- Strong net inflows of $12bn supporting AUM growth of 4%
year-over-year
- Net income of $573m; Net income per share of $1.43
- Non-GAAP operating earnings1 of $548m, or $1.36 per share;
adjusting for notable items2, Non-GAAP operating earnings of $615m,
or $1.53 per share
- Fair value management supports capital return during
volatile markets; including $461m in Q13
- Acquisition of CarVal Investors will expand AB’s Private
Markets AUM to nearly $50bn4 and creates new growth opportunities
to diversify and expand services to meet clients' evolving
needs
Equitable Holdings, Inc. (“Equitable Holdings”, “Holdings”, or
the “Company”) (NYSE: EQH) today announced financial results for
the first quarter ended March 31, 2022.
“Our fair value economic approach and use of market interest
rates have led to robust cash flows despite volatile markets and
geopolitical conflict. We reported first quarter Non-GAAP operating
earnings of $1.36 per share, up 1% year-over-year. Adjusting for
notable items, Non-GAAP operating earnings were $1.53, up 13%
year-over-year. Net inflows in the quarter were $12 billion, more
than doubling year-over-year, driving our AUM to $856 billion. With
our leading franchises in advice, retirement and asset management,
we remain well-positioned to help address the growing demand to
protect the financial future of Americans who are confronting
greater economic uncertainty,” said Mark Pearson, President and
Chief Executive Officer.
Mr. Pearson continued, "During the quarter our subsidiary
AllianceBernstein announced an agreement to acquire CarVal
Investors, which will bring its Private Markets platform to nearly
$50 billion. This agreement is an example of the unique synergies
between AllianceBernstein and Equitable, the two complementary and
well-established companies of Equitable Holdings. Equitable has
committed to deploy $10 billion in investment capital from its
General Account towards AB's Private Markets platform. Of the
commitment, $750 million will be allocated across targeted CarVal
strategies, further improving Equitable's risk-adjusted return and
strengthening AB's efforts to grow higher multiple, higher margin
and capital light businesses."
Consolidated Results
First Quarter
(in millions, except per share amounts or
unless otherwise noted)
2022
2021
Total Assets Under Management (“AUM”, in
billions)
$
856
$
822
Net income (loss) attributable to
Holdings
573
(1,488
)
Net income (loss) attributable to Holdings
per common share
1.43
(3.46
)
Non-GAAP operating earnings (loss)
548
600
Non-GAAP operating earnings (loss) per
common share (“EPS”)
1.36
1.35
As of March 31, 2022, total AUM was $856 billion, a
year-over-year increase of 4.1% driven by net inflows and market
performance over the prior twelve months.
The Net income attributable to Holdings for the first quarter of
2022 was $573 million compared to Net loss of $1.5 billion in the
first quarter of 2021 driven primarily by non-economic market
impacts from hedging under U.S. GAAP accounting.
Non-GAAP operating earnings in the first quarter of 2022 was
$548 million compared to $600 million in the first quarter of 2021.
Excluding notable items5 of $67 million, first quarter 2022
Non-GAAP operating earnings were $615 million or $1.53 per
share.
As of March 31, 2022, book value per common share, including
accumulated other comprehensive income (“AOCI”), was $16.64. Book
value per common share, excluding AOCI, was $21.29.
Business
Highlights
- Business segment highlights:
- Individual Retirement (“IR”) reported first quarter net inflows
of $52 million, the highest quarter since the IPO. The Structured
Capital Strategies (“SCS”) buffered annuity product achieved its
highest month of sales ever in March and $2 billion in first year
premium for the quarter.
- Group Retirement (“GR”) generated first quarter net inflows of
$523 million primarily driven by secure income inflows associated
with AB’s Lifetime Income product.
- Investment Management and Research (AllianceBernstein or “AB”)6
reported another quarter of net inflows, over $11 billion in the
quarter, with fee rate expansion of 1% and annualized organic
growth of 6% year-over-year.
