TORCHMARK
CORPORATION REPORTS Fourth Quarter 2016 Results
MCKINNEY, Texas, Feb. 1, 2017 -- Torchmark Corporation (NYSE:
TMK) reported today that for the quarter ended December 31,
2016, net income was $1.12 per
diluted common share, compared with $1.07 per diluted common share for the year-ago
quarter. Net operating income from continuing operations for the
quarter was $1.15 per diluted common
share, compared with $1.05 per
diluted common share for the year-ago quarter.
Net income for the year ended December 31, 2016 was
$4.49 per diluted common share,
compared with $4.16 per diluted
common share for the year-ago period. Net operating income from
continuing operations for the year ended December 31, 2016 was
$4.49 per diluted common share
compared with $4.13 per diluted
common share for the prior year.
Net income and net operating income for 2016 reflect the impact
of new accounting guidance implemented on a prospective basis at
the beginning of 2016.
HIGHLIGHTS:
- Net income as a ROE was 12.0%. Net operating income as a ROE
excluding net unrealized gains on fixed maturities was 14.6%.
- American Income life premiums increased 11% over the year-ago
quarter.
- At Liberty National, net life sales increased 15% over the
year-ago quarter.
- Net health sales increased 8% at Family Heritage over the
year-ago quarter.
- Average agent counts increased over the year-ago quarter by 16%
at Liberty National and 8% at Family Heritage.
- 1.0 million shares of common stock were repurchased during the
quarter and 5.2 million shares were repurchased during the
year.
FINANCIAL SUMMARY
Quarter End
(Dollar amounts in millions, except per share data)
(unaudited)
Net operating income, a non-GAAP financial measure, has been
used consistently by Torchmark's management for many years to
evaluate the operating performance of the Company, and is a measure
commonly used in the life insurance industry. It differs from net
income primarily because it excludes certain non-operating items
such as realized investment gains and losses and certain
nonrecurring items included in net income. Management believes an
analysis of net operating income is important in understanding the
profitability and operating trends of the Company's business. Net
income is the most directly comparable GAAP measure.
|
Per Share
Quarter Ended |
|
|
|
Quarter
Ended |
|
|
|
December
31, |
|
|
|
December
31, |
|
|
|
2016 |
|
|
2015 |
|
%
Chg. |
|
2016 |
|
|
2015 |
|
%
Chg. |
| Insurance underwriting income(1) |
$ |
1.23 |
|
|
|
$ |
1.20 |
|
|
3 |
|
$ |
148.7 |
|
|
|
$ |
149.4 |
|
|
— |
| Excess investment income(1) |
0.48 |
|
|
|
0.43 |
|
|
12 |
|
58.0 |
|
|
|
53.8 |
|
|
8 |
| Parent company expense |
(0.02) |
|
|
|
(0.02) |
|
|
|
|
(2.2) |
|
|
|
(2.3) |
|
|
|
| Income tax |
(0.55) |
|
|
|
(0.53) |
|
|
4 |
|
(67.0) |
|
|
|
(65.5) |
|
|
2 |
| Stock option expense, net of
tax(2) |
0.02 |
|
|
|
(0.04) |
|
|
|
|
2.0 |
|
|
|
(4.4) |
|
|
|
| Net operating income from continuing
operations(3) |
$ |
1.15 |
|
|
|
$ |
1.05 |
|
|
10 |
|
$ |
139.5 |
|
|
|
$ |
130.9 |
|
|
6 |
| Net operating income from discontinued
operations |
0.01 |
|
|
|
— |
|
|
|
|
0.8 |
|
|
|
0.2 |
|
|
|
| Net operating income from all
operations |
$ |
1.16 |
|
|
|
$ |
1.05 |
|
|
|
|
$ |
140.3 |
|
|
|
$ |
131.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation to net income (GAAP): |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciling items, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Realized gains (losses) on investments—continuing
operations |
(0.10) |
|
|
|
(0.09) |
|
|
|
|
(12.0) |
|
|
|
(10.8) |
|
|
|
| Part D adjustments—discontinued
