EX-99.2 3 pri-ex992_7.htm FINANCIAL SUPPLEMENT pri-ex992_7.htm

Exhibit 99.2

 

 

 

 

 

Supplemental Financial Information

First Quarter 2019

 

 

 

 

 

 

 

 

 

 

Table of Contents

PRIMERICA, INC.

Financial Supplement

 

 

 

Page

Preface, definition of Non-GAAP financial measures

3

Condensed balance sheets and reconciliation of balance sheet non-GAAP to GAAP financial measures

4

Financial results and other statistical data  

5

Statements of income  

6

Reconciliation of statement of income GAAP to non-GAAP financial measures

7

Segment operating results  

8

Term Life Insurance segment - financial results, key statistics, and financial analysis  

9-10

Investment and Savings Products segment - financial results, financial analysis, and key statistics  

11-12

Investment portfolio  

13-15

Five-year historical key statistics  

16

 

 

This document may contain forward-looking statements and information.  Additional information and factors that could cause actual results to differ materially from any forward-looking statements or information in this document is available in our Form 10-K for the year ended December 31, 2018.

 

2 of 16

 

 

 

Preface

PRIMERICA, INC.

Financial Supplement

 

 

First Quarter 2019

 

This document is a financial supplement to our first quarter 2019 earnings release.  It is designed to enable comprehensive analysis of our ongoing business using the same core metrics that our management utilizes in assessing our business and making strategic and operational decisions.  Throughout this document we provide financial information that is derived from our U.S. GAAP financial statements and adjusted for three different purposes, as follows:

 

•

Operating adjustments exclude the impact of realized investment gains/losses, mark-to-market (MTM) investment adjustments, and the one-time transition impact of the Tax Cuts and Jobs Act of 2017 (Tax Reform).  We exclude realized investment gains/losses and MTM investment adjustments in measuring adjusted operating revenues to eliminate period-over-period fluctuations that may obscure comparisons of operating results due to items such as the timing of recognizing gains and losses and other factors prior to an invested asset's maturity or sale that are not directly associated with the Company's insurance operations.  We exclude the provisional one-time transition impact from Tax Reform recognized in the fourth quarter of 2017, as well as all adjustments recognized in 2018 to the provisional one-time transition impact, to present meaningful and useful period-over-period comparisons that could be distorted by this historically infrequent tax law change.

 

•

Adjusted stockholders’ equity refers to the removal of the impact of net unrealized gains and losses on invested assets.  We exclude unrealized investment gains and losses in measuring adjusted stockholders' equity as unrealized gains and losses from the Company's invested assets are largely caused by market movements in interest rates and credit spreads that do not necessarily correlate with the cash flows we will ultimately realize when an invested asset matures or is sold.

 

•

IPO coinsurance transactions adjustments relate to transactions in the first quarter of 2010, where we coinsured between 80% and 90% of our business that was in-force at year-end 2009 to entities then affiliated with Citigroup Inc. that were executed concurrent with our initial public offering (IPO).  We exclude amounts ceded under the IPO coinsurance transactions in measuring adjusted direct premiums and other ceded premiums to present meaningful comparisons of the actual premiums economically maintained by the Company. Amounts ceded under the IPO coinsurance transactions will continue to decline over time as policies terminate within this block of business.

 

Management utilizes these non-GAAP financial measures in managing the business and believes they present relevant and meaningful analytical metrics for evaluating the ongoing business.  Reconciliations of non-GAAP to GAAP financial measures are included in this financial supplement.

Certain items throughout this supplement may not add due to rounding and as such, may not agree to other public reporting of the respective item.  Certain items throughout this supplement are noted as ‘na’ to indicate not applicable.  Certain variances are noted as ‘nm’ to indicate not meaningful.  Certain reclassifications have been made to prior-period amounts to conform to current-period reporting classifications. These reclassifications had no impact on net income or total stockholders’ equity.

 

3 of 16

 

 

 

Condensed Balance Sheets and Reconciliation of Balance Sheet Non-GAAP to GAAP Financial Measures

PRIMERICA, INC.

Financial Supplement

 

(Dollars in thousands)

Dec 31,

2017

 

Mar 31,

2018

 

Jun 30,

2018

 

Sep 30,

2018

 

Dec 31,

2018

 

Mar 31,

2019

 

Condensed Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments and cash excluding securities held to maturity

$

2,287,955

 

$

2,254,512

 

$

2,239,045

 

$

2,322,453

 

$

2,422,734

 

$

2,471,745

 

 

Securities held to maturity

 

737,150

 

 

796,450

 

 

843,810

 

 

891,860

 

 

970,390

 

 

1,036,110

 

 

 

 

Total investments and cash

 

3,025,105

 

 

3,050,962

 

 

3,082,855

 

 

3,214,313

 

 

3,393,124

 

 

3,507,855

 

 

Due from reinsurers

 

4,205,173

 

 

4,263,111

 

 

4,199,275

 

 

4,196,021

 

 

4,141,569

 

 

4,202,903

 

 

Deferred policy acquisition costs

 

1,951,892

 

 

1,998,985

 

 

2,053,445

 

 

2,107,814

 

 

2,133,920

 

 

2,181,741

 

 

Other assets

 

705,661

 

 

759,973

 

 

772,058

 

 

769,387

 

 

730,933

 

 

815,369

 

 

Separate account assets

 

2,572,872

 

 

2,419,707

 

 

2,389,007

 

 

2,419,997

 

 

2,195,501

 

 

2,368,760

 

 

 

 

Total assets

$

12,460,704

 

$

12,492,737

 

$

12,496,640

 

$

12,707,531

 

$

12,595,047

 

$

13,076,628

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Future policy benefits

$

5,954,524

 

$

6,004,101

 

$

6,057,112

 

$

6,132,750

 

$

6,168,157

 

$

6,240,864

 

 

Other policy liabilities

 

685,885

 

 

693,223

 

 

673,912

 

 

682,126

 

 

700,094

 

 

703,123

 

 

Income taxes

 

177,468

 

 

184,161

 

 

182,140

 

 

182,241

 

 

187,104

 

 

206,180

 

 

Other liabilities

 

451,398

 

 

506,535

 

 

495,242

 

 

511,623

 

 

486,772

 

 

562,225

 

 

Notes payable

 

373,288

 

 

373,381

 

 

373,474

 

 

373,567

 

 

373,661

 

 

373,755

 

 

Surplus note

 

736,381

 

 

795,697

 

 

843,073

 

 

891,139

 

 

969,685

 

 

1,035,421

 

 

Payable under securities lending

 

89,786

 

 

89,433

 

 

82,096

 

 

70,632

 

 

52,562

 

 

64,914

 

 

Separate account liabilities

 

2,572,872

 

 

2,419,707

 

 

2,389,007

 

 

2,419,997

 

 

2,195,501

 

 

2,368,760

 

 

 

 

Total liabilities

 

11,041,603

 

 

11,066,237

 

 

11,096,056

 

 

11,264,074

 

 

11,133,535

 

 

11,555,241

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock ($0.01 par value) (1)

 

443

 

 

440

 

 

432

 

 

430

 

 

427

 

 

424

 

 

Paid-in capital

 

(0

)

 

(0

)

 

(0

)

 

(0

)

 

(0

)

 

0

 

 

Retained earnings

 

1,375,090

 

 

1,416,564

 

 

1,409,104

 

 

1,452,841

 

 

1,489,520

 

 

1,506,944

 

 

Treasury stock

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

Accumulated other comprehensive income (loss), net:

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

Net unrealized investment gains (losses) not other-than-temporarily impaired

 

39,686

 

 

14,039

 

 

1,493

 

 

(4,380

)

 

(7,253

)

 

29,022

 

 

 

Net unrealized investment losses other-than-temporarily impaired

 

(113

)

 

(136

)

 

(136

)

 

(135

)

 

(116

)

 

(106

)

 

 

Cumulative translation adjustment

 

3,995

 

 

(4,406

)

 

(10,309

)

 

(5,300

)

 

(21,064

)

 

(14,897

)

 

 

 

Total stockholders’ equity

 

1,419,101

 

 

1,426,500

 

 

1,400,584

 

 

1,443,456

 

 

1,461,513

 

 

1,521,387

 

 

 

 

Total liabilities and stockholders' equity

$

12,460,704

 

$

12,492,737

 

$

12,496,640

 

$

12,707,531

 

$

12,595,047

 

$

13,076,628

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Adjusted Stockholders' Equity to Total Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted stockholders' equity

$

1,379,528

 

$

1,412,597

 

$

1,399,227

 

$

1,447,972

 

$

1,468,882

 

$

1,492,471

 

Reconciling items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net unrealized investment gains (losses) not other-than-temporarily impaired

 

39,686

 

 

14,039

 

 

1,493

 

 

(4,380

)

 

(7,253

)

 

29,022

 

 

Net unrealized investment losses other-than-temporarily impaired

 

(113

)

 

(136

)

 

(136

)

 

(135

)

 

(116

)

 

(106

)

 

 

Total reconciling items

 

39,573

 

 

13,903

 

 

1,357

 

 

(4,515

)

 

(7,370

)

 

28,916

 

 

 

 

Total stockholders’ equity

$

1,419,101

 

$

1,426,500

 

$

1,400,584

 

$

1,443,456

 

$

1,461,513

 

$

1,521,387

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Stockholders' Equity Rollforward

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

1,233,482

 

$

1,379,528

 

$

1,412,597

 

$

1,399,227

 

$

1,447,972

 

$

1,468,882

 

 

Net Income

 

168,443

 

 

65,714

 

 

86,699

 

 

85,139

 

 

86,541

 

 

79,166

 

 

Shareholder dividends

 

(9,020

)

 

(11,278

)

 

(11,086

)

 

(10,920

)

 

(10,856

)

 

(14,628

)

 

Retirement of shares and warrants

 

(17,318

)

 

(51,563

)

 

(87,448

)

 

(34,508

)