- Protection Solutions (“PS”) gross written premiums up 36%
year-over-year driven by shift to less interested-sensitive VUL;
excess mortality continues to be within COVID guidance.
- Capital management program:
- As part of the Company’s 2022 capital management program, we
returned $461 million to shareholders including $70 million of
quarterly cash dividends, $279 million of first quarter 2022 share
repurchases and an additional $112 million of fourth quarter 2021
accelerated repurchases.
- The Company intends to increase its quarterly cash dividend
from $0.18 to $0.20 per share in the second quarter.7
- The Company reported cash and liquid assets of $1.5 billion at
Holdings, which remains above the $500 million minimum liquidity
target.
- Maintained c. 95% hedging effectiveness through volatile
markets in the quarter.
- Delivering long-term shareholder value:
- AllianceBernstein announced the acquisition of CarVal
Investors, which will further enhance the Company’s differentiated
business model. The transaction will expand AB’s higher-multiple
private markets platform to nearly $50 billion8 in AUM and elevates
AB into a leading private credit provider with direct origination
capabilities.
- The Company expects c. $1.6 billion of cash generation in 2022;
a c. 30% increase since the IPO attributable to growth in asset and
wealth management.
- Continuing to deliver 8-10% annualized EPS growth supported by
the Company’s General Account rebalancing efforts, realizing $118
million of $180 million incremental investment income target to
date, and expense savings of $35 million, 44% of target.
Business Segment
Results
Individual Retirement
(in millions, unless otherwise noted)
Q1 2022
Q1 2021
Account value (in billions)
$
106.4
$
120.8
Segment net
flows
Current Product Offering
665
559
Legacy (1)
(613
)
(1,075
)
Total segment net flows
52
(516
)
Operating earnings (loss)
293
363
(1) Net flows of $(316) million not included Q1 2022 as it
relates to AV ceded to Venerable.
- Account value decreased by 11.9% primarily due to $16.9 billion
of AV ceded to Venerable, partially offset by strong new business
growth and equity markets.
- Net inflows of $52 million increased compared to the first
quarter of 2021 led by net inflows of $665 million from our current
product offering of less capital-intensive products, which was
partially offset outflows from the legacy VA block of $(613)
million.
- Operating earnings decreased from $363 million in the prior
year quarter to $293 million, primarily due to lower fee and net
investment income associated with the Venerable transaction which
was partially offset by higher GMxB margins and lower
expenses.
- Operating earnings less notable items9 decreased from $367
million in the prior year quarter to $307 million. Notable items of
$(14) million in the current period reflect higher net investment
income from alternatives partially offsetting a deferred
acquisition cost (“DAC”) update.
Group Retirement
(in millions, unless otherwise noted)
Q1 2022
Q1 2021
Account value (in billions)
$
46.0
$
44.3
Segment net flows
523
(36
)
Operating earnings (loss)
150
151
- Account value increased by 4% driven primarily by equity market
performance over the prior twelve months.
- Net flows of $523 million increased versus the prior year
quarter primarily due to premiums attributable to an allocation
from AB’s Lifetime Income product and net inflows in our tax-exempt
market.
- Operating earnings decreased from $151 million to $150 million
versus the prior year quarter, primarily due to higher amortization
of DAC, partially offset by higher fee-type revenue and lower
expenses.
- Operating earnings less notable items9 increased from $139
million in the prior year quarter to $149 million. Notable items of
$1 million in the current period reflect higher net investment
income from alternatives offsetting a DAC update.
Investment Management and Research
(in millions, unless otherwise noted)
Q1 2022
Q1 2021
Total AUM (in billions)
$
735.4
$
697.2
Segment net flows (in billions)
11.4
5.2
Operating earnings (loss)
136
121
- AUM increased by 5% due to equity market performance and net
inflows over the prior twelve months.
- First quarter net flows of $11.4 billion were driven by strong
net inflows in the Institutional and Private Wealth channels,
including $12 billion in active net inflows.
