- Net income available to RGA shareholders of $2.92 per diluted
share
- Adjusted operating income* of $5.78 per diluted share
- Premium growth of 4.3% over the prior-year quarter
- ROE 2.5% and adjusted operating ROE* 3.3% for the trailing
twelve months
- Deployed capital of $121 million into transactions
- Increased quarterly dividend 9.6% to $0.80 per share
- Global estimated COVID-19 impacts1 of approximately $11 million
on a pre-tax basis, or $0.12 per diluted share2
Reinsurance Group of America, Incorporated (NYSE: RGA), a
leading global provider of life reinsurance, reported second
quarter net income available to RGA shareholders of $198 million,
or $2.92 per diluted share, compared with net income available to
RGA shareholders of $344 million, or $5.02 per diluted share, in
the prior-year quarter. Adjusted operating income* totaled $391
million, or $5.78 per diluted share, compared with adjusted
operating income of $274 million, or $4.00 per diluted share, the
year before. Net foreign currency fluctuations had a favorable
effect of $0.08 per diluted share on net income available to RGA
and an adverse effect of $0.16 per diluted share on adjusted
operating income as compared with the prior year.
Quarterly Results
Year-to-Date Results
($ in millions, except per share
data)
2022
2021
2022
2021
Net premiums
$
3,230
$
3,098
$
6,385
$
6,012
Net income available to RGA
shareholders
198
344
135
483
Net income available to RGA shareholders
per diluted share
2.92
5.02
2.00
7.06
Adjusted operating income*
391
274
423
190
Adjusted operating income per diluted
share*
5.78
4.00
6.25
2.78
Book value per share
87.14
197.72
Book value per share, excluding
accumulated other comprehensive income (AOCI)*
140.26
138.29
Total assets
84,609
88,944
*
See ‘Use of Non-GAAP Financial Measures’
below
1
COVID-19 impact estimates include
mortality and morbidity claims of approximately $11 million with no
offsetting impact from longevity in the quarter.
2
Tax effected at 24%.
In the second quarter, consolidated net premiums totaled $3.2
billion, an increase of 4.3% over last year’s second quarter, with
an adverse net foreign currency effect of $119 million. Compared
with the year-ago period, excluding spread-based businesses and the
value of associated derivatives, second quarter investment income
increased 3.7%, reflecting a higher average asset balance. Average
investment yield was flat at 4.63% in the second quarter compared
with 4.64% in the prior year.
The effective tax rate for the quarter was 22.1% on pre-tax
income.
The adjusted operating effective tax rate for the quarter was
22.5%, compared with the expected range of 23% to 24%.
Anna Manning, President and Chief Executive Officer, commented,
“This was a record level of earnings for us, and importantly it
included strong contributions from many of our business segments.
In addition, growth in organic new business was good and we had
another active quarter for capital deployment into in-force and
other transactions. COVID-19 claim costs came down substantially
this quarter, and our underlying non-COVID-19 mortality was
favorable in many markets.
“On the capital front, we deployed $121 million into in-force
and other transactions, and increased our quarterly dividend 9.6%
to $0.80 per share. Our balance sheet remains strong, and we ended
the quarter with excess capital of approximately $1.0 billion. This
quarter continues to demonstrate that our global platform can
perform well in a range of economic environments.”
SEGMENT RESULTS
U.S. and Latin America
Traditional
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Net premiums
$
1,631
$
1,578
$
3,172
$
2,997
Pre-tax income (loss)
209
135
43
(203
)
Pre-tax adjusted operating income
(loss)
190
134
9
(210
)
- Quarterly results reflected favorable individual mortality
experience.
- Non-COVID-19 individual mortality experience was favorable,
both large and non-large claims.
- COVID-19 claim costs were a net positive of $9 million,
including IBNR adjustments.
Financial Solutions
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Asset-Intensive:
Pre-tax income (loss)
$
(11
)
$
163
$
9
$
223
Pre-tax adjusted operating income
66
126
141
175
Capital Solutions:
Pre-tax income
72
23
96
46
Pre-tax adjusted operating income
72
23
96
46
- Asset-Intensive results for the quarter reflected favorable
overall experience.
