AUSTIN,
Texas, Feb. 29, 2024 /PRNewswire/ -- Ross R. Moody, Chairman of the Board, President,
and Chief Executive Officer of National Western Life Group, Inc.
(Nasdaq: NWLI), announced today 2023 consolidated net earnings of
$94.4 million, or $26.71 per diluted share of Class A Common Stock,
compared with restated consolidated net earnings of $246.5 million, or $69.71 per diluted share of Class A Common Stock
for 2022. The Company's book value per share as of
December 31, 2023 was $670.99.
The Company's reported results were prepared in accordance with
the liability accounting methodology required under the Accounting
for Long-Duration Contracts ("LDTI") accounting standard effective
for publicly traded companies in 2023. A retrospective transition
date of January 1, 2021 was elected
and financial statements for the years ended December 31, 2022 and 2021 were restated. The
Company's pretax earnings for the years ended December 31, 2023 and 2022 include an
expense/(benefit) of $68.1 million
and $(135.7) million, respectively,
for changes in the Market Risk Benefits liability, a new liability
category created under LDTI. Unlike previous accounting guidance,
the contracts and contract features subject to liability
measurement as Market Risk Benefits are measured at fair value,
which is largely determined based upon interest rate levels in
effect at each respective reporting date.
Commenting on the reported results, Mr. Moody noted, "The new
accounting standard produced a swing in pretax earnings in excess
of $200 million, which covered over
the Company's many accomplishments in 2023. We experienced
significant gains in our investment returns, enjoyed improved
mortality experience on our blocks of business, and, excluding the
increase in our equity award expense accruals caused by the sizable
increase in our stock price, we pared back our operating expenses
substantially. All of this was accomplished in the context of
successfully achieving our goal of reaching a merger agreement with
Prosperity Life Group early in the fourth quarter of the
year."
Mr. Moody added, "Stockholders of National Western Life Group,
Inc. overwhelmingly voted to approve the merger agreement at a
special stockholders meeting held in January. We are steadily
working through the remaining required conditions to closing, most
notably the approval of various insurance regulators, and continue
to expect to close the deal in the first half of 2024."
National Western Life Group, Inc. is the parent organization of
National Western Life Insurance Company, which is the parent
organization of Ozark National Life Insurance Company, both stock
life insurance companies in aggregate offering a broad portfolio of
individual universal life, whole life and term insurance plans, as
well as annuity products. At December 31, 2023, the Company
maintained consolidated total assets of $12.3 billion, consolidated stockholders' equity
of $2.4 billion, and combined life
insurance in force of $18.0
billion.
Caution Regarding Forward-Looking Statements:
This press release contains statements which are or may be viewed
as forward-looking within the meaning of The Private Securities
Litigation Reform Act of 2005. Forward-looking statements relate to
future operations, strategies, financial results or other
developments, and are subject to assumptions, risks, and
uncertainties. These risks and uncertainties also include, (1) the
timing of completion of the proposed merger (the "Proposed
Transaction") contemplated by the Company's October 8, 2023 merger agreement (the "Merger
Agreement") with S. USA Life Insurance Company, Inc. ("S.USA") and
its direct wholly owned subsidiary ("PGH Merger Inc.") is
uncertain; (2) the conditions to the closing of the Proposed
Transaction may not be satisfied; (3) regulatory approvals required
for the Proposed Transaction may not be obtained, or required
regulatory approvals may delay the Proposed Transaction or result
in the imposition of conditions that could have a material adverse
effect on the Company or S.USA or cause certain conditions to the
closing to not be satisfied, which could result in the termination
of the Merger Agreement; (4) the business of the Company or S.USA
could suffer as a result of uncertainty surrounding the Proposed
Transaction; (5) events, changes or other circumstances could occur
that could give rise to the termination of the Merger Agreement;
(6) there are risks related to disruption of management's attention
from the ongoing business operations of the Company or S.USA due to
the Proposed Transaction; (7) the announcement or pendency of the
Proposed Transaction could affect the relationships of the Company
or S.USA with its clients, and operating results and business
generally, including its ability to retain and attract employees;
(8) the outcome of any legal proceedings initiated against the
Company or S.USA following the announcement of the Proposed
Transaction could adversely affect the Company or S.USA, including
their ability to consummate the Proposed Transaction; and (9) the
Company or S.USA mat be adversely affected by other economic,
business, and/or competitive factors as well as management's
response to any of the factors described in this paragraph. The
foregoing review of important factors should not be construed as
exhaustive and should be read in conjunction with the other
cautionary statements that are included herein and elsewhere,
including the risk factors included in the Company's most recent
Annual Report on Form 10-K and Quarterly Report on Form 10-Q and
other documents of the Company on file with the SEC. The Company
does not undertake any obligation to update, correct or otherwise
revise any forward-looking statements. All subsequent written and
oral forward-looking statements attributable to the Company and/or
any person acting on its behalf are expressly qualified in their
entirety by this section.
