forward-looking
statements.
Numerous important factors could cause actual results and events
to differ materially from those expressed or implied by
forward-looking statements including, without limitation, (1)
adverse capital and credit market conditions and their impact on
the Company’s liquidity, access to capital, and cost of capital,
(2) the impairment of other financial institutions and its effect
on the Company’s business, (3) requirements to post collateral or
make payments due to declines in market value of assets subject to
the Company’s collateral arrangements, (4) the fact that the
determination of allowances and impairments taken on the Company’s
investments is highly subjective, (5) adverse changes in mortality,
morbidity, lapsation, or claims experience, (6) changes in the
Company’s financial strength and credit ratings and the effect of
such changes on the Company’s future results of operations and
financial condition, (7) inadequate risk analysis and underwriting,
(8) general economic conditions or a prolonged economic downturn
affecting the demand for insurance and reinsurance in the Company’s
current and planned markets, (9) the availability and cost of
collateral necessary for regulatory reserves and capital, (10)
market or economic conditions that adversely affect the value of
the Company’s investment securities or result in the impairment of
all or a portion of the value of certain of the Company’s
investment securities, that in turn could affect regulatory
capital, (11) market or economic conditions that adversely affect
the Company’s ability to make timely sales of investment
securities, (12) risks inherent in the Company’s risk management
and investment strategy, including changes in investment portfolio
yields due to interest rate or credit quality changes, (13)
fluctuations in U.S. or foreign currency exchange rates, interest
rates, or securities and real estate markets, (14) adverse
litigation or arbitration results, (15) the adequacy of reserves,
resources, and accurate information relating to settlements,
awards, and terminated and discontinued lines of business, (16) the
stability of and actions by governments and economies in the
markets in which the Company operates, including ongoing
uncertainties regarding the amount of United States sovereign debt
and the credit ratings thereof, (17) competitive factors and
competitors’ responses to the Company’s initiatives, (18) the
success of the Company’s clients, (19) successful execution of the
Company’s entry into new markets, (20) successful development and
introduction of new products and distribution opportunities, (21)
the Company’s ability to successfully integrate acquired blocks of
business and entities, (22) action by regulators who have authority
over the Company’s reinsurance operations in the jurisdictions in
which it operates, (23) the Company’s dependence on third parties,
including those insurance companies and reinsurers to which the
Company cedes some reinsurance, third-party investment managers,
and others, (24) the threat of natural disasters, catastrophes,
terrorist attacks, epidemics, or pandemics anywhere in the world
where the Company or its clients do business, (25) interruption or
failure of the Company’s telecommunication, information technology,
or other operational systems, or the Company’s failure to maintain
adequate security to protect the confidentiality or privacy of
personal or sensitive data stored on such systems, (26) changes in
laws, regulations, and accounting standards applicable to the
Company, its subsidiaries, or its business, (27) the effect of the
Company’s status as an insurance holding company and regulatory
restrictions on its ability to pay principal of and interest on its
debt obligations, and (28) other risks and uncertainties described
in this document and in the Company’s other filings with the
Securities and Exchange Commission.
Forward-looking statements should be evaluated together with the
many risks and uncertainties that affect our business, including
those mentioned in this document and described in the periodic
reports we file with the Securities and Exchange Commission. These
forward-looking statements speak only as of the date on which they
are made. We do not undertake any obligations to update these
forward-looking statements, even though our situation may change in
the future. We qualify all of our forward-looking statements by
these cautionary statements. For a discussion of the risks and
uncertainties that could cause actual results to differ materially
from those contained in the forward-looking statements, you are
advised to see Item 1A - “Risk Factors” in the 2016 Annual
Report.
