Horace Mann Reports First-Quarter 2019 Net Income of $0.77 Per Share and Core Earnings* of $0.63 Per Share
Business Wire 30-Apr-2019 4:15 PM
-
60% increase in net income per share; 24% increase in core earnings
per share over prior year quarter, benefiting from compounding
progress on strategic initiatives
-
95.5% Property and Casualty combined ratio reflected significant
improvement in underlying auto and property loss ratios
-
Continued sales momentum in Retirement and Life; annuity sales
deposits up 9%
-
Annualized ROE based on net income was 9.5% in first quarter vs. 5.6%
in last year's quarter; annualized core ROE* was 8.8% vs. 7.1%
Horace Mann Educators Corporation (NYSE:HMN) today reported financial
results for the quarter ended March 31, 2019:
|
Horace Mann Consolidated Financial Highlights
|
|
|
|
Three Months EndedMarch 31,
|
|
($ in millions, except per share amounts)
|
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
313.2
|
|
|
$
|
295.5
|
|
|
6.0%
|
|
Net income
|
|
32.2
|
|
|
20.2
|
|
|
59.4%
|
|
Net investment gains (losses) after tax
|
|
5.8
|
|
|
(1.3
|
)
|
|
N.M.
|
|
Core earnings*
|
|
26.4
|
|
|
21.5
|
|
|
22.8%
|
|
Per diluted share:
|
|
|
|
|
|
|
|
Net income
|
|
0.77
|
|
|
0.48
|
|
|
60.4%
|
|
Net investment gains (losses) after tax
|
|
0.14
|
|
|
(0.03
|
)
|
|
N.M.
|
|
Core earnings per diluted share*
|
|
0.63
|
|
|
0.51
|
|
|
23.5%
|
|
Book value per share
|
|
34.60
|
|
|
34.35
|
|
|
0.7%
|
|
Book value per share excluding net unrealized investment gains on
securities*
|
|
29.47
|
|
|
30.00
|
|
|
-1.8%
|
|
N.M. - Not meaningful.
|
|
* These measures are not based on accounting principles generally
accepted in the United States (non-GAAP). They are reconciled to the
most directly comparable GAAP measures in the Appendix to the
Investor Supplement. An explanation of these measures is contained
in the Glossary of Selected Terms included as an exhibit in the
Company's reports filed with the Securities and Exchange Commission.
|
"We had a strong start to 2019, with quarterly results that reflected
the progress we've made on strategic initiatives that will drive our
return to a long-term, sustainable double-digit return on equity," said
President and CEO Marita Zuraitis. "In our Property and Casualty
business, the cumulative benefit of rate increases and underwriting
initiatives delivered a 4.6 point improvement in the underlying auto
loss ratio. Retirement and Life sales remained solid, with educators
responding to our suite of solutions to meet their unique needs.
"In addition, our pending acquisition of National Teachers Associates
(NTA) will enhance our offerings for educators. NTA specializes in
developing, marketing and underwriting supplemental insurance products,
including cancer and heart," Zuraitis said. "Our full-year guidance of
$2.00 to $2.20 in core earnings per share doesn't reflect any
contribution from NTA, pending mid-year completion of that transaction."
|
Property and Casualty Segment Shows Profitability Improvement
(All comparisons vs. same period in 2018, unless noted
otherwise)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
($ in millions)
|
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
|
|
|
Property and Casualty written premiums*
|
|
$
|
161.7
|
|
|
$
|
159.4
|
|
|
1.4%
|
|
Property and Casualty net income / core earnings*
|
|
15.0
|
|
|
9.7
|
|
|
54.6%
|
|
Property and Casualty combined ratio
|
|
95.5
|
%
|
|
98.9
|
%
|
|
-3.4 pts
|
|
Property and Casualty underlying loss ratio*
|
|
63.3
|
%
|
|
67.2
|
%
|
|
-3.9 pts
|
|
Property and Casualty expense ratio
|
|
27.2
|
%
|
|
26.0
|
%
|
|
1.2 pts
|
|
Property and Casualty catastrophe costs
|
|
6.2
|
%
|
|
5.9
|
%
|
|
0.3 pts
|
|
Property and Casualty underlying combined ratio*
|
|
90.5
|
%
|
|
93.2
|
%
|
|
-2.7 pts
|
|
Auto combined ratio
|
|
98.0
|
%
|
|
101.8
|
%
|
|
-3.8 pts
|
|
Auto underlying loss ratio*
|
|
70.9
|
%
|
|
75.5
|
%
|
|
-4.6 pts
|
|
Property combined ratio
|
|
90.5
|
%
|
|
93.3
|
%
|
|
-2.8 pts
|
|
Property underlying loss ratio*
|
|
46.5
|
%
|
|
49.6
|
%
|
|
-3.1 pts
|
For the first quarter of 2019, the Property and Casualty combined ratio
improved 3.4 points to 95.5% on improved underwriting results and modest
favorable reserve development, with net income and core earnings up 55%.
