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Share Name | Share Symbol | Market | Type |
---|---|---|---|
MetLife Inc | NYSE:MET | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.28 | 0.40% | 70.52 | 70.76 | 69.19 | 70.29 | 3,361,218 | 01:00:00 |
MetLife, Inc. (NYSE: MET) today announced its results for the second quarter ended June 30, 2019.
Second Quarter Results Summary
“MetLife had another strong quarter driven by business growth, favorable underwriting and expense discipline. During the first half of 2019, we returned approximately $2 billion to shareholders through common stock repurchases and dividends,” said Michel Khalaf, president and CEO of MetLife, Inc. “Overall, our results highlight the strength of our diverse businesses and our focus on consistently executing for our customers and shareholders.”
Second Quarter 2019 Summary
($ in millions, except per share data)
Three months ended June 30,
2019
2018
Change
Premiums, fees and other revenues
$12,019
$16,998
(29)%
Net investment income
4,693
4,473
5%
Net investment gains (losses)
61
(227)
Net derivative gains (losses)
724
(59)
Total revenues
$17,497
$21,185
(17)%
Total adjusted revenues
$16,454
$21,216
(22)%
Adjusted premiums, fees and other revenues
$11,900
$16,889
(30)%
Adjusted premiums, fees and other revenues, excluding pension risk transfer (PRT)
$11,344
$10,937
4%
Net income (loss)
$1,684
$845
99%
Net income (loss) per share
$1.77
$0.83
113%
Adjusted earnings
$1,319
$1,326
(1)%
Adjusted earnings per share
$1.38
$1.30
6%
Book value per share
$64.61
$50.28
29%
Book value per share, excluding AOCI other than FCTA
$47.09
$42.76
10%
Expense ratio
20.3%
14.6%
Direct expense ratio, excluding total notable items related to direct expenses and PRT
12.3%
13.0%
Adjusted expense ratio, excluding total notable items related to other expenses and PRT
20.0%
20.7%
ROE
11.6%
6.5%
ROE, excluding AOCI other than FCTA
15.4%
7.8%
Adjusted ROE, excluding AOCI other than FCTA
12.1%
12.2%
MetLife reported second quarter 2019 premiums, fees and other revenues of $12.0 billion, down 29 percent over the second quarter of 2018. Adjusted premiums, fees and other revenues were $11.9 billion, down 30 percent, and 29 percent on a constant currency basis over the prior-year period. Excluding pension risk transfers, adjusted premiums, fees and other revenues were $11.3 billion, up 4 percent, and 5 percent on a constant currency basis.
Net investment income was $4.7 billion, up 5 percent, driven by higher variable investment income and asset growth. On an adjusted basis, net investment income was $4.6 billion, up 5 percent.
Net derivative gains amounted to $724 million, or $572 million after tax during the quarter.
Net income was $1.7 billion, compared to net income of $845 million in the second quarter of 2018. On a per share basis, net income was $1.77, compared to net income of $0.83 in the prior-year period.
MetLife reported adjusted earnings of $1.3 billion, down 1 percent, and up 2 percent on a constant currency basis. On a per share basis, which includes the impact of share repurchases, adjusted earnings were $1.38, up 6 percent from the prior-year period.
Information regarding the non-GAAP and other financial measures included in this news release and reconciliation of the non-GAAP financial measures to GAAP measures are in “Non-GAAP and Other Financial Disclosures” below and in the tables that accompany this news release.
Supplemental slides for the second quarter of 2019, titled "2Q19 Supplemental Slides," are available on the MetLife Investor Relations website at www.metlife.com and in the Form 8-K furnished by MetLife to the U.S. Securities and Exchange Commission in connection with this earnings news release.
Adjusted Earnings by Segment Summary*
Three months ended
June 30, 2019
Segment
Change from
prior-year period
Change from
prior-year period
(on a constant
currency basis)
U.S.
9%
Asia
(1)%
2%
Latin America
10%
18%
Europe, the Middle East and Africa (EMEA)
(10)%
—%
MetLife Holdings
7%
*The percentages in this table are on a reported and constant currency basis, and do not exclude notable items.
Business Discussions
All comparisons of the results for the second quarter of 2019 in the business discussions that follow are with the second quarter of 2018, unless otherwise noted. See the second quarter of 2019 notable items table that follows the Business Discussions section of this release for additional information on notable items incurred in the second quarter of 2019.
U.S.
