Exhibit 99.3
Assurant, Inc. (AIZ)
REVISED Financial Supplement as of December 31, 2021
Note: In conjunction with the transition of its new CEO and chief operating decision maker, Assurant changed its segment measure of profitability for its reportable segments to an Adjusted EBITDA metric, the primary measure used for purposes of making decisions about allocating resources to the segments and assessing performance, from segment net income from continuing operations, effective January 1, 2022. In addition, the Company will report Adjusted earnings, both including and excluding reportable catastrophes, per diluted share, as an additional non-GAAP measure, a global mobile devices serviced metric for the Global Lifestyle segment and a revised Connected Living line of business within the Global Lifestyle segment, which will include the business previously reported as Global Financial Services and Other. These changes are reflected for all periods presented and highlighted in yellow throughout this revised financial supplement as of December 31, 2021.
As previously disclosed, Assurant will no longer report net operating income and net operating income per diluted share, both including and excluding reportable catastrophes.
ASSURANT, INC.
FINANCIAL SUPPLEMENT
(UNAUDITED)
As of December 31, 2021
INDEX TO FINANCIAL SUPPLEMENT
Page: | ||||
SUMMARY FINANCIAL HIGHLIGHTS | 1 | |||
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS | 2 | |||
RECONCILIATION OF ADJUSTED EBITDA TO NET INCOME FROM CONTINUING OPERATIONS | 3 | |||
SEGMENT STATEMENTS OF OPERATIONS AND SELECTED DATA | 4 | |||
SEGMENT CONDENSED BALANCE SHEETS | 9 | |||
INVESTMENTS | 10 | |||
INVESTMENT RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS | 11 | |||
RATINGS SUMMARY | 13 | |||
REGULATION G – NON-GAAP FINANCIAL MEASURES | 14 |
CONTACT INFORMATION
Corporate Headquarters Address: | Investor Inquiries: | |||
55 Broadway, Suite 2901 | Suzanne Shepherd | Sean Moshier | ||
New York, NY 10006 212-859-7000 | Senior Vice President, Investor Relations and Sustainability Investor Relations 201-788-4324 suzanne.shepherd@assurant.com | Assistant Vice President Investor Relations 914-204-2253 sean.moshier@assurant.com | ||
Website Address: | ||||
www.assurant.com |
Assurant, Inc. (NYSE: AIZ) is a leading global business services company that supports, protects and connects major consumer purchases. A Fortune 300 company with a presence in 21 countries, Assurant supports the advancement of the connected world by partnering with the world’s leading brands to develop innovative solutions and to deliver an enhanced customer experience through mobile device solutions, extended service contracts, vehicle protection services, renters insurance, lender-placed insurance products and other specialty products. Learn more at assurant.com or on Twitter @Assurant.
Assurant, Inc.
Summary Financial Highlights
(Unaudited)
($ in millions, except | 2021 | 2020 | Twelve Months | 4Q21- 4Q20 % Change | 4Q21- 3Q21 % Change | 12M’21- 12M’20 % Change | ||||||||||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | |||||||||||||||||||||||||||||||||||||||||||
KEY FINANCIAL METRICS | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment net earned premiums, fees and other income(1) | $ | 2,490.4 | $ | 2,449.7 | $ | 2,448.9 | $ | 2,355.3 | $ | 2,313.7 | $ | 2,296.3 | $ | 2,257.6 | $ | 2,447.3 | $ | 9,744.3 | $ | 9,314.9 | 7.6 | % | 1.7 | % | 4.6 | % | ||||||||||||||||||||||||||
Total segment revenues(1) | $ | 2,560.7 | $ | 2,518.4 | $ | 2,522.0 | $ | 2,425.5 | $ | 2,382.4 | $ | 2,357.4 | $ | 2,318.2 | $ | 2,524.0 | $ | 10,026.6 | $ | 9,582.0 | 7.5 | % | 1.7 | % | 4.6 | % | ||||||||||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | 123.6 | $ | 882.4 | $ | 203.4 | $ | 158.3 | $ | 134.5 | $ | (34.9 | ) | $ | 173.5 | $ | 150.0 | $ | 1,367.7 | $ | 423.1 | (8.1 | )% | (86.0 | )% | 223.3 | % | |||||||||||||||||||||||||
Net income from continuing operations | $ | 126.7 | $ | 153.6 | $ | 184.7 | $ | 148.5 | $ | 119.1 | $ | 88.0 | $ | 164.7 | $ | 148.6 | $ | 613.5 | $ | 520.4 | 6.4 | % | (17.5 | )% | 17.9 | % | ||||||||||||||||||||||||||
Adjusted EBITDA(2) | $ | 243.9 | $ | 163.6 | $ | 297.1 | $ | 258.6 | $ | 192.8 | $ | 141.6 | $ | 257.6 | $ | 247.7 | $ | 963.2 | $ | 839.7 | 26.5 | % | 49.1 | % | 14.7 | % | ||||||||||||||||||||||||||
Adjusted EBITDA, excluding reportable catastrophes(3)(4) | $ | 245.4 | $ | 262.3 | $ | 297.6 | $ | 302.2 | $ | 227.5 | $ | 251.7 | $ | 270.2 | $ | 264.0 | $ | 1,107.5 | $ | 1,013.4 | 7.9 | % | (6.4 | )% | 9.3 | % | ||||||||||||||||||||||||||
Per share: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) attributable to common stockholders, per diluted share | $ | 2.14 | $ | 14.83 | $ | 3.32 | $ | 2.64 | $ | 2.23 | $ | (0.58 | ) | $ | 2.81 | $ | 2.43 | $ | 22.83 | $ | 6.99 | (4.0 | )% | (85.6 | )% | 226.6 | % | |||||||||||||||||||||||||
Net income from continuing operations, per diluted share | $ | 2.20 | $ | 2.58 | $ | 3.01 | $ | 2.41 | $ | 1.91 | $ | 1.38 | $ | 2.59 | $ | 2.32 | $ | 10.20 | $ | 8.22 | 15.2 | % | (14.7 | )% | 24.1 | % | ||||||||||||||||||||||||||
Adjusted earnings, per diluted share(3) | $ | 2.69 | $ | 1.61 | $ | 3.18 | $ | 2.66 | $ | 1.80 | $ | 1.28 | $ | 2.62 | $ | 2.52 | $ | 10.22 | $ | 8.36 | 49.4 | % | 67.1 | % | 22.2 | % | ||||||||||||||||||||||||||
Adjusted earnings, excluding reportable catastrophes, per diluted share(3)(4) | $ | 2.71 | $ | 2.92 | $ | 3.19 | $ | 3.21 | $ | 2.24 | $ | 2.72 | $ | 2.78 | $ | 2.72 | $ | 12.12 | $ | 10.54 | 21.0 | % | (7.2 | )% | 15.0 | % | ||||||||||||||||||||||||||
Debt to total capital ratio | 28.6 | % | 27.7 | % | 30.2 | % | 27.5 | % | 27.5 | % | 25.3 | % | 27.0 | % | 29.1 | % | 28.6 | % | 27.5 | % | 110 | bps | 90 | bps | 110 | bps | ||||||||||||||||||||||||||
Debt to total capital ratio, excluding AOCI(3) | 28.1 | % | 27.4 | % | 32.5 | % | 29.3 | % | 30.1 | % | 27.6 | % | 29.0 | % | 29.5 | % | 28.1 | % | 30.1 | % | (200 | )bps | 70 | bps | (200 | )bps | ||||||||||||||||||||||||||
Dividends from subsidiaries, net of capital infusions | $ | 176.0 | $ | 127.0 | $ | 243.0 | $ | 183.0 | $ | 292.0 | $ | 245.0 | $ | 157.0 | $ | 127.0 | $ | 729.0 | $ | 821.0 | (39.7 | )% | 38.6 | % | (11.2 | )% | ||||||||||||||||||||||||||
Share repurchases: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares repurchased | 1,823,252 | 2,001,336 | 1,204,534 | 308,000 | 1,126,532 | 577,476 | 254,000 | 480,967 | 5,337,122 | 2,438,975 | 61.8 | % | (8.9 | )% | 118.8 | % | ||||||||||||||||||||||||||||||||||||