 

(43,338

)

 

(60,288

)

 

Net foreign currency translation adjustment

 

(497

)

 

(8,402

)

 

(5,903

)

 

5,009

 

 

(15,765

)

 

6,167

 

 

Other, net

 

4,437

 

 

38,598

 

 

4,367

 

 

4,024

 

 

4,328

 

 

13,171

 

Balance, end of period

$

1,379,528

 

$

1,412,597

 

$

1,399,227

 

$

1,447,972

 

$

1,468,882

 

$

1,492,471

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred Policy Acquisition Costs Rollforward

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, beginning of period

$

1,900,122

 

$

1,951,892

 

$

1,998,985

 

$

2,053,445

 

$

2,107,814

 

$

2,133,920

 

 

General expenses deferred

 

8,887

 

 

9,599

 

 

9,800

 

 

8,886

 

 

8,497

 

 

9,163

 

 

Commission costs deferred

 

99,411

 

 

104,314

 

 

103,192

 

 

100,890

 

 

96,697

 

 

98,196

 

 

Amortization of deferred policy acquisition costs

 

(56,304

)

 

(60,165

)

 

(53,847

)

 

(59,534

)

 

(66,184

)

 

(64,628

)

 

Foreign currency impact and other, net

 

(224

)

 

(6,655

)

 

(4,684

)

 

4,127

 

 

(12,904

)

 

5,091

 

Balance, end of period

$

1,951,892

 

$

1,998,985

 

$

2,053,445

 

$

2,107,814

 

$

2,133,920

 

$

2,181,741

 

 

(1)

Outstanding common shares exclude restricted stock units.

 

 

 

4 of 16

 

 

Financial Results and Other Statistical Data

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands, except per-share data)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$/#

Change

 

%

Change

 

Earnings per Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares and fully vested equity awards

 

44,739,864

 

 

44,065,972

 

 

43,452,234

 

 

43,179,898

 

 

42,824,471

 

 

(1,915,393

)

 

-4.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

65,714

 

$

86,699

 

$

85,139

 

$

86,541

 

$

79,166

 

$

13,452

 

 

20.5

%

 

Less income attributable to unvested participating securities

 

(425

)

 

(483

)

 

(485

)

 

(487

)

 

(401

)

 

24

 

 

5.6

%

 

 

Net income used in computing basic EPS

$

65,289

 

$

86,216

 

$

84,654

 

$

86,054

 

$

78,765

 

$

13,475

 

 

20.6

%

 

 

Basic earnings per share

$

1.46

 

$

1.96

 

$

1.95

 

$

1.99

 

$

1.84

 

$

0.38

 

 

26.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net operating income

$

66,215

 

$

85,984

 

$

84,489

 

$

87,641

 

$

75,303

 

$

9,088

 

 

13.7

%

 

Less operating income attributable to unvested participating securities

 

(428

)

 

(479

)

 

(482

)

 

(493

)

 

(381

)

 

47

 

 

10.9

%

 

 

Adjusted net operating income used in computing basic operating EPS

$

65,787

 

$

85,506

 

$

84,008

 

$

87,147

 

$

74,922

 

$

9,135

 

 

13.9

%

 

 

Basic adjusted operating income per share

$

1.47

 

$

1.94

 

$

1.93

 

$

2.02

 

$

1.75

 

$

0.28

 

 

19.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares and fully vested equity awards

 

44,739,864

 

 

44,065,972

 

 

43,452,234

 

 

43,179,898

 

 

42,824,471

 

 

(1,915,393

)

 

-4.3

%

 

Dilutive impact of contingently issuable shares

 

115,421

 

 

140,567

 

 

136,628

 

 

131,384

 

 

118,014

 

 

2,593

 

 

2.2

%

 

 

Shares used to calculate diluted EPS

 

44,855,285

 

 

44,206,539

 

 

43,588,862

 

 

43,311,282

 

 

42,942,485

 

 

(1,912,800

)

 

-4.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

65,714

 

$

86,699

 

$

85,139

 

$

86,541

 

$

79,166

 

$

13,452

 

 

20.5

%

 

Less income attributable to unvested participating securities

 

(424

)

 

(481

)

 

(484

)

 

(486

)

 

(400

)

 

24

 

 

5.6

%

 

 

Net income used in computing diluted EPS

$

65,290

 

$

86,217

 

$

84,655

 

$

86,055

 

$

78,766

 

$

13,475

 

 

20.6

%

 

 

Diluted earnings per share

$

1.46

 

$

1.95

 

$

1.94

 

$

1.99

 

$

1.83

 

$

0.38

 

 

26.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net operating income

$

66,215

 

$

85,984

 

$

84,489

 

$

87,641

 

$

75,303

 

$

9,088

 

 

13.7

%

 

Less operating income attributable to unvested participating securities

 

(427

)

 

(478

)

 

(480

)

 

(492

)

 

(381

)

 

47

 

 

10.9

%

 

 

Adjusted net operating income used in computing diluted operating EPS

$

65,788

 

$

85,507

 

$

84,009

 

$

87,149

 

$

74,923

 

$

9,134

 

 

13.9

%

 

 

Diluted adjusted operating income per share

$

1.47

 

$

1.93

 

$

1.93

 

$

2.01

 

$

1.74

 

$

0.28

 

 

19.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

 

 

 

 

 

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$/#

Change

 

%

Change

 

Annualized Return on Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average stockholders' equity

$

1,422,801

 

$

1,413,542

 

$

1,422,020

 

$

1,452,485

 

$

1,491,450

 

$

68,649

 

 

4.8

%

 

Average adjusted stockholders' equity

$

1,396,063

 

$

1,405,912

 

$

1,423,599

 

$

1,458,427

 

$

1,480,676

 

$

84,613

 

 

6.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income return on stockholders' equity

 

18.5

%

 

24.5

%

 

23.9

%

 

23.8

%

 

21.2

%

 

2.8

%

nm

 

 

Net income return on adjusted stockholders' equity

 

18.8

%

 

24.7

%

 

23.9

%

 

23.7

%

 

21.4

%

 

2.6

%

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net operating income return on adjusted stockholders' equity

 

19.0

%

 

24.5

%

 

23.7

%

 

24.0

%

 

20.3

%

 

1.4

%

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Structure

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt-to-capital (1)

 

20.7

%

 

21.1

%

 

20.6

%

 

20.4

%

 

19.7

%

 

-1.0

%

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and invested assets to stockholders' equity

 

2.1

x

 

2.2

x

 

2.2

x

 

2.3

x

 

2.3

x

 

0.2

x

nm

 

 

Cash and invested assets to adjusted stockholders' equity

 

2.2

x

 

2.2

x

 

2.2

x

 

2.3

x

 

2.4

x

 

0.2

x

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share count, end of period (2)

 

43,953,046

 

 

43,168,005

 

 

42,976,742

 

 

42,694,258

 

 

42,398,643

 

 

(1,554,403

)

 

-3.5

%

 

Adjusted stockholders' equity per share

$

32.14

 

$

32.41

 

$

33.69

 

$

34.40

 

$

35.20

 

$

3.06

 

 

9.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Strength Ratings - Primerica Life Insurance Co

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Moody's

A2

 

A2

 

A1

 

A1

 

A1

 

nm

 

nm

 

 

S&P

AA-

 

AA-

 

AA-

 

AA-

 

AA-

 

nm

 

nm

 

 

A.M. Best

A+

 

A+

 

A+

 

A+

 

A+

 

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Holding Company Senior Debt Ratings

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Moody's

Baa2

 

Baa2

 

Baa1

 

Baa1

 

Baa1

 

nm

 

nm

 

 

S&P

A-

 

A-

 

A-

 

A-

 

A-

 

nm

 

nm

 

 

A.M. Best

a-

 

a-

 

a-

 

a-

 

a-

 

nm

 

nm

 

 

 

(1)

Debt-to-capital is that of the parent company only.  Capital in the debt-to-capital ratio includes stockholders' equity and the note payable.

(2)

Share count reflects outstanding common shares, but excludes restricted stock units (RSUs).

 

 

 

5 of 16

 

 

Statements of Income

 

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Statement of Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct premiums

$

656,087

 

$

667,191

 

$

670,222

 

$

673,605

 

$

677,286

 

$

21,199

 

 

3.2

%

 

Ceded premiums

 

(394,249

)

 

(403,449

)

 

(391,175

)

 

(392,290

)

 

(389,795

)

 

4,454

 

 

1.1

%

 

 

Net premiums

 

261,838

 

 

263,741

 

 

279,047

 

 

281,314

 

 

287,491

 

 

25,653

 

 

9.8

%

 

Net investment income

 

19,017

 

 

20,030

 

 

20,622

 

 

21,760

 

 

24,111

 

 

5,094

 

 

26.8

%

 

Commissions and fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based (1)

 

64,461

 

 

64,307

 

 

64,181

 

 

67,041

 

 

66,997

 

 

2,536

 

 

3.9

%

 

 

Asset-based (2)

 

74,649

 

 

75,672

 

 

78,318

 

 

75,012

 

 

73,639

 

 

(1,010

)

 

-1.4

%

 

 

Account-based (3)

 

20,595

 

 

20,438

 

 

20,306

 

 

20,463

 

 

19,613

 

 

(982

)

 

-4.8

%

 

 

Other commissions and fees

 

7,122

 

 

7,523

 

 

8,074

 

 

9,444

 

 

7,066

 

 

(55

)

 

-0.8

%

 

Realized investment (losses) gains

 

(1,656

)

 

1,313

 

 

(126

)

 

(1,651

)

 

2,847

 

 

4,504

 

nm

 

 

Other, net

 

13,897

 

 

14,790

 

 

14,359

 

 

13,940

 

 

13,223

 

 

(674

)

 

-4.8

%

 

                  Total revenues

 

459,923

 

 

467,814

 

 

484,781

 

 

487,324

 

 

494,988

 

 

35,065

 

 