operations(4) |
0.07 |
|
|
|
0.11 |
|
|
|
|
9.1 |
|
|
|
13.6 |
|
|
|
| Net gain from Sale of Part D—discontinued
operations |
0.01 |
|
|
|
— |
|
|
|
|
0.8 |
|
|
|
— |
|
|
|
| Administrative settlements |
(0.02) |
|
|
|
(0.01) |
|
|
|
|
(2.5) |
|
|
|
(0.9) |
|
|
|
| Non operating legal fees |
— |
|
|
|
— |
|
|
|
|
(0.2) |
|
|
|
— |
|
|
|
| Net income(5) |
$ |
1.12 |
|
|
|
$ |
1.07 |
|
|
|
|
$ |
135.4 |
|
|
|
$ |
133.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average diluted shares outstanding
(000) |
121,237 |
|
|
|
124,725 |
|
|
|
|
|
|
|
|
|
|
|
| (1) Definitions included within the document. |
| (2) Decrease from fourth quarter of 2015 is due
primarily to the impact of new accounting guidance that was
implemented at the beginning of 2016 and was required to be adopted
prospectively. |
| (3) The adoption of the new accounting guidance
mentioned above resulted in a $0.04 increase in earnings per
share. |
| (4) Under GAAP, benefit costs can exceed premiums
in the first part of the year, but be less than premiums during the
remainder of the year. For net operating income purposes, Torchmark
defers excess benefits incurred in earlier interim periods to later
periods in order to more closely match the benefit cost with the
associated revenue. |
| (5) A GAAP-basis consolidated statement of
operations is included in the appendix of this report. |
| Note: Tables in this news release may not foot due
to rounding. |
FINANCIAL SUMMARY, CON'T
Year End
(Dollar amounts in millions, except per share data)
(unaudited)
|
Per Share
Year Ended |
|
|
|
Year Ended |
|
|
|
December
31, |
|
|
|
December
31, |
|
|
|
2016 |
|
|
2015 |
|
%
Chg. |
|
2016 |
|
|
2015 |
|
%
Chg. |
| Insurance underwriting income(1) |
$ |
4.89 |
|
|
|
$ |
4.69 |
|
|
4 |
|
$ |
598.1 |
|
|
|
$ |
594.5 |
|
|
1 |
| Excess investment income(1) |
1.83 |
|
|
|
1.73 |
|
|
6 |
|
224.0 |
|
|
|
219.5 |
|
|
2 |
| Parent company expense |
(0.07) |
|
|
|
(0.07) |
|
|
|
|
(8.6) |
|
|
|
(9.0) |
|
|
|
| Income tax |
(2.17) |
|
|
|
(2.08) |
|
|
4 |
|
(265.8) |
|
|
|
(263.5) |
|
|
1 |
| Stock option expense, net of
tax(2) |
0.01 |
|
|
|
(0.15) |
|
|
|
|
1.5 |
|
|
|
(18.6) |
|
|
|
| Net operating income from continuing
operations(3) |
$ |
4.49 |
|
|
|
$ |
4.13 |
|
|
9 |
|
$ |
549.4 |
|
|
|
$ |
522.9 |
|
|
5 |
| Net operating income from discontinued
operations |
0.07 |
|
|
|
0.09 |
|
|
|
|
9.0 |
|
|
|
10.8 |
|
|
|
| Net operating income from all
operations |
$ |
4.56 |
|
|
|
$ |
4.21 |
|
|
|
|
$ |
558.4 |
|
|
|
$ |
533.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciliation to net income (GAAP): |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Reconciling items, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Realized gains (losses) on investments—continuing
operations |
(0.06) |
|
|
|
(0.05) |
|
|
|
|
(6.9) |
|
|
|
(5.7) |
|
|
|
| Part D adjustments—discontinued operations |
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
| Net gain from Sale of Part D—discontinued
operations |
0.01 |
|
|
|
— |
|
|
|
|
1.2 |
|
|
|
— |
|
|
|
| Administrative settlements |
(0.02) |
|
|
|
(0.01) |
|
|
|
|
(2.5) |
|
|
|
(0.9) |
|
|
|
| Non operating legal fees |
— |
|
|
|
— |
|
|
|
|
(0.4) |
|
|
|
— |
|
|
|
| Net income(4) |
$ |
4.49 |
|
|
|
$ |
4.16 |
|
|
|
|
$ |
549.8 |
|
|
|
$ |
527.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average diluted shares outstanding
(000) |
122,368 |
|
|
|
126,757 |
|
|
|
|
|
|
|
|
|
|
|
| (1) Definitions included within the document. |
| (2) Decrease from 2015 is due primarily to the
impact of new accounting guidance that was implemented at the
beginning of 2016 and was required to be adopted