Average repurchase price per share | $ | 158.91 | $ | 161.16 | $ | 158.34 | $ | 134.69 | $ | 130.20 | $ | 121.39 | $ | 101.88 | $ | 118.92 | $ | 158.23 | $ | 122.94 | 22.1 | % | (1.4 | )% | 28.7 | % | ||||||||||||||||||||||||||
Total cost of share repurchase(5) | $ | 289.7 | $ | 322.5 | $ | 190.7 | $ | 41.5 | $ | 146.6 | $ | 70.1 | $ | 25.8 | $ | 57.3 | $ | 844.4 | $ | 299.8 | 97.6 | % | (10.2 | )% | 181.7 | % | ||||||||||||||||||||||||||
Common stock dividends: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Dividend per share | $ | 0.68 | $ | 0.66 | $ | 0.66 | $ | 0.66 | $ | 0.66 | $ | 0.63 | $ | 0.63 | $ | 0.63 | $ | 2.66 | $ | 2.55 | 3.0 | % | 3.0 | % | 4.3 | % | ||||||||||||||||||||||||||
Total paid | $ | 39.1 | $ | 38.5 | $ | 41.8 | $ | 38.2 | $ | 39.5 | $ | 37.5 | $ | 39.6 | $ | 38.0 | $ | 157.6 | $ | 154.6 | (1.0 | )% | 2.4 | % | 1.9 | % | ||||||||||||||||||||||||||
Yield(6) | 1.75 | % | 1.67 | % | 1.69 | % | 1.86 | % | 1.94 | % | 2.08 | % | 2.44 | % | 2.42 | % | 1.71 | % | 1.87 | % | (19 | )bps | 7 | bps | (17 | )bps | ||||||||||||||||||||||||||
AIZ closing stock price (NYSE) | $ | 155.86 | $ | 157.75 | $ | 156.18 | $ | 141.77 | $ | 136.22 | $ | 121.31 | $ | 103.29 | $ | 104.09 | $ | 155.86 | $ | 136.22 | 14.4 | % | (1.2 | )% | 14.4 | % | ||||||||||||||||||||||||||
Share Data: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Weighted average basic common shares outstanding | 57,274,878 | 59,126,313 | 60,990,609 | 59,192,880 | 59,310,101 | 60,190,103 | 60,363,577 | 60,602,911 | 59,140,861 | 60,114,670 | (3.4 | )% | (3.1 | )% | (1.6 | )% | ||||||||||||||||||||||||||||||||||||
Incremental common shares from: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Performance share units and employee stock purchase plan | 453,260 | 353,151 | 331,947 | 367,274 | 387,292 | 235,619 | 206,362 | 327,840 | 448,920 | 363,343 | 17.0 | % | 28.3 | % | 23.6 | % | ||||||||||||||||||||||||||||||||||||
Mandatory convertible preferred stock(7) | — | — | — | 2,223,238 | 2,701,925 | — | 2,777,250 | 2,696,175 | 533,913 | 2,701,925 | (100.0 | )% | N/A | (80.2 | )% | |||||||||||||||||||||||||||||||||||||
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Weighted average diluted common shares outstanding | 57,728,138 | 59,479,464 | 61,322,556 | 61,783,392 | 62,399,318 | 60,425,722 | 63,347,189 | 63,626,926 | 60,123,694 | 63,179,938 | (7.5 | )% | (2.9 | )% | (4.8 | )% | ||||||||||||||||||||||||||||||||||||
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Anti-dilutive incremental common shares from mandatory convertible preferred stock(7) | — | — | — | — | — | 2,699,913 | — | — | — | — | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||||||||
(1) | Includes net earned premiums, fees and other income and total revenues of the Global Lifestyle and Global Housing operating segments. |
(2) | Refer to page 3 for a reconciliation of Adjusted EBITDA to its most comparable GAAP measure, net income from continuing operations. |
(3) | Refer to the Footnotes in Regulation G - Non GAAP Financial Measures for reconciliations of non-GAAP measures to the most comparable GAAP measure. |
(4) | Represents individual catastrophic events that generate losses in excess of $5.0 million, pre-tax, net of reinsurance and client profit sharing adjustments and including reinstatement and other premiums. |
(5) | As of December 31, 2021, there was $842.1 million remaining under the total repurchase authorization. |
(6) | Common stock dividend yield is calculated by annualizing the quarterly common stock dividend per share and dividing by the quarter’s closing stock price. |
(7) | Dilution for the mandatory convertible preferred stock is calculated based on the assumed conversion of the outstanding mandatory convertible preferred stock, using the average closing stock price for the period the shares were outstanding. Net income attributable to common stockholders per diluted share excludes the effect of shares potentially dilutive securities which were anti-dilutive for the period. Accordingly, the numerator has not been increased by the amount of the preferred stock dividends in the periods in which the incremental common shares from mandatory convertible preferred stock were anti-dilutive. Each outstanding share of mandatory convertible preferred stock converted to common stock in March 2021. |
1
Assurant, Inc.
Consolidated Condensed Statements of Operations
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 % Change | 4Q21- 3Q21 % Change | 12M’21- 12M’20 % Change | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earned premiums | $ | 2,175.8 | $ | 2,140.1 | $ | 2,150.6 | $ | 2,105.6 | $ | 2,102.2 | $ | 2,086.8 | $ | 2,021.3 | $ | 2,065.5 | $ | 8,572.1 | $ | 8,275.8 | 3.5 | % | 1.7 | % | 3.6 | % | ||||||||||||||||||||||||||
Fees and other income | 314.9 | 309.6 | 298.5 | 249.9 | 212.9 | 209.4 | 236.4 | 383.6 | 1,172.9 | 1,042.3 | 47.9 | % | 1.7 | % | 12.5 | % | ||||||||||||||||||||||||||||||||||||
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Total net earned premiums, fees and other income | 2,490.7 | 2,449.7 | 2,449.1 | 2,355.5 | 2,315.1 | 2,296.2 | 2,257.7 | 2,449.1 | 9,745.0 | 9,318.1 | 7.6 | % | 1.7 | % | 4.6 | % | ||||||||||||||||||||||||||||||||||||
Net investment income | 79.2 | 76.0 | 82.9 | 76.3 | 73.3 | 63.3 | 65.4 | 83.6 | 314.4 | 285.6 | 8.0 | % | 4.2 | % | 10.1 | % | ||||||||||||||||||||||||||||||||||||
Net realized gains (losses) on investments and fair value changes to equity securities | 5.0 | 112.1 | 10.3 | 0.8 | 29.7 | 17.2 | 28.9 | (84.0 | ) | 128.2 | (8.2 | ) | (83.2 | )% | (95.5 | )% | 1663.4 | % | ||||||||||||||||||||||||||||||||||
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Total revenues | 2,574.9 | 2,637.8 | 2,542.3 | 2,432.6 | 2,418.1 | 2,376.7 | 2,352.0 | 2,448.7 | 10,187.6 | 9,595.5 | 6.5 | % | (2.4 | )% | 6.2 | % | ||||||||||||||||||||||||||||||||||||
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Benefits, losses and expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Policyholder benefits | 514.5 | 614.2 | 538.3 | 528.7 | 567.6 | 638.5 | 523.6 | 535.2 | 2,195.7 | 2,264.9 | (9.4 | )% | (16.2 | )% | (3.1 | )% | ||||||||||||||||||||||||||||||||||||