- Operating earnings increased from $121 million to $136 million,
primarily driven by higher base fees on higher average AUM and
higher performance fees, partially offset by higher expenses.
Protection Solutions
(in millions)
Q1 2022
Q1 2021
Gross written premiums
$
1,033
$
762
Annualized premiums
77
69
Operating earnings (loss)
35
41
- Gross written premiums increased 36% versus the prior year
quarter with continued success in our strategic shift to less
interest-sensitive VUL accumulation products.
- Annualized premiums increased from $69 million to $77 million
versus the prior year quarter primarily driven by year-over-year
growth in our life business, up 14%.
- Operating earnings decreased from $41 million to $35 million
versus the prior year quarter, primarily due to elevated mortality
partially offset by higher fee-type revenue and net investment
income.
- Operating earnings excluding notable items10 increased from $42
million in the prior year quarter to $96 million. Notable items of
$(61) million in the current period related to higher net
investment income from alternatives partially offsetting excess
mortality and a DAC update. On a post-tax basis, net excess
mortality was $61 million, within COVID guidance of a $30 million
to $60 million operating earnings per 100 thousand US deaths.
Corporate and Other (“C&O”)
Operating loss of $66 million in the first quarter improved
compared to operating loss of $76 million in the prior year
quarter, primarily driven by lower policy benefits and higher
wealth management fee-type revenue. Operating loss excluding
notable items10 decreased from $67 million in the prior year
quarter to $73 million. Notable items of $7 million in the current
period related to higher net investment income from
alternatives.
Exhibit 1: Notable
Items
Notable items represent the impact on results from our annual
actuarial assumption review, approximate impacts attributable to
significant variances from the Company’s expectations, and other
items that the Company believes may not be indicative of future
performance. The Company chooses to highlight the impact of these
items and Non-GAAP measures, less notable items to provide a better
understanding of our results of operations in a given period.
Certain figures may not sum due to rounding.
Impact of notable items by segment and Corporate &
Other:
Three Months Ended March
31,
(in millions)
2022
2021
Non-GAAP Operating Earnings
$
548
$
600
Adjustments related to notable items:
Individual Retirement
(14
)
(4
)
Group Retirement
1
12
Investment Management and Research
—
—
Protection Solutions
(61
)
(0
)
Corporate & Other
7
(10
)
Notable items subtotal
(67
)
(2
)
Less: impact of actuarial assumption
update
—
—
Non-GAAP operating earnings, less notable
items
$
615
$
602
Impact of notable items by item category:
Three Months Ended March
31,
(in millions)
2022
2021
Non-GAAP Operating Earnings
$
548
$
600
Pre-tax adjustments related to notable
items:
Actuarial Updates/Reserve
(28
)
(6
)
Mortality
(74
)
(58
)
Expenses
—
—
Net Investment Income
24
57
Subtotal
(78
)
(6
)
Post-tax impact of notable items
(67
)
(2
)
Less: impact of actuarial assumption
update
—
—
Non-GAAP operating earnings, less notable
items
$
615
$
602
Impact of Notable Items by segment and corporate &
other:
Three Months Ended
March 31, 2022 ($m)
IR
GR
AB
PS
C&O
Consolidated
Non-GAAP Operating Earnings
293
150
136
35
(66
)
548
Pre-tax adjustments related to Notable
Items
Actuarial Updates/Reserve
(19
)
(3
)
—
(7
)
—
(28
)
Mortality
—
—
—
(74
)
—
(74
)
Expenses
—
—
—
—
—
—
Net Investment Income
6
6
—
8
4
24
Pre-tax Subtotal
(13
)
3
—
(73
)
4
(78
)
Tax adjustment
(1
)
(2
)
—
12
2
11
Post-tax impact of Notable
Items
(14
)
1
—
(61
)
7
(67
)
Impact of Actuarial Assumption Update
—
—
—
—
—
—
Non-GAAP Operating Earnings, less
Notable Items
307
149
136
96
(73
)
615
Three Months Ended
March 31, 2021 ($m)
IR
GR
AB
PS
C&O
Consolidated
Non-GAAP Operating Earnings
363
151
121
41
(76
)
600
Pre-tax adjustments related to Notable
Items
Actuarial Updates/Reserve
—
—
—
(6
)
—
(6
)
Mortality
(21
)
—
—
(15
)
(22
)
(58
)
Expenses
—
—
—
—
—
—
Net Investment Income
14
13
—
19
11
57
Pre-tax Subtotal
(7
)
13
—
(1
)
(11
)
(6
)
Tax adjustment
3
(2
)
—
0
2
4
Post-tax impact of Notable
Items
(4
)
12
—
(0
)
(10
)
(2
)
Impact of Actuarial Assumption Update
—
—
—
—
—
—
Non-GAAP Operating Earnings, less
Notable Items
367
139
121
42
(67
)
602
Earnings Conference Call
Equitable Holdings will host a conference call at 9 a.m. ET May
10, 2022 to discuss its full year and first quarter 2022 results.