|
Summary of
Consolidated Financial Results (Unaudited)
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
(In thousands except
per share data)
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenues:
|
|
|
|
|
|
|
|
|
Revenues, excluding
investment and index option gains
(losses)
|
$
|
172,620
|
|
158,985
|
|
636,879
|
|
640,545
|
Realized and unrealized
gains (losses) on index options
|
|
35,366
|
|
2,308
|
|
40,612
|
|
(86,866)
|
Realized gains (losses)
on investments
|
|
(117)
|
|
50
|
|
25,859
|
|
6,355
|
Total
revenues
|
|
207,869
|
|
161,343
|
|
703,350
|
|
560,034
|
|
|
|
|
|
|
|
|
|
Benefits and
expenses:
|
|
|
|
|
|
|
|
|
Life and other policy
benefits
|
|
34,213
|
|
41,173
|
|
117,648
|
|
128,654
|
Policy benefit
remeasurement (gains) and losses
|
|
—
|
|
—
|
|
8,360
|
|
9,827
|
Market risk benefits
expense
|
|
61,397
|
|
14,320
|
|
68,130
|
|
(135,749)
|
Amortization of
deferred transaction costs
|
|
19,735
|
|
21,053
|
|
83,335
|
|
88,602
|
Universal life and
annuity contract interest
|
|
52,255
|
|
20,374
|
|
104,996
|
|
22,840
|
Other operating
expenses
|
|
61,639
|
|
43,526
|
|
191,196
|
|
135,817
|
Total benefits and
expenses
|
|
229,239
|
|
140,446
|
|
573,665
|
|
249,991
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
before income taxes
|
|
(21,370)
|
|
20,897
|
|
129,685
|
|
310,043
|
Income tax expense
(benefit)
|
|
(9,135)
|
|
3,663
|
|
35,255
|
|
63,532
|
Net earnings
(loss)
|
$
|
(12,235)
|
|
17,234
|
|
94,430
|
|
246,511
|
|
|
|
|
|
|
|
|
|
Net earnings (loss)
attributable to Class A shares
|
$
|
(11,889)
|
|
16,746
|
|
91,759
|
|
239,540
|
|
|
|
|
|
|
|
|
|
Diluted Earnings
(Loss) Per Class A Share
|
$
|
(3.46)
|
|
4.87
|
|
26.71
|
|
69.71
|
|
|
|
|
|
|
|
|
|
Diluted Weighted
Average Class A Shares
|
|
3,436
|
|
3,436
|
|
3,436
|
|
3,436
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2023
|
|
2022
|
Book value per
share
|
|
|
|
|
$
|
670.99
|
|
602.56
|
Less: Per share impact
of accumulated other comprehensive income (loss)
|
|
|
|
|
|
(88.72)
|
|
(131.52)
|
Book value per share,
excluding accumulated other comprehensive income (loss)
*
|
|
|
|
|
$
|
759.71
|
|
734.08
|
|
|
*
|
Book value per share
excluding accumulated other comprehensive income (loss) is a
non-GAAP financial measure. Accumulated other comprehensive income
(loss) totaled $(322.6) million at December 31, 2023 and
$(478.2) million at December 31, 2022. Since accumulated other
comprehensive income (loss) fluctuates from quarter to quarter due
to unrealized changes in the fair value of investments caused
primarily by changes in market interest rates, National Western
Life Group, Inc. believes this financial measure provides useful
supplemental information.
|
Investor Relations Contact:
Brian M. Pribyl - Senior Vice President, Chief
Financial Officer and Treasurer
(512) 836-1010
bpribyl@nwlic.com
www.nwlgi.com
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SOURCE National Western Life Group, Inc.