Selling, underwriting, general and administrative expenses | 1,871.5 | 1,783.9 | 1,738.6 | 1,682.4 | 1,664.8 | 1,600.2 | 1,592.4 | 1,787.9 | 7,076.4 | 6,645.3 | 12.4 | % | 4.9 | % | 6.5 | % | ||||||||||||||||||||||||||||||||||||
Interest expense | 27.1 | 27.5 | 28.8 | 28.4 | 26.8 | 25.5 | 26.7 | 25.5 | 111.8 | 104.5 | 1.1 | % | (1.5 | )% | 7.0 | % | ||||||||||||||||||||||||||||||||||||
Loss on extinguishment of debt | — | 20.7 | — | — | — | — | — | — | 20.7 | — | N/A | (100.0 | )% | N/A | ||||||||||||||||||||||||||||||||||||||
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Total benefits, losses and expenses | 2,413.1 | 2,446.3 | 2,305.7 | 2,239.5 | 2,259.2 | 2,264.2 | 2,142.7 | 2,348.6 | 9,404.6 | 9,014.7 | 6.8 | % | (1.4 | )% | 4.3 | % | ||||||||||||||||||||||||||||||||||||
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Income from continuing operations before provision (benefit) for income taxes | 161.8 | 191.5 | 236.6 | 193.1 | 158.9 | 112.5 | 209.3 | 100.1 | 783.0 | 580.8 | 1.8 | % | (15.5 | )% | 34.8 | % | ||||||||||||||||||||||||||||||||||||
Provision (benefit) for income taxes | 35.1 | 37.9 | 51.9 | 44.6 | 39.8 | 24.5 | 44.6 | (48.5 | ) | 169.5 | 60.4 | (11.8 | )% | (7.4 | )% | 180.6 | % | |||||||||||||||||||||||||||||||||||
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Net income from continuing operations | 126.7 | 153.6 | 184.7 | 148.5 | 119.1 | 88.0 | 164.7 | 148.6 | 613.5 | 520.4 | 6.4 | % | (17.5 | )% | 17.9 | % | ||||||||||||||||||||||||||||||||||||
Net income (loss) from discontinued operations | (3.1 | ) | 728.8 | 18.9 | 14.3 | 19.9 | (118.5 | ) | 13.7 | 7.2 | 758.9 | (77.7 | ) | (115.6 | )% | (100.4 | )% | 1076.7 | % | |||||||||||||||||||||||||||||||||
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Net income (loss) | 123.6 | 882.4 | 203.6 | 162.8 | 139.0 | (30.5 | ) | 178.4 | 155.8 | 1,372.4 | 442.7 | (11.1 | )% | (86.0 | )% | 210.0 | % | |||||||||||||||||||||||||||||||||||
Less: Net (income) loss attributable to non-controlling interests | — | — | (0.2 | ) | 0.2 | 0.2 | 0.3 | (0.3 | ) | (1.1 | ) | — | (0.9 | ) | (100.0 | )% | N/A | 100.0 | % | |||||||||||||||||||||||||||||||||
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Net income (loss) attributable to stockholders | 123.6 | 882.4 | 203.4 | 163.0 | 139.2 | (30.2 | ) | 178.1 | 154.7 | 1,372.4 | 441.8 | (11.2 | )% | (86.0 | )% | 210.6 | % | |||||||||||||||||||||||||||||||||||
Less: Preferred stock dividends | — | — | — | (4.7 | ) | (4.7 | ) | (4.7 | ) | (4.6 | ) | (4.7 | ) | (4.7 | ) | (18.7 | ) | 100.0 | % | N/A | 74.9 | % | ||||||||||||||||||||||||||||||
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Net income (loss) attributable to common stockholders | $ | 123.6 | $ | 882.4 | $ | 203.4 | $ | 158.3 | $ | 134.5 | $ | (34.9 | ) | $ | 173.5 | $ | 150.0 | $ | 1,367.7 | $ | 423.1 | (8.1 | )% | (86.0 | )% | 223.3 | % | |||||||||||||||||||||||||
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Pre-tax income from continuing operations margin(1) | 6.5 | % | 7.8 | % | 9.7 | % | 8.2 | % | 6.9 | % | 4.9 | % | 9.3 | % | 4.1 | % | 8.0 | % | 6.2 | % | (40 | )bps | (130 | )bps | 180 | bps | ||||||||||||||||||||||||||
Net income from continuing operations margin(2) | 5.1 | % | 6.3 | % | 7.5 | % | 6.3 | % | 5.1 | % | 3.8 | % | 7.3 | % | 6.1 | % | 6.3 | % | 5.6 | % | 0 | bps | (120 | )bps | 70 | bps | ||||||||||||||||||||||||||
Effective tax rate for net income from continuing operations | 21.7 | % | 19.8 | % | 21.9 | % | 23.1 | % | 25.0 | % | 21.8 | % | 21.3 | % | (48.5 | )% | 21.6 | % | 10.4 | % | (330 | )bps | 190 | bps | 1,120 | bps | ||||||||||||||||||||||||||
Investment yield(3) | 3.02 | % | 2.94 | % | 3.48 | % | 3.22 | % | 3.01 | % | 2.68 | % | 2.85 | % | 3.65 | % | 3.16 | % | 3.03 | % | 1 | bps | 8 | bps | 13 | bps | ||||||||||||||||||||||||||
Real estate joint venture partnerships (loss) income from sales and depreciation expense, pre-tax(3) | $ | (3.0 | ) | $ | (3.4 | ) | $ | 11.1 | $ | (5.8 | ) | $ | (0.9 | ) | $ | (1.6 | ) | $ | (1.2 | ) | $ | (1.9 | ) | $ | (1.1 | ) | $ | (5.6 | ) | (233.3 | )% | 11.8 | % | 80.4 | % | |||||||||||||||||
(1) | Equals income from continuing operations before provision (benefit) for income taxes divided by total net earned premiums, fees and other income. The margins for 3Q 2020, 2Q 2020 and 1Q 2020 have been revised for a correction to the calculation. |
(2) | Equals net income from continuing operations divided by total net earned premiums, fees and other income. |
(3) | Excludes investment income attributable to non-controlling interests. Prior period investment yields have been revised for a correction to the calculation. |
2
Assurant, Inc.
Reconciliation of Adjusted EBITDA to Net Income from Continuing Operations
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 | 4Q21- 3Q21 | 12M’21- 12M’20 | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | % Change | % Change | % Change | |||||||||||||||||||||||||||||||||||||||
GAAP net income from continuing operations | $ | 126.7 | $ | 153.6 | $ | 184.7 | $ | 148.5 | $ | 119.1 | $ | 88.0 | $ | 164.7 | $ | 148.6 | 613.5 | 520.4 | 6.4 | % | (17.5 | )% | 17.9 | % | ||||||||||||||||||||||||||||
Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | 27.1 | 27.5 | 28.8 | 28.4 | 26.8 | 25.5 | 26.7 | 25.5 | 111.8 | 104.5 | 1.1 | % | (1.5 | )% | 7.0 | % | ||||||||||||||||||||||||||||||||||||
Provision (benefit) for income taxes | 35.1 | 37.9 | 51.9 | 44.6 | 39.8 | 24.5 | 44.6 | (48.5 | ) | 169.5 | 60.4 | (11.8 | )% | (7.4 | )% | 180.6 | % | |||||||||||||||||||||||||||||||||||
Depreciation expense | 21.4 | 18.1 | 17.5 | 16.8 | 15.5 | 13.9 | 14.3 | 12.4 | 73.8 | 56.1 | 38.1 | % | 18.2 | % | 31.6 | % | ||||||||||||||||||||||||||||||||||||
Amortization of purchased intangible assets | 15.8 | 15.7 | 17.3 | 17.0 | 16.7 | 12.5 | 12.3 | 11.2 | 65.8 | 52.7 | (5.4 | )% | 0.6 | % | 24.9 | % | ||||||||||||||||||||||||||||||||||||
Adjustments, pre-tax: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net realized (gains) losses on investments and fair value changes to equity securities | (5.1 | ) | (112.1 | ) | (10.3 | ) | (0.9 | ) | (29.6 | ) | (17.1 | ) | (28.9 | ) | 85.0 | (128.4 | ) | 9.4 | 82.8 | % | 95.5 | % | (1,466.0 | )% | ||||||||||||||||||||||||||||
COVID-19 direct and incremental expenses | 2.8 | 2.0 | 2.2 | 3.0 | 5.3 | (0.6 | ) | 17.5 | 3.0 | 10.0 | 25.2 | (47.2 | )% | 40.0 | % | (60.3 | )% | |||||||||||||||||||||||||||||||||||