- Capital Solutions results for the quarter were above
expectations, due to a treaty recapture fee.
Canada
Traditional
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Net premiums
$
314
$
301
$
618
$
581
Pre-tax income
16
32
22
56
Pre-tax adjusted operating income
24
34
29
57
- Foreign currency exchange rates had an adverse effect of $13
million on net premiums for the quarter.
- Quarterly results reflected unfavorable individual life
mortality experience driven by large claims and COVID-19 claim
costs of $4 million.
- Foreign currency exchange rates had an adverse effect of $1
million on pre-tax income and pre-tax adjusted operating income for
the quarter.
Financial Solutions
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Pre-tax income
$
4
$
4
$
17
$
10
Pre-tax adjusted operating income
4
4
17
10
- Quarterly results were in-line with expectations.
- Foreign currency exchange rates had an immaterial effect on
pre-tax income and pre-tax adjusted operating income for the
quarter.
Europe, Middle East and Africa (EMEA)
Traditional
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Net premiums
$
427
$
433
$
878
$
871
Pre-tax income (loss)
2
(12
)
(4
)
(80
)
Pre-tax adjusted operating income
(loss)
2
(12
)
(4
)
(80
)
- Foreign currency exchange rates had an adverse effect of $46
million on net premiums for the quarter.
- Quarterly results reflected unfavorable U.K. mortality
experience and $5 million of COVID-19 claim costs, partially offset
by favorable results in other markets.
- Foreign currency exchange rates had an adverse effect of $1
million on pre-tax income and pre-tax adjusted operating income for
the quarter.
Financial Solutions
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Pre-tax income
$
33
$
83
$
118
$
143
Pre-tax adjusted operating income
66
83
145
125
- Quarterly results reflected favorable longevity
experience.
- Foreign currency exchange rates had an adverse effect of $4
million on pre-tax income and $7 million on pre-tax adjusted
operating income for the quarter.
Asia Pacific
Traditional
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Net premiums
$
640
$
616
$
1,290
$
1,225
Pre-tax income (loss)
58
(12
)
109
29
Pre-tax adjusted operating income
(loss)
58
(12
)
109
29
- Foreign currency exchange rates had an adverse effect of $38
million on net premiums for the quarter.
- Quarterly results reflected favorable underwriting experience,
absorbing $7 million of COVID-19 claim costs.
- Australia reported a small loss for the quarter, driven by
COVID-19 claim costs.
- Foreign currency exchange rates had an adverse effect of $5
million on pre-tax income and $4 million on pre-tax adjusted
operating income for the quarter.
Financial Solutions
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Net premiums
$
60
$
48
$
103
$
101
Pre-tax income (loss)
(66
)
31
(122
)
59
Pre-tax adjusted operating income
28
20
49
39
- Quarterly results reflected business growth and favorable
investment yields, partially offset by $4 million of COVID-19 claim
costs.
- Foreign currency exchange rates had a favorable effect of $16
million on pre-tax loss and an adverse effect of $1 million on
pre-tax adjusted operating income for the quarter.
Corporate and Other
Quarterly Results
Year-to-Date Results
($ in millions)
2022
2021
2022
2021
Pre-tax income (loss)
$
(63
)
$
35
$
(94
)
$
385
Pre-tax adjusted operating income
(loss)
(5
)
(39
)
(27
)
55
- Second quarter pre-tax adjusted operating loss was favorable as
compared to with the quarterly average run rate, primarily due to
higher net investment income, including limited partnership
income.
Long Duration Targeted Improvements
In the first quarter of 2023, the Company will adopt Accounting
Standards Update 2018-12, Financial Services – Insurance (Topic
944): Targeted Improvements to the Accounting for Long-Duration
Contracts (“LDTI”). The Company estimates the adoption of LDTI will
decrease:
- retained earnings by $500 million to $800 million, net of tax,
as of December 31, 2021;
- retained earnings by $1.0 billion to $1.3 billion, net of tax,
as of the transition date of January 1, 2021;
- accumulated other comprehensive income by $3.2 billion to $5.2
billion, net of tax, as of December 31, 2021; and
- accumulated other comprehensive income by $5.1 billion to $7.1
billion, net of tax, as of the transition date of January 1,
2021.