prospectively. |
| (3) The adoption of the new accounting guidance
mentioned above resulted in a $0.13 increase in earnings per
share. |
| (4) A GAAP-basis consolidated statement of
operations is included in the appendix of this report. |
FINANCIAL SUMMARY, CON'T
Management vs. GAAP measures
(Dollar amounts in millions, except per share data)
(unaudited)
Shareholders' equity, excluding net unrealized gains on fixed
maturities, and book value per share, excluding net unrealized
gains on fixed maturities, are non-GAAP measures that are utilized
by management to view the business without the effect of unrealized
gains or losses which are primarily attributable to fluctuation in
interest rates on the available-for-sale portfolio. Management
views the business in this manner because the Company has the
ability and generally, the intent, to hold investments to maturity
and meaningful trends can more easily be identified without the
fluctuations. Shareholders' equity and book value per share are the
most directly comparable GAAP measures.
|
December
31, |
|
2016 |
|
2015 |
| Net income as a ROE(1) |
12.0 |
% |
|
11.9 |
% |
| Net operating income as a ROE(1)
(excluding net unrealized gains on fixed maturities) |
14.6 |
% |
|
14.5 |
% |
|
|
|
|
| Shareholders' equity |
$ |
4,567 |
|
|
$ |
4,056 |
|
| Impact of adjustment to exclude net unrealized
gains on fixed maturities |
(681) |
|
|
(324) |
|
| Shareholders' equity, excluding net unrealized
gains on fixed maturities |
$ |
3,886 |
|
|
$ |
3,732 |
|
|
|
|
|
| Book value per share |
$ |
37.76 |
|
|
$ |
32.71 |
|
| Impact of adjustment to exclude net unrealized
gains on fixed maturities |
(5.63) |
|
|
(2.62) |
|
| Book value per share, excluding net unrealized
gains on fixed maturities |
$ |
32.13 |
|
|
$ |
30.09 |
|
|
| (1) Calculated using average shareholders' equity
for the measurement period. |
| Note: Net unrealized gains on fixed maturities
referred to above are net of tax. |
CONTINUING INSURANCE OPERATIONS –
comparing the fourth quarter 2016 with fourth quarter
2015:
Life insurance accounted for 72% of the Company's insurance
underwriting margin for the quarter and 70% of total premium
revenue.
Health insurance accounted for 27% of Torchmark's insurance
underwriting margin for the quarter and 30% of total premium
revenue.
Net sales of life insurance were flat, while net health sales
decreased 21%.
INSURANCE PREMIUM REVENUE
(Dollar amounts in millions, except per share data)
(unaudited)
|
Quarter
Ended |
|
%
Chg. |
|
December 31,
2016 |
|
|
December 31,
2015 |
|
| Life insurance |
$ |
550.2 |
|
|
|
$ |
520.8 |
|
|
6 |
| Health insurance |
237.7 |
|
|
|
235.3 |
|
|
1 |
| Total |
$ |
787.9 |
|
|
|
$ |
756.1 |
|
|
4 |
INSURANCE UNDERWRITING
INCOME
(Dollar amounts in millions, except per share data)
(unaudited)
Insurance underwriting margin, a non-GAAP measure, is
management's measure of profitability of its life, health, and
annuity segments' underwriting performance, and consists of
premiums less policy obligations, commissions and other acquisition
expenses. Insurance underwriting income is the sum of the insurance
underwriting margins of the life, health, and annuity segments,
plus other income, less insurance administrative expenses. It
excludes the investment segment, parent company expense and income
taxes. Management believes this information helps provide a better
understanding of the business and a more meaningful analysis of
underwriting results by distribution channel. Underwriting income
is a component of net operating income, which is reconciled to net
income in the Financial Summary section above.