7.6

%

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and claims

 

116,890

 

 

105,069

 

 

118,787

 

 

116,837

 

 

122,284

 

 

5,394

 

 

4.6

%

 

Amortization of DAC

 

60,165

 

 

53,847

 

 

59,534

 

 

66,184

 

 

64,628

 

 

4,464

 

 

7.4

%

 

Insurance commissions

 

5,877

 

 

6,417

 

 

6,584

 

 

5,612

 

 

5,619

 

 

(258

)

 

-4.4

%

 

Insurance expenses

 

41,109

 

 

43,451

 

 

41,925

 

 

41,671

 

 

43,402

 

 

2,294

 

 

5.6

%

 

Sales commissions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based (1)

 

46,259

 

 

45,905

 

 

45,634

 

 

47,424

 

 

47,831

 

 

1,572

 

 

3.4

%

 

 

Asset-based (2)

 

32,484

 

 

33,350

 

 

34,813

 

 

33,297

 

 

32,343

 

 

(141

)

 

-0.4

%

 

 

Other sales commissions

 

3,777

 

 

3,700

 

 

4,141

 

 

4,602

 

 

3,626

 

 

(151

)

 

-4.0

%

 

Interest expense

 

7,173

 

 

7,229

 

 

7,216

 

 

7,192

 

 

7,180

 

 

7

 

 

0.1

%

 

Other operating expenses

 

63,228

 

 

55,083

 

 

54,712

 

 

56,584

 

 

65,706

 

 

2,478

 

 

3.9

%

 

                  Total benefits and expenses

 

376,961

 

 

354,050

 

 

373,346

 

 

379,403

 

 

392,619

 

 

15,658

 

 

4.2

%

 

Income before income taxes

 

82,962

 

 

113,764

 

 

111,435

 

 

107,922

 

 

102,368

 

 

19,407

 

 

23.4

%

Income taxes

 

17,248

 

 

27,065

 

 

26,296

 

 

21,380

 

 

23,203

 

 

5,955

 

 

34.5

%

 

                  Net income

$

65,714

 

$

86,699

 

$

85,139

 

$

86,541

 

$

79,166

 

$

13,452

 

 

20.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Before Income Taxes by Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term Life

$

59,621

 

$

75,827

 

$

74,338

 

$

72,117

 

$

70,339

 

$

10,718

 

 

18.0

%

Investment & Savings Products

 

39,985

 

 

43,228

 

 

45,052

 

 

45,647

 

 

42,684

 

 

2,699

 

 

6.7

%

Corporate & Other Distributed Products

 

(16,644

)

 

(5,291

)

 

(7,954

)

 

(9,842

)

 

(10,654

)

 

5,990

 

 

36.0

%

 

Income before income taxes

$

82,962

 

$

113,764

 

$

111,435

 

$

107,922

 

$

102,368

 

$

19,407

 

 

23.4

%

 

(1)

Sales-based - revenues or commission expenses relating to the sales of mutual funds and variable annuities.

(2)

Asset-based - revenues or commission expenses relating to the value of assets in client accounts for which we earn ongoing service, distribution, and other fees.

(3)

Account-based - revenues relating to the fee generating client accounts we administer.

6 of 16

 

 

 

Reconciliation of Statement of Income GAAP to Non-GAAP Financial Measures

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Reconciliation from Term Life Direct Premiums to Term Life Adjusted Direct Premiums

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term Life direct premiums

$

649,366

 

$

660,505

 

$

663,183

 

$

667,776

 

$

670,755

 

$

21,389

 

 

3.3

%

 

Less: Premiums ceded to IPO Coinsurers

 

294,301

 

 

290,956

 

 

284,742

 

 

281,265

 

 

276,150

 

 

(18,150

)

 

-6.2

%

 

Term Life adjusted direct premiums

$

355,065

 

$

369,548

 

$

378,441

 

$

386,511

 

$

394,605

 

$

39,539

 

 

11.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Term Life Ceded Premiums to Term Life Other Ceded Premiums

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term Life ceded premiums

$

(392,561

)

$

(401,686

)

$

(389,332

)

$

(390,173

)

$

(388,100

)

$

4,461

 

 

1.1

%

 

Less: Premiums ceded to IPO Coinsurers

 

(294,301

)

 

(290,956

)

 

(284,742

)

 

(281,265

)

 

(276,150

)

 

18,150

 

 

6.2

%

 

Term Life other ceded premiums

$

(98,260

)

$

(110,730

)

$

(104,590

)

$

(108,908

)

$

(111,950

)

$

(13,690

)

 

-13.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Net Investment Income to Adjusted Net Investment Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Investment Income

$

19,017

 

$

20,030

 

$

20,622

 

$

21,760

 

$

24,111

 

$

5,094

 

 

26.8

%

 

Less: MTM investment adjustments

 

(1,288

)

 

(375

)

 

(297

)

 

280

 

 

2,147

 

nm

 

nm

 

 

Adjusted net investment income

$

20,305

 

$

20,405

 

$

20,920

 

$

21,480

 

$

21,964

 

$

1,660

 

 

8.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Total Revenues to Adjusted Operating Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

$

459,923

 

$

467,814

 

$

484,781

 

$

487,324

 

$

494,988

 

$

35,065

 

 

7.6

%

 

Less: Realized investment gains/(losses)

 

(1,656

)

 

1,313

 

 

(126

)

 

(1,651

)

 

2,847

 

nm

 

nm

 

 

Less: MTM investment adjustments

 

(1,288

)

 

(375

)

 

(297

)

 

280

 

 

2,147

 

nm

 

nm

 

 

Adjusted operating revenues

$

462,866

 

$

466,877

 

$

485,205

 

$

488,695

 

$

489,993

 

$

27,127

 

 

5.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Income Before Income Taxes to Adjusted Operating Income Before Income Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

$

82,962

 

$

113,764

 

$

111,435

 

$

107,922

 

$

102,368

 

$

19,407

 

 

23.4

%

 

Less: Realized investment gains/(losses)

 

(1,656

)

 

1,313

 

 

(126

)

 

(1,651

)

 

2,847

 

nm

 

nm

 

 

Less: MTM investment adjustments

 

(1,288

)

 

(375

)

 

(297

)

 

280

 

 

2,147

 

nm

 

nm

 

 

Adjusted operating income before income taxes

$

85,906

 

$

112,827

 

$

111,859

 

$

109,293

 

$

97,374

 

$

11,468

 

 

13.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation from Net Income to Adjusted Net Operating Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

65,714

 

$

86,699

 

$

85,139

 

$

86,541

 

$

79,166

 

$

13,452

 

 

20.5

%

 

Less: Income before income taxes reconciling items

 

(2,944

)

 

937

 

 

(424

)

 

(1,371

)

 

4,994

 

nm

 

nm

 

 

Less: Tax impact of income before income taxes reconciling items

 

675

 

 

(223

)

 

104

 

 

272

 

 

(1,132

)

nm

 

nm

 

 

Less: Transition impact of tax reform (1)

 

1,768

 

 

—

 

 

970

 

 

—

 

 

—

 

nm

 

nm

 

 

Adjusted net operating income

$

66,215

 

$

85,984

 

$

84,489

 

$

87,641

 

$

75,303

 

$

9,088

 

 

13.7

%

 

(1)

Represents the transition effect of revaluing deferred tax assets and liabilities to a 21% tax rate and the inclusion of tax on mandatory deemed repatriated foreign earnings due to the enactment of Tax Reform, which was signed into law on December 22, 2017.  Amounts recognized in 2018 represent adjustments to the provisional amounts estimated as of December 31, 2017.

7 of 16

 

 

 

Segment Operating Results

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Term Life Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Premiums

$

649,366

 

$

660,505

 

$

663,183

 

$

667,776

 

$

670,755

 

$

21,389

 

 

3.3

%

 

Premiums ceded to IPO coinsurers (1)

 

(294,301

)

 

(290,956

)

 

(284,742

)

 

(281,265

)

 

(276,150

)

 

18,150

 

 

6.2

%

 

Adjusted direct premiums (2)

 

355,065

 

 

369,548

 

 

378,441

 

 

386,511

 

 

394,605

 

 

39,539

 

 

11.1

%

 

Other ceded premiums  (3)

 

(98,260

)

 

(110,730

)

 

(104,590

)

 

(108,908

)

 

(111,950

)

 

(13,690

)

 

-13.9

%

 

Net premiums

 

256,805

 

 

258,818

 

 

273,851

 

 

277,603

 

 

282,655

 

 

25,850

 

 

10.1

%

 

Allocated net investment income

 

3,089

 

 

3,246

 

 

3,506

 

 

3,907

 

 

4,444

 

 

1,355

 

 

43.9

%

 

Other, net

 

10,415

 

 

10,913

 

 

10,615

 

 

10,431

 

 

9,744

 

 

(671

)

 

-6.4

%

 

Revenues

 

270,309

 

 

272,978

 

 

287,972

 

 

291,941

 

 

296,843

 

 

26,534

 

 

9.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and claims

 

112,831

 

 

101,755

 

 

113,988

 

 

113,201

 

 

118,443

 

 

5,611

 

 

5.0

%

 

Amortization of DAC

 

56,673

 

 

51,257

 

 

56,904

 

 

63,779

 

 

64,066

 

 

7,393

 

 

13.0

%

 

Insurance commissions

 

2,228

 

 

2,856

 

 

2,936

 

 

2,244

 

 

2,163

 

 

(64

)

 

-2.9

%

 

Insurance expenses

 

38,956

 

 

41,282

 

 

39,807

 

 

40,600

 

 

41,832

 

 

2,876

 

 

7.4

%

 

Benefits and expenses

 

210,688

 

 

197,150

 

 

213,635

 

 

219,824

 

 

226,504

 

 

15,816

 

 

7.5

%

 

Income before income taxes

$

59,621

 

$

75,827

 

$

74,338

 

$

72,117

 

$

70,339

 

$

10,718

 

 