The LDTI adoption impacts, including the 24% tax rate assumed in
the above figures, are estimates and subject to change due to
ongoing review and refinement of actuarial assumptions and
projection models, additional review of tax impacts across various
tax jurisdictions and additional implementation guidance.
Additionally, the ultimate impact on retained earnings and
accumulated other comprehensive income upon adoption of LDTI on
January 1, 2023, may differ materially from the above figures based
on the performance of the Company’s business during 2022 and
macroeconomic conditions, including changes in interest rates.
Please see the Company’s quarterly earnings presentation furnished
as Exhibit 99.3 to the Company’s Current Report on Form 8-K filed
with the U.S. Securities and Exchange Commission on August 4, 2022,
for additional details.
Dividend Declaration
Effective August 2, 2022, the board of directors declared a
regular quarterly dividend of $0.80, payable August 30, 2022, to
shareholders of record as of August 16, 2022.
Earnings Conference Call
A conference call to discuss second quarter results will begin
at 10 a.m. Eastern Time on Friday, August 5. Interested parties may
access the call by dialing 888-204-4368 (domestic) or 323-994-2093
(international). The access code is 9502707. 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.
The Company has posted to its website an earnings presentation
and 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. 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, tax reform 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 stockholders’ 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 (NYSE: RGA) is a
global industry leader specializing in life and health reinsurance
and financial solutions that help clients effectively manage risk
and optimize capital. Founded in 1973, RGA is one of the world’s
largest and most respected reinsurers and is guided by a
fundamental purpose: to make financial protection accessible to
all. RGA is widely recognized for superior risk management and
underwriting expertise, innovative product design, and dedicated
client focus. RGA serves clients and partners in key markets around
the world and has approximately $3.4 trillion of life reinsurance
in force and assets of $84.6 billion as of June 30, 2022. To learn
more about RGA and its businesses, visit www.rgare.com. Follow RGA
on LinkedIn, Twitter, and Facebook.
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
future operations, strategies, earnings, revenues, income or loss,
ratios, financial performance and growth potential of the Company.
Forward-looking statements often contain words and phrases such as
“intend,” “expect,” “project,” “estimate,” “predict,” “anticipate,”
“should,” “believe” and other similar expressions. Forward-looking
statements are based on management’s current expectations and
beliefs concerning future developments and their potential effects
on the Company. Forward-looking statements are not a guarantee of
future performance and are 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.
The effects of the COVID-19 pandemic and the response thereto on
economic conditions, the financial markets and insurance risks, and
the resulting effects on the Company’s financial results,
liquidity, capital resources, financial metrics, investment
portfolio and stock price, could cause actual results and events to
differ materially from those expressed or implied by
forward-looking statements. Further, any estimates, projections,
illustrative scenarios or frameworks used to plan for potential
effects of the pandemic are dependent on numerous underlying
assumptions and estimates that may not materialize. Additionally,
numerous other important factors (whether related to, resulting
from or exacerbated by the COVID-19 pandemic or otherwise) could
also cause results and events to differ materially from those
expressed or implied by forward-looking statements, including,
without limitation: (1) adverse changes in mortality, morbidity,
lapsation or claims experience, (2) inadequate risk analysis and
underwriting, (3) adverse capital and credit market conditions and
their impact on the Company’s liquidity, access to capital and cost
of capital, (4) 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, (5) the
availability and cost of collateral necessary for regulatory