The conference call webcast, along with additional earnings
materials will be accessible on the company’s investor relations
website at ir.equitableholdings.com. Please log on to the webcast
at least 15 minutes prior to the call to download and install any
necessary software.
To register for the conference call, please use the following
link: EQH First Quarter 2022 Earnings Call
After registering, you will receive an email confirmation
including dial in details and a unique conference call code for
entry. Registration is open through the live call. To ensure you
are connected for the full call we suggest registering a day in
advance or at minimum 10 minutes before the start of the call.
A webcast replay will be made available on the Equitable
Holdings Investor Relations website at
ir.equitableholdings.com.
About Equitable Holdings
Equitable Holdings, Inc. (NYSE: EQH) is a financial services
holding company comprised of two complementary and well-established
principal franchises, Equitable and AllianceBernstein. Founded in
1859, Equitable provides advice, protection and retirement
strategies to individuals, families and small businesses.
AllianceBernstein is a global investment management firm that
offers high-quality research and diversified investment services to
institutional investors, individuals and private wealth clients in
major world markets. Equitable Holdings has approximately 12,100
employees and financial professionals, $856 billion in assets under
management (as of 3/31/2022) and more than 5 million client
relationships globally.
Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as “expects,” “believes,” “anticipates,”
“intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,”
“projects,” “should,” “would,” “could,” “may,” “will,” “shall” or
variations of such words are generally part of forward-looking
statements. Forward-looking statements are made based on
management’s current expectations and beliefs concerning future
developments and their potential effects upon Equitable Holdings,
Inc. (“Holdings”) and its consolidated subsidiaries. “We,” “us” and
“our” refer to Holdings and its consolidated subsidiaries, unless
the context refers only to Holdings as a corporate entity. There
can be no assurance that future developments affecting Holdings
will be those anticipated by management. Forward-looking statements
include, without limitation, all matters that are not historical
facts.