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$732
$671
9%
Adjusted premiums, fees and other revenues
$6,731
$11,767
(43)%
Adjusted premiums, fees and other revenues, excluding PRT
$6,175
$5,815
6%
Notable item(s)
$0
$0
Group Benefits
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$311
$261
19%
Adjusted premiums, fees and other revenues
$4,594
$4,378
5%
Notable item(s)
$0
$0
Retirement and Income Solutions
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$351
$347
1%
Adjusted premiums, fees and other revenues
$1,220
$6,492
(81)%
Adjusted premiums, fees and other revenues, excluding PRT
$664
$540
23%
Notable item(s)
$0
$0
Property & Casualty
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$70
$63
11%
Adjusted premiums, fees and other revenues
$917
$897
2%
Notable item(s)
$0
$0
ASIA
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$359
$363
(1)%
Adjusted earnings (constant currency)
$359
$352
2%
Adjusted premiums, fees and other revenues
$2,063
$2,066
—%
Notable item(s)
$0
$0
LATIN AMERICA
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$159
$145
10%
Adjusted earnings (constant currency)
$159
$135
18%
Adjusted premiums, fees and other revenues
$1,064
$972
9%
Notable item(s)
$0
$0
EMEA
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$77
$86
(10)%
Adjusted earnings (constant currency)
$77
$77
—%
Adjusted premiums, fees and other revenues
$669
$673
(1)%
Notable item(s)
$0
$0
METLIFE HOLDINGS
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$299
$280
7%
Adjusted premiums, fees and other revenues
$1,275
$1,326
(4)%
Notable item(s)
$0
$0
CORPORATE & OTHER
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Adjusted earnings
$(307)
$(219)
Notable item(s)
$(70)
$(62)
INVESTMENTS
($ in millions)
Three months ended June 30, 2019
Three months ended June 30, 2018
Change
Net investment income (as reported on an adjusted basis)
$4,554
$4,327
5%
SECOND QUARTER 2019 NOTABLE ITEMS
($ in millions)
Adjusted Earnings
Three months ended June 30, 2019
Notable Items
U.S.
Asia
Latin
America
EMEA
MetLife
Holdings
Corporate
&
Other
Total
Group Benefits
Retirement and Income Solutions
Property & Casualty
Expense initiative costs
$(70)
$(70)
Total notable items
$0
$0
$0
$0
$0
$0
$0
$(70)
$(70)
About MetLife
MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (MetLife), is one of the world's leading financial services companies, providing insurance, annuities, employee benefits and asset management to help its individual and institutional customers navigate their changing world. Founded in 1868, MetLife has operations in more than 40 countries and holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit www.metlife.com.
Conference Call
MetLife will hold its second quarter 2019 earnings conference call and audio webcast on Thursday, August 1, 2019, from 9-10 a.m. (ET). The conference call will be available live via telephone and the internet. To listen via telephone, dial 800-230-1085 (U.S.) or 612-288-0340 (outside the U.S.). To listen to the conference call via the internet, visit www.metlife.com through a link on the Investor Relations page. Those who want to listen to the call via telephone or the internet should dial in or go to the website at least 15 minutes prior to the call to register, and/or download and install any necessary audio software.
The conference call will be available for replay via telephone and the internet beginning at 11 a.m. (ET) on Thursday, August 1, 2019, until Thursday, August 8, 2019, at 11:59 p.m. (ET). To listen to a replay of the conference call via telephone, dial 800-475-6701 (U.S.) or 320-365-3844 (outside the U.S.). The access code for the replay is 462462. To access the replay of the conference call over the internet, visit the above-mentioned website.
Non-GAAP and Other Financial Disclosures
Any references in this news release (except in this section and the tables that accompany this release) to:
should be read as, respectively:
(i)
net income (loss);
(i)
net income (loss) available to MetLife, Inc.’s common shareholders;
(ii)
net income (loss) per share;
(ii)
net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(iii)
adjusted earnings;
(iii)
adjusted earnings available to common shareholders;
(iv)
adjusted earnings per share;
(iv)
adjusted earnings available to common shareholders per diluted common share;
(v)
book value per share;
(v)
book value per common share;
(vi)
book value per share, excluding AOCI other than FCTA;
(vi)
book value per common share, excluding AOCI other than FCTA;
(vii)
book value per share-tangible common stockholders’ equity;
(vii)
book value per common share-tangible common stockholders’ equity;
(viii)
premiums, fees and other revenues;
(viii)
premiums, fees and other revenues (adjusted);
(ix)
return on equity;
(ix)
return on MetLife, Inc.’s common stockholders’ equity;
(x)
return on equity, excluding AOCI other than FCTA;
(x)
return on MetLife, Inc.’s common stockholders’ equity, excluding AOCI, other than FCTA;
(xi)
adjusted return on equity, excluding AOCI other than FCTA;
(xi)
adjusted return on MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA;
(xii)
tangible return on equity; and
(xii)
return on MetLife, Inc.’s tangible common stockholders' equity; and
(xiii)
adjusted tangible return on equity.