reserves and capital, (6) requirements to post collateral or make
payments due to declines in market value of assets subject to the
Company’s collateral arrangements, (7) action by regulators who
have authority over the Company’s reinsurance operations in the
jurisdictions in which it operates, (8) the effect of the Company
parent’s status as an insurance holding company and regulatory
restrictions on its ability to pay principal of and interest on its
debt obligations, (9) general economic conditions or a prolonged
economic downturn affecting the demand for insurance and
reinsurance in the Company’s current and planned markets, (10) the
impairment of other financial institutions and its effect on the
Company’s business, (11) fluctuations in U.S. or foreign currency
exchange rates, interest rates, or securities and real estate
markets, (12) 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, (13) market or economic conditions that
adversely affect the Company’s ability to make timely sales of
investment securities, (14) 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,
(15) the fact that the determination of allowances and impairments
taken on the Company’s investments is highly subjective, (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 U.S. sovereign debt and the
credit ratings thereof, (17) 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, (18) financial performance of the Company’s
clients, (19) the threat of natural disasters, catastrophes,
terrorist attacks, epidemics or pandemics anywhere in the world
where the Company or its clients do business, (20) competitive
factors and competitors’ responses to the Company’s initiatives,
(21) development and introduction of new products and distribution
opportunities, (22) execution of the Company’s entry into new
markets, (23) integration of acquired blocks of business and
entities, (24) 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 and intellectual property stored on such systems, (25) adverse
litigation or arbitration results, (26) the adequacy of reserves,
resources and accurate information relating to settlements, awards
and terminated and discontinued lines of business, (27) changes in
laws, regulations, and accounting standards applicable to the
Company or its business, including Long Duration Targeted
Improvement accounting changes and (28) other risks and
uncertainties described in this document and in the Company’s other
filings with the Securities and Exchange Commission (“SEC”).
Forward-looking statements should be evaluated together with the
many risks and uncertainties that affect the Company’s business,
including those mentioned in this document and described in the
periodic reports the Company files with the SEC. These
forward-looking statements speak only as of the date on which they
are made. The Company does not undertake any obligation to update
these forward-looking statements, even though the Company’s
situation may change in the future. For a discussion of these 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 Company’s
Annual Report on Form 10-K for the year ended December 31, 2021, as
may be supplemented by Item 1A - “Risk Factors” in the Company’s
subsequent Quarterly Reports on Form 10-Q.
REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
Reconciliation of Consolidated
Net Income to Adjusted Operating Income
(Dollars in millions, except per
share data)
(Unaudited)
Three Months Ended June 30,
2022
2021
Diluted Earnings Per Share
Diluted Earnings Per Share
Net income available to RGA
shareholders
$
198
$
2.92
$
344
$
5.02
Reconciliation to adjusted operating
income:
Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net
151
2.25
(82
)
(1.19
)
Capital (gains) losses on funds withheld,
included in investment income, net of related expenses
7
0.10
(1
)
(0.01
)
Embedded derivatives:
Included in investment related
gains/losses, net
54
0.80
1
0.01
Included in interest credited
(22
)
(0.33
)
(2
)
(0.03
)
DAC offset, net
6
0.09
(1
)
(0.01
)
Investment (income) loss on unit-linked
variable annuities
6
0.09
(2
)
(0.03
)
Interest credited on unit-linked variable
annuities
(6
)
(0.09
)
2
0.03
Interest expense on uncertain tax
positions
—
—
3
0.04
Non-investment derivatives and other
(7
)
(0.10
)
(12
)
(0.18
)
Uncertain tax positions and other tax
related items
3
0.04
24
0.35
Net income attributable to noncontrolling
interest
1
0.01
—
—
Adjusted operating income