These forward-looking statements are not a guarantee of future
performance and involve risks and uncertainties, and there are
certain important factors that could cause actual results to
differ, possibly materially, from expectations or estimates
reflected in such forward-looking statements, including, among
others: (i) conditions in the financial markets and economy,
including the impact of COVID-19 and related economic conditions,
equity market declines and volatility, interest rate fluctuations,
impacts on our goodwill and changes in liquidity and access to and
cost of capital; (ii) operational factors, including reliance on
the payment of dividends to Holdings by its subsidiaries,
protection of confidential customer information or proprietary
business information, operational failures by us or our service
providers, and catastrophic events, such as the outbreak of
pandemic diseases including COVID-19; (iii) credit, counterparties
and investments, including counterparty default on derivative
contracts, failure of financial institutions, defaults by third
parties and affiliates and economic downturns, defaults and other
events adversely affecting our investments; (iv) our reinsurance
and hedging programs; (v) our products, structure and product
distribution, including variable annuity guaranteed benefits
features within certain of our products, variations in statutory
capital requirements, financial strength and claims-paying ratings,
state insurance laws limiting the ability of our insurance
subsidiaries to pay dividends and key product distribution
relationships; (vi) estimates, assumptions and valuations,
including risk management policies and procedures, potential
inadequacy of reserves and experience differing from pricing
expectations, amortization of deferred acquisition costs and
financial models; (vii) our Investment Management and Research
segment, including fluctuations in assets under management and the
industry-wide shift from actively-managed investment services to
passive services; (viii) legal and regulatory risks, including
federal and state legislation affecting financial institutions,
insurance regulation and tax reform; (ix) risks related to our
common stock and (x) general risks, including strong industry
competition, information systems failing or being compromised and
protecting our intellectual property.
Forward-looking statements should be read in conjunction with
the other cautionary statements, risks, uncertainties and other
factors identified in Holdings’ filings with the Securities and
Exchange Commission. Further, any forward-looking statement speaks
only as of the date on which it is made, and we undertake no
obligation to update or revise any forward-looking statement to
reflect events or circumstances after the date on which the
statement is made or to reflect the occurrence of unanticipated
events, except as otherwise may be required by law.
Use of Non-GAAP Financial Measures
In addition to our results presented in accordance with U.S.
GAAP, we report Non-GAAP Operating Earnings, Non-GAAP Operating
EPS, and Book Value per common share, excluding AOCI, each of which
is a measure that is not determined in accordance with U.S. GAAP.
Management principally uses these non-GAAP financial measures in
evaluating performance because they present a clearer picture of
our operating performance and they allow management to allocate
resources. Similarly, management believes that the use of these
Non-GAAP financial measures, together with relevant U.S. GAAP
measures, provide investors with a better understanding of our
results of operations and the underlying profitability drivers and
trends of our business. These non-GAAP financial measures are
intended to remove from our results of operations the impact of
market changes (where there is mismatch in the valuation of assets
and liabilities) as well as certain other expenses which are not
part of our underlying profitability drivers or likely to re-occur
in the foreseeable future, as such items fluctuate from
period-to-period in a manner inconsistent with these drivers. These
measures should be considered supplementary to our results that are
presented in accordance with U.S. GAAP and should not be viewed as
a substitute for the U.S. GAAP measures. Other companies may use
similarly titled non-GAAP financial measures that are calculated
differently from the way we calculate such measures. Consequently,
our non-GAAP financial measures may not be comparable to similar
measures used by other companies.
We also discuss certain operating measures, including AUM, AV,
and certain other operating measures, which management believes
provide useful information about our businesses and the operational
factors underlying our financial performance.
Non-GAAP Operating Earnings
Non-GAAP Operating Earnings is an after-tax non-GAAP financial
measure used to evaluate our financial performance on a
consolidated basis that is determined by making certain adjustments
to our consolidated after-tax net income attributable to Holdings.
The most significant of such adjustments relates to our derivative
positions, which protect economic value and statutory capital, and
are more sensitive to changes in market conditions than the
variable annuity product liabilities as valued under U.S. GAAP.
This is a large source of volatility in net income.