Loss on extinguishment of debt | — | 20.7 | — | — | — | — | — | — | 20.7 | — | N/A | (100.0 | )% | N/A | ||||||||||||||||||||||||||||||||||||||
Other adjustments(1) | 20.1 | 0.2 | 5.2 | 1.0 | (1.1 | ) | (5.3 | ) | 6.7 | 11.9 | 26.5 | 12.2 | 1,927.3 | % | 9,950.0 | % | 117.2 | % | ||||||||||||||||||||||||||||||||||
(Income) loss attributable to non-controlling interests | — | — | (0.2 | ) | 0.2 | 0.3 | 0.2 | (0.3 | ) | (1.4 | ) | — | (1.2 | ) | (100.0 | )% | N/A | 100.0 | % | |||||||||||||||||||||||||||||||||
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Adjusted EBITDA | $ | 243.9 | $ | 163.6 | $ | 297.1 | $ | 258.6 | $ | 192.8 | $ | 141.6 | $ | 257.6 | $ | 247.7 | $ | 963.2 | 839.7 | 26.5 | % | 49.1 | % | 14.7 | % | |||||||||||||||||||||||||||
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Segment Adjusted EBITDA | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Global Lifestyle | $ | 158.7 | $ | 176.5 | $ | 186.0 | $ | 193.0 | $ | 137.2 | $ | 150.6 | $ | 175.4 | $ | 173.8 | 714.2 | $ | 637.0 | 15.7 | % | (10.1 | )% | 12.1 | % | |||||||||||||||||||||||||||
Global Housing | 110.7 | 10.1 | 128.0 | 93.5 | 85.9 | 24.0 | 116.0 | 101.2 | 342.3 | 327.1 | 28.9 | % | 996.0 | % | 4.6 | % | ||||||||||||||||||||||||||||||||||||
Corporate and Other | (25.5 | ) | (23.0 | ) | (16.9 | ) | (27.9 | ) | (30.3 | ) | (33.0 | ) | (33.8 | ) | (27.3 | ) | (93.3 | ) | (124.4 | ) | 15.8 | % | (10.9 | )% | 25.0 | % | ||||||||||||||||||||||||||
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Total | $ | 243.9 | $ | 163.6 | $ | 297.1 | $ | 258.6 | $ | 192.8 | $ | 141.6 | $ | 257.6 | $ | 247.7 | $ | 963.2 | $ | 839.7 | 26.5 | % | 49.1 | % | 14.7 | % | ||||||||||||||||||||||||||
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(1) | Refer to the Footnotes in the Regulation G - Non GAAP Financial Measures for detail of what is included in other adjustments. |
3
Global Lifestyle
Condensed Statements of Operations and Selected Data
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 % Change | 4Q21- 3Q21 % Change | 12M’21- 12M’20 % Change | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earned premiums | $ | 1,705.7 | $ | 1,688.5 | $ | 1,677.4 | $ | 1,648.7 | $ | 1,643.2 | $ | 1,633.2 | $ | 1,568.1 | $ | 1,597.7 | $ | 6,720.3 | $ | 6,442.2 | 3.8 | % | 1.0 | % | 4.3 | % | ||||||||||||||||||||||||||
Fees and other income | 278.9 | 274.5 | 260.4 | 213.6 | 173.8 | 171.8 | 200.6 | 349.2 | 1,027.4 | 895.4 | 60.5 | % | 1.6 | % | 14.7 | % | ||||||||||||||||||||||||||||||||||||
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Total net earned premiums, fees and other income | 1,984.6 | 1,963.0 | 1,937.8 | 1,862.3 | 1,817.0 | 1,805.0 | 1,768.7 | 1,946.9 | 7,747.7 | 7,337.6 | 9.2 | % | 1.1 | % | 5.6 | % | ||||||||||||||||||||||||||||||||||||
Net investment income | 52.6 | 48.5 | 49.4 | 50.8 | 50.8 | 44.6 | 44.2 | 54.7 | 201.3 | 194.3 | 3.5 | % | 8.5 | % | 3.6 | % | ||||||||||||||||||||||||||||||||||||
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Total revenues | 2,037.2 | 2,011.5 | 1,987.2 | 1,913.1 | 1,867.8 | 1,849.6 | 1,812.9 | 2,001.6 | 7,949.0 | 7,531.9 | 9.1 | % | 1.3 | % | 5.5 | % | ||||||||||||||||||||||||||||||||||||
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Benefits, losses and expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Policyholder benefits | 325.8 | 335.1 | 344.8 | 327.4 | 367.9 | 365.4 | 343.1 | 336.2 | 1,333.1 | 1,412.6 | (11.4 | )% | (2.8 | )% | (5.6 | )% | ||||||||||||||||||||||||||||||||||||
Selling, underwriting, general and administrative expenses | 1,552.7 | 1,499.9 | 1,456.4 | 1,392.7 | 1,362.7 | 1,333.6 | 1,294.4 | 1,491.6 | 5,901.7 | 5,482.3 | 13.9 | % | 3.5 | % | 7.7 | % | ||||||||||||||||||||||||||||||||||||
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Total benefits, losses and expenses | 1,878.5 | 1,835.0 | 1,801.2 | 1,720.1 | 1,730.6 | 1,699.0 | 1,637.5 | 1,827.8 | 7,234.8 | 6,894.9 | 8.5 | % | 2.4 | % | 4.9 | % | ||||||||||||||||||||||||||||||||||||
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Global Lifestyle Adjusted EBITDA | $ | 158.7 | $ | 176.5 | $ | 186.0 | $ | 193.0 | $ | 137.2 | $ | 150.6 | $ | 175.4 | $ | 173.8 | $ | 714.2 | $ | 637.0 | 15.7 | % | (10.1 | )% | 12.1 | % | ||||||||||||||||||||||||||
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Adjusted EBITDA margin(1) | 8.0 | % | 9.0 | % | 9.6 | % | 10.4 | % | 7.6 | % | 8.3 | % | 9.9 | % | 8.9 | % | 9.2 | % | 8.7 | % | 40 bps | (100 | )bps | 50 | bps | |||||||||||||||||||||||||||
Supplemental financial information: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | $ | 24.7 | 27.8 | 37.8 | 40.2 | 26.1 | 26.3 | 36.5 | 38.2 | 130.5 | 127.1 | (5.4 | )% | (11.2 | )% | 2.7 | % | |||||||||||||||||||||||||||||||||||
Effective tax rate | 18.6 | % | 18.3 | % | 23.4 | % | 23.7 | % | 22.9 | % | 19.8 | % | 23.1 | % | 24.0 | % | 21.2 | % | 22.5 | % | (430 | )bps | 30 | bps | (130 | )bps | ||||||||||||||||||||||||||
Depreciation expense | $ | 11.5 | 10.0 | 9.2 | 9.0 | 8.9 | 7.5 | 7.2 | 5.9 | 39.7 | 29.5 | 29.2 | % | 15.0 | % | 34.6 | % | |||||||||||||||||||||||||||||||||||
Amortization of purchased intangible assets | $ | 14.7 | 14.7 | 15.2 | 14.7 | 14.3 | 10.2 | 9.9 | 8.8 | 59.3 | 43.2 | 2.8 | % | — | % | 37.3 | % | |||||||||||||||||||||||||||||||||||
Real estate joint venture partnerships (loss) income from sales and depreciation expense, pre-tax | $ | (2.4 | ) | $ | (2.7 | ) | $ | 5.2 | $ | (4.2 | ) | $ | (0.8 | ) | $ | (1.1 | ) | $ | (0.8 | ) | $ | (1.3 | ) | $ | (4.1 | ) | $ | (4.0 | ) | (200.0 | )% | 11.1 | % | (2.5 | )% | |||||||||||||||||
Key Metrics: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Global mobile devices protected (in millions)(2) | 62.8 | 53.2 | 53.1 | 53.7 | 53.1 | 52.6 | 51.9 | 53.2 | 62.8 | 53.1 | 18.3 | % | 18.0 | % | 18.3 | % | ||||||||||||||||||||||||||||||||||||
Global mobile devices serviced (in millions)(3) | 7.2 | 6.3 | 6.1 | 6.0 | 3.6 | 2.2 | 1.9 | 2.6 | 25.6 | 10.3 | 100.0 | % | 14.3 | % | 148.5 | % | ||||||||||||||||||||||||||||||||||||
Global protected vehicles (in millions)(4) | 53.8 | 52.4 | 50.7 | 50.2 | 49.1 | 48.4 | 48.1 | 48.0 | 53.8 | 49.1 | 9.6 | % | 2.7 | % | 9.6 | % | ||||||||||||||||||||||||||||||||||||
Investment yield | 3.10 | % | 2.86 | % | 3.03 | % | 3.14 | % | 3.09 | % | 2.84 | % | 2.94 | % | 3.61 | % | 3.02 | % | 3.09 | % | 1 | bps | 24 | bps | (7 | )bps |
(1) | Equals Adjusted EBITDA divided by total net earned premiums, fees and other income. |