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Reconciliation of Consolidated Net Income
to Adjusted Operating Income
(Dollars in thousands, except per share
data)
(Unaudited) Three Months Ended September 30, 2017
2016
DilutedEarnings PerShare
DilutedEarnings PerShare
Net income $ 227,591 $ 3.47 $ 198,719 $ 3.07 Reconciliation to
adjusted operating income: Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net (2,254 )
(0.05 ) (19,745 ) (0.31 ) Capital (gains) losses on funds withheld,
included in investment income, net of related expenses (4,838 )
(0.07 ) (2,159 ) (0.03 ) Embedded derivatives: Included in
investment related gains/losses, net (10,946 ) (0.17 ) (37,093 )
(0.57 ) Included in interest credited (888 ) (0.01 ) 28 — DAC
offset, net 17,450 0.27 20,719 0.32 Investment (income) loss on
unit-linked variable annuities (1,609 ) (0.02 ) (3,601 ) (0.06 )
Interest credited on unit-linked variable annuities 1,609 0.02
3,601 0.06 Non-investment derivatives (67 ) — (1,108 ) (0.02
) Adjusted operating income $ 226,048 $ 3.44 $
159,361 $ 2.46 (Unaudited) Nine
Months Ended September 30, 2017 2016
DilutedEarnings PerShare
DilutedEarnings PerShare
Net income $ 605,293 $ 9.23 $ 511,294 $ 7.87 Reconciliation to
adjusted operating income: Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net (7,421 )
(0.12 ) (87,962 ) (1.36 ) Capital (gains) losses on funds withheld,
included in investment income, net of related expenses (8,034 )
(0.12 ) (12,975 ) (0.20 ) Embedded derivatives: Included in
investment related gains/losses, net (80,192 ) (1.22 ) 32,041 0.49
Included in interest credited (23,832 ) (0.36 ) 7,688 0.12 DAC
offset, net 55,933 0.85 12,830 0.20 Investment (income) loss on
unit-linked variable annuities (4,093 ) (0.06 ) (5,794 ) (0.09 )
Interest credited on unit-linked variable annuities 4,093 0.06
5,794 0.09 Non-investment derivatives 40 — (1,577 )
(0.02 ) Adjusted operating income $ 541,787 $ 8.26 $
461,339 $ 7.10
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Reconciliation of Consolidated Effective
Income Tax Rates
(Dollars in thousands)
(Unaudited) Three Months Ended September 30, 2017 Pre-tax
Income Income Taxes
Effective TaxRate
GAAP income $ 340,162 $ 112,571 33.1 % Reconciliation to adjusted
operating income: Capital (gains) losses, derivatives and other,
included in investment related gains/losses, net (3,113 ) (859 )
Capital (gains) losses on funds withheld, included in investment
income, net of related expenses (7,443 ) (2,605 ) Embedded
derivatives: Included in investment related gains/losses, net
(16,839 ) (5,893 ) Included in interest credited (1,367 ) (479 )
DAC offset, net 26,845 9,395 Investment (income) loss on
unit-linked variable annuities (2,475 ) (866 ) Interest credited on
unit-linked variable annuities 2,475 866 Non-investment derivatives
(102 ) (35 ) Adjusted operating income $ 338,143 $ 112,095
33.2
%
Reconciliation of Consolidated Income
before Income Taxes to Pre-tax Adjusted Operating Income
(Dollars in thousands)
(Unaudited) Three Months EndedSeptember 30, Nine Months
EndedSeptember 30, 2017 2016 2017 2016
Income before income taxes $ 340,162 $ 287,600 $ 887,321 $ 748,403
Reconciliation to pre-tax adjusted operating income: Capital
(gains) losses, derivatives and other, included in investment
related gains/losses, net (3,113 ) (26,958 ) (7,939 ) (126,026 )
Capital (gains) losses on funds withheld, included in investment
income, net of related expenses (7,443 ) (3,322 ) (12,360 ) (19,962
) Embedded derivatives: Included in investment related
gains/losses, net (16,839 ) (57,066 ) (123,372 ) 49,294 Included in
interest credited (1,367 ) 42 (36,665 ) 11,827 DAC offset, net
26,845 31,876 86,050 19,739 Investment (income) loss on unit-linked
variable annuities (2,475 ) (5,540 ) (6,297 ) (8,914 ) Interest
credited on unit-linked variable annuities 2,475 5,540 6,297 8,914
Non-investment derivatives (102 ) (1,705 ) 62 (2,426 )
Pre-tax adjusted operating income $ 338,143 $ 230,467
$ 793,097 $ 680,849
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Reconciliation of Pre-tax Income to
Pre-tax Adjusted Operating Income
(Dollars in thousands)
(Unaudited) Three Months Ended September 30, 2017
Pre-tax income(loss)
Capital(gains) losses,derivativesand
other, net
Change invalue ofembedded
derivatives, net
Pre-tax adjustedoperatingincome (loss)
U.S. and Latin America: Traditional $ 160,512 $ 8 $ 1,495 $ 162,015
Financial Solutions: Asset-Intensive 67,126 16,379 (1) (10,924 )
(2) 72,581 Financial Reinsurance 21,992 — —
21,992 Total U.S. and Latin America 249,630 16,387 (9,429 )
256,588 Canada Traditional 28,789 (1,428 ) — 27,361 Canada
Financial Solutions 4,472 — — 4,472
Total Canada 33,261 (1,428 ) — 31,833 EMEA Traditional 15,421 — —
15,421 EMEA Financial Solutions 30,953 (1,285 ) —
29,668 Total EMEA 46,374 (1,285 ) — 45,089 Asia Pacific
Traditional 26,564 — — 26,564 Asia Pacific Financial Solutions (229
) (16 ) — (245 ) Total Asia Pacific 26,335 (16 ) — 26,319
Corporate and Other (15,438 ) (6,248 ) — (21,686 )
Consolidated $ 340,162 $ 7,410 $ (9,429 ) $ 338,143
(1) Asset-Intensive is net of $18,068 DAC
offset. (2) Asset-Intensive is net of $8,777 DAC offset.