|
Quarter
Ended |
|
% of
Premium |
|
|
Quarter
Ended |
|
% of
Premium |
|
%
Chg. |
|
December 31,
2016 |
|
|
|
December 31,
2015 |
|
|
| Insurance underwriting margins: |
|
|
|
|
|
|
|
|
|
|
| Life |
$ |
142.7 |
|
|
26 |
|
|
$ |
144.5 |
|
|
28 |
|
(1) |
| Health |
52.8 |
|
|
22 |
|
|
51.0 |
|
|
22 |
|
4 |
| Annuity |
3.2 |
|
|
|
|
|
1.3 |
|
|
|
|
|
|
198.8 |
|
|
|
|
|
196.8 |
|
|
|
|
1 |
| Other income |
0.4 |
|
|
|
|
|
0.2 |
|
|
|
|
|
| Administrative expenses |
(50.5) |
|
|
|
|
|
(47.6) |
|
|
|
|
6 |
| Insurance underwriting income |
$ |
148.7 |
|
|
|
|
|
$ |
149.4 |
|
|
|
|
— |
| Per share |
$ |
1.23 |
|
|
|
|
|
$ |
1.20 |
|
|
|
|
3 |
Insurance Results
from Continuing Operations by Distribution Channel
Total premium, underwriting margins, first-year collected
premium and net sales by all distribution channels are shown at
http://www.torchmarkcorp.com/ on the Investors page at "Financial
Reports."
American Income Agency was Torchmark's leading
contributor to total underwriting margin ($86 million), on premium revenue of $257 million. Life premiums of $236 million were up 11% and life insurance
underwriting margin of $75 million
was up 10%. As a percentage of life premium, life
underwriting margin was 32%, the same as a year ago and the highest
of the major life distribution channels at Torchmark. The average
producing agent count during the quarter was 6,874, up 4% from a
year ago, and down 2% from the previous quarter. The producing
agent count at the end of the fourth quarter was 6,870. Net life
sales were $52 million, up 3%.
Globe Life Direct Response was Torchmark's second leading
contributor to total underwriting margin ($32 million), on premium revenue of $209 million. Life premiums of $192 million were up 4% and the life underwriting
margin was $29 million, down 21%. As
a percentage of life premium, life underwriting margin was 15%,
down from 20%. Net life sales were $34
million, down 7% from the year-ago quarter. Net health
sales increased from $1.4
million to $2.0 million.
LNL Agency was Torchmark's third leading contributor to
total underwriting margin ($30
million), on premium revenue of $117
million. Life premiums of $67
million were the same as the year-ago quarter and life
underwriting margin was $19 million,
down 4%. As a percentage of life premium, life underwriting margin
was 28%, down from 29% from the year-ago quarter. Net life sales
were $10 million, up 15%.
LNL Agency was Torchmark's third leading contributor to health
underwriting margin ($11 million), on
health premiums of $49 million.
Health underwriting margin as a percentage of health premium was
22%, down from 23%. Net health sales were $5
million, approximately the same as the year-ago quarter.
LNL Agency's average producing agent count during the
quarter was 1,781, up 16% over a year ago, and down 1% from the
previous quarter. The producing agent count at the end of the
fourth quarter was 1,758.
Family Heritage Agency was Torchmark's second leading
contributor to health underwriting margin ($14 million) on health premiums of $61 million. Health underwriting margin as a
percentage of health premium was 23%, up from 20%. The average
producing agent count during the quarter was 947, up 8% from a year
ago, and down 4% from the previous quarter. The producing agent
count at the end of the fourth quarter was 909. Net health
sales were $13 million, up 8%
from the year-ago quarter.
UA Independent Agency was Torchmark's leading contributor
to health underwriting margin ($15
million), on health premiums of $89
million. Health underwriting margin as a percentage of
premium was 17%, down from 18%. Net health sales were
$24 million, down 38%.