Rate actions were the primary factor in the 1.4% increase in written
premiums, as well as in the 4.6 point improvement in the auto underlying
loss ratio and the 3.1 point improvement in the property underlying loss
ratio.
Auto and property policy retention rates for the current quarter were
81.5% and 87.8%, respectively, which are consistent with full year 2018
retention rates.
|
Retirement Segment Annuity Sales Deposits up 9%
(All comparisons vs. same period in 2018, unless noted
otherwise)
|
|
|
|
Three Months EndedMarch 31,
|
|
($ in millions)
|
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
|
|
|
Annuity sales deposits*
|
|
$
|
107.3
|
|
|
$
|
98.8
|
|
|
8.6%
|
|
Annuity assets under management
|
|
6,972.7
|
|
|
6,769.5
|
|
|
3.0%
|
|
Total assets under administration (1)
|
|
10,528.4
|
|
|
7,052.6
|
|
|
49.3%
|
|
Retirement net income / core earnings*
|
|
12.2
|
|
|
11.4
|
|
|
7.0%
|
|
Retirement core earnings excluding DAC unlocking*
|
|
10.6
|
|
|
11.6
|
|
|
-8.6%
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes Annuity AUM, Brokerage and Advisory AUA,
and Recordkeeping AUA
|
For the first quarter of 2019, annuity sales deposits* increased 9% on
higher demand from educators for the retirement savings solutions we
offer. Annuity assets under management increased 3% due to the continued
sales momentum and favorable market performance. Total cash value
persistency remained strong at 94.3% for variable annuities and 94.1%
for fixed annuities.
Total assets under administration were $10.5 billion, up from a year ago
because of the inclusion of Benefit Consultants Group's (BCG) advisory
and recordkeeping assets effective January 2, 2019.
Both net income and core earnings* increased for the quarter, largely
due to favorable DAC unlocking. Core earnings excluding DAC unlocking
declined slightly for the quarter. The net interest spread for the first
quarter was 142 basis points on $4.7 billion of fixed annuity assets
under management, consistent with 2019 guidance.
|
Life Segment Sales Remain Robust
(All comparisons vs. same period in 2018, unless noted
otherwise)
|
|
|
|
|
Three Months EndedMarch 31,
|
|
($ in millions)
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
|
|
Life sales*
|
$
|
4.3
|
|
|
$
|
4.3
|
|
|
—%
|
|
Life mortality costs
|
10.5
|
|
|
9.5
|
|
|
10.5%
|
|
Life net income / core earnings*
|
3.3
|
|
|
3.8
|
|
|
-13.2%
|
Life sales* were consistent with the strong prior year quarter; both
ranked among the top 10 quarters for Life sales in the past 20 years.
Demand remains healthy in the educator market for both single and
recurring premium products.
Life core earnings* were down 13% for the quarter largely due to
mortality costs, which rose in line with modeled actuarial assumptions.
Life persistency of 95.4% was slightly better than the prior year period.
|
Net Investment Income Up Slightly from PYQ
(All comparisons vs. same period in 2018, unless noted
otherwise)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
($ in millions)
|
2019
|
|
2018
|
|
Change
|
|
|
|
|
|
|
|
|
Total pretax net investment income
|
$
|
92.8
|
|
|
$
|
91.9
|
|
|
1.0%
|
|
Pretax net investment gains (losses)
|
7.4
|
|
|
(1.7
|
)
|
|
N.M.
|
|
Pretax net unrealized investment gains (losses) on securities
|
310.5
|
|
|
261.1
|
|
|
18.9%
|
Total net investment income increased slightly on strong returns on
alternative investments and higher asset balances. As anticipated,
prepayment activity was below last year, and investment yields continue
to be impacted by the low interest rate environment of recent years.