Non-GAAP Operating Earnings equals our consolidated after-tax
net income attributable to Holdings adjusted to eliminate the
impact of the following items:
- Items related to variable annuity product features, which
include: (i) certain changes in the fair value of the derivatives
and other securities we use to hedge these features; (ii) the
effect of benefit ratio unlock adjustments, including extraordinary
economic conditions or events such as COVID-19; (iii) changes in
the fair value of the embedded derivatives reflected within
variable annuity products’ net derivative results and the impact of
these items on DAC amortization on our SCS product; and (iv) DAC
amortization for the SCS variable annuity product arising from
near-term fluctuations in index segment returns;
- Investment (gains) losses, which includes credit loss
impairments of securities/investments, sales or disposals of
securities/investments, realized capital gains/losses and valuation
allowances;
- Net actuarial (gains) losses, which includes actuarial gains
and losses as a result of differences between actual and expected
experience on pension plan assets or projected benefit obligation
during a given period related to pension, other postretirement
benefit obligations, and the one-time impact of the settlement of
the defined benefit obligation;
- Other adjustments, which primarily include restructuring costs
related to severance and separation, COVID-19 related impacts, net
derivative gains (losses) on certain Non-GMxB derivatives, net
investment income from certain items including consolidated VIE
investments, seed capital mark-to-market adjustments, unrealized
gain/losses associated with equity securities, certain legal
accruals; and a bespoke deal to repurchase UL policies from one
entity that had invested in numerous policies purchased in the life
settlement market, which disposed of the risk of additional COI
litigation by that entity related to those UL policies; and
- Income tax expense (benefit) related to the above items and
non-recurring tax items, which includes the effect of uncertain tax
positions for a given audit period.
Because Non-GAAP Operating Earnings excludes the foregoing items
that can be distortive or unpredictable, management believes that
this measure enhances the understanding of the Company’s underlying
drivers of profitability and trends in our business, thereby
allowing management to make decisions that will positively impact
our business.
We use the prevailing corporate federal income tax rate of 21%
while taking into account any non-recurring differences for events
recognized differently in our financial statements and federal
income tax returns as well as partnership income taxed at lower
rates when reconciling Net income (loss) attributable to Holdings
to Non-GAAP Operating Earnings.
The table below presents a reconciliation of Net income (loss)
attributable to Holdings to Non-GAAP Operating Earnings for the
three months and three months ended March 31, 2022 and 2021:
Three Months Ended March
31,
(in millions)
2022
2021
Net income (loss) attributable to
Holdings
$
573
$
(1,488
)
Adjustments related to:
Variable annuity product features
(601
)
2,267
Investment (gains) losses
326
(183
)
Net actuarial (gains) losses related to
pension and other postretirement benefit obligations
19
34
Other adjustments (1) (2) (3)
220
524
Income tax expense (benefit) related to
above adjustments
8
(555
)
Non-recurring tax items
3
1
Non-GAAP Operating Earnings
$
548
$
600
(1)
Includes Separation Costs of $21 million for the three months
ended March 31, 2021. Separation costs were completed during
2021.
(2)
Includes certain legal accruals related to the cost of insurance
litigation of $59 million and $180 million for the three months
ended March 31, 2022 and 2021, respectively. Includes policyholder
benefit costs of $75 million for the three months ended March 31,
2022 stemming from a deal to repurchase UL policies from one entity
that had invested in numerous policies purchased in the life
settlement market.
(3)
Includes Non-GMxB related derivative hedge losses of ($2)
million and $244 million for the three months ended March 31, 2022
and 2021, respectively.
Non-GAAP Operating EPS
Non-GAAP Operating Earnings per common share is calculated by
dividing Non-GAAP Operating Earnings less preferred dividends by
diluted common shares outstanding. The table below presents a
reconciliation of GAAP EPS to Non-GAAP Operating EPS for the three
months and three months ended March 31, 2022 and 2021.