(Unaudited) Three Months Ended September 30, 2016
Pre-tax income(loss)
Capital(gains) losses,derivativesand
other, net
Change invalue ofembeddedderivatives,
net
Pre-tax adjustedoperatingincome (loss)
U.S. and Latin America: Traditional $ 77,081 $ (69 ) $ 3,463 $
80,475 Financial Solutions: Asset-Intensive 88,732 (8,281 ) (1)
(21,758 ) (2) 58,693 Financial Reinsurance 13,982 — —
13,982 Total U.S. and Latin America 179,795 (8,350 )
(18,295 ) 153,150 Canada Traditional 34,275 (3,651 ) — 30,624
Canada Financial Solutions 1,160 — — 1,160
Total Canada 35,435 (3,651 ) — 31,784 EMEA Traditional 8,515
— — 8,515 EMEA Financial Solutions 43,786 (9,841 ) —
33,945 Total EMEA 52,301 (9,841 ) — 42,460 Asia Pacific
Traditional 19,822 — — 19,822 Asia Pacific Financial Solutions
7,549 (5,283 ) — 2,266 Total Asia Pacific
27,371 (5,283 ) — 22,088 Corporate and Other (7,302 ) (11,713 ) —
(19,015 ) Consolidated $ 287,600 $ (38,838 ) $
(18,295 ) $ 230,467 (1) Asset-Intensive is net
of $(6,853) DAC offset. (2) Asset-Intensive is net of $38,729 DAC
offset.
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Reconciliation of Pre-tax Income to
Pre-tax Adjusted Operating Income
(Dollars in thousands)
(Unaudited) Nine Months Ended September 30, 2017
Pre-tax income(loss)
Capital(gains) losses,derivativesand
other, net
Change invalue ofembeddedderivatives,
net
Pre-tax adjustedoperatingincome (loss)
U.S. and Latin America: Traditional $ 281,066 $ 7 $ 185 $ 281,258
Financial Solutions: Asset-Intensive 239,898 51,207 (1) (116,996 )
(2) 174,109 Financial Reinsurance 59,791 — —
59,791 Total U.S. and Latin America 580,755 51,214 (116,811
) 515,158 Canada Traditional 80,953 (5,638 ) — 75,315 Canada
Financial Solutions 12,489 — — 12,489
Total Canada 93,442 (5,638 ) — 87,804 EMEA Traditional 40,751 (7 )
— 40,744 EMEA Financial Solutions 91,776 (8,102 ) —
83,674 Total EMEA 132,527 (8,109 ) — 124,418 Asia Pacific
Traditional 121,574 — — 121,574 Asia Pacific Financial Solutions
11,020 (9,090 ) — 1,930 Total Asia Pacific
132,594 (9,090 ) — 123,504 Corporate and Other (51,997 ) (5,790 ) —
(57,787 ) Consolidated $ 887,321 $ 22,587 $
(116,811 ) $ 793,097 (1) Asset-Intensive is
net of $42,824 DAC offset. (2) Asset-Intensive is net of $43,226
DAC offset. (Unaudited) Nine Months Ended
September 30, 2016
Pre-tax income(loss)
Capital(gains) losses,derivativesand
other, net
Change invalue ofembeddedderivatives,
net
Pre-tax adjustedoperatingincome (loss)
U.S. and Latin America: Traditional $ 239,609 $ (3 ) $ 6,379 $
245,985 Financial Solutions: Asset-Intensive 151,881 (88,640 ) (1)
95,043 (2) 158,284 Financial Reinsurance 44,791 — —
44,791 Total U.S. and Latin America 436,281 (88,643 )
101,422 449,060 Canada Traditional 97,679 (6,784 ) — 90,895 Canada
Financial Solutions 3,880 — — 3,880
Total Canada 101,559 (6,784 ) — 94,775 EMEA Traditional 14,233 (5 )
— 14,228 EMEA Financial Solutions 96,679 (10,995 ) —
85,684 Total EMEA 110,912 (11,000 ) — 99,912 Asia Pacific
Traditional 95,464 (16 ) — 95,448 Asia Pacific Financial Solutions
16,029 (12,319 ) — 3,710 Total Asia Pacific
111,493 (12,335 ) — 99,158 Corporate and Other (11,842 ) (50,214 )
— (62,056 ) Consolidated $ 748,403 $ (168,976 ) $
101,422 $ 680,849 (1) Asset-Intensive
is net of $(20,562) DAC offset. (2) Asset-Intensive is net of
$40,301 DAC offset.