Net investment gains were $7.4 million (pretax), primarily due to
increases in the fair values of equity securities. Net unrealized
investment gains on securities increased from last year due to a decline
in interest rates, which has resulted in higher fair values of fixed
maturity securities.
Capital Position Supports Business Investments
At March 31, 2019, shareholders' equity was $1.4 billion, or $34.60 per
share. Excluding net unrealized investment gains on securities,
shareholders' equity was $1.2 billion, or $29.47 per share. The
improvement in book value since year-end reflected lower interest rates
and tighter credit spreads across most asset classes.
On January 2, 2019, the company completed the purchase of BCG in a $25
million transaction. The NTA transaction is expected to close in
mid-2019, pending regulatory approvals and other customary closing
conditions, for a purchase price of $405 million. First-quarter expenses
of $0.5 million, after tax, related to the continued work on the pending
NTA transaction, and was reported in the Corporate and Other segment.
Quarterly Webcast
Horace Mann's senior management will discuss the company's first quarter
financial results with investors on May 1, 2019 at 9:30 a.m. Eastern
Time. The conference call will be webcast live at investors.horacemann.com
and archived later in the day for replay.
About Horace Mann
Horace Mann Educators Corporation (NYSE:HMN) is the largest financial
services company focused on providing America's educators and school
employees with insurance and retirement solutions. Founded by Educators
for Educators® in 1945, the company is headquartered in
Springfield, Illinois. For more information, visit horacemann.com.
Safe Harbor Statement and Non-GAAP Measures
`Statements included in this news release that are not historical in
nature are forward-looking within the meaning of the Private Securities
Litigation Reform Act of 1995 and are subject to certain risks and
uncertainties. Horace Mann is not under any obligation to (and expressly
disclaims any such obligation to) update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. Please refer to the company's Annual Report on Form 10-K for
the period ended December 31, 2018 and the company's past and future
filings and reports filed with the Securities and Exchange Commission
(SEC) for information concerning important factors that could cause
actual results to differ materially from those in forward-looking
statements. Information contained in this news release include measures
which are based on methodologies other than accounting principles
generally accepted in the United States (GAAP). Reconciliations of
non-GAAP measures to the closest GAAP measures are contained in the
Appendix to the Investor Supplement and additional descriptions of the
non-GAAP measures are contained in the Glossary of Selected Terms
included as an exhibit to the company's SEC filings.
|
HORACE MANN EDUCATORS CORPORATION
Financial Highlights (Unaudited)
($ in Millions, except per share data)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
|
|
|
|
2019
|
|
2018
|
|
Change
|
|
EARNINGS SUMMARY
|
|
|
|
|
|
|
|
Net income
|
|
$
|
32.2
|
|
|
$
|
20.2
|
|
|
59.4
|
%
|
|
Net investment gains (losses), after tax
|
|
5.8
|
|
|
(1.3
|
)
|
|
N.M.
|
|
Core earnings*
|
|
26.4
|
|
|
21.5
|
|
|
22.8
|
%
|
|
|
|
|
|
|
|
|
|
Per diluted share:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
0.77
|
|
|
$
|
0.48
|
|
|
60.4
|
%
|
|
Net investment gains (losses), after tax
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
N.M.
|
|
Core earnings*
|
|
$
|
0.63
|
|
|
$
|
0.51
|
|
|
23.5
|
%
|
|
Weighted average number of shares and
equivalent shares (in millions) - Diluted
|
|
41.8
|
|
|
41.7
|
|
|
0.2
|
%
|
|
|
|
|
|
|
|
|
|
RETURN ON EQUITY
|
|
|
|
|
|
|
|
Net income return on equity - LTM (1)
|
|
2.2
|
%
|
|
12.5
|
%
|
|
|
|
Net income return on equity - annualized
|
|
9.5
|
%
|
|
5.6
|
%
|
|
|
|
Core return on equity - LTM* (2)
|
|
2.7
|
%
|
|
6.7
|
%
|
|
|
|
Core return on equity - annualized*
|
|
8.8
|
%
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
FINANCIAL POSITION
|
|
|
|
|
|
|
|
Per share (3):
|
|
|
|
|
|
|
|
Book value
|
|
$
|
34.60
|
|
|
$
|
34.35
|
|
|
0.7
|
%
|
|
Effect of net unrealized investment gains on securities (4)
|
|
$
|
5.13
|
|
|
$
|
4.35
|
|
|
17.9
|
%
|
|
Dividends paid
|
|
$
|
0.2875
|
|
|
$
|
0.2850
|
|
|
0.9
|
%
|
|
Ending number of shares outstanding (in millions) (3)
|
|
41.2
|
|
|
40.9
|
|
|
0.7
|
%
|
|
Total assets
|
|
$
|
11,561.1
|
|
|
$
|
11,068.5
|
|
|
4.5
|
%
|
|
Long-term debt, current and noncurrent
|
|
297.8
|
|
|
297.5
|
|
|
0.1
|
%
|
|
Total shareholders' equity
|
|
1,423.7
|
|
|
1,404.7
|
|
|
1.4
|
%
|
|
|
|
|
|
|
|
|
|
ADDITIONAL INFORMATION
|
|
|
|
|
|
|
|
Net investment gains (losses)
|
|
|
|
|
|
|
|
Before tax
|
|
$
|
7.4
|
|
|
$
|
(1.7
|
)
|
|
N.M.