(2) | Global mobile devices protected includes insurance and upgrade contracts inforce for mobile phones, tablets, e-readers and accessories. In 1Q 2021, we reduced the global covered mobile device count, reflecting an adjustment to the data for certain countries. Prior periods were revised to reflect this adjustment. |
(3) | Global mobile devices serviced includes number of devices for which we provide value to our consumers and partners, through trade-ins and upgrades, technology, claims fulfillment, repair capabilities, logistics, and asset disposition. 2020 includes one month (December) of the HYLA Mobile acquisition. |
(4) | Global protected vehicles includes insurance and service contracts inforce for vehicles, RVs, powersports and ancillary products. |
4
Global Lifestyle (continued)
Condensed Statements of Operations and Selected Data
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 | 4Q21- 3Q21 | 12M’21- 12M’20 | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | % Change | % Change | % Change | |||||||||||||||||||||||||||||||||||||||
Net written premiums: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Connected Living(1) | $ | 883.5 | $ | 825.0 | $ | 824.4 | $ | 841.9 | $ | 860.1 | $ | 853.3 | $ | 737.1 | $ | 860.4 | $ | 3,374.8 | $ | 3,310.9 | 2.7 | % | 7.1 | % | 1.9 | % | ||||||||||||||||||||||||||
Global Automotive | 1,009.6 | 1,182.4 | 1,253.2 | 923.1 | 884.4 | 1,058.2 | 744.6 | 860.4 | 4,368.3 | 3,547.6 | 14.2 | % | (14.6 | )% | 23.1 | % | ||||||||||||||||||||||||||||||||||||
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Total | $ | 1,893.1 | $ | 2,007.4 | $ | 2,077.6 | $ | 1,765.0 | $ | 1,744.5 | $ | 1,911.5 | $ | 1,481.7 | $ | 1,720.8 | $ | 7,743.1 | $ | 6,858.5 | 8.5 | % | (5.7 | )% | 12.9 | % | ||||||||||||||||||||||||||
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Net earned premiums, fees and other income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Connected Living(1) | $ | 1,082.8 | $ | 1,095.9 | $ | 1,082.2 | $ | 1,049.9 | $ | 1,015.0 | $ | 1,002.5 | $ | 1,013.3 | $ | 1,193.8 | $ | 4,310.8 | $ | 4,224.6 | 6.7 | % | (1.2 | )% | 2.0 | % | ||||||||||||||||||||||||||
Global Automotive | 901.8 | 867.1 | 855.6 | 812.4 | 802.0 | 802.5 | 755.4 | 753.1 | 3,436.9 | 3,113.0 | 12.4 | % | 4.0 | % | 10.4 | % | ||||||||||||||||||||||||||||||||||||
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Total | $ | 1,984.6 | $ | 1,963.0 | $ | 1,937.8 | $ | 1,862.3 | $ | 1,817.0 | $ | 1,805.0 | $ | 1,768.7 | $ | 1,946.9 | $ | 7,747.7 | $ | 7,337.6 | 9.2 | % | 1.1 | % | 5.6 | % | ||||||||||||||||||||||||||
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Adjusted EBITDA: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Connected Living(1) | $ | 84.3 | $ | 107.7 | $ | 115.8 | $ | 122.0 | $ | 78.2 | $ | 93.3 | $ | 116.7 | $ | 115.7 | $ | 429.8 | $ | 403.9 | 7.8 | % | (21.7 | )% | 6.4 | % | ||||||||||||||||||||||||||
Global Automotive | 74.4 | 68.8 | 70.2 | 71.0 | 59.0 | 57.3 | 58.7 | 58.1 | 284.4 | 233.1 | 26.1 | % | 8.1 | % | 22.0 | % | ||||||||||||||||||||||||||||||||||||
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Total | $ | 158.7 | $ | 176.5 | $ | 186.0 | $ | 193.0 | $ | 137.2 | $ | 150.6 | $ | 175.4 | $ | 173.8 | $ | 714.2 | $ | 637.0 | 15.7 | % | (10.1 | )% | 12.1 | % | ||||||||||||||||||||||||||
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Line of business supplemental financial information: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Connected Living(1): | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | $ | 12.1 | $ | 16.9 | $ | 23.7 | $ | 25.6 | $ | 14.9 | $ | 16.3 | $ | 24.6 | $ | 25.6 | $ | 78.3 | $ | 81.4 | (18.8 | )% | (28.4 | )% | (3.8 | )% | ||||||||||||||||||||||||||
Depreciation expense | $ | 9.2 | $ | 7.6 | $ | 7.1 | $ | 7.2 | $ | 7.4 | $ | 5.8 | $ | 6.3 | $ | 5.4 | $ | 31.1 | $ | 24.9 | 24.3 | % | 21.1 | % | 24.9 | % | ||||||||||||||||||||||||||
Amortization of purchased intangible assets | $ | 7.0 | $ | 7.0 | $ | 7.5 | $ | 7.1 | $ | 8.1 | $ | 4.2 | $ | 3.8 | $ | 3.8 | $ | 28.6 | $ | 19.9 | (13.6 | )% | — | % | 43.7 | % | ||||||||||||||||||||||||||
Global Automotive: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense | $ | 12.6 | $ | 10.9 | $ | 14.1 | $ | 14.6 | $ | 11.2 | $ | 10.0 | $ | 11.9 | $ | 12.6 | $ | 52.2 | $ | 45.7 | 12.5 | % | 15.6 | % | 14.2 | % | ||||||||||||||||||||||||||
Depreciation expense | $ | 2.3 | $ | 2.4 | $ | 2.1 | $ | 1.8 | $ | 1.5 | $ | 1.7 | $ | 0.9 | $ | 0.5 | $ | 8.6 | $ | 4.6 | 53.3 | % | (4.2 | )% | 87.0 | % | ||||||||||||||||||||||||||
Amortization of purchased intangible assets | $ | 7.7 | $ | 7.7 | $ | 7.7 | $ | 7.6 | $ | 6.2 | $ | 6.0 | $ | 6.1 | $ | 5.0 | $ | 30.7 | $ | 23.3 | 24.2 | % | — | % | 31.8 | % | ||||||||||||||||||||||||||
Foreign currency translation (“FX”) impact(2): | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earned premiums, fees and other income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Including FX impact | 9.2 | % | 8.8 | % | 9.6 | % | (4.3 | )% | (2.0 | )% | 3.2 | % | (2.2 | )% | 15.8 | % | 5.6 | % | 3.4 | % | 1,120 | bps | 40 | bps | 220 | bps | ||||||||||||||||||||||||||
FX impact | (0.5 | )% | 0.5 | % | 1.5 | % | — | % | (0.7 | )% | (1.3 | )% | (2.2 | )% | (0.8 | )% | 0.3 | % | (1.3 | )% | 20 | bps | (100 | )bps | 160 | bps | ||||||||||||||||||||||||||
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Excluding FX impact | 9.7 | % | 8.3 | % | 8.1 | % | (4.3 | )% | (1.3 | )% | 4.5 | % | — | % | 16.6 | % | 5.3 | % | 4.7 | % | 1,100 | bps | 140 | bps | 60 | bps | ||||||||||||||||||||||||||
Adjusted EBITDA: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Including FX impact | 15.7 | % | 17.2 | % | 6.0 | % | 11.0 | % | (6.1 | )% | 5.1 | % | 14.2 | % | 21.0 | % | 12.1 | % | 8.6 | % | 2,180 | bps | (150 | )bps | 350 | bps | ||||||||||||||||||||||||||
FX impact | (1.5 | )% | 0.3 | % | 0.9 | % | 1.8 | % | (1.5 | )% | (3.8 | )% | (2.0 | )% | (4.5 | )% | 0.5 | % | (2.9 | )% | — | bps | (180 | )bps | 340 | bps | ||||||||||||||||||||||||||
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Excluding FX impact | 17.2 | % | 16.9 | % | 5.2 | % | 9.2 | % | (4.6 | )% | 8.9 | % | 16.2 | % | 25.5 | % | 11.6 | % | 11.5 | % | 2,180 | bps | 30 | bps | 10 | bps | ||||||||||||||||||||||||||