18.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment & Savings Products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based

$

64,461

 

$

64,307

 

$

64,181

 

$

67,041

 

$

66,997

 

$

2,536

 

 

3.9

%

 

Asset-based

 

74,649

 

 

75,672

 

 

78,318

 

 

75,012

 

 

73,639

 

 

(1,010

)

 

-1.4

%

 

Account-based

 

20,595

 

 

20,438

 

 

20,306

 

 

20,463

 

 

19,613

 

 

(982

)

 

-4.8

%

 

Other, net

 

2,336

 

 

2,424

 

 

2,464

 

 

2,408

 

 

2,423

 

 

86

 

 

3.7

%

 

Revenues

 

162,042

 

 

162,841

 

 

165,269

 

 

164,924

 

 

162,671

 

 

630

 

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of DAC

 

3,442

 

 

2,080

 

 

2,349

 

 

1,896

 

 

477

 

 

(2,964

)

 

-86.1

%

 

Insurance commissions

 

3,199

 

 

3,132

 

 

3,193

 

 

3,042

 

 

3,025

 

 

(175

)

 

-5.5

%

 

Sales commissions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based

 

46,259

 

 

45,905

 

 

45,634

 

 

47,424

 

 

47,831

 

 

1,572

 

 

3.4

%

 

Asset-based

 

32,484

 

 

33,350

 

 

34,813

 

 

33,297

 

 

32,343

 

 

(141

)

 

-0.4

%

 

Other operating expenses

 

36,673

 

 

35,147

 

 

34,228

 

 

33,619

 

 

36,312

 

 

(361

)

 

-1.0

%

 

Benefits and expenses

 

122,057

 

 

119,613

 

 

120,217

 

 

119,277

 

 

119,988

 

 

(2,069

)

 

-1.7

%

 

Income before income taxes

$

39,985

 

$

43,228

 

$

45,052

 

$

45,647

 

$

42,684

 

$

2,699

 

 

6.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate & Other Distributed Products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct premiums

$

6,721

 

$

6,686

 

$

7,039

 

$

5,829

 

$

6,531

 

$

(190

)

 

-2.8

%

 

Ceded premiums

 

(1,688

)

 

(1,763

)

 

(1,843

)

 

(2,118

)

 

(1,695

)

 

(7

)

 

-0.4

%

 

Net premiums

 

5,033

 

 

4,923

 

 

5,195

 

 

3,711

 

 

4,836

 

 

(197

)

 

-3.9

%

 

Allocated net investment income

 

17,216

 

 

17,159

 

 

17,413

 

 

17,574

 

 

17,521

 

 

305

 

 

1.8

%

 

Commissions and fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prepaid Legal Services

 

3,669

 

 

3,607

 

 

4,431

 

 

4,586

 

 

3,737

 

 

67

 

 

1.8

%

 

Auto and Homeowners Insurance

 

1,347

 

 

1,800

 

 

1,516

 

 

2,386

 

 

1,500

 

 

154

 

 

11.4

%

 

Other sales commissions

 

2,106

 

 

2,116

 

 

2,127

 

 

2,472

 

 

1,829

 

 

(276

)

 

-13.1

%

 

Other, net

 

1,145

 

 

1,453

 

 

1,281

 

 

1,102

 

 

1,056

 

 

(89

)

 

-7.8

%

 

Adjusted operating revenues

 

30,516

 

 

31,058

 

 

31,964

 

 

31,831

 

 

30,479

 

 

(37

)

 

-0.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and claims

 

4,059

 

 

3,314

 

 

4,799

 

 

3,636

 

 

3,842

 

 

(217

)

 

-5.4

%

 

Amortization of DAC

 

50

 

 

510

 

 

282

 

 

509

 

 

85

 

 

35

 

 

70.3

%

 

Insurance commissions

 

450

 

 

428

 

 

455

 

 

326

 

 

431

 

 

(20

)

 

-4.4

%

 

Insurance expenses

 

2,153

 

 

2,169

 

 

2,118

 

 

1,071

 

 

1,570

 

 

(582

)

 

-27.1

%

 

Sales commissions

 

3,777

 

 

3,700

 

 

4,141

 

 

4,602

 

 

3,626

 

 

(151

)

 

-4.0

%

 

Interest expense

 

7,173

 

 

7,229

 

 

7,216

 

 

7,192

 

 

7,180

 

 

7

 

 

0.1

%

 

Other operating expenses

 

26,554

 

 

19,936

 

 

20,484

 

 

22,965

 

 

29,394

 

 

2,840

 

 

10.7

%

 

Benefits and expenses

 

44,216

 

 

37,287

 

 

39,495

 

 

40,301

 

 

46,127

 

 

1,911

 

 

4.3

%

 

Adjusted operating income before income taxes

$

(13,700

)

$

(6,228

)

$

(7,531

)

$

(8,471

)

$

(15,648

)

$

(1,948

)

 

-14.2

%

 

(1)

Premiums ceded to IPO coinsurers - premiums ceded to IPO coinsurers under the IPO coinsurance transactions excluding any reimbursements from the IPO coinsurers on previously existing reinsurance agreements.

(2)

Adjusted direct premiums - direct premiums net of premiums ceded to IPO coinsurers.

(3)

Other ceded premiums - premiums ceded to non-IPO coinsurers net of any applicable reimbursements from the IPO coinsurers.

8 of 16

 

 

 

Term Life Insurance - Financial Results and Analysis

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Term Life Insurance Income Before Income Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct Premiums

$

649,366

 

$

660,505

 

$

663,183

 

$

667,776

 

$

670,755

 

$

21,389

 

 

3.3

%

 

Premiums ceded to IPO coinsurers (1)

 

(294,301

)

 

(290,956

)

 

(284,742

)

 

(281,265

)

 

(276,150

)

 

18,150

 

 

6.2

%

 

Adjusted direct premiums (2)

 

355,065

 

 

369,548

 

 

378,441

 

 

386,511

 

 

394,605

 

 

39,539

 

 

11.1

%

 

Other ceded premiums  (3)

 

(98,260

)

 

(110,730

)

 

(104,590

)

 

(108,908

)

 

(111,950

)

 

(13,690

)

 

-13.9

%

 

Net premiums

 

256,805

 

 

258,818

 

 

273,851

 

 

277,603

 

 

282,655

 

 

25,850

 

 

10.1

%

 

Allocated net investment income

 

3,089

 

 

3,246

 

 

3,506

 

 

3,907

 

 

4,444

 

 

1,355

 

 

43.9

%

 

Other, net

 

10,415

 

 

10,913

 

 

10,615

 

 

10,431

 

 

9,744

 

 

(671

)

 

-6.4

%

 

Revenues

 

270,309

 

 

272,978

 

 

287,972

 

 

291,941

 

 

296,843

 

 

26,534

 

 

9.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and claims

 

112,831

 

 

101,755

 

 

113,988

 

 

113,201

 

 

118,443

 

 

5,611

 

 

5.0

%

 

Amortization of DAC

 

56,673

 

 

51,257

 

 

56,904

 

 

63,779

 

 

64,066

 

 

7,393

 

 

13.0

%

 

Insurance commissions

 

2,228

 

 

2,856

 

 

2,936

 

 

2,244

 

 

2,163

 

 

(64

)

 

-2.9

%

 

Insurance expenses

 

38,956

 

 

41,282

 

 

39,807

 

 

40,600

 

 

41,832

 

 

2,876

 

 

7.4

%

 

Benefits and expenses

 

210,688

 

 

197,150

 

 

213,635

 

 

219,824

 

 

226,504

 

 

15,816

 

 

7.5

%

 

Income before income taxes

$

59,621

 

$

75,827

 

$

74,338

 

$

72,117

 

$

70,339

 

$

10,718

 

 

18.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Term Life Insurance - Financial Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Primary direct premiums (4)

$

267,615

 

$

280,209

 

$

287,554

 

$

294,006

 

$

300,708

 

$

33,093

 

 

12.4

%

 

Legacy direct premiums (5)

 

381,751

 

 

380,295

 

 

375,629

 

 

373,770

 

 

370,047

 

 

(11,704

)

 

-3.1

%

 

Total direct premiums

$

649,366

 

$

660,505

 

$

663,183

 

$

667,776

 

$

670,755

 

$

21,389

 

 

3.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premiums ceded to IPO coinsurers

$

294,301

 

$

290,956

 

$

284,742

 

$

281,265

 

$

276,150

 

$

(18,150

)

 

-6.2

%

 

% of Legacy direct premiums

 

77.1

%

 

76.5

%

 

75.8

%

 

75.3

%

 

74.6

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and claims, net (6)

$

211,091

 

$

212,485

 

$

218,577

 

$

222,109

 

$

230,392

 

$

19,301

 

 

9.1

%

 

% of adjusted direct premiums

 

59.5

%

 

57.5

%

 

57.8

%

 

57.5

%

 

58.4

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DAC amortization & insurance commissions

$

58,901

 

$

54,113

 

$

59,839

 

$

66,023

 

$

66,229

 

$

7,329

 

 

12.4

%

 

% of adjusted direct premiums

 

16.6

%

 

14.6

%

 

15.8

%

 

17.1

%

 

16.8

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Insurance expenses, net (7)

$

28,541

 

$

30,369

 

$

29,193

 

$

30,169

 

$

32,088

 

$

3,547

 

 

12.4

%

 

% of adjusted direct premiums

 

8.0

%

 

8.2

%

 

7.7

%

 

7.8

%

 

8.1

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Term Life income before income taxes

$

59,621

 

$

75,827

 

$

74,338

 

$

72,117

 

$

70,339

 

$

10,718

 

 

18.0

%

 

Term Life operating margin (8)

 

16.8

%

 

20.5

%

 

19.6

%

 

18.7

%

 

17.8

%

nm

 

nm

 

 

(1)

Premiums ceded to IPO coinsurers - premiums ceded to IPO coinsurers under the IPO coinsurance transactions excluding any reimbursements from the IPO coinsurers on previously existing reinsurance agreements.