|
|
After tax
|
|
5.8
|
|
|
(1.3
|
)
|
|
N.M.
|
|
Per share, diluted
|
|
$
|
0.14
|
|
|
$
|
(0.03
|
)
|
|
N.M.
|
|
|
|
N.M.- Not meaningful.
|
|
(1)
|
|
Based on last twelve months net income and average quarter-end
shareholders' equity.
|
|
(2)
|
|
Based on last twelve months core earnings and average quarter-end
shareholders' equity which has been adjusted to exclude the fair
value adjustment for investments, net of the related impact on
deferred policy acquisition costs and applicable deferred taxes.
|
|
(3)
|
|
Ending shares outstanding were 41,150,005 at March 31, 2019 and
40,888,534 at March 31, 2018.
|
|
(4)
|
|
Net of the related impact on deferred policy acquisition costs and
applicable deferred taxes.
|
|
HORACE MANN EDUCATORS CORPORATION
Statements of Operations and Supplemental Consolidated Data
(Unaudited)
($ in Millions)
|
|
|
|
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
|
|
|
|
2019
|
|
2018
|
|
Change
|
|
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
Insurance premiums and contract charges earned
|
|
$
|
209.8
|
|
|
$
|
203.0
|
|
|
3.3
|
%
|
|
Net investment income
|
|
92.8
|
|
|
91.9
|
|
|
1.0
|
%
|
|
Net investment gains (losses)
|
|
7.4
|
|
|
(1.7
|
)
|
|
N.M.
|
|
Other income
|
|
3.2
|
|
|
2.3
|
|
|
39.1
|
%
|
|
Total revenues
|
|
313.2
|
|
|
295.5
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
Benefits, claims and settlement expenses
|
|
139.4
|
|
|
143.6
|
|
|
-2.9
|
%
|
|
Interest credited
|
|
52.9
|
|
|
50.0
|
|
|
5.8
|
%
|
|
Policy acquisition expenses amortized
|
|
25.0
|
|
|
26.7
|
|
|
-6.4
|
%
|
|
Operating expenses
|
|
54.0
|
|
|
48.2
|
|
|
12.0
|
%
|
|
Interest expense
|
|
3.3
|
|
|
3.2
|
|
|
3.1
|
%
|
|
Total benefits, losses and expenses
|
|
274.6
|
|
|
271.7
|
|
|
1.1
|
%
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
38.6
|
|
|
23.8
|
|
|
62.2
|
%
|
|
Income tax expense
|
|
6.4
|
|
|
3.6
|
|
|
77.8
|
%
|
|
Net income
|
|
$
|
32.2
|
|
|
$
|
20.2
|
|
|
59.4
|
%
|
|
|
|
|
|
|
|
|
|
PREMIUMS WRITTEN AND CONTRACT DEPOSITS
|
|
|
|
|
|
|
|
Property and Casualty
|
|
$
|
161.7
|
|
|
$
|
159.4
|
|
|
1.4
|
%
|
|
Annuity deposits
|
|
107.3
|
|
|
98.8
|
|
|
8.6
|
%
|
|
Life
|
|
26.4
|
|
|
25.8
|
|
|
2.3
|
%
|
|
Total
|
|
$
|
295.4
|
|
|
$
|
284.0
|
|
|
4.0
|
%
|
|
|
|
|
|
|
|
|
|
SEGMENT NET INCOME (LOSS)
|
|
|
|
|
|
|
|
Property and Casualty
|
|
$
|
15.0
|
|
|
$
|
9.7
|
|
|
54.6
|
%
|
|
Retirement
|
|
12.2
|
|
|
11.4
|
|
|
7.0
|
%
|
|
Life
|
|
3.3
|
|
|
3.8
|
|
|
-13.2
|
%
|
|
Corporate and Other (1)
|
|
1.7
|
|
|
(4.7
|
)
|
|
N.M.