$
391
$
5.78
$
274
$
4.00
(Unaudited)
Six Months Ended June 30,
2022
2021
Diluted Earnings Per Share
Diluted Earnings Per Share
Net income available to RGA
shareholders
$
135
$
2.00
$
483
$
7.06
Reconciliation to adjusted operating
income:
Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net
245
3.62
(261
)
(3.82
)
Capital (gains) losses on funds withheld,
included in investment income, net of related expenses
13
0.19
(2
)
(0.03
)
Embedded derivatives:
Included in investment related
gains/losses, net
69
1.02
(53
)
(0.77
)
Included in interest credited
(35
)
(0.52
)
(26
)
(0.38
)
DAC offset, net
(2
)
(0.03
)
8
0.12
Investment (income) loss on unit-linked
variable annuities
13
0.19
(1
)
(0.01
)
Interest credited on unit-linked variable
annuities
(13
)
(0.19
)
1
0.01
Interest expense on uncertain tax
positions
—
—
5
0.07
Non-investment derivatives and other
(7
)
(0.10
)
(3
)
(0.04
)
Uncertain tax positions and other tax
related items
4
0.06
39
0.57
Net income attributable to noncontrolling
interest
1
0.01
—
—
Adjusted operating income
$
423
$
6.25
$
190
$
2.78
REINSURANCE GROUP OF AMERICA,
INCORPORATED AND SUBSIDIARIES
Reconciliation of Consolidated
Effective Income Tax Rates
(Dollars in millions)
(Unaudited)
Three Months Ended June 30,
2022
Six Months Ended June 30,
2022
Pre-tax Income (Loss)
Income Taxes
Effective Tax Rate (1)
Pre-tax Income (Loss)
Income Taxes
Effective Tax Rate (1)
GAAP income
$
254
$
55
22.1
%
$
194
$
58
30.1
%
Reconciliation to adjusted operating
income:
Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net
203
52
322
77
Capital (gains) losses on funds withheld,
included in investment income, net of related expenses
9
2
17
4
Embedded derivatives:
Included in investment related
gains/losses, net
68
14
87
18
Included in interest credited
(27
)
(5
)
(44
)
(9
)
DAC offset, net
7
1
(3
)
(1
)
Investment (income) loss on unit-linked
variable annuities
8
2
17
4
Interest credited on unit-linked variable
annuities
(8
)
(2
)
(17
)
(4
)
Interest expense on uncertain tax
positions
—
—
—
—
Non-investment derivatives and other
(9
)
(2
)
(9
)
(2
)
Uncertain tax positions and other tax
related items
—
(3
)
—
(4
)
Adjusted operating income
$
505
$
114
22.5
%
$
564
$
141
25.0
%
(1)
The Company rounds amounts in the
financial statements to millions and calculates the effective tax
rate from the underlying whole-dollar amounts. Thus certain amounts
may not recalculate based on the numbers due to rounding.
Reconciliation of Consolidated
Income before Income Taxes to Pre-tax Adjusted Operating Income
(Dollars in millions)
(Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2022
2021
2022
2021
Income before income taxes
$
254
$
482
$
194
$
668
Reconciliation to pre-tax adjusted
operating income:
Capital (gains) losses, derivatives and
other, included in investment related gains/losses, net
203
(104
)
322
(332
)
Capital (gains) losses on funds withheld,
included in investment income, net of related expenses
9
(1
)
17
(2
)
Embedded derivatives:
Included in investment related
gains/losses, net
68
1
87
(67
)
Included in interest credited
(27
)
(3
)
(44
)
(33
)
DAC offset, net
7
(2
)
(3
)
10
Investment (income) loss on unit-linked
variable annuities
8
(2
)
17
(1
)
Interest credited on unit-linked variable
annuities
(8
)
2
(17
)
1
Interest expense on uncertain tax
positions
—
3
—
6
Non-investment derivatives and other
(9
)
(15
)
(9
)
(4
)
Pre-tax adjusted operating income
$
505
$
361
$
564
$
246
REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES
Reconciliation of Pre-tax Income
to Pre-tax Adjusted Operating Income
(Dollars in millions)
(Unaudited)
Three Months Ended June 30,
2022
Pre-tax income (loss)
Capital
(gains) losses,
derivatives
and other, net
Change in
value of
embedded
derivatives, net
Pre-tax adjusted operating
income (loss)
U.S. and Latin America:
Traditional
$
209
$
—
$
(19
)
$
190
Financial Solutions:
Asset-Intensive
(11
)
37
(1)
40
(2)
66
Capital Solutions
72
—
—
72
Total U.S. and Latin America
270
37
21
328
Canada Traditional
16
8
—
24
Canada Financial Solutions
4
—
—
4
Total Canada
20
8
—
28
EMEA Traditional
2
—
—
2
EMEA Financial Solutions
33
33
—
66
Total EMEA
35
33
—
68
Asia Pacific Traditional
58
—
—
58
Asia Pacific Financial Solutions
(66
)
94
—
28
Total Asia Pacific
(8
)
94
—
86
Corporate and Other
(63
)
58
—
(5
)
Consolidated
$
254
$
230
$
21
$
505
(1) Asset-Intensive is net of $27
DAC offset.