(2)

Adjusted direct premiums - direct premiums net of premiums ceded to IPO coinsurers.

(3)

Other ceded premiums - premiums ceded to non-IPO coinsurers net of any applicable reimbursements from the IPO coinsurers.

(4)

Primary direct premiums - direct premiums not subject to the 2010 IPO coinsurance transactions.

(5)

Legacy direct premiums - direct premiums subject to the 2010 IPO coinsurance transactions.

(6)

Benefits and claims, net - benefits & claims net of other ceded premiums which are largely YRT.

(7)

Insurance expenses, net - insurance expenses net of other, net revenues.

(8)

Term Life operating margin - Term Life operating income before income taxes as a percentage of adjusted direct premiums.

9 of 16

 

 

 

Term Life Insurance - Key Statistics

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

 

(Dollars in thousands, except as noted)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$/#

Change

 

%

Change

 

 

Key Statistics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Life-insurance licensed sales force, beginning of period

 

126,121

 

 

127,182

 

 

130,156

 

 

130,658

 

 

130,736

 

 

4,615

 

 

3.7

%

 

 

New life-licensed representatives

 

11,730

 

 

13,544

 

 

11,715

 

 

11,052

 

 

10,065

 

 

(1,665

)

 

-14.2

%

 

 

Non-renewal and terminated representatives

 

(10,669

)

 

(10,570

)

 

(11,213

)

 

(10,974

)

 

(10,980

)

 

(311

)

 

-2.9

%

 

Life-insurance licensed sales force, end of period

 

127,182

 

 

130,156

 

 

130,658

 

 

130,736

 

 

129,821

 

 

2,639

 

 

2.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Estimated annualized issued term life premium ($mills) (1):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premium from new policies

$

60.4

 

$

71.1

 

$

64.6

 

$

62.4

 

$

56.1

 

$

(4.3

)

 

-7.1

%

 

 

Additions and increases in premium

 

16.9

 

 

18.7

 

 

18.4

 

 

19.1

 

 

18.4

 

 

1.5

 

 

8.6

%

 

 

 

 

Total estimated annualized issued term life premium

$

77.3

 

$

89.8

 

$

82.9

 

$

81.4

 

$

74.5

 

$

(2.8

)

 

-3.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued term life policies

 

70,821

 

 

83,754

 

 

74,892

 

 

72,122

 

 

64,242

 

 

(6,579

)

 

-9.3

%

 

Estimated average annualized issued term life premium per policy (1)(2)

$

853

 

$

849

 

$

862

 

$

865

 

$

874

 

$

20

 

 

2.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term life face amount in-force, beginning of period ($mills)

$

763,831

 

$

765,732

 

$

773,604

 

$

781,276

 

$

781,041

 

$

17,210

 

 

2.3

%

 

 

Issued term life face amount (3)

 

22,258

 

 

26,001

 

 

23,728

 

 

23,222

 

 

20,925

 

 

(1,333

)

 

-6.0

%

 

 

Terminated term life face amount

 

(17,788

)

 

(16,341

)

 

(17,638

)

 

(18,525

)

 

(18,383

)

 

(595

)

 

-3.3

%

 

 

Foreign currency impact, net

 

(2,570

)

 

(1,788

)

 

1,582

 

 

(4,932

)

 

1,969

 

 

4,539

 

nm

 

 

Term life face amount in-force, end of period

$

765,732

 

$

773,604

 

$

781,276

 

$

781,041

 

$

785,552

 

$

19,820

 

 

2.6

%

 

(1)     Estimated annualized issued term life premium - estimated as average premium per $1,000 of face amounts issued on new policies and additions (before free look returns) multiplied by actual face amount issued on new policies, rider additions and face amount increases.

(2)     In whole dollars.

(3)     Issued term life face amount - includes face amount on issued term life policies, additional riders added to existing policies, and face increases under increasing benefit riders.

 


10 of 16

 

 

 

Investment and Savings Products - Financial Results and Financial Analysis

 

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands, except as noted)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Investment & Savings Products Income Before Income Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based

$

64,461

 

$

64,307

 

$

64,181

 

$

67,041

 

$

66,997

 

$

2,536

 

 

3.9

%

 

Asset-based

 

74,649

 

 

75,672

 

 

78,318

 

 

75,012

 

 

73,639

 

 

(1,010

)

 

-1.4

%

 

Account-based

 

20,595

 

 

20,438

 

 

20,306

 

 

20,463

 

 

19,613

 

 

(982

)

 

-4.8

%

 

Other, net

 

2,336

 

 

2,424

 

 

2,464

 

 

2,408

 

 

2,423

 

 

86

 

 

3.7

%

 

Revenues

 

162,042

 

 

162,841

 

 

165,269

 

 

164,924

 

 

162,671

 

 

630

 

 

0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of DAC

 

3,442

 

 

2,080

 

 

2,349

 

 

1,896

 

 

477

 

 

(2,964

)

 

-86.1

%

 

Insurance commissions

 

3,199

 

 

3,132

 

 

3,193

 

 

3,042

 

 

3,025

 

 

(175

)

 

-5.5

%

 

Sales commissions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based

 

46,259

 

 

45,905

 

 

45,634

 

 

47,424

 

 

47,831

 

 

1,572

 

 

3.4

%

 

Asset-based

 

32,484

 

 

33,350

 

 

34,813

 

 

33,297

 

 

32,343

 

 

(141

)

 

-0.4

%

 

Other operating expenses

 

36,673

 

 

35,147

 

 

34,228

 

 

33,619

 

 

36,312

 

 

(361

)

 

-1.0

%

 

Benefits and expenses

 

122,057

 

 

119,613

 

 

120,217

 

 

119,277

 

 

119,988

 

 

(2,069

)

 

-1.7

%

 

Income before income taxes

$

39,985

 

$

43,228

 

$

45,052

 

$

45,647

 

$

42,684

 

$

2,699

 

 

6.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees paid based on client asset values (1)

$

5,690

 

$

5,833

 

$

6,037

 

$

5,962

 

$

5,898

 

$

208

 

 

3.7

%

 

Fees paid based on fee-generating positions (2)

 

12,495

 

 

10,854

 

 

10,223

 

 

10,219

 

 

11,159

 

 

(1,336

)

 

-10.7

%

 

Other operating expenses

 

18,488

 

 

18,460

 

 

17,968

 

 

17,437

 

 

19,254

 

 

766

 

 

4.1

%

 

Total other operating expenses

$

36,673

 

$

35,147

 

$

34,228

 

$

33,619

 

$

36,312

 

$

(361

)

 

-1.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales-based net revenue as % of revenue-generating sales (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

1.24

%

 

1.27

%

 

1.26

%

 

1.35

%

 

1.33

%

nm

 

nm

 

 

Canada

 

1.05

%

 

0.95

%

 

0.90

%

 

0.90

%

 

1.00

%

nm

 

nm

 

 

Total

 

1.20

%

 

1.22

%

 

1.21

%

 

1.29

%

 

1.28

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-based net revenue as % of average asset values (4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

0.036

%

 

0.037

%

 

0.037

%

 

0.037

%

 

0.036

%

nm

 

nm

 

 

Canada

 

0.111

%

 

0.123

%

 

0.121

%

 

0.122

%

 

0.136

%

nm

 

nm

 

 

Total

 

0.048

%

 

0.051

%

 

0.050

%

 

0.051

%

 

0.052

%

nm

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Account-based net revenue per average fee generating position (5)(6)

$

2.90

 

$

3.49

 

$

3.70

 

$

3.80

 

$

3.20

 

nm

 

nm

 

 

(1)

Fees paid based on client asset values - administration fees on Canadian Segregated Funds and advisory fees on Managed Accounts that vary directly with client asset values.

(2)

Fees paid based on fee-generating positions - recordkeeping fees that vary with the number of fee-generating positions.

(3)

Sales-based net revenue - commission and fee revenue less commissions paid to the sales force based on product sales activity.

(4)

Asset-based net revenue - commission and fee revenue less administration and advisory fees paid to third-party providers and commissions paid to the sales force earned based on product account values including amortization of deferred acquisition costs for segregated funds.

(5)

Account-based net revenue - fee revenue less recordkeeping fees paid to third-party providers based on fee-generating positions and certain direct general expenses.

(6)

In whole dollars.

11 of 16

 

 

 

Investment and Savings Products - Key Statistics

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands, except as noted)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$/#

Change

 

%

Change

 

Key Statistics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Product sales ($mills)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Retail Mutual Funds

$

792.4

 

$

800.6

 

$

763.3

 

$

767.8

 

$

710.2

 

$

(82.2

)

 

-10.4

%

 

 

Canada Retail Mutual Funds

 

276.2

 

 

199.2

 

 

181.7

 

 

182.6

 

 

244.1

 

 

(32.1

)

 

-11.6

%

 

 

Indexed Annuities

 

67.5

 

 

71.9

 

 

78.8

 

 

88.2

 

 

81.0

 

 

13.4

 

 

19.9

%

 

 

Variable Annuities and other

 

376.1

 

 

432.2

 

 

504.5

 

 

476.8

 

 

465.8

 

 

89.8

 

 

23.9

%

 

 

 

 

Total sales-based revenue generating product sales

 

1,512.2

 

 

1,504.0

 

 

1,528.3

 

 

1,515.3

 

 

1,501.1

 

 

(11.1

)

 

-0.7

%

 

 

Managed Accounts

 

188.8

 

 

204.3

 

 

190.5

 

 

169.4

 

 

161.6

 

 

(27.2

)

 

-14.4

%

 

 

Segregated Funds and other

 

82.0

 

 

50.6

 

 

43.7

 

 

50.9

 

 

94.3

 

 

12.3

 

 

14.9

%

 

 

 

 

Total product sales

$

1,783.0

 

$

1,758.9

 

$

1,762.4

 

$

1,735.7

 