Administrative Expenses were $50
million, up 6% from the year-ago quarter. The ratio of
administrative expenses to premium for continuing operations was
approximately 6.4% and in line with expectations, compared to 6.3%
for the year-ago quarter.
Note: Net sales (health and life) are calculated as the
annualized premium issued, net of cancellations in the first 30
days after issue, except in the case of Globe Life Direct Response
where net sales is annualized premium issued at the time the first
full premium is paid after any introductory offer period has
expired.
INVESTMENTS
EXCESS INVESTMENT INCOME
(Dollar amounts in millions, except per share data)
(unaudited)
Management uses excess investment income, a non-GAAP measure, as
the measure to evaluate the performance of the investment
segment. It is defined as net investment income less both the
required interest attributable to net policy liabilities and the
interest on debt. We also view excess investment income per diluted
common share as an important and useful measure to evaluate
performance of the investment segment as it takes into
consideration our stock repurchase program.
|
Quarter
Ended |
|
December
31, |
|
2016 |
|
|
2015 |
|
%
Chg. |
| Net investment income |
$ |
205.5 |
|
|
|
$ |
194.3 |
|
|
6 |
| Required interest: |
|
|
|
|
|
|
| Interest on net policy
liabilities(1) |
(127.0) |
|
|
|
(121.3) |
|
|
5 |
| Interest on debt |
(20.5) |
|
|
|
(19.2) |
|
|
7 |
| Total required interest |
(147.5) |
|
|
|
(140.5) |
|
|
5 |
| Excess investment income |
$ |
58.0 |
|
|
|
$ |
53.8 |
|
|
8 |
| Per share |
$ |
0.48 |
|
|
|
$ |
0.43 |
|
|
12 |
|
| (1) Interest on net policy liabilities is a
component of total policyholder benefits (a GAAP measure). |
Net investment income increased 6%, while average invested
assets increased 7%. Required interest on net policy liabilities
increased 5%, approximately the same as the increase in net policy
liabilities. Interest expense on debt increased by 7%. The weighted
average discount rate for the net policy liabilities was 5.6%, same
as the year-ago quarter.
Investment
Portfolio
The composition of the investment portfolio at December 31,
2016 is as follows:
|
Invested Assets
(dollars in millions)
(unaudited) |
|
$ |
|
% of Total |
| Fixed maturities (at amortized cost) |
$ |
14,188 |
|
|
96 |
% |
| Policy loans |
508 |
|
|
3 |
|
| Other long-term investments |
53 |
|
|
— |
|
| Short-term investments |
72 |
|
|
— |
|
| Total |
$ |
14,821 |
|
|
100 |
% |
Fixed maturities at amortized cost by asset class as of
December 31, 2016 are as follows:
|
Fixed
Maturities
(dollars in millions)
(unaudited) |
|
Investment
Grade |
|
Below
Investment
Grade |
|
Total |
| Corporate bonds |
$ |
11,367 |
|
|
$ |
616 |
|
|
$ |
11,983 |
|
| Redeemable preferred stock: |
|
|
|
|
|
| U.S. |
271 |
|
|
74 |
|
|
345 |
|
| Foreign |
55 |
|
|
— |
|
|
55 |
|
| Municipal |
1,284 |
|
|
1 |
|
|
1,285 |
|
| Government-sponsored enterprises |
305 |
|
|
— |
|
|
305 |
|
| Government and agencies |
97 |
|
|
— |
|
|
97 |
|
| Collateralized debt obligations |
— |
|
|
61 |
|
|
61 |
|
| Residential mortgage-backed securities |
4 |
|
|
— |
|
|
4 |
|
| Other asset-backed securities |
54 |
|
|
— |
|
|
54 |
|
| Total |
$ |
13,437 |
|
|
$ |
751 |
|
|
$ |
14,188 |
|
The market value of Torchmark's fixed maturity portfolio was
$15.2 billion, $1.1 billion higher than amortized cost of
$14.2 billion. The $1.1 billion of net unrealized gains compares to
$1.9 billion at September 30, 2016. Net unrealized gains were
comprised of gross unrealized gains of $1.3
billion and gross unrealized losses of $216 million.