|
|
Net income
|
|
$
|
32.2
|
|
|
$
|
20.2
|
|
|
59.4
|
%
|
|
|
|
N.M. - Not meaningful.
|
|
(1)
|
|
Corporate and Other includes interest expense on debt and the impact
of net investment gains and losses and other Corporate level items.
The Company does not allocate the impact of corporate level
transactions to the insurance segments consistent with how
management evaluates the results of those segments. See detail for
this segment on page 4.
|
|
HORACE MANN EDUCATORS CORPORATION
Supplemental Business Segment Overview (Unaudited)
($ in Millions)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
|
|
|
|
2019
|
|
2018
|
|
Change
|
|
PROPERTY & CASUALTY
|
|
|
|
|
|
|
|
Premiums written
|
|
$
|
161.7
|
|
|
$
|
159.4
|
|
|
1.4
|
%
|
|
Premiums earned
|
|
170.8
|
|
|
165.5
|
|
|
3.2
|
%
|
|
Net investment income
|
|
10.2
|
|
|
9.5
|
|
|
7.4
|
%
|
|
Other income
|
|
0.4
|
|
|
0.2
|
|
|
100.0
|
%
|
|
Losses and loss adjustment expenses (LAE)
|
|
116.8
|
|
|
120.7
|
|
|
-3.2
|
%
|
|
Operating expenses (includes policy
acquisition expenses amortized)
|
|
46.5
|
|
|
43.1
|
|
|
7.9
|
%
|
|
Interest expense
|
|
0.3
|
|
|
0.2
|
|
|
50.0
|
%
|
|
Income before tax
|
|
17.8
|
|
|
11.2
|
|
|
58.9
|
%
|
|
Net income
|
|
15.0
|
|
|
9.7
|
|
|
54.6
|
%
|
|
Net investment income, after tax
|
|
8.7
|
|
|
7.8
|
|
|
11.5
|
%
|
|
|
|
|
|
|
|
|
|
Catastrophe costs (1)
|
|
|
|
|
|
|
|
After tax
|
|
8.5
|
|
|
7.7
|
|
|
10.4
|
%
|
|
Before tax
|
|
10.8
|
|
|
9.8
|
|
|
10.2
|
%
|
|
Prior years' reserves favorable (adverse)
development, before tax
|
|
|
|
|
|
|
|
Automobile
|
|
1.0
|
|
|
—
|
|
|
—
|
%
|
|
Property & other
|
|
1.0
|
|
|
0.3
|
|
|
N.M.
|
|
Total
|
|
2.0
|
|
|
0.3
|
|
|
N.M.
|
|
|
|
|
|
|
|
|
|
Operating statistics:
|
|
|
|
|
|
|
|
Loss and loss adjustment expense ratio
|
|
68.3
|
%
|
|
72.9
|
%
|
|
-4.6
|
pts
|
|
Expense ratio
|
|
27.2
|
%
|
|
26.0
|
%
|
|
1.2
|
pts
|
|
Combined ratio
|
|
95.5
|
%
|
|
98.9
|
%
|
|
-3.4
|
pts
|
|
Effect on the combined ratio of:
|
|
|
|
|
|
|
|
Catastrophe costs (1)
|
|
6.2
|
%
|
|
5.9
|
%
|
|
0.3
|
pts
|
|
Prior years' (favorable) adverse reserve development
|
|
-1.2
|
%
|
|
-0.2
|
%
|
|
-1.0
|
pts
|
|
Combined ratio excluding the effects of
catastrophe costs and prior years' reserve
development (underlying combined ratio)*
|
|
90.5
|
%
|
|
93.2
|
%
|
|
-2.7
|
pts
|
|
|
|
|
|
|
|
|
|
Policies in force (in thousands)
|
|
654
|
|
|
679
|
|
|
-3.7
|
%
|
|
Automobile (2)
|
|
454
|
|
|
475
|
|
|
-4.4
|
%
|
|
Property
|
|
200
|
|
|
204
|
|
|
-2.0
|
%
|
|
|
|
|
|
|
|
|
|
Policy renewal rate - 12 months
|
|
|
|
|
|
|
|
Automobile
|
|
81.5
|
%
|
|
82.9
|
%
|
|
-1.4
|
pts
|
|
Property
|
|
87.8
|
%
|
|
87.9
|
%
|
|
-0.1
|
pts
|
|
|
|
N.M. - Not meaningful.