$

1,757.0

 

$

(26.0

)

 

-1.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada Retail Mutual Funds

$

276.2

 

$

199.2

 

$

181.7

 

$

182.6

 

$

244.1

 

$

(32.1

)

 

-11.6

%

 

 

Segregated Funds and other

 

82.0

 

 

50.6

 

 

43.7

 

 

50.9

 

 

94.3

 

 

12.3

 

 

14.9

%

 

 

 

Total Canada product sales

 

358.2

 

 

249.8

 

 

225.4

 

 

233.6

 

 

338.4

 

 

(19.8

)

 

-5.5

%

 

 

 

Total U.S. product sales

 

1,424.8

 

 

1,509.1

 

 

1,537.1

 

 

1,502.1

 

 

1,418.6

 

 

(6.2

)

 

-0.4

%

 

 

 

 

Total product sales

$

1,783.0

 

$

1,758.9

 

$

1,762.4

 

$

1,735.7

 

$

1,757.0

 

$

(26.0

)

 

-1.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Client asset values, beginning of period ($mills)

$

61,167

 

$

60,821

 

$

61,777

 

$

64,234

 

$

57,704

 

$

(3,463

)

 

-5.7

%

 

 

Inflows

 

1,783

 

 

1,759

 

 

1,762

 

 

1,736

 

 

1,757

 

 

(26

)

 

-1.5

%

 

 

Outflows (1)

 

(1,571

)

 

(1,498

)

 

(1,499

)

 

(1,376

)

 

(1,530

)

 

41

 

 

2.6

%

 

 

 

 

Net flows

 

212

 

 

261

 

 

264

 

 

360

 

 

227

 

 

15

 

 

7.1

%

 

 

Foreign currency impact, net

 

(283

)

 

(195

)

 

174

 

 

(543

)

 

201

 

 

484

 

nm

 

 

 

Change in market value, net and other (2)

 

(276

)

 

891

 

 

2,019

 

 

(6,346

)

 

5,470

 

 

5,746

 

nm

 

 

Client asset values, end of period

$

60,821

 

$

61,777

 

$

64,234

 

$

57,704

 

$

63,602

 

$

2,781

 

 

4.6

%

 

 

Annualized net flows as % of beginning of period asset values

 

1.4

%

 

1.7

%

 

1.7

%

 

2.2

%

 

1.6

%

 

0.2

%

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average client asset values ($mills)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Retail Mutual Funds

$

30,674

 

$

30,348

 

$

31,439

 

$

30,156

 

$

30,266

 

$

(408

)

 

-1.3

%

 

 

Canada Retail Mutual Funds

 

7,508

 

 

7,444

 

 

7,610

 

 

7,252

 

 

7,390

 

 

(118

)

 

-1.6

%

 

 

Managed Accounts

 

2,739

 

 

2,930

 

 

3,179

 

 

3,189

 

 

3,241

 

 

503

 

 

18.4

%

 

 

Indexed Annuities

 

1,939

 

 

1,997

 

 

2,049

 

 

2,117

 

 

2,182

 

 

243

 

 

12.5

%

 

 

Variable Annuities and other

 

16,333

 

 

16,176

 

 

16,669

 

 

15,982

 

 

16,057

 

 

(276

)

 

-1.7

%

 

 

Segregated Funds

 

2,510

 

 

2,402

 

 

2,417

 

 

2,311

 

 

2,314

 

 

(196

)

 

-7.8

%

 

 

 

 

Total

$

61,704

 

$

61,297

 

$

63,363

 

$

61,006

 

$

61,451

 

$

(252

)

 

-0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada Retail Mutual Funds

$

7,508

 

$

7,444

 

$

7,610

 

$

7,252

 

$

7,390

 

$

(118

)

 

-1.6

%

 

 

Segregated Funds

 

2,510

 

 

2,402

 

 

2,417

 

 

2,311

 

 

2,314

 

 

(196

)

 

-7.8

%

 

 

 

Total Canada average client assets

 

10,018

 

 

9,846

 

 

10,027

 

 

9,562

 

 

9,704

 

 

(315

)

 

-3.1

%

 

 

 

Total U.S. average client assets

 

51,685

 

 

51,451

 

 

53,336

 

 

51,444

 

 

51,747

 

 

62

 

 

0.1

%

 

 

 

 

Total average client assets

$

61,704

 

$

61,297

 

$

63,363

 

$

61,006

 

$

61,451

 

$

(252

)

 

-0.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of fee-generating positions (thous) (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recordkeeping and custodial

 

2,130

 

 

2,086

 

 

2,066

 

 

2,042

 

 

1,998

 

 

(132

)

 

-6.2

%

 

 

Recordkeeping only

 

665

 

 

660

 

 

657

 

 

652

 

 

641

 

 

(24

)

 

-3.7

%

 

 

 

 

Total

 

2,795

 

 

2,746

 

 

2,723

 

 

2,694

 

 

2,639

 

 

(156

)

 

-5.6

%

 

(1)

Asset value outflows - include (a) redemptions of assets, (b) sales charges on the inflow sales figures, and (c) the net flow of money market funds sold and redeemed on the company's recordkeeping platform.  The redemptions of assets must be estimated for approximately 4% of account values as these figures are not readily available.  Actual redemptions as a percentage of account values for similar known account values are used to estimate the unknown redemption values.

(2)

Change in market value, net - market value fluctuations net of fees and expenses.

(3)

Fee generating positions - mutual fund positions for which we receive recordkeeping fees. An individual client account may include multiple mutual fund positions. We may also receive fees earned for custodial services that we provide to clients with retirement plan accounts that hold positions in these mutual funds.

12 of 16

 

 

 

Investment Portfolio - Summary of Holdings

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

As of or for the period ended March 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

% of Total

 

Avg

 

 

 

 

 

 

 

 

 

 

Market

 

Amortized

 

Unrealized

 

Market

 

Amortized

 

Book

 

Avg

(Dollars in thousands)

 

Value

 

Cost

 

G/(L)

 

Value

 

Cost

 

Yield

 

Rating

Investment Portfolio by Asset Class

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash, Cash Equivalents, and Short Term

 

$

287,856

 

$

287,856

 

$

-

 

 

11.8

%

 

12.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Treasury

 

 

28,798

 

 

28,275

 

 

523

 

 

1.2

%

 

1.2

%

 

2.33

%

AAA

 

Government

 

 

200,498

 

 

193,862

 

 

6,637

 

 

8.2

%

 

8.1

%

 

3.33

%

AA-

 

Tax-Exempt Municipal

 

 

15,063

 

 

14,426

 

 

637

 

 

0.6

%

 

0.6

%

 

3.68

%

AA-

 

Corporate

 

 

1,332,164

 

 

1,310,476

 

 

21,688

 

 

54.6

%

 

54.5

%

 

3.94

%

BBB+

 

Mortgage-Backed

 

 

203,246

 

 

200,105

 

 

3,141

 

 

8.3

%

 

8.3

%

 

3.52

%

AAA

 

Asset-Backed

 

 

74,633

 

 

74,362

 

 

271

 

 

3.1

%

 

3.1

%

 

3.29

%

AA

 

CMBS

 

 

131,346

 

 

129,679

 

 

1,667

 

 

5.4

%

 

5.4

%

 

3.98

%

AAA

 

Private

 

 

126,390

 

 

124,049

 

 

2,341

 

 

5.2

%

 

5.2

%

 

4.74

%

BBB

 

Redeemable Preferred

 

 

3,119

 

 

2,947

 

 

172

 

 

0.1

%

 

0.1

%

 

5.79

%

BBB

 

 

 

 

 

 

Total Fixed Income

 

 

2,115,258

 

 

2,078,180

 

 

37,078

 

 

86.7

%

 

86.5

%

 

3.85

%

A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Perpetual Preferred

 

 

12,850

 

 

12,850

 

 

-

 

 

0.5

%

 

0.5

%

 

 

 

 

 

Common Stock

 

 

18,158

 

 

18,158

 

 

0

 

 

0.7

%

 

0.8

%

 

 

 

 

 

Mutual Fund

 

 

6,840

 

 

6,840

 

 

0

 

 

0.3

%

 

0.3

%

 

 

 

 

 

Other

 

 

-

 

 

-

 

 

-

 

 

0.0

%

 

0.0

%

 

 

 

 

 

 

 

 

 

 

Total Equities

 

 

37,848

 

 

37,848

 

 

0

 

 

1.6

%

 

1.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Invested Assets

 

$

2,440,962

 

$

2,403,884

 

$

37,078

 

 

100.0

%

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Portfolio by Sector

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Banking

 

$

178,043

 

$

176,093

 

$

1,950

 

 

13.4

%

 

13.4

%

 

 

 

 

 

Consumer Non Cyclical

 

 

167,753

 

 

165,140

 

 

2,613

 

 

12.6

%

 

12.6

%

 

 

 

 

 

Reits

 

 

128,882

 

 

126,727

 

 

2,155

 

 

9.7

%

 

9.7

%

 

 

 

 

 

Energy

 

 

118,439

 

 

115,921

 

 

2,518

 

 

8.9

%

 

8.8

%

 

 

 

 

 

Technology

 

 

106,781

 

 

105,039

 

 

1,742

 

 

8.0

%

 

8.0

%

 

 

 

 

 

Insurance

 

 

106,637

 

 

104,553

 

 

2,084

 

 

8.0

%

 

8.0

%

 

 

 

 

 

Communications

 

 

89,058

 

 

87,175

 

 

1,883

 

 

6.7

%

 

6.7

%

 

 

 

 

 

Capital Goods

 

 

88,044

 

 

87,603

 

 

441

 

 

6.6

%

 

6.7

%

 

 

 

 

 

Consumer Cyclical

 

 

84,376

 

 

82,494

 

 

1,882

 

 

6.3

%

 

6.3

%

 

 

 

 

 

Basic Industry

 

 

66,784

 

 

65,425

 

 

1,359

 

 

5.0

%

 

5.0

%

 

 

 

 

 

Electric

 

 

65,142

 

 

63,926

 

 

1,216

 

 

4.9

%

 

4.9

%

 

 

 

 

 

Transportation

 

 

59,506

 

 

59,206

 

 

300

 

 

4.5

%

 

4.5

%

 

 

 

 

 

Brokerage

 

 

36,105

 

 

35,143

 

 

962

 

 

2.7

%

 

2.7

%

 

 

 

 

 

Finance Companies

 

 

15,833

 

 

15,626

 

 

206

 

 

1.2

%

 

1.2

%

 

 

 

 

 

Industrial Other

 

 

11,592

 

 

11,383

 

 

209

 

 

0.9

%

 

0.9

%

 

 

 

 

 

Natural Gas

 

 

5,609

 

 

5,495

 

 

114

 

 

0.4

%

 

0.4

%

 

 

 

 

 

Financial Other

 

 

2,560

 

 

2,529

 

 

31

 

 

0.2

%

 

0.2

%

 

 

 

 

 

Utility Other

 

 

1,020

 

 

998

 

 

23

 

 

0.1

%

 

0.1

%

 

 

 

 

 

 

 

 

 

 

Total Corporate portfolio

 

$

1,332,164

 

$

1,310,476

 

$

21,688

 

 

100.0

%

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed-Maturity Securities - Effective Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effective maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

< 1 Yr.