Net earned premiums, fees and other income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Domestic | $ | 1,531.7 | $ | 1,502.1 | $ | 1,464.7 | $ | 1,380.6 | $ | 1,328.1 | $ | 1,335.4 | $ | 1,310.3 | $ | 1,434.5 | $ | 5,879.1 | $ | 5,408.3 | 15.3 | % | 2.0 | % | 8.7 | % | ||||||||||||||||||||||||||
International | 452.9 | 460.9 | 473.1 | 481.7 | 488.9 | 469.6 | 458.4 | 512.4 | 1,868.6 | 1,929.3 | (7.4 | )% | (1.7 | )% | (3.1 | )% | ||||||||||||||||||||||||||||||||||||
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Total | $ | 1,984.6 | $ | 1,963.0 | $ | 1,937.8 | $ | 1,862.3 | $ | 1,817.0 | $ | 1,805.0 | $ | 1,768.7 | $ | 1,946.9 | $ | 7,747.7 | $ | 7,337.6 | 9.2 | % | 1.1 | % | 5.6 | % | ||||||||||||||||||||||||||
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(1) | Effective 1Q 2022, the Connected Living line of business includes the previous Global Financial Services and Other line of business. All prior period amounts have been revised to reflect this change. |
(2) | Represents the FX impact on the percentage change in segment net earned premiums, fees and other income and segment Adjusted EBITDA that is attributed to changes in weighted average foreign currency exchange rates used in the translation of the income statement. Excludes the impact of foreign exchange transaction gains (losses) associated with the remeasurement of non-functional currencies. |
5
Global Housing
Condensed Statements of Operations and Selected Data
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 % Change | 4Q21- 3Q21 % Change | 12M’21- 12M’20 % Change | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earned premiums | $ | 470.1 | $ | 451.6 | $ | 473.2 | $ | 456.9 | $ | 459.0 | $ | 453.6 | $ | 453.2 | $ | 467.8 | $ | 1,851.8 | $ | 1,833.6 | 2.4 | % | 4.1 | % | 1.0 | % | ||||||||||||||||||||||||||
Fees and other income | 35.7 | 35.1 | 37.9 | 36.1 | 37.7 | 37.7 | 35.7 | 32.6 | 144.8 | 143.7 | (5.3 | )% | 1.7 | % | 0.8 | % | ||||||||||||||||||||||||||||||||||||
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Total net earned premiums, fees and other income | 505.8 | 486.7 | 511.1 | 493.0 | 496.7 | 491.3 | 488.9 | 500.4 | 1,996.6 | 1,977.3 | 1.8 | % | 3.9 | % | 1.0 | % | ||||||||||||||||||||||||||||||||||||
Net investment income | 17.7 | 20.2 | 23.7 | 19.4 | 17.9 | 16.5 | 16.4 | 22.0 | 81.0 | 72.8 | (1.1 | )% | (12.4 | )% | 11.3 | % | ||||||||||||||||||||||||||||||||||||
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Total revenues | 523.5 | 506.9 | 534.8 | 512.4 | 514.6 | 507.8 | 505.3 | 522.4 | 2,077.6 | 2,050.1 | 1.7 | % | 3.3 | % | 1.3 | % | ||||||||||||||||||||||||||||||||||||
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Benefits, losses and expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Policyholder benefits | 188.7 | 279.1 | 193.5 | 201.3 | 200.2 | 272.8 | 180.4 | 198.7 | 862.6 | 852.1 | (5.7 | )% | (32.4 | )% | 1.2 | % | ||||||||||||||||||||||||||||||||||||
Selling, underwriting, general and administrative expenses | 224.1 | 217.7 | 213.3 | 217.6 | 228.5 | 211.0 | 208.9 | 222.5 | 872.7 | 870.9 | (1.9 | )% | 2.9 | % | 0.2 | % | ||||||||||||||||||||||||||||||||||||
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Total benefits, losses and expenses | 412.8 | 496.8 | 406.8 | 418.9 | 428.7 | 483.8 | 389.3 | 421.2 | 1,735.3 | 1,723.0 | (3.7 | )% | (16.9 | )% | 0.7 | % | ||||||||||||||||||||||||||||||||||||
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Global Housing Adjusted EBITDA | 110.7 | 10.1 | 128.0 | 93.5 | 85.9 | 24.0 | 116.0 | 101.2 | 342.3 | 327.1 | 28.9 | % | 996.0 | % | 4.6 | % | ||||||||||||||||||||||||||||||||||||
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Reportable catastrophes(1) | 1.3 | 98.7 | 0.5 | 43.6 | 34.7 | 110.1 | 12.8 | 16.1 | 144.1 | 173.7 | (96.3 | )% | (98.7 | )% | (17.0 | )% | ||||||||||||||||||||||||||||||||||||
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Global Housing Adjusted EBITDA, excluding reportable catastrophes(2) | $ | 112.0 | $ | 108.8 | $ | 128.5 | $ | 137.1 | $ | 120.6 | $ | 134.1 | $ | 128.8 | $ | 117.3 | $ | 486.4 | $ | 500.8 | (7.1 | )% | 2.9 | % | (2.9 | )% | ||||||||||||||||||||||||||
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Adjusted EBITDA margin(3) | 21.9 | % | 2.1 | % | 25.0 | % | 19.0 | % | 17.3 | % | 4.9 | % | 23.7 | % | 20.2 | % | 17.1 | % | 16.5 | % | 460 | bps | 1,980 | bps | 60 | bps | ||||||||||||||||||||||||||
Supplemental financial information: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax expense (benefit) | $ | 22.7 | $ | (0.5 | ) | $ | 25.8 | $ | 17.4 | $ | 16.9 | $ | 2.9 | $ | 22.2 | $ | 19.3 | $ | 65.4 | $ | 61.3 | 34.3 | % | 4,640.0 | % | 6.7 | % | |||||||||||||||||||||||||
Effective tax rate | 22.0 | % | (18.5 | )% | 21.6 | % | 20.5 | % | 21.7 | % | 18.1 | % | 20.6 | % | 20.6 | % | 21.1 | % | 20.8 | % | 40 | bps | 4,060 | bps | 30 | bps | ||||||||||||||||||||||||||
Depreciation expense | $ | 6.6 | 6.4 | 6.4 | 6.4 | 5.5 | 5.7 | 6.0 | 5.3 | $ | 25.8 | $ | 22.5 | 20.0 | % | 3.1 | % | 14.7 | % | |||||||||||||||||||||||||||||||||
Amortization of purchased intangible assets | $ | 1.1 | 1.0 | 2.1 | 2.3 | 2.4 | 2.3 | 2.4 | 2.4 | $ | 6.5 | $ | 9.5 | (54.2 | )% | 10.0 | % | (31.6 | )% | |||||||||||||||||||||||||||||||||
Real estate joint venture partnerships (loss) income from sales and depreciation expense, pre-tax | $ | (1.1 | ) | $ | (0.7 | ) | $ | 4.5 | $ | (1.2 | ) | $ | (0.1 | ) | $ | (0.5 | ) | $ | (0.4 | ) | $ | (0.6 | ) | $ | 1.5 | $ | (1.6 | ) | (1,000.0 | )% | (57.1 | )% | 193.8 | % | ||||||||||||||||||
Net earned premiums, fees and other income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Lender-placed Insurance | $ | 275.0 | $ | 256.2 | $ | 274.3 | $ | 260.4 | $ | 265.0 | $ | 258.2 | $ | 265.0 | $ | 264.3 | $ | 1,065.9 | $ | 1,052.5 | 3.8 | % | 7.3 | % | 1.3 | % | ||||||||||||||||||||||||||
Multifamily Housing | 121.1 | 121.7 | 122.1 | 117.4 | 113.5 | 117.9 | 111.2 | 109.0 | 482.3 | 451.6 | 6.7 | % | (0.5 | )% | 6.8 | % | ||||||||||||||||||||||||||||||||||||
Specialty and Other | 109.7 | 108.8 | 114.7 | 115.2 | 118.2 | 115.2 | 112.7 | 127.1 | 448.4 | 473.2 | (7.2 | )% | 0.8 | % | (5.2 | )% | ||||||||||||||||||||||||||||||||||||
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Total | $ | 505.8 | $ | 486.7 | $ | 511.1 | $ | 493.0 | $ | 496.7 | $ | 491.3 | $ | 488.9 | $ | 500.4 | $ | 1,996.6 | $ | 1,977.3 | 1.8 | % | 3.9 | % | 1.0 | % | ||||||||||||||||||||||||||