|
|
(1)
|
|
Includes allocated loss adjustment expenses and, when applicable,
catastrophe reinsurance reinstatement premiums.
|
|
(2)
|
|
March 31, 2019 includes assumed policies in force of 4.
|
|
HORACE MANN EDUCATORS CORPORATION
Supplemental Business Segment Overview (Unaudited)
($ in Millions)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
|
|
|
|
2019
|
|
2018
|
|
Change
|
|
RETIREMENT
|
|
|
|
|
|
|
|
Contract deposits
|
|
$
|
107.3
|
|
|
$
|
98.8
|
|
|
8.6
|
%
|
|
Variable
|
|
48.8
|
|
|
46.8
|
|
|
4.3
|
%
|
|
Fixed
|
|
58.5
|
|
|
52.0
|
|
|
12.5
|
%
|
|
Contract charges earned
|
|
8.6
|
|
|
8.0
|
|
|
7.5
|
%
|
|
Net investment income
|
|
64.7
|
|
|
64.2
|
|
|
0.8
|
%
|
|
Interest credited
|
|
41.7
|
|
|
38.7
|
|
|
7.8
|
%
|
|
Net interest margin (without net investment gains/losses)
|
|
23.0
|
|
|
25.5
|
|
|
-9.8
|
%
|
|
Other income
|
|
2.4
|
|
|
1.8
|
|
|
33.3
|
%
|
|
Mortality loss and other reserve changes
|
|
(0.6
|
)
|
|
(1.9
|
)
|
|
-68.4
|
%
|
|
Operating expenses (includes policy acquisition expenses amortized)
|
|
18.8
|
|
|
19.4
|
|
|
-3.1
|
%
|
|
Income before tax
|
|
14.6
|
|
|
14.0
|
|
|
4.3
|
%
|
|
Net income
|
|
12.2
|
|
|
11.4
|
|
|
7.0
|
%
|
|
Pretax income increase (decrease) due to evaluation of:
|
|
|
|
|
|
|
|
Deferred policy acquisition costs
|
|
$
|
2.0
|
|
|
$
|
(0.2
|
)
|
|
N.M.
|
|
Guaranteed minimum death benefit reserve
|
|
0.1
|
|
|
—
|
|
|
—
|
%
|
|
Retirement contracts in force (in thousands)
|
|
226
|
|
|
223
|
|
|
1.3
|
%
|
|
Annuity accumulated account value on deposit /
Assets under management
|
|
$
|
6,972.7
|
|
|
$
|
6,769.5
|
|
|
3.0
|
%
|
|
Variable
|
|
2,224.1
|
|
|
2,139.6
|
|
|
3.9
|
%
|
|
Fixed
|
|
4,748.6
|
|
|
4,629.9
|
|
|
2.6
|
%
|
|
Annuity accumulated value retention - 12 months
|
|
|
|
|
|
|
|
Variable accumulations
|
|
94.3
|
%
|
|
94.6
|
%
|
|
-0.3
|
pts
|
|
Fixed accumulations
|
|
94.1
|
%
|
|
94.4
|
%
|
|
-0.3
|
pts
|
|
|
|
|
|
|
|
|
|
LIFE
|
|
|
|
|
|
|
|
Premiums and contract deposits
|
|
$
|
26.4
|
|
|
$
|
25.8
|
|
|
2.3
|
%
|
|
Premiums and contract charges earned
|
|
30.4
|
|
|
29.5
|
|
|
3.1
|
%
|
|
Net investment income
|
|
18.1
|
|
|
18.3
|
|
|
-1.1
|
%
|
|
Other income
|
|
0.1
|
|
|
0.1
|
|
|
—
|
%
|
|
Death benefits/mortality cost/change in reserves
|
|
22.0
|
|
|
21.0
|
|
|
4.8
|
%
|
|
Interest credited
|
|
11.2
|
|
|
11.3
|
|
|
-0.9
|
%
|
|
Operating expenses (includes policy acquisition expenses amortized)
|
|
11.4
|
|
|
10.9
|
|
|
4.6
|
%
|
|
Income before tax
|
|
4.0
|
|
|
4.7
|
|
|
-14.9
|
%
|
|
Net income
|
|
3.3
|
|
|
3.8
|
|
|
-13.2
|
%
|
|
Pretax income increase (decrease) due to evaluation of:
|
|
|
|
|
|
|
|
Deferred policy acquisition costs
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
N.M.