 

$

256,976

 

$

255,543

 

$

1,433

 

 

12.1

%

 

12.3

%

 

4.34

%

 

 

 

1-2 Yrs.

 

 

247,775

 

 

245,868

 

 

1,908

 

 

11.7

%

 

11.8

%

 

3.63

%

 

 

 

2-5 Yrs.

 

 

883,949

 

 

867,659

 

 

16,290

 

 

41.8

%

 

41.8

%

 

3.69

%

 

 

 

5-10 Yrs.

 

 

658,006

 

 

646,136

 

 

11,870

 

 

31.1

%

 

31.1

%

 

3.89

%

 

 

 

> 10 Yrs.

 

 

68,552

 

 

62,974

 

 

5,577

 

 

3.2

%

 

3.0

%

 

4.40

%

 

 

 

 

 

 

 

Total Fixed Income

 

$

2,115,258

 

$

2,078,180

 

$

37,078

 

 

100.0

%

 

100.0

%

 

3.85

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Duration

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed Income portfolio duration

 

 

3.6

 

years

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                        Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

 

13 of 16

 

 

 

Investment Portfolio - Quality Ratings As of March 31, 2019

PRIMERICA, INC.

Financial Supplement

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment Portfolio Quality Ratings (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortized  Cost

 

% of Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Fixed Income portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AAA

 

$

443,886

 

 

21.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AA

 

 

226,866

 

 

10.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A

 

 

475,137

 

 

22.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BBB

 

 

868,985

 

 

41.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Below Investment Grade

 

 

60,228

 

 

2.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NA

 

 

3,078

 

 

0.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Fixed Income

 

$

2,078,180

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortized  Cost

 

% of Total

 

 

 

 

 

 

 

 

 

 

 

Amortized  Cost

 

% of Total

 

Corporate asset class:

 

 

 

 

 

 

 

 

 

Private asset class:

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

AAA

 

$

12,449

 

 

0.9

%

 

 

 

AAA

 

$

-

 

 

—

 

 

AA

 

 

102,646

 

 

7.8

%

 

 

 

AA

 

 

997

 

 

0.8

%

 

A

 

 

398,284

 

 

30.4

%

 

 

 

A

 

 

9,641

 

 

7.8

%

 

BBB

 

 

739,755

 

 

56.4

%

 

 

 

BBB

 

 

111,741

 

 

90.1

%

 

Below Investment Grade

 

 

56,392

 

 

4.3

%

 

 

 

Below Investment Grade

 

 

1,671

 

 

1.3

%

 

NA

 

 

950

 

 

0.1

%

 

 

 

NA

 

 

-

 

 

—

 

 

 

 

 

 

 

Total Corporate

 

$

1,310,476

 

 

100.0

%

 

 

 

 

 

 

 

 

Total Private

 

$

124,049

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CMBS asset class:

 

 

 

 

 

 

 

 

 

Mortgage-Backed asset class:

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

AAA

 

$

121,930

 

 

94.0

%

 

 

 

AAA

 

$

194,375

 

 

97.1

%

 

AA

 

 

-

 

 

—

 

 

 

 

AA

 

 

2,751

 

 

1.4

%

 

A

 

 

6,921

 

 

5.3

%

 

 

 

A

 

 

2,619

 

 

1.3

%

 

BBB

 

 

141

 

 

0.1

%

 

 

 

BBB

 

 

249

 

 

0.1

%

 

Below Investment Grade

 

 

688

 

 

0.5

%

 

 

 

Below Investment Grade

 

 

59

 

 

0.0

%

 

NA

 

 

-

 

 

—

 

 

 

 

NA

 

 

52

 

 

0.0

%

 

 

 

 

 

 

Total CMBS

 

$

129,679

 

 

100.0

%

 

 

 

 

 

 

 

 

Total Mortgage-Backed

 

$

200,105

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Backed asset class:

 

 

 

 

 

 

 

 

 

Treasury & Government asset classes:

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

AAA

 

$

46,451

 

 

62.5

%

 

 

 

AAA

 

$

67,241

 

 

30.3

%

 

AA

 

 

5,705

 

 

7.7

%

 

 

 

AA

 

 

107,268

 

 

48.3

%

 

A

 

 

18,904

 

 

25.4

%

 

 

 

A

 

 

36,797

 

 

16.6

%

 

BBB

 

 

1,077

 

 

1.4

%

 

 

 

BBB

 

 

9,562

 

 

4.3

%

 

Below Investment Grade

 

 

149

 

 

0.2

%

 

 

 

Below Investment Grade

 

 

1,270

 

 

0.6

%

 

NA

 

 

2,076

 

 

2.8

%

 

 

 

NA

 

 

0

 

 

0.0

%

 

 

 

 

 

 

Total Asset-Backed

 

$

74,362

 

 

100.0

%

 

 

 

 

 

 

 

 

Total Treasury & Government

 

$

222,137

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NAIC Designations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

$

952,928

 

 

54.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

 

755,987

 

 

42.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

46,937

 

 

2.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

9,451

 

 

0.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

-

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

 

3

 

 

0.0

%

 

 

 

 

 

 

 

`

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Insurer Fixed Income (2)

 

 

1,765,306

 

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other (3)

 

 

350,722

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

287,856

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Invested Assets

 

$

2,403,884

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Ratings method for split ratings: If by 2 NRSROs, use lower of the two; if by 3 or more NRSROs, use second lowest.

(2)

NAIC ratings for our U.S. insurance companies' fixed income portfolios.

(3)

Other consists of assets held by our non-life companies, Canadian insurance company, and unrated equities.

                        Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

14 of 16

 

 

 

Investment Portfolio - Supplemental Data and Trends

PRIMERICA, INC.

Financial Supplement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

(Dollars in thousands)

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

$

Change

 

%

Change

 

Net Investment Income by Source

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed-maturity securities (available-for-sale)

$

19,289

 

$

19,743

 

$

20,142

 

$

20,183

 

$

20,333

 

$

1,044

 

5.4%

 

 

Fixed-maturity securities (held-to-maturity)

 

8,373

 

 

9,052

 

 

9,592

 

 

10,467

 

 

10,674

 

 

2,301

 

27.5%

 

 

Equity Securities

 

513

 

 

466

 

 

482

 

 

495

 

 

487

 

 

(26

)

-5.1%

 

 

Deposit asset underlying 10% reinsurance treaty

 

1,181

 

 

1,270

 

 

1,392

 

 

1,480

 

 

1,755

 

 

574

 

48.6%

 

 

Deposit asset - Mark to Market

 

(1,288

)

 

(375

)

 

(297

)

 

280

 

 

2,147

 

 

3,435

 

n/m

 

 

Policy loans and other invested assets

 

411

 

 

390

 

 

391

 

 

478

 

 

467

 

 

56

 

13.6%

 

 

Cash & cash equivalents

 

586

 

 

641

 

 

664

 

 

1,030

 

 

1,056

 

 

470

 

n/m

 

 

 

 

 

 

Total investment income

 

29,065

 

 

31,187

 

 

32,366

 

 

34,413

 

 

36,919

 

 

7,854

 

27.0%

 

 

Investment expenses

 

1,675

 

 

2,105

 

 

2,152

 

 

2,186

 

 

2,134

 

 

459

 

27.4%

 

 

Interest Expense on Surplus Note

 

8,373

 

 

9,052

 

 

9,592

 

 

10,467

 

 

10,674

 

 

2,301

 

27.5%

 

 

 

 

 

 

Net investment income

$

19,017

 

$

20,030

 

$

20,622

 

$

21,760

 

$

24,111

 

$

5,094

 

26.8%

 

 

 

Fixed income book yield, end of period

 

3.92

%

 

3.91

%

 

3.88

%

 

3.89

%

 

3.85

%

 

 

 

 

 

 

 

 

New money yield

 

2.43

%

 

3.16

%

 

3.34

%

 

2.81

%

 

3.56

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YOY Q1

 

 

 

 

 

 

 

 

 

 

 

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

% Pt

Change

 

 

 

 

Fixed Income Portfolio Quality Ratings

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rating

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AAA

 

19.8

%

 

20.9

%

 

22.0

%

 

21.2

%

 

21.4

%

 

1.6

%

 

 

 

 

AA

 

8.6

%

 

9.8

%

 

10.6

%

 

10.4

%

 

10.9

%

 

2.3

%

 

 

 

 

A

 

23.4

%

 

23.0

%

 

22.2

%

 

22.4

%

 

22.9

%

 

-0.6

%

 

 

 

 

BBB

 