(xiii)
adjusted return on MetLife, Inc.’s tangible common stockholders’ equity.
In this news release, MetLife presents certain measures of its performance on a consolidated and segment basis that are not calculated in accordance with accounting principles generally accepted in the United States of America (GAAP). MetLife believes that these non-GAAP financial measures enhance the understanding of MetLife’s performance by highlighting the results of operations and the underlying profitability drivers of the business. Segment-specific financial measures are calculated using only the portion of consolidated results attributable to that specific segment.
The following non-GAAP financial measures should not be viewed as substitutes for the most directly comparable financial measures calculated in accordance with GAAP:
Non-GAAP financial measures:
Comparable GAAP financial measures:
(i)
total adjusted revenues;
(i)
total revenues;
(ii)
total adjusted expenses;
(ii)
total expenses;
(iii)
adjusted premiums, fees and other revenues;
(iii)
premiums, fees and other revenues;
(iv)
adjusted premiums, fees and other revenues, excluding pension risk transfer;
(iv)
premiums, fees and other revenues;
(v)
adjusted earnings;
(v)
income (loss) from continuing operations, net of income tax;
(vi)
net investment income, as reported on an adjusted basis;
(vi)
net investment income
(vii)
capitalization of deferred policy acquisition costs (DAC), as reported on an adjusted basis;
(vii)
capitalization of DAC
(viii)
other expenses, as reported on an adjusted basis;
(viii)
other expenses
(ix)
adjusted earnings available to common shareholders;
(ix)
net income (loss) available to MetLife, Inc.’s common shareholders;
(x)
adjusted earnings available to common shareholders, excluding total notable items;
(x)
net income (loss) available to MetLife, Inc.’s common shareholders;
(xi)
adjusted earnings available to common shareholders per diluted common share;
(xi)
net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xii)
adjusted earnings available to common shareholders, excluding total notable items, per diluted common share;
(xii)
net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xiii)
adjusted return on equity;
(xiii)
return on equity;
(xiv)
adjusted return on equity, excluding AOCI other than FCTA;
(xiv)
return on equity;
(xv)
adjusted tangible return on equity;
(xv)
return on equity;
(xvi)
investment portfolio gains (losses);
(xvi)
net investment gains (losses);
(xvii)
derivative gains (losses);
(xvii)
net derivative gains (losses);
(xviii)
total MetLife, Inc.’s tangible common stockholders’ equity;
(xviii)
total MetLife, Inc.’s stockholders’ equity;
(xix)
total MetLife, Inc.’s tangible common stockholders’ equity, excluding total notable items;
(xix)
total MetLife, Inc.’s stockholders’ equity;
(xx)
total MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA;
(xx)
total MetLife, Inc.’s stockholders’ equity;
(xxi)
total MetLife, Inc.’s common stockholders’ equity, excluding total notable items (excludes AOCI other than FCTA);
(xxi)
total MetLife, Inc.’s stockholders’ equity;
(xxii)
book value per common share, excluding AOCI other than FCTA;
(xxii)
book value per common share
(xxiii)
book value per common share - tangible common stockholders' equity;
(xxiii)
book value per common share
(xxiv)
free cash flow of all holding companies;
(xxiv)
MetLife, Inc. (parent company only) net cash provided by (used in) operating activities;
(xxv)
adjusted expense ratio;
(xxv)
expense ratio;
(xxvi)
adjusted expense ratio, excluding total notable items related to other expenses and PRT;
(xxvi)
expense ratio;
(xxvii)
direct expense ratio; and
(xxvii)
expense ratio; and
(xxviii)
direct expense ratio, excluding total notable items related to direct expenses and PRT.
(xxviii)
expense ratio.
Any of these financial measures shown on a constant currency basis reflect the impact of changes in foreign currency exchange rates and are calculated using the average foreign currency exchange rates for the most recent period and applied to the comparable prior period.
Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in this earnings news release and in this period’s quarterly financial supplement, which is available at www.metlife.com.