Torchmark is not a party to any derivatives contracts, including
credit default swaps, and does not participate in securities
lending.
At amortized cost, 95% of fixed maturities (95% at market value)
were rated "investment grade." The fixed maturity portfolio earned
an annual effective yield of 5.75% during the fourth quarter of
2016, compared to 5.81% in the year-ago quarter.
Acquisitions of fixed maturity investments during the quarter
totaled $607 million at cost.
Comparable information for acquisitions of fixed maturity
investments is as follows:
|
Quarter
Ended |
|
December
31, |
|
2016 |
|
|
2015 |
| Average annual effective yield |
4.6% |
|
|
5.0% |
| Average rating |
BBB+ |
|
|
A- |
| Average life (in years) to: |
|
|
|
|
| Next call |
25.3 |
|
|
26.1 |
| Maturity |
26.1 |
|
|
26.3 |
SHARE REPURCHASE:
During the quarter, the Company repurchased 1.0 million shares
of Torchmark Corporation common stock at a total cost of
$71 million for an average share
price of $68.60. For the twelve
months ended December 31, 2016, the Company repurchased 5.2
million shares at an average share price of $59.78.
LIQUIDITY/CAPITAL:
Torchmark's operations consist primarily of writing basic
protection life and supplemental health insurance policies which
generate strong and stable cash flows. Capital at the insurance
companies is sufficient to support current operations.
EARNINGS GUIDANCE FOR THE YEAR ENDING
DECEMBER 31, 2017:
Torchmark projects that net operating income from continuing
operations per share will be in a range of $4.57 to $4.77 for the year ending December 31, 2017.
NON-GAAP MEASURES:
In this news release, Torchmark includes non-GAAP measures to
enhance investors' understanding of management's view of the
business. The non-GAAP measures are not a substitute for GAAP, but
rather a supplement to increase transparency by providing broader
perspective. Torchmark's definitions of non-GAAP measures may
differ from other companies' definitions. More detailed financial
information including various GAAP and non-GAAP measurements are
located at www.torchmarkcorp.com on the Investors page under
"Financial Reports."
CAUTION REGARDING FORWARD-LOOKING
STATEMENTS:
This press release may contain forward-looking statements within
the meaning of the federal securities laws. These prospective
statements reflect management's current expectations, but are not
guarantees of future performance. Accordingly, please refer
to Torchmark's cautionary statement regarding forward-looking
statements, and the business environment in which the Company
operates, contained in the Company's Form 10-K for the year ended
December 31, 2015, and any subsequent Forms 10-Q on file with
the Securities and Exchange Commission and on the Company's website
at www.torchmarkcorp.com on the Investors page. Torchmark
specifically disclaims any obligation to update or revise any
forward-looking statement because of new information, future
developments or otherwise.
EARNINGS RELEASE CONFERENCE CALL
WEBCAST:
Torchmark will provide a live audio webcast of its fourth
quarter 2016 earnings release conference call with financial
analysts at 11:00 a.m. (Eastern)
tomorrow, February 2, 2017. Access to the live webcast and
replay will be available at www.torchmarkcorp.com on the
Investors/Calls and Meetings page, at the Conference Calls on the
Web icon. Immediately following this press release, supplemental
financial reports will be available before the conference call on
the Investors page menu of the Torchmark website at "Financial
Reports."