(2) Asset-Intensive is net of
$(20) DAC offset.
(Unaudited)
Three Months Ended June 30,
2021
Pre-tax income (loss)
Capital
(gains) losses,
derivatives
and other, net
Change in
value of
embedded
derivatives, net
Pre-tax adjusted
operating
income (loss)
U.S. and Latin America:
Traditional
$
135
$
—
$
(1
)
$
134
Financial Solutions:
Asset-Intensive
163
(47
)
(1)
10
(2)
126
Capital Solutions
23
—
—
23
Total U.S. and Latin America
321
(47
)
9
283
Canada Traditional
32
2
—
34
Canada Financial Solutions
4
—
—
4
Total Canada
36
2
—
38
EMEA Traditional
(12
)
—
—
(12
)
EMEA Financial Solutions
83
—
—
83
Total EMEA
71
—
—
71
Asia Pacific Traditional
(12
)
—
—
(12
)
Asia Pacific Financial Solutions
31
(11
)
—
20
Total Asia Pacific
19
(11
)
—
8
Corporate and Other
35
(74
)
—
(39
)
Consolidated
$
482
$
(130
)
$
9
$
361
(1) Asset-Intensive is net of
$(13) DAC offset.
(2) Asset-Intensive is net of $11
DAC offset.
REINSURANCE GROUP OF AMERICA,
INCORPORATED AND SUBSIDIARIES
Reconciliation of Pre-tax Income
to Pre-tax Adjusted Operating Income
(Dollars in millions)
(Unaudited)
Six Months Ended June 30,
2022
Pre-tax income (loss)
Capital
(gains) losses,
derivatives
and other, net
Change in
value of
embedded
derivatives, net
Pre-tax adjusted operating
income (loss)
U.S. and Latin America:
Traditional
$
43
$
—
$
(34
)
$
9
Financial Solutions:
Asset-Intensive
9
94
(1)
38
(2)
141
Capital Solutions
96
—
—
96
Total U.S. and Latin America
148
94
4
246
Canada Traditional
22
7
—
29
Canada Financial Solutions
17
—
—
17
Total Canada
39
7
—
46
EMEA Traditional
(4
)
—
—
(4
)
EMEA Financial Solutions
118
27
—
145
Total EMEA
114
27
—
141
Asia Pacific Traditional
109
—
—
109
Asia Pacific Financial Solutions
(122
)
171
—
49
Total Asia Pacific
(13
)
171
—
158
Corporate and Other
(94
)
67
—
(27
)
Consolidated
$
194
$
366
$
4
$
564
(1) Asset-Intensive is net of $36
DAC offset.
(2) Asset-Intensive is net of
$(39) DAC offset.
(Unaudited)
Six Months Ended June 30,
2021
Pre-tax income (loss)
Capital
(gains) losses,
derivatives
and other, net
Change in
value of
embedded
derivatives, net
Pre-tax adjusted
operating
income (loss)
U.S. and Latin America:
Traditional
$
(203
)
$
—
$
(7
)
$
(210
)
Financial Solutions:
Asset-Intensive
223
8
(1)
(56
)
(2)
175
Capital Solutions
46
—
—
46
Total U.S. and Latin America
66
8
(63
)
11
Canada Traditional
56
1
—
57
Canada Financial Solutions
10
—
—
10
Total Canada
66
1
—
67
EMEA Traditional
(80
)
—
—
(80
)
EMEA Financial Solutions
143
(18
)
—
125
Total EMEA
63
(18
)
—
45
Asia Pacific Traditional
29
—
—
29
Asia Pacific Financial Solutions
59
(20
)
—
39
Total Asia Pacific
88
(20
)
—
68
Corporate and Other
385
(330
)
—
55
Consolidated
$
668
$
(359
)
$
(63
)
$
246
(1) Asset-Intensive is net of
$(27) DAC offset.