MetLife’s definitions of the various non-GAAP and other financial measures discussed in this news release may differ from those used by other companies:
Adjusted earnings and related measures
These measures are used by management to evaluate performance and allocate resources. Consistent with GAAP guidance for segment reporting, adjusted earnings and components of, or other financial measures based on adjusted earnings are also MetLife’s GAAP measure of segment performance. Adjusted earnings and other financial measures based on adjusted earnings are also the measures by which MetLife senior management’s and many other employees’ performance is evaluated for the purposes of determining their compensation under applicable compensation plans. Adjusted earnings and other financial measures based on adjusted earnings allow analysis of MetLife's performance relative to its Business Plan and facilitate comparisons to industry results.
Adjusted earnings is defined as adjusted revenues less adjusted expenses, net of income tax. Adjusted loss is defined as negative adjusted earnings. Adjusted earnings available to common shareholders is defined as adjusted earnings less preferred stock dividends.
Adjusted revenues and adjusted expenses
These financial measures, along with the related adjusted premiums, fees and other revenues, focus on our primary businesses principally by excluding the impact of market volatility, which could distort trends, and revenues and costs related to non-core products and certain entities required to be consolidated under GAAP. Also, these measures exclude results of discontinued operations under GAAP and other businesses that have been or will be sold or exited by MetLife but do not meet the discontinued operations criteria under GAAP and are referred to as divested businesses. Divested businesses also includes the net impact of transactions with exited businesses that have been eliminated in consolidation under GAAP and costs relating to businesses that have been or will be sold or exited by MetLife that do not meet the criteria to be included in results of discontinued operations under GAAP.
Adjusted revenues also excludes net investment gains (losses) (NIGL) and net derivative gains (losses) (NDGL). Adjusted expenses also excludes goodwill impairments.
The following additional adjustments are made to revenues, in the line items indicated, in calculating adjusted revenues:
The following additional adjustments are made to expenses, in the line items indicated, in calculating adjusted expenses:
Adjusted earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the measurement period under GAAP business combination accounting guidance.
The tax impact of the adjustments mentioned above are calculated net of the U.S. or foreign statutory tax rate, which could differ from MetLife’s effective tax rate. Additionally, the provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.
Investment portfolio gains (losses) and derivative gains (losses)
These are measures of investment and hedging activity. Investment portfolio gains (losses) principally excludes amounts that are reported within net investment gains (losses) but do not relate to the performance of the investment portfolio, such as gains (losses) on sales and divestitures of businesses, goodwill impairment or changes in estimated fair value. Derivative gains (losses) principally excludes earned income on derivatives and amortization of premium on derivatives, where such derivatives are either hedges of investments or are used to replicate certain investments, and where such derivatives do not qualify for hedge accounting. This earned income and amortization of premium is reported within adjusted earnings and not within derivative gains (losses).
Return on equity, allocated equity, tangible equity and related measures
Expense ratio, direct expense ratio, adjusted expense ratio and related measures
Statistical sales information:
Sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity.
The following additional information is relevant to an understanding of MetLife’s performance results:
Forward-Looking Statements
This news release may contain or incorporate by reference information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words and terms such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” "will," and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.
Many factors will be important in determining the results of MetLife, Inc., its subsidiaries and affiliates. Forward-looking statements are based on our assumptions and current expectations, which may be inaccurate, and on the current economic environment, which may change. These statements are not guarantees of future performance. They involve a number of risks and uncertainties that are difficult to predict. Results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in MetLife, Inc.’s filings with the U.S. Securities and Exchange Commission. These factors include: (1) difficult economic conditions, including risks relating to interest rates, credit spreads, equity, real estate, obligors and counterparties, currency exchange rates, derivatives, and terrorism and security; (2) adverse global capital and credit market conditions, which may affect our