Three Months Ended March
31,
(per share amounts)
2022
2021
Net income (loss) attributable to Holdings
(1)
$
1.46
$
(3.43
)
Less: Preferred stock dividend
0.03
0.03
Net Income (loss) available to common
shareholders
1.43
(3.46
)
Adjustments related to:
Variable annuity product features
(1.53
)
5.22
Investment (gains) losses
0.83
(0.42
)
Net actuarial (gains) losses related to
pension and other postretirement benefit obligations
0.05
0.08
Other adjustments (2) (3) (4)
0.55
1.21
Income tax expense (benefit) related to
above adjustments
0.02
(1.28
)
Non-recurring tax items
0.01
—
Non-GAAP Operating Earnings
$
1.36
$
1.35
(1) For periods presented with a net loss, basic shares was used
for the three months ended March 31, 2021. (2) Includes separation
costs of $0.05 for the three months ended March 31, 2021. (3)
Includes certain legal accruals related to the cost of insurance
litigation of $59 million and $180 million for the three months
ended March 31, 2022 and 2021, respectively. The impact per common
share is $0.15 and $0.41, respectively. Includes policyholder
benefit costs of $75 million for the three months ended March 31,
2022 stemming from a deal to repurchase UL policies from one entity
that had invested in numerous policies purchased in the life
settlement market. The impact per common share is $0.19. No
adjustments were made to prior period non-GAAP operating EPS as the
impact was immaterial. (4) Includes Non-GMxB related derivative
hedge losses of ($0.00), and $0.56 for the three months ended March
31, 2022 and 2021, respectively.
Book Value per common share, excluding AOCI
We use the term “book value” to refer to total equity
attributable to Holdings’ common shareholders. Book Value per
common share, excluding AOCI, is our total equity attributable to
Holdings, excluding AOCI and preferred stock, divided by ending
common shares outstanding.
March 31, 2022
December 31, 2021
Book value per common share
$
16.64
$
25.45
Per share impact of AOCI
4.65
(5.12
)
Book Value per common share, excluding
AOCI
$
21.29
$
20.33
Other Operating Measures
We also use certain operating measures which management believes
provide useful information about our businesses and the operational
factors underlying our financial performance.
Account Value (“AV”)
Account value generally equals the aggregate policy account
value of our retirement products.
Assets Under Management (“AUM”)
AUM means investment assets that are managed by one of our
subsidiaries and includes: (i) assets managed by AB, (ii) the
assets in our general account investment portfolio and (iii) the
separate account assets of our Individual Retirement, Group
Retirement and Protection Solutions businesses. Total AUM reflects
exclusions between segments to avoid double counting.
Segment net flows
Net change in segment customer account balances in a period
including, but not limited to, gross premiums, surrenders,
withdrawals and benefits. It excludes investment performance,
interest credited to customer accounts and policy charges.
Consolidated Statements of Income (Loss)
(Unaudited)
Three Months Ended March
31,
2022
2021
(in millions)
REVENUES
Policy charges and fee income
$
840
$
949
Premiums
247
258
Net derivative gains (losses)
821
(2,546
)
Net investment income (loss)
804
884
Investment gains (losses), net:
Credit losses on available-for-sale debt
securities and loans
10
1
Other investment gains (losses), net
(336
)
183
Total investment gains (losses), net
(326
)
184
Investment management and service fees
1,355
1,257
Other income
203
167
Total revenues
3,944
1,153
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits
1,060
939
Interest credited to policyholders’
account balances
315
291
Compensation and benefits
595
580
Commissions and distribution-related
payments
422
382
Interest expense
47
74
Amortization of deferred policy
acquisition costs
181
87
Other operating costs and expenses
537
608
Total benefits and other deductions
3,157
2,961
Income (loss) from continuing operations,
before income taxes
787
(1,808
)
Income tax (expense) benefit
(148
)
408
Net income (loss)
639
(1,400
)
Less: Net income (loss) attributable to
the noncontrolling interest
66
88
Net income (loss) attributable to
Holdings
573
(1,488
)
Less: Preferred stock dividends
14
13
Net income (loss) available to Holdings’
common shareholders
$
559
$
(1,501
)
Earnings
Per Common Share
Three Months Ended March
31,
2022
2021
(in millions)
Earnings per common share
Basic
$
1.44
$
(3.46
)
Diluted
$
1.43
$
(3.46
)
Weighted average shares
Weighted average common stock outstanding
for basic earnings per common share
388.6
434.2
Weighted average common stock outstanding
for diluted earnings per common share (1)
391.7
434.2
(1)
Due to net loss for the three months ended March 31, 2021,
approximately 4.3 million share awards were excluded from the
diluted EPS calculation.