(2) Asset-Intensive is net of $37
DAC offset.
REINSURANCE GROUP OF AMERICA,
INCORPORATED AND SUBSIDIARIES
Per Share and Shares Data
(In thousands, except per share
data)
(Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2022
2021
2022
2021
Earnings per share from net income:
Basic earnings per share
$
2.95
$
5.06
$
2.01
$
7.11
Diluted earnings per share (1)
$
2.92
$
5.02
$
2.00
$
7.06
Diluted earnings per share from adjusted
operating income (1)
$
5.78
$
4.00
$
6.25
$
2.78
Weighted average number of common and
common equivalent shares outstanding
67,620
68,533
67,614
68,460
(1) As a result of anti-dilutive impact,
in periods of a loss, weighted average common shares outstanding
(basic) are used in the calculation of diluted earnings per
share.
(Unaudited)
At June 30,
2022
2021
Treasury shares
18,304
17,314
Common shares outstanding
67,007
67,997
Book value per share outstanding
$
87.14
$
197.72
Book value per share outstanding, before
impact of AOCI
$
140.26
$
138.29
Reconciliation of Book Value Per
Share to Book Value Per Share Excluding AOCI
(Unaudited)
At June 30,
2022
2021
Book value per share outstanding
$
87.14
$
197.72
Less effect of AOCI:
Accumulated currency translation
adjustments
(0.58
)
(0.29
)
Unrealized appreciation of securities
(51.78
)
60.78
Pension and postretirement benefits
(0.76
)
(1.06
)
Book value per share outstanding, before
impact of AOCI
$
140.26
$
138.29
Reconciliation of Stockholders'
Average Equity to Stockholders' Average Equity Excluding AOCI
(Dollars in millions)
(Unaudited)
Trailing Twelve Months Ended June 30,
2022:
Average Equity
Stockholders' average equity
$
10,873
Less effect of AOCI:
Accumulated currency translation
adjustments
(23
)
Unrealized appreciation of securities
1,612
Pension and postretirement benefits
(58
)
Stockholders' average equity, excluding
AOCI
$
9,342
Reconciliation of Trailing Twelve
Months of Consolidated Net Income to Adjusted Operating Income
and
Related Return on Equity
(Dollars in millions)
(Unaudited)
Return on Equity
Trailing Twelve Months Ended June 30,
2022:
Income
Net income available to RGA
shareholders
$
269
2.5
%
Reconciliation to adjusted operating
income:
Capital (gains) losses, derivatives and
other, net
147
Change in fair value of embedded
derivatives
(2
)
Deferred acquisition cost offset, net
20
Tax expense on uncertain tax positions
(125
)
Net income attributable to noncontrolling
interest
1
Adjusted operating income
$
310
3.3
%
REINSURANCE GROUP OF AMERICA,
INCORPORATED AND SUBSIDIARIES
Condensed Consolidated Statements
of Income
(Dollars in millions)
(Unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2022
2021
2022
2021
Revenues:
Net premiums
$
3,230
$
3,098
$
6,385
$
6,012
Investment income, net of related
expenses
754
759
1,564
1,571
Investment related gains (losses), net
(254
)
112
(380
)
414
Other revenue
157
168
248
259
Total revenues
3,887
4,137
7,817
8,256
Benefits and expenses:
Claims and other policy benefits
2,815
2,813
6,040
6,005
Interest credited
138
218
279
364
Policy acquisition costs and other
insurance expenses
393
339
748
672
Other operating expenses
243
240
469
454
Interest expense
42
43
84
88
Collateral finance and securitization
expense
2
2
3
5
Total benefits and expenses
3,633
3,655
7,623
7,588
Income before income taxes
254
482
194
668
Provision for income taxes
55
138
58
185
Net income
199
344
136
483
Net income attributable to noncontrolling
interest
1
—
1
—
Net income available to RGA
shareholders
$
198
$
344
$
135
$
483
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220728005676/en/
Investor Contact Jeff Hopson Senior Vice President -
Investor Relations (636) 736-2068
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