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Gross earned premiums | $ | 740.1 | $ | 726.4 | $ | 733.6 | $ | 712.8 | $ | 710.5 | $ | 703.0 | $ | 710.8 | $ | 712.7 | $ | 2,912.9 | $ | 2,837.0 | 4.2 | % | 1.9 | % | 2.7 | % | ||||||||||||||||||||||||||
Gross written premiums | $ | 734.7 | $ | 774.9 | $ | 836.2 | $ | 596.5 | $ | 692.8 | $ | 772.3 | $ | 802.5 | $ | 600.9 | $ | 2,942.3 | $ | 2,868.5 | 6.0 | % | (5.2 | )% | 2.6 | % | ||||||||||||||||||||||||||
Reconciliation of gross earned premiums to net earned premiums: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross earned premiums | $ | 740.1 | $ | 726.4 | $ | 733.6 | $ | 712.8 | $ | 710.5 | $ | 703.0 | $ | 710.8 | $ | 712.7 | $ | 2,912.9 | $ | 2,837.0 | 4.2 | % | 1.9 | % | 2.7 | % | ||||||||||||||||||||||||||
Ceded catastrophe reinsurance(4) | (34.6 | ) | (43.6 | ) | (35.6 | ) | (35.5 | ) | (32.9 | ) | (31.4 | ) | (41.1 | ) | (32.2 | ) | (149.3 | ) | (137.6 | ) | (5.2 | )% | 20.6 | % | (8.5 | )% | ||||||||||||||||||||||||||
Ceded to U.S. Government | (132.4 | ) | (133.0 | ) | (132.4 | ) | (129.8 | ) | (132.2 | ) | (133.7 | ) | (134.7 | ) | (133.6 | ) | (527.6 | ) | (534.2 | ) | (0.2 | )% | 0.5 | % | 1.2 | % | ||||||||||||||||||||||||||
Ceded to clients | (103.0 | ) | (98.2 | ) | (92.4 | ) | (90.6 | ) | (86.4 | ) | (84.3 | ) | (81.8 | ) | (79.1 | ) | (384.2 | ) | (331.6 | ) | (19.2 | )% | (4.9 | )% | (15.9 | )% | ||||||||||||||||||||||||||
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Net earned premiums | $ | 470.1 | $ | 451.6 | $ | 473.2 | $ | 456.9 | $ | 459.0 | $ | 453.6 | $ | 453.2 | $ | 467.8 | $ | 1,851.8 | $ | 1,833.6 | 2.4 | % | 4.1 | % | 1.0 | % | ||||||||||||||||||||||||||
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Key Metrics: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Global Housing loss ratio(5) | 40.1 | % | 61.8 | % | 40.9 | % | 44.1 | % | 43.6 | % | 60.1 | % | 39.8 | % | 42.5 | % | 46.6 | % | 46.5 | % | (350) | bps | (2,170) | bps | 10 | bps | ||||||||||||||||||||||||||
Global Housing expense ratio(6) | 45.8 | % | 46.3 | % | 43.4 | % | 45.9 | % | 47.6 | % | 44.6 | % | 44.4 | % | 46.0 | % | 45.3 | % | 45.7 | % | (180) | bps | (40) | bps | (30) | bps | ||||||||||||||||||||||||||
Global Housing combined ratio(7) | 83.1 | % | 103.6 | % | 81.3 | % | 86.7 | % | 87.9 | % | 100.1 | % | 81.3 | % | 85.7 | % | 88.5 | % | 88.8 | % | (480) | bps | (2,050) | bps | (20) | bps | ||||||||||||||||||||||||||
Global Housing annualized ROE(8) | 22.3 | % | 0.9 | % | 25.2 | % | 17.9 | % | 15.8 | % | 3.3 | % | 21.6 | % | 18.8 | % | 16.5 | % | 15.0 | % | 650 | bps | 2,140 | bps | 150 | bps | ||||||||||||||||||||||||||
Investment yield | 3.21 | % | 3.62 | % | 4.26 | % | 3.46 | % | 3.17 | % | 2.90 | % | 2.94 | % | 3.94 | % | 3.64 | % | 3.23 | % | 4 | bps | (41) | bps | 41 | bps |
(1) | Represents individual catastrophic events that generate losses in excess of $5.0 million, pre-tax, net of reinsurance and client profit sharing adjustments and including reinstatement and other premiums. |
(2) | Represents a non-GAAP financial measure because it excludes reportable catastrophes. |
(3) | Equals Adjusted EBITDA divided by total net earned premiums, fees and other income. |
(4) | All periods reflect catastrophe reinsurance premiums. |
(5) | Equals policyholder benefits divided by net earned premiums. |
(6) | Equals selling, underwriting, general and administrative expenses plus depreciation expense and amortization of purchased intangible assets divided by net earned premiums, fees and other income. |
(7) | Equals total benefits, losses and expenses plus depreciation expense and amortization of purchased intangible assets divided by net earned premiums, fees and other income. Income from processing National Flood Insurance Program claims is reported as a reduction in expenses and is included in the combined ratio. |
(8) | Equals Global Housing Adjusted EBITDA (including reportable catastrophes) less income tax expense, depreciation expense and amortization of purchased intangible assets, all annualized, divided by average stockholders’ equity. |
6
Global Housing (continued)
Condensed Statements of Operations and Selected Data
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 | 4Q21- 3Q21 | 12M’21- 12M’20 | |||||||||||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | % Change | % Change | % Change | ||||||||||||||||||||||||||||||||||||||||
Lender-placed Insurance: Loans tracked (in millions) | 30.4 | 30.3 | 30.1 | 31.6 | 31.9 | 31.8 | 32.2 | 32.4 | 30.4 | 31.9 | (4.7 | )% | 0.3 | % | (4.7 | )% | ||||||||||||||||||||||||||||||||||||
Lender-placed Insurance: Average placement rates | 1.63 | % | 1.62 | % | 1.60 | % | 1.60 | % | 1.59 | % | 1.58 | % | 1.56 | % | 1.54 | % | 1.63 | % | 1.59 | % | 4 | bps | 1 | bps | 4 | bps | ||||||||||||||||||||||||||
Lender-placed Insurance: Average insured value (“AIV”) (in thousands) | $ | 214 | $ | 209 | $ | 206 | $ | 204 | $ | 202 | $ | 196 | $ | 196 | $ | 192 | $ | 214 | $ | 202 | 5.9 | % | 2.4 | % | 5.9 | % | ||||||||||||||||||||||||||
Renters policies (in millions) | 2.581 | 2.556 | 2.527 | 2.460 | 2.404 | 2.392 | 2.342 | 2.265 | 2.581 | 2.404 | 7.4 | % | 1.0 | % | 7.4 | % | ||||||||||||||||||||||||||||||||||||
% Spread of exposure(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Region Name | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Middle U.S. states | 11.5 | % | 11.6 | % | 11.8 | % | 11.8 | % | 11.9 | % | 12.1 | % | 12.3 | % | 12.3 | % | 11.5 | % | 11.9 | % | (40 | )bps | (10 | )bps | (40 | )bps | ||||||||||||||||||||||||||
Northeastern coastal exposure | 17.8 | % | 18.0 | % | 17.7 | % | 18.1 | % | 18.2 | % | 18.0 | % | 18.0 | % | 18.2 | % | 17.8 | % | 18.2 | % | (40 | )bps | (20 | )bps | (40 | )bps | ||||||||||||||||||||||||||
Northern inland exposure | 7.8 | % | 7.8 | % | 7.9 | % | 7.9 | % | 7.9 | % | 7.9 | % | 8.0 | % | 7.9 | % | 7.8 | % | 7.9 | % | (10 | )bps | — | bps | (10 | )bps | ||||||||||||||||||||||||||
Southern inland exposure | 12.9 | % | 12.9 | % | 13.0 | % | 12.9 | % | 12.9 | % | 13.1 | % | 13.2 | % | 13.0 | % | 12.9 | % | 12.9 | % | — | bps | 0bps | — | bps | |||||||||||||||||||||||||||
Southern and HI coastal exposure | 23.3 | % | 23.7 | % | 23.9 | % | 24.1 | % | 24.2 | % | 24.4 | % | 24.4 | % | 25.0 | % | 23.3 | % | 24.2 | % | (90 | )bps | (40 | )bps | (90 | )bps | ||||||||||||||||||||||||||