| APPENDIX |
|
| TORCHMARK
CORPORATION |
| GAAP CONSOLIDATED
STATEMENTS OF OPERATIONS |
|
(Unaudited) |
| (Amounts in
millions except per share data) |
|
|
Three Months
Ended
December 31, |
|
Twelve Months
Ended
December 31, |
|
2016(1) |
|
2015 |
|
2016(1) |
|
2015 |
| Revenue: |
|
|
|
|
|
|
|
| Life premium |
$ |
550 |
|
|
$ |
521 |
|
|
$ |
2,189 |
|
|
$ |
2,073 |
|
| Health premium |
238 |
|
|
235 |
|
|
948 |
|
|
926 |
|
| Other premium |
— |
|
|
— |
|
|
— |
|
|
— |
|
| Total premium |
788 |
|
|
756 |
|
|
3,137 |
|
|
2,999 |
|
| Net investment income |
205 |
|
|
194 |
|
|
807 |
|
|
774 |
|
| Realized investment gains (losses) |
(18) |
|
|
(17) |
|
|
(11) |
|
|
(9) |
|
| Other income |
— |
|
|
— |
|
|
1 |
|
|
2 |
|
| Total revenue |
975 |
|
|
934 |
|
|
3,935 |
|
|
3,766 |
|
| Benefits and expenses: |
|
|
|
|
|
|
|
| Life policyholder benefits |
378 |
|
|
345 |
|
|
1,479 |
|
|
1,375 |
|
| Health policyholder benefits |
153 |
|
|
154 |
|
|
613 |
|
|
603 |
|
| Other policyholder benefits |
9 |
|
|
10 |
|
|
37 |
|
|
39 |
|
| Total policyholder benefits |
540 |
|
|
509 |
|
|
2,129 |
|
|
2,016 |
|
| Amortization of deferred acquisition costs |
116 |
|
|
112 |
|
|
469 |
|
|
446 |
|
| Commissions, premium taxes, and non-deferred
acquisition costs |
64 |
|
|
61 |
|
|
249 |
|
|
238 |
|
| Other operating expense |
59 |
|
|
57 |
|
|
232 |
|
|
224 |
|
| Interest expense |
20 |
|
|
19 |
|
|
83 |
|
|
77 |
|
| Total benefits and expenses |
799 |
|
|
758 |
|
|
3,162 |
|
|
3,000 |
|
|
|
|
|
|
|
|
|
| Income before income taxes |
176 |
|
|
176 |
|
|
772 |
|
|
766 |
|
| Income taxes |
(51) |
|
|
(57) |
|
|
(233) |
|
|
(250) |
|
| Income from continuing operations |
125 |
|
|
119 |
|
|
540 |
|
|
516 |
|
|
|
|
|
|
|
|
|
| Discontinued operations: |
|
|
|
|
|
|
|
| Income (loss) from discontinued operations, net of
tax |
11 |
|
|
14 |
|
|
10 |
|
|
11 |
|
| Net income |
$ |
135 |
|
|
$ |
133 |
|
|
$ |
550 |
|
|
$ |
527 |
|
|
|
|
|
|
|
|
|
| Basic net income per share: |
|
|
|
|
|
|
|
| Continuing operations |
$ |
1.05 |
|
|
$ |
0.97 |
|
|
$ |
4.50 |
|
|
$ |
4.13 |
|
| Discontinued operations |
0.09 |
|
|
0.11 |
|
|
0.08 |
|
|
0.08 |
|
| Total basic net income per common share |
$ |
1.14 |
|
|
$ |
1.08 |
|
|
$ |
4.58 |
|
|
$ |
4.21 |
|
|
|
|
|
|
|
|
|
| Diluted net income per share: |
|
|
|
|
|
|
|
| Continuing operations |
$ |
1.03 |
|
|
$ |
0.96 |
|
|
$ |
4.41 |
|
|
$ |
4.07 |
|
| Discontinued operations |
0.09 |
|
|
0.11 |
|
|
0.08 |
|
|
0.09 |
|
| Total diluted net income per common share |
$ |
1.12 |
|
|
$ |
1.07 |
|
|
$ |
4.49 |
|
|
$ |
4.16 |
|
|
|
|
|
|
|
|
|
| Dividends declared per common share |
$ |
0.14 |
|
|
$ |
0.13 |
|
|
$ |
0.56 |
|
|
$ |
0.54 |
|
|
| (1) Due to the adoption of ASU 2016-09, certain
balances related to excess tax benefits from stock compensation
were adjusted prospectively. |
CONTACT: Mike Majors, Vice President, Investor Relations,
Torchmark Corporation, 3700 South Stonebridge Dr., P. O. Box 8080,
McKinney, Texas 75070-8080, Phone:
972/569-3239, tmkir@torchmarkcorp.com, Website:
www.torchmarkcorp.com