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Per Share and Shares Data
(In thousands, except per share data)
(Unaudited) Three Months EndedSeptember 30, Nine Months
EndedSeptember 30, 2017 2016 2017 2016
Earnings per share from net income: Basic earnings per share $ 3.53
$ 3.10 $ 9.39 $ 7.95 Diluted earnings per share $ 3.47 $ 3.07 $
9.23 $ 7.87 Diluted earnings per share from adjusted
operating income $ 3.44 $ 2.46 $ 8.26 $ 7.10 Weighted average
number of common and common equivalent shares outstanding 65,653
64,815 65,604 64,944 (Unaudited) At September 30,
2017 2016 Treasury shares 14,770 14,932 Common shares outstanding
64,368 64,206 Book value per share outstanding $ 125.79 $ 124.50
Book value per share outstanding, before impact of AOCI $ 100.54 $
90.04
Reconciliation of Book Value Per Share to
Book Value Per Share Excluding AOCI
(Unaudited) At September 30, 2017 2016 Book value per share
outstanding $ 125.79 $ 124.50 Less effect of AOCI: Accumulated
currency translation adjustments (1.62 ) (1.90 ) Unrealized
appreciation of securities 27.51 37.09 Pension and postretirement
benefits (0.64 ) (0.73 ) Book value per share outstanding, before
impact of AOCI $ 100.54 $ 90.04
Reconciliation of Stockholders' Average
Equity to Stockholders' Average Equity Excluding AOCI
(Dollars in thousands)
(Unaudited) Twelve Months Ended September 30, 2017
Stockholders' average equity $ 7,714,973 Less effect of AOCI:
Accumulated currency translation adjustments (148,930 ) Unrealized
appreciation of securities 1,786,007 Pension and postretirement
benefits (42,984 ) Stockholders' average equity, excluding AOCI $
6,120,880
REINSURANCE GROUP OF AMERICA, INCORPORATED
AND SUBSIDIARIES
Condensed Consolidated Statements of
Income
(Dollars in thousands)
(Unaudited) Three Months EndedSeptember 30, Nine Months
EndedSeptember 30, 2017 2016 2017 2016
Revenues: Net premiums $ 2,489,797 $ 2,251,758 $ 7,335,944 $
6,755,708 Investment income, net of related expenses 556,918
489,727 1,589,820 1,414,659 Investment related gains (losses), net:
Other-than-temporary impairments on fixed maturity securities (390
) — (20,980 ) (34,663 ) Other investment related gains (losses),
net 23,043 86,624 160,451 118,665 Total
investment related gains (losses), net 22,653 86,624 139,471 84,002
Other revenue 75,942 72,468 218,091 197,844
Total revenues 3,145,310 2,900,577 9,283,326
8,452,213 Benefits and expenses: Claims and other
policy benefits 2,100,680 1,993,064 6,371,188 5,877,330 Interest
credited 126,099 116,848 349,068 300,602 Policy acquisition costs
and other insurance expenses 365,424 300,962 1,064,645 940,406
Other operating expenses 168,417 152,556 481,279 469,875 Interest
expense 36,836 43,063 108,590 96,201 Collateral finance and
securitization expense 7,692 6,484 21,235
19,396 Total benefits and expenses 2,805,148
2,612,977 8,396,005 7,703,810 Income before
income taxes 340,162 287,600 887,321 748,403 Provision for income
taxes 112,571 88,881 282,028 237,109
Net income $ 227,591 $ 198,719 $ 605,293 $
511,294
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version on businesswire.com: http://www.businesswire.com/news/home/20171026006562/en/
Reinsurance Group of America, IncorporatedJeff Hopson,
636-736-7000Senior Vice President - Investor Relations
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