Results
of Operations by Segment
Three Months Ended March
31,
2022
2021
(in millions)
Operating earnings (loss) by
segment:
Individual Retirement
$
293
$
363
Group Retirement
150
151
Investment Management and Research
136
121
Protection Solutions
35
41
Corporate and Other (1)
(66
)
(76
)
Non-GAAP Operating Earnings
$
548
$
600
(1)
Includes interest expense and financing fees of $53 million and
$58 million for the three months ended March 31, 2022 and 2021,
respectively.
Select
Balance Sheet Statistics
March 31, 2022
December 31, 2021
(in millions)
ASSETS
Total investments and cash and cash
equivalents
$
104,489
$
110,299
Separate Accounts assets
136,812
147,306
Total assets
277,658
292,262
LIABILITIES
Short-term and long-term debt
$
4,044
$
3,931
Future policy benefits and other
policyholders' liabilities
35,165
36,717
Policyholders’ account balances
79,549
79,357
Total liabilities
267,789
278,699
EQUITY
Preferred stock
1,562
1,562
Accumulated other comprehensive income
(loss)
(1,787
)
2,004
Total equity attributable to Holdings
$
7,954
$
11,519
Total equity attributable to Holdings'
common shareholders (ex. AOCI)
8,179
7,953
Assets
Under Management (Unaudited)
March 31, 2022
December 31, 2021
(in billions)
Assets Under
Management
AB AUM
$
735.4
$
778.6
Exclusion for General Account and other
Affiliated Accounts
(75.1
)
(79.7
)
Exclusion for Separate Accounts
(45.3
)
(48.8
)
AB third party
$
615.0
$
650.1
Total company AUM
AB third party
$
615.0
$
650.1
General Account and other Affiliated
Accounts (1) (3)
104.5
110.3
Separate Accounts (2) (3)
136.8
147.3
Total AUM
$
856.3
$
907.7
(1)
“General Account and Other Affiliated
Accounts” refers to assets held in the general accounts of our
insurance companies and other assets on which we bear the
investment risk.
(2)
“Separate Accounts” refers to the separate
account investment assets of our insurance subsidiaries excluding
any assets on which we bear the investment risk.
(3)
As of June 30, 2021, September 30, 2021,
December 31, 2021 and March 31, 2022, Separate Account and General
Account AUM is inclusive of $16.9 billion, $63 million, $16.3
billion, $64 million, $16.6 billion, $61 million, $15.1 billion and
$60 million, respectively, Account Value ceded to Venerable. For
additional information on the Venerable transaction see Note 1 of
the Notes to Consolidated Financial Statements within the 10-Q.
_______________
1
This press release includes certain Non-GAAP financial measures.
More information on these measures and reconciliations to the most
comparable U.S. GAAP measures can be found in the “Use of Non-GAAP
Financial Measures” section of this release.
2
Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
3
Includes $70 million of quarterly cash dividends, $279 million of
first quarter 2022 share repurchases and an additional $112 million
of fourth quarter 2021 accelerated repurchases.
4
Pro forma AUM of AB comprised of approximately $37.2 billion in
fee-earning AUM and $12.0 billion in fee-eligible AUM. As of
12/31/2021.
5
Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
6
Refers to AllianceBernstein L.P. and AllianceBernstein Holding
L.P., collectively.
7
Any declaration of dividends will be at the discretion of the Board
of Directors and will depend on our financial condition and other
factors.
8
Pro forma AUM of AB comprised of approximately $37.2 billion in
fee-earning AUM and $12.0 billion in fee-eligible AUM. As of
12/31/2021.
9
Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509005768/en/
Investor Relations Işıl Müderrisoğlu (212) 314-2476
IR@equitable.com
Media Relations Todd Williamson (212) 314-2010
mediarelations@equitable.com
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