Western U.S. states | 26.7 | % | 26.0 | % | 25.7 | % | 25.2 | % | 24.9 | % | 24.5 | % | 24.1 | % | 23.6 | % | 26.7 | % | 24.9 | % | 18 | 0bps | 7 | 0bps | 180 | bps | ||||||||||||||||||||||||||
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Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||||||||||||||||||
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![]() | ![]() |
(1) | Geographical spread of exposure is based on the company’s assessment of total insured value for all of Global Housing. |
7
Total Corporate and Other
Condensed Statements of Operations and Selected Data
(Unaudited)
2021 | 2020 | Twelve Months | 4Q21- 4Q20 | 4Q21- 3Q21 | 12M’21- 12M’20 | |||||||||||||||||||||||||||||||||||||||||||||||
($ in millions) | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | % Change | % Change | % Change | |||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earned premiums | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | N/A | N/A | N/A | |||||||||||||||||||||||||||||
Fees and other income | 0.1 | — | 0.1 | 0.1 | 1.1 | (0.6 | ) | — | — | 0.3 | 0.5 | (90.9 | )% | N/A | (40.0 | )% | ||||||||||||||||||||||||||||||||||||
Net investment income | 8.8 | 7.3 | 9.7 | 6.1 | 4.4 | 2.0 | 4.5 | 6.7 | 31.9 | 17.6 | 100.0 | % | 20.5 | % | 81.3 | % | ||||||||||||||||||||||||||||||||||||
Net realized gains (losses) on investments and fair value changes to equity securities | (0.1 | ) | — | — | (0.1 | ) | 0.1 | 0.1 | — | 1.0 | (0.2 | ) | 1.2 | (200.0 | )% | N/A | (116.7 | )% | ||||||||||||||||||||||||||||||||||
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Total revenues | 8.8 | 7.3 | 9.8 | 6.1 | 5.6 | 1.5 | 4.5 | 7.7 | 32.0 | 19.3 | 57.1 | % | 20.5 | % | 65.8 | % | ||||||||||||||||||||||||||||||||||||
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Benefits, losses and expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Policyholder benefits | — | — | — | — | (0.4 | ) | 0.2 | — | 0.2 | — | — | 100.0 | % | N/A | N/A | |||||||||||||||||||||||||||||||||||||
Selling, underwriting, general and administrative expenses | 34.3 | 30.3 | 26.7 | 34.0 | 36.3 | 34.3 | 38.3 | 34.8 | 125.3 | 143.7 | (5.5 | )% | 13.2 | % | (12.8 | )% | ||||||||||||||||||||||||||||||||||||
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Total benefits, losses and expenses | 34.3 | 30.3 | 26.7 | 34.0 | 35.9 | 34.5 | 38.3 | 35.0 | 125.3 | 143.7 | (4.5 | )% | 13.2 | % | (12.8 | )% | ||||||||||||||||||||||||||||||||||||
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Corporate and Other Adjusted EBITDA | $ | (25.5 | ) | $ | (23.0 | ) | $ | (16.9 | ) | $ | (27.9 | ) | $ | (30.3 | ) | $ | (33.0 | ) | $ | (33.8 | ) | $ | (27.3 | ) | $ | (93.3 | ) | $ | (124.4 | ) | 15.8 | % | (10.9 | )% | 25.0 | % | ||||||||||||||||
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Supplemental financial information: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | $ | 27.1 | $ | 27.5 | $ | 28.8 | $ | 28.4 | $ | 26.8 | $ | 25.5 | $ | 26.7 | $ | 25.5 | $ | 111.8 | $ | 104.5 | 1.1 | % | (1.5 | )% | 7.0 | % | ||||||||||||||||||||||||||
Income tax benefit | $ | (12.3 | ) | $ | 10.6 | $ | (11.7 | ) | $ | (13.0 | ) | $ | (3.2 | ) | $ | (4.7 | ) | $ | (14.1 | ) | $ | (106.0 | ) | $ | (26.4 | ) | $ | (128.0 | ) | (284.4 | )% | (216.0 | )% | 79.4 | % | |||||||||||||||||
Depreciation expense | $ | 3.3 | $ | 1.7 | $ | 1.9 | $ | 1.4 | $ | 1.1 | $ | 0.7 | $ | 1.1 | $ | 1.2 | $ | 8.3 | $ | 4.1 | 200.0 | % | 94.1 | % | 102.4 | % |
8
Assurant, Inc.
Segment Condensed Balance Sheets
(Unaudited)
As of December 31, 2021 | As of December 31, 2020 | |||||||||||||||||||||||||||||||
Global Lifestyle | Global Housing | Corporate and Other(1) | Consolidated | Global Lifestyle | Global Housing | Corporate and Other(1) | Consolidated | |||||||||||||||||||||||||
($ in millions) | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||
Investments and cash and cash equivalents | $ | 6,830.0 | $ | 2,208.5 | $ | 1,673.9 | $ | 10,712.4 | $ | 6,725.4 | $ | 2,248.6 | $ | 1,456.4 | $ | 10,430.4 | ||||||||||||||||
Reinsurance recoverables(2) | 4,917.9 | 821.9 | 439.1 | 6,178.9 | 4,593.7 | 694.8 | 1,316.9 | 6,605.4 | ||||||||||||||||||||||||
Deferred acquisition costs | 8,654.2 | 156.8 | — | 8,811.0 | 7,236.0 | 152.2 | (0.2 | ) | 7,388.0 | |||||||||||||||||||||||
Goodwill | 2,192.1 | 379.5 | — | 2,571.6 | 2,209.8 | 379.5 | — | 2,589.3 | ||||||||||||||||||||||||
Value of business acquired | 583.4 | — | — | 583.4 | 1,152.2 | — | — | 1,152.2 | ||||||||||||||||||||||||
Assets held in separate accounts | — | — | 11.9 | �� | 11.9 | — | — | 11.5 | 11.5 | |||||||||||||||||||||||
Other assets | 3,032.4 | 564.5 | 368.5 | 3,965.4 | 2,443.7 | 539.2 | 271.5 | 3,254.4 | ||||||||||||||||||||||||
Assets held for sale | — | — | 1,076.9 | 1,076.9 | — | — | 13,218.7 | 13,218.7 | ||||||||||||||||||||||||
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Total assets | $ | 26,210.0 | $ | 4,131.2 | $ | 3,570.3 | $ | 33,911.5 | $ | 24,360.8 | $ | 4,014.3 | $ | 16,274.8 | $ | 44,649.9 | ||||||||||||||||
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Liabilities | ||||||||||||||||||||||||||||||||
Policyholder benefits and claims payable(2) | $ | 788.3 | $ | 764.7 | $ | 456.1 | $ | 2,009.1 | $ | 819.6 | $ | 651.9 | $ | 1,497.3 | $ | 2,968.8 | ||||||||||||||||
Unearned premiums | 17,102.0 | 1,516.0 | 5.7 | 18,623.7 | 15,818.0 | 1,467.4 | 7.7 | 17,293.1 | ||||||||||||||||||||||||
Debt | — | — | 2,202.5 | 2,202.5 | — | — | 2,252.9 | 2,252.9 | ||||||||||||||||||||||||
Liabilities related to separate accounts | — | — | 11.9 | 11.9 | — | — | 11.5 | 11.5 | ||||||||||||||||||||||||
Accounts payable and other liabilities | 3,722.0 | 404.7 | 383.1 | 4,509.8 | 3,205.7 | 379.9 | 471.9 | 4,057.5 | ||||||||||||||||||||||||
Liabilities held for sale | — | — | 1,064.8 | 1,064.8 | — | — | 12,111.3 | 12,111.3 | ||||||||||||||||||||||||
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| |||||||||||||||||
Total liabilities | 21,612.3 | 2,685.4 | 4,124.1 | 28,421.8 | 19,843.3 | 2,499.2 | 16,352.6 | 38,695.1 | ||||||||||||||||||||||||
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Stockholders’ equity | ||||||||||||||||||||||||||||||||
Equity, excluding accumulated other comprehensive (loss) income | 4,597.7 | 1,445.8 | (403.8 | ) | 5,639.7 | 4,517.5 | 1,515.1 | (791.0 | ) | 5,241.6 | ||||||||||||||||||||||
Accumulated other comprehensive (loss) income |
| — |
| — | (150.0 | ) | (150.0 | ) | — | — | 709.8 | 709.8 | ||||||||||||||