|
|
Life policies in force (in thousands)
|
|
198
|
|
|
197
|
|
|
0.5
|
%
|
|
Life insurance in force
|
|
$
|
18,409
|
|
|
$
|
17,665
|
|
|
4.2
|
%
|
|
Lapse ratio - 12 months (Ordinary life insurance)
|
|
4.6
|
%
|
|
4.9
|
%
|
|
-0.3
|
pts
|
|
|
|
|
|
|
|
|
|
CORPORATE AND OTHER (1)
|
|
|
|
|
|
|
|
Components of income (loss) before tax:
|
|
|
|
|
|
|
|
Net investment gains (losses)
|
|
$
|
7.4
|
|
|
$
|
(1.7
|
)
|
|
N.M.
|
|
Interest expense
|
|
(3.0
|
)
|
|
(3.0
|
)
|
|
—
|
%
|
|
Other operating expenses, net investment income and other income
|
|
(2.2
|
)
|
|
(1.4
|
)
|
|
57.1
|
%
|
|
Income (loss) before tax
|
|
2.2
|
|
|
(6.1
|
)
|
|
-136.1
|
%
|
|
Net income (loss)
|
|
1.7
|
|
|
(4.7
|
)
|
|
136.2
|
%
|
|
|
|
N.M.-Not meaningful.
|
|
(1)
|
|
The Corporate and Other segment includes interest expense on debt
and the impact of investment gains and losses and other corporate
level items. The Company does not allocate the impact of corporate
level transactions to the insurance segments consistent with how
management evaluates the results of those segments.
|
|
HORACE MANN EDUCATORS CORPORATION
Supplemental Business Segment Overview (Unaudited)
($ in Millions)
|
|
|
|
|
|
Three Months EndedMarch 31,
|
|
|
|
|
|
2019
|
|
2018
|
|
Change
|
|
INVESTMENTS
|
|
|
|
|
|
|
|
Retirement and Life
|
|
|
|
|
|
|
|
Fixed maturity securities, at fair value (amortized
cost 2019, $6,656.9; 2018, $6,551.1)
|
|
$
|
6,940.1
|
|
|
$
|
6,792.7
|
|
|
2.2
|
%
|
|
Equity securities, at fair value
|
|
77.6
|
|
|
77.5
|
|
|
0.1
|
%
|
|
Short-term investments
|
|
121.2
|
|
|
10.6
|
|
|
N.M.
|
|
Policy loans
|
|
153.4
|
|
|
152.8
|
|
|
0.4
|
%
|
|
Other investments
|
|
280.6
|
|
|
211.0
|
|
|
33.0
|
%
|
|
Total Retirement and Life investments
|
|
7,572.9
|
|
|
7,244.6
|
|
|
4.5
|
%
|
|
|
|
|
|
|
|
|
|
Property & Casualty
|
|
|
|
|
|
|
|
Fixed maturity securities, at fair value (amortized
cost 2019, $830.5; 2018, $822.4)
|
|
857.9
|
|
|
842.0
|
|
|
1.9
|
%
|
|
Equity securities, at fair value
|
|
27.9
|
|
|
53.5
|
|
|
-47.9
|
%
|
|
Short-term investments
|
|
15.2
|
|
|
9.0
|
|
|
68.9
|
%
|
|
Other investments
|
|
76.8
|
|
|
73.0
|
|
|
5.2
|
%
|
|
Total Property & Casualty investments
|
|
977.8
|
|
|
977.5
|
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
Corporate investments
|
|
7.1
|
|
|
2.6
|
|
|
N.M.
|
|
|
|
|
|
|
|
|
|
Total investments
|
|
8,557.8
|
|
|
8,224.7
|
|
|
4.0
|
%
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
|
|
|
|
|
Before tax
|
|
$
|
92.8
|
|
|
$
|
91.9
|
|
|
1.0
|
%
|
|
After tax
|
|
74.0
|
|
|
72.8
|
|
|
1.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
N.M.-Not meaningful.
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190430006140/en/