44.6

%

 

43.0

%

 

42.2

%

 

42.9

%

 

41.8

%

 

-2.8

%

 

 

 

 

Below Investment Grade

 

3.4

%

 

3.1

%

 

2.7

%

 

2.8

%

 

2.9

%

 

-0.5

%

 

 

 

 

NA

 

0.2

%

 

0.2

%

 

0.2

%

 

0.2

%

 

0.1

%

 

-0.0

%

 

 

 

 

 

 

 

 

Total Fixed Income

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average rating by amortized cost

A

 

A

 

A

 

A

 

A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 2019

 

 

 

As of March 31, 2019

 

 

 

 

 

 

As of March 31, 2019

 

 

 

 

 

 

 

 

Market

Value

 

Amortized

Cost

 

Credit

Rating

 

 

 

Market

Value

 

Amortized

Cost

 

 

 

 

 

 

Market

Value

 

Amortized

Cost

 

Top 25 Exposures

 

 

 

 

 

 

 

 

Foreign Exposure (1)

 

 

 

 

 

 

 

 

Government Investments (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

Canada

$

23,954

 

$

23,543

 

AAA

 

Canada

$

65,611

 

$

64,300

 

 

 

AAA

$

3,253

 

$

3,250

 

 

2

Comcast Corp

 

15,320

 

 

15,184

 

A-

 

Australia

 

47,899

 

 

46,891

 

 

 

AA

 

14,459

 

 

14,311

 

 

3

Province of Quebec Canada

 

13,486

 

 

12,510

 

AA-

 

United Kingdom

 

42,250

 

 

41,639

 

 

 

A

 

10,230

 

 

10,067

 

 

4

Wells Fargo & Co

 

12,433

 

 

12,380

 

A-

 

Germany

 

19,200

 

 

19,209

 

 

 

BBB

 

8,447

 

 

8,122

 

 

5

Bank of America Corp

 

11,938

 

 

11,845

 

A-

 

France

 

18,723

 

 

18,449

 

 

 

Below Investment Grade

 

1,280

 

 

1,270

 

 

6

Office Properties Income Trust

 

11,461

 

 

11,463

 

BBB-

 

Switzerland

 

14,334

 

 

14,234

 

 

 

NA

 

—

 

 

—

 

 

7

Province of Alberta Canada

 

11,386

 

 

11,079

 

A+

 

Ireland

 

12,872

 

 

12,549

 

 

 

 

Total

$

37,670

 

$

37,019

 

 

8

Apple Inc

 

10,682

 

 

10,616

 

AA+

 

Bermuda

 

12,351

 

 

12,134

 

 

 

 

 

 

 

 

 

 

 

 

 

9

American Express Co

 

10,649

 

 

10,676

 

BBB+

 

Cayman Islands

 

11,559

 

 

11,425

 

 

 

 

 

 

 

 

 

 

 

 

 

10

Province of Ontario Canada

 

10,642

 

 

10,240

 

A+

 

Netherlands

 

8,909

 

 

8,048

 

 

 

Non-Government Investments (1)

 

 

 

 

 

 

 

11

Province of British Columbia

 

10,482

 

 

10,275

 

AAA

 

Belgium

 

6,196

 

 

6,121

 

 

 

 

 

 

 

 

 

 

 

 

 

12

Morgan Stanley

 

9,553

 

 

9,410

 

A+

 

Norway

 

5,851

 

 

5,891

 

 

 

AAA

$

4,358

 

$

4,349

 

 

13

City of Toronto Canada

 

9,402

 

 

9,216

 

AA

 

Japan

 

5,608

 

 

5,449

 

 

 

AA

 

31,174

 

 

31,149

 

 

14

Province of Manitoba Canada

 

9,028

 

 

8,791

 

A+

 

Mexico

 

5,377

 

 

5,213

 

 

 

A

 

73,907

 

 

72,967

 

 

15

Honda Motor Co Ltd

 

8,709

 

 

8,558

 

A

 

Israel

 

5,353

 

 

5,264

 

 

 

BBB

 

177,733

 

 

173,147

 

 

16

Municipal Finance Authority of British Columbia

 

8,584

 

 

8,466

 

AAA

 

Emerging Markets  (2)

 

12,616

 

 

12,427

 

 

 

Below Investment Grade

 

4,754

 

 

4,889

 

 

17

Enbridge Inc

 

8,405

 

 

8,205

 

BBB+

 

All Other

 

 

34,886

 

 

34,278

 

 

 

NA

 

—

 

 

—

 

 

18

Capital One Financial Corp

 

8,374

 

 

8,266

 

BBB

 

 

Total

$

329,596

 

$

323,520

 

 

 

 

Total

$

291,926

 

$

286,501

 

 

19

Cigna Corp

 

8,007

 

 

7,824

 

A-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20

City of Montreal Canada

 

7,892

 

 

7,388

 

AA-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21

JPMorgan Chase & Co

 

7,835

 

 

7,700

 

A-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22

American Airlines Group Inc

 

7,630

 

 

7,748

 

AA-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23

General Electric Co

 

7,349

 

 

7,697

 

BBB+

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24

Hewlett Packard Enterprise Co

 

7,314

 

 

7,038

 

BBB

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

US Bancorp

 

7,297

 

 

7,212

 

A+

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

257,812

 

$

253,329

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

% of total fixed income portfolio

 

10.6

%

 

10.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

US$ denominated investments in issuers outside of the United States based on country of risk.

(2)

Emerging markets is as defined by MSCI, Inc. which include Chile, India, Peru, Poland and South Africa.

                        Note:  Investment Portfolio pages in this Financial Supplement exclude the Held to Maturity asset on our balance sheet.

15 of 16

 

 

 

Five-Year Historical Key Statistics

PRIMERICA, INC.

Financial Supplement

 

(Dollars in millions)

2014

 

2015

 

2016

 

2017

 

2018

 

Q1

2018

 

Q2

2018

 

Q3

2018

 

Q4

2018

 

Q1

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recruits

 

190,439

 

 

228,115

 

 

262,732

 

 

303,867

 

 

290,886

 

 

76,230

 

 

76,520

 

 

76,146

 

 

61,990

 

 

63,223

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Life-insurance licensed sales force, beginning of period

 

95,566

 

 

98,358

 

 

106,710

 

 

116,827

 

 

126,121

 

 

126,121

 

 

127,182

 

 

130,156

 

 

130,658

 

 

130,736

 

 

New life-licensed representatives

 

33,832

 

 

39,632

 

 

44,724

 

 

48,535

 

 

48,041

 

 

11,730

 

 

13,544

 

 

11,715

 

 

11,052

 

 

10,065

 

 

Non-renewal and terminated representatives

 

(31,040

)

 

(31,280

)

 

(34,607

)

 

(39,241

)

 

(43,426

)

 

(10,669

)

 

(10,570

)

 

(11,213

)

 

(10,974

)

 

(10,980

)

Life-insurance licensed sales force, end of period

 

98,358

 

 

106,710

 

 

116,827

 

 

126,121

 

 

130,736

 

 

127,182

 

 

130,156

 

 

130,658

 

 

130,736

 

 

129,821

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued term life policies

 

220,984

 

 

260,059

 

 

298,244

 

 

312,799

 

 

301,589

 

 

70,821

 

 

83,754

 

 

74,892

 

 

72,122

 

 

64,242

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issued term life face amount

$

69,574

 

$

79,111

 

$

89,869

 

$

95,635

 

$

95,209

 

$

22,258

 

$

26,001

 

$

23,728

 

$

23,222

 

$

20,925

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Term life face amount in force, beginning of period

$

674,868

 

$

681,927

 

$

693,194

 

$

728,385

 

$

763,831

 

$

763,831

 

$

765,732

 

$

773,604

 

$

781,276

 

$

781,041

 

 

Issued term life face amount

 

69,574

 

 

79,111

 

 

89,869

 

 

95,635

 

 

95,209

 

 

22,258

 

 

26,001

 

 

23,728

 

 

23,222

 

 

20,925

 

 

Terminated term life face amount

 

(54,962

)

 

(53,580

)

 

(57,238

)

 

(65,958

)

 

(70,291

)

 

(17,788

)

 

(16,341

)

 

(17,638

)

 

(18,525

)

 

(18,383

)

 

Foreign currency impact, net

 

(7,553

)

 

(14,263

)

 

2,560

 

 

5,769

 

 

(7,708

)

 

(2,570

)

 

(1,788

)

 

1,582

 

 

(4,932

)

 

1,969

 

Term life face amount in force, end of period

$

681,927

 

$

693,194

 

$

728,385

 

$

763,831

 

$

781,041

 

$

765,732

 

$

773,604

 

$

781,276

 

$

781,041

 

$

785,552

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Estimated annualized issued term life premium

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Premium from new policies

$

179.8

 

$

212.4

 

$

245.2

 

$

263.1

 

$

258.5

 

$

60.4

 

$

71.1

 

$

64.6

 

$

62.4

 

$

56.1

 

 

Additions and increases in premium

 

51.6

 

 

54.9

 

 

60.4

 

 

65.5

 

 

73.0

 

 

16.9

 

 

18.7

 

 

18.4

 

 

19.1

 

 

18.4

 

 

 

Total estimated annualized issued term life premium

$

231.4

 

$

267.3

 

$

305.7

 

$

328.6

 

$

331.5

 

$

77.3

 

$

89.8

 

$

82.9

 

$

81.4

 

$

74.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment & Savings product sales

$

5,682.3

 

$

5,856.8

 

$

5,594.3

 

$

6,192.2

 

$

7,040.1

 

$

1,783.0

 

$

1,758.9

 

$

1,762.4

 

$

1,735.7

 

$

1,757.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment & Savings average client asset values

$

46,936

 

$

48,477

 

$

49,427

 

$

56,791

 

$

61,842

 

$

61,704

 

$

61,297

 

$

63,363

 

$

61,006

 

$

61,451

 

 

16 of 16