ability to meet liquidity needs and access capital, including through our credit facilities; (3) downgrades in our claims paying ability, financial strength or credit ratings; (4) availability and effectiveness of reinsurance, hedging or indemnification arrangements; (5) increasing cost and limited market capacity for statutory life insurance reserve financings; (6) the impact on us of changes to and implementation of the wide variety of laws and regulations to which we are subject; (7) regulatory, legislative or tax changes relating to our operations that may affect the cost of, or demand for, our products or services; (8) adverse results or other consequences from litigation, arbitration or regulatory investigations; (9) legal, regulatory and other restrictions affecting MetLife, Inc.’s ability to pay dividends and repurchase common stock; (10) MetLife, Inc.’s primary reliance, as a holding company, on dividends from subsidiaries to meet free cash flow targets and debt payment obligations and the applicable regulatory restrictions on the ability of the subsidiaries to pay such dividends; (11) investment losses, defaults and volatility; (12) potential liquidity and other risks resulting from our participation in a securities lending program and other transactions; (13) changes to investment valuations, allowances and impairments taken on investments, and methodologies, estimates and assumptions;
(14) differences between actual claims experience and underwriting and reserving assumptions; (15) political, legal, operational, economic and other risks relating to our global operations; (16) competitive pressures, including with respect to pricing, entry of new competitors, consolidation of distributors, the development of new products by new and existing competitors, and for personnel; (17) the impact of technological changes on our businesses; (18) catastrophe losses; (19) a deterioration in the experience of the closed block established in connection with the reorganization of Metropolitan Life Insurance Company; (20) impairment of goodwill or other long-lived assets, or the establishment of a valuation allowance against our deferred income tax asset; (21) changes in assumptions related to deferred policy acquisition costs, deferred sales inducements or value of business acquired; (22) exposure to losses related to guarantees in certain products; (23) ineffectiveness of risk management policies and procedures or models; (24) a failure in our cybersecurity systems or other information security systems or our disaster recovery plans; (25) any failure to protect the confidentiality of client information; (26) changes in accounting standards; (27) our associates taking excessive risks; (28) difficulties in marketing and distributing products through our distribution channels; (29) increased expenses relating to pension and other postretirement benefit plans; (30) inability to protect our intellectual property rights or claims of infringement of others’ intellectual property rights; (31) difficulties, unforeseen liabilities, asset impairments, or rating agency actions arising from business acquisitions and dispositions, joint ventures, or other legal entity reorganizations; (32) unanticipated or adverse developments that could adversely affect our expected operational or other benefits from the separation of Brighthouse Financial, Inc. and its subsidiaries; (33) the possibility that MetLife, Inc.’s Board of Directors may influence the outcome of stockholder votes through the voting provisions of the MetLife Policyholder Trust; (34) provisions of laws and our incorporation documents that may delay, deter or prevent takeovers and corporate combinations involving MetLife; and (35) other risks and uncertainties described from time to time in MetLife, Inc.’s filings with the U.S. Securities and Exchange Commission.
MetLife, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if MetLife, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife, Inc. makes on related subjects in reports to the U.S. Securities and Exchange Commission.
MetLife, Inc.
GAAP Interim Condensed Consolidated Statements of Operations
(Unaudited)
(In millions)
For the Three Months Ended
June 30,
2019
2018
Revenues
Premiums
$
10,129
$
15,153
Universal life and investment-type product policy fees
1,412
1,370
Net investment income
4,693
4,473
Other revenues
478
475
Net investment gains (losses)
61
(227
)
Net derivative gains (losses)
724
(59
)
Total revenues
17,497
21,185
Expenses
Policyholder benefits and claims
9,993
14,866
Interest credited to policyholder account balances
1,515
1,424
Policyholder dividends
302
309
Capitalization of DAC
(837
)
(834
)
Amortization of DAC and VOBA
689
707
Amortization of negative VOBA
(10
)
(16
)
Interest expense on debt
274
309
Other expenses
3,274
3,319
Total expenses
15,200
20,084
Income (loss) from continuing operations before provision for income tax
2,297
1,101
Provision for income tax expense (benefit)
551
207
Income (loss) from continuing operations, net of income tax
1,746
894
Income (loss) from discontinued operations, net of income tax
—
—
Net income (loss)
1,746
894
Less: Net income (loss) attributable to noncontrolling interests
5
3
Net income (loss) attributable to MetLife, Inc.
1,741
891
Less: Preferred stock dividends
57
46
Net income (loss) available to MetLife, Inc.'s common shareholders
$
1,684
$
845
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(In millions, except per share data)
For the Three Months Ended
June 30,
2019
2018
Reconciliation to Adjusted Earnings Available to Common Shareholders
Earnings Per Weighted Average Common Share Diluted (1)
Earnings Per Weighted Average Common Share Diluted (1)
Net income (loss) available to MetLife, Inc.'s common shareholders
$
1,684
$
1.77
$
845
$
0.83
Adjustments from net income (loss) available to common shareholders to adjusted earnings available to common shareholders:
Less: Net investment gains (losses)
61
0.06
(227
)
(0.22
)
Net derivative gains (losses)
724
0.76
(59
)
(0.06
)
Premiums
—
—
—
—
Universal life and investment-type product policy fees
48
0.05
26
0.03
Net investment income
139
0.16
146
0.14
Other revenues
71
0.07
83
0.08
Policyholder benefits and claims and policyholder dividends
(112
)
(0.12
)
(50
)
(0.05
)
Interest credited to policyholder account balances
(251
)
(0.26
)
(267
)
(0.26
)
Capitalization of DAC
—
—
—
—
Amortization of DAC and VOBA
8
0.01
1
—
Amortization of negative VOBA
—
—
—
—
Interest expense on debt
—
—
(30
)
(0.03
)
Other expenses
(82
)
(0.09
)
(142
)
(0.14
)
Goodwill impairment
—
—
—
—
Provision for income tax (expense) benefit
(236
)
(0.24
)
41
0.04
Income (loss) from discontinued operations, net of income tax
—
—
—
—
Add: Net income (loss) attributable to noncontrolling interests
5
0.01
3
—
Adjusted earnings available to common shareholders
1,319
1.38
1,326
1.30
Less: Total notable items (2)
(70
)
(0.07
)
(62
)
(0.06
)
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
1,389
$
1.46
$
1,388
$
1.36
Adjusted earnings available to common shareholders on a constant currency basis
$
1,319
$
1.38
$
1,296
$
1.27
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2)
$
1,389
$
1.46
$
1,358
$
1.33
Weighted average common shares outstanding - diluted
952.9
1,023.8
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(In millions)
For the Three Months Ended
June 30,
2019
2018
Premiums, Fees and Other Revenues
Premiums, fees and other revenues
$
12,019
$
16,998
Less: Unearned revenue adjustments
20
(5
)
GMIB fees
28
31
Settlement of foreign currency earnings hedges
2
5
TSA fees
69
78
Divested businesses
—
—
Adjusted premiums, fees and other revenues
$
11,900
$
16,889
Adjusted premiums, fees and other revenues, on a constant currency basis
$
11,900
$
16,757
Less: Pension risk transfer (PRT) (3)
556
5,952
Adjusted premiums, fees and other revenues, excluding PRT, on a constant currency basis
$
11,344
$
10,805
Net Investment Income
Net investment income
$
4,693
$
4,473
Less: Investment hedge adjustments
(118
)
(119
)
Operating joint venture adjustments
—
—
Unit-linked contract income
261
286
Securitization entities income
—
—
Certain partnership distributions
(4
)
(21
)
Divested businesses
—
—
Net investment income, as reported on an adjusted basis
$
4,554
$
4,327
Revenues and Expenses
Total revenues
$
17,497
$
21,185
Less: Net investment gains (losses)
61
(227
)
Less: Net derivative gains (losses)
724
(59
)
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
20
(5
)
Less: Other adjustments to revenues:
GMIB fees
28
31
Investment hedge adjustments
(118
)
(119
)
Operating joint venture adjustments
—
—
Unit-linked contract income
261
286
Securitization entities income
—
—
Settlement of foreign currency earnings hedges
2
5
Certain partnership distributions
(4
)
(21
)
TSA fees
69
78
Divested businesses
—
—
Total adjusted revenues
$
16,454
$
21,216
Total expenses
$
15,200
$
20,084
Less: Adjustments related to net investment (gains) losses and net derivative (gains) losses
(5
)
(10
)
Less: Goodwill impairment
—
—
Less: Other adjustments to expenses:
Inflation and pass-through adjustments
84
—
GMIB costs and amortization of DAC and VOBA related to GMIB fees and GMIB costs
36
60
Market value adjustments and amortization of DAC, VOBA and negative VOBA related to market value adjustments
(11
)
(1
)
PAB hedge adjustments
(6
)
(1
)
Unit-linked contract costs
257
268
Securitization entities debt expense
—
—
Noncontrolling interest
(6
)
(5
)
Regulatory implementation costs
7
2
Acquisition, integration and other costs
6
14
TSA fees
69
78
Divested businesses
6
83
Total adjusted expenses
$
14,763
$
19,596
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(In millions, except per share and ratio data)
For the Three Months Ended
June 30,
Expense Detail and Ratios
2019
2018
Reconciliation of Capitalization of DAC to Capitalization of DAC, as reported on an adjusted basis.
Capitalization of DAC
$
(837
)
$
(834
)
Less: Divested businesses
—
—
Capitalization of DAC, as reported on an adjusted basis
$
(837
)
$
(834
)
Reconciliation of Other Expenses to Other Expenses, as reported on an adjusted basis
Other expenses
$
3,274
$
3,319
Less: Noncontrolling interest
(6
)
(5
)
Less: Regulatory implementation costs
7
2
Less: Acquisition, integration and other costs
6
14
Less: TSA fees
69
78
Less: Divested businesses
6
53
Other expenses, as reported on an adjusted basis
$
3,192
$
3,177
Other detail and ratios
Other expenses
$
3,274
$
3,319
Capitalization of DAC
(837
)
(834
)
Other expenses, net of capitalization of DAC
$
2,437
$
2,485
Premiums, fees and other revenues
$
12,019
$
16,998
Expense ratio
20.3
%
14.6
%
Direct expenses
$
1,485
$
1,500
Less: Total notable items related to direct expenses (2)
88
78
Direct expenses, excluding total notable items related to direct expenses
$
1,397
$
1,422
Other expenses, as reported on an adjusted basis
$
3,192
$
3,177
Capitalization of DAC, as reported on an adjusted basis
(837
)
(834
)
Other expenses, net of capitalization of DAC, as reported on an adjusted basis
2,355
2,343
Less: Total notable items related to other expenses, as reported on an adjusted basis (2)
88
78
Other expenses, net of capitalization of DAC, excluding total notable items related to other expenses, as reported on an adjusted basis (2)
$
2,267
$
2,265
Adjusted premiums, fees and other revenues
$
11,900
$
16,889
Less: PRT
556
5,952
Adjusted premiums, fees and other revenues, excluding PRT
$
11,344
$
10,937
Direct expense ratio
12.5
%
8.9
%
Direct expense ratio, excluding total notable items related to direct expenses and PRT (2)
12.3
%
13.0
%
Adjusted expense ratio
19.8
%
13.9
%
Adjusted expense ratio, excluding total notable items related to other expenses and PRT (2)
20.0
%
20.7
%
See footnotes on last page.
MetLife, Inc.
(Unaudited)
June 30,
Equity Details
2019
2018
Total MetLife, Inc.'s stockholders' equity
$
63,811
$
53,633
Less: Preferred stock
3,340
3,340
MetLife, Inc.'s common stockholders' equity
60,471
50,293
Less: Net unrealized investment gains (losses), net of income tax
18,381
9,703
Defined benefit plans adjustment, net of income tax
(1,984
)
(2,179
)
Total MetLife, Inc.'s common stockholders' equity, excluding AOCI other than FCTA
44,074
42,769
Less: Goodwill, net of income tax
9,071
9,205
VODA and VOCRA, net of income tax
288
341
Total MetLife, Inc.'s tangible common stockholders' equity
$
34,715
$
33,223
June 30,
Book Value (4)
2019
2018
Book value per common share
$
64.61
$
50.28
Less: Net unrealized investment gains (losses), net of income tax
19.64
9.70
Defined benefit plans adjustment, net of income tax
(2.12
)
(2.18
)
Book value per common share, excluding AOCI other than FCTA
47.09
42.76
Less: Goodwill, net of income tax
9.69
9.20
VODA and VOCRA, net of income tax
0.31
0.34
Book value per common share - tangible common stockholders' equity
$
37.09
$
33.22
Common shares outstanding, end of period
935.9
1,000.2
For the Three Months Ended
June 30, (5)
Return on Equity
2019
2018
Return on MetLife, Inc.'s:
Common stockholders' equity
11.6
%
6.5
%
Common stockholders' equity, excluding AOCI other than FCTA
15.4
%
7.8
%
Tangible common stockholders' equity (6)
19.7
%
10.1
%
Adjusted return on MetLife, Inc.'s:
Common stockholders' equity
9.1
%
10.2
%
Common stockholders' equity, excluding AOCI other than FCTA
12.1
%
12.2
%
Common stockholders' equity, excluding total notable items (excludes AOCI other than FCTA) (2)
12.7
%
12.7
%
Tangible common stockholders' equity (6)
15.5
%
15.8
%
Tangible common stockholders' equity, excluding total notable items (2), (6)
16.2
%
16.5
%
Adjusted Return on Allocated Equity:
U.S.
27.3
%
24.7
%
Asia
10.1
%
10.2
%
Latin America
21.5
%
18.5
%
EMEA
11.0
%
9.9
%
MetLife Holdings
12.5
%
11.1
%
Adjusted Return on Allocated Tangible Equity:
U.S.
31.0
%
28.6
%
Asia
15.3
%
15.4
%
Latin America
35.5
%
30.9
%
EMEA
19.8
%
16.2
%
MetLife Holdings
14.0
%
12.6
%
See footnotes on last page.
MetLife, Inc.
Adjusted Earnings Available to Common Shareholders
(Unaudited)
(In millions)
For the Three Months Ended
June 30,
2019
2018
U.S. (3):
Adjusted earnings available to common shareholders
$
732
$
671
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
732
$
671
Adjusted premiums, fees and other revenues
$
6,731
$
11,767
Less: PRT
556
5,952
Adjusted premiums, fees and other revenues, excluding PRT
$
6,175
$
5,815
Group Benefits (3):
Adjusted earnings available to common shareholders
$
311
$
261
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
311
$
261
Adjusted premiums, fees and other revenues
$
4,594
$
4,378
Retirement & Income Solutions (3):
Adjusted earnings available to common shareholders
$
351
$
347
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
351
$
347
Adjusted premiums, fees and other revenues
$
1,220
$
6,492
Less: PRT
556
5,952
Adjusted premiums, fees and other revenues, excluding PRT
$
664
$
540
Property & Casualty (3):
Adjusted earnings available to common shareholders
$
70
$
63
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
70
$
63
Adjusted premiums, fees and other revenues
$
917
$
897
See footnotes on last page.
MetLife, Inc.
Adjusted Earnings Available to Common Shareholders (Continued)
(Unaudited)
(In millions)
For the Three Months Ended
June 30,
2019
2018
Asia:
Adjusted earnings available to common shareholders
$
359
$
363
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
359
$
363
Adjusted earnings available to common shareholders on a constant currency basis
$
359
$
352
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2)
$
359
$
352
Adjusted premiums, fees and other revenues
$
2,063
$
2,066
Adjusted premiums, fees and other revenues, on a constant currency basis
$
2,063
$
2,020
Latin America:
Adjusted earnings available to common shareholders
$
159
$
145
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
159
$
145
Adjusted earnings available to common shareholders on a constant currency basis
$
159
$
135
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2)
$
159
$
135
Adjusted premiums, fees and other revenues
$
1,064
$
972
Adjusted premiums, fees and other revenues, on a constant currency basis
$
1,064
$
922
EMEA:
Adjusted earnings available to common shareholders
$
77
$
86
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
77
$
86
Adjusted earnings available to common shareholders on a constant currency basis
$
77
$
77
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2)
$
77
$
77
Adjusted premiums, fees and other revenues
$
669
$
673
Adjusted premiums, fees and other revenues, on a constant currency basis
$
669
$
637
MetLife Holdings (3):
Adjusted earnings available to common shareholders
$
299
$
280
Less: Total notable items (2)
—
—
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
299
$
280
Adjusted premiums, fees and other revenues
$
1,275
$
1,326
Corporate & Other (3):
Adjusted earnings available to common shareholders
$
(307
)
$
(219
)
Less: Total notable items (2)
(70
)
(62
)
Adjusted earnings available to common shareholders, excluding total notable items (2)
$
(237
)
$
(157
)
Adjusted premiums, fees and other revenues
$
98
$
85
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(1)
Adjusted earnings available to common shareholders, excluding total notable items, per diluted common share is calculated on a standalone basis and may not equal the sum of (i) adjusted earnings available to common shareholders per diluted common share and (ii) total notable items per diluted common share.
(2)
Notable items reflect the unexpected impact of events that affect MetLife’s results, but that were unknown and that MetLife could not anticipate when it devised its Business Plan. Notable items also include certain items regardless of the extent anticipated in the Business Plan to help investors have a better understanding of MetLife's results and to evaluate and forecast those results. Notable items can affect MetLife’s results either positively or negatively.
(3)
Results on a constant currency basis are not included as constant currency impact is not significant.
(4)
Book values exclude $3,340 million and $3,340 million of equity related to preferred stock at June 30, 2019 and 2018, respectively.
(5)
Annualized using quarter-to-date results.
(6)
Net income (loss) available to MetLife, Inc.'s common shareholders and adjusted earnings available to common shareholders, used to calculate returns on tangible equity, exclude the impact of amortization of VODA and VOCRA, net of income tax, for the three months ended June 30, 2019 and June 30, 2018 of $9 million and $10 million, respectively.
View source version on businesswire.com: https://www.businesswire.com/news/home/20190731005947/en/
For Media: Ashia Razzaq MetLife (212) 578-1538 For Investors: John Hall MetLife (212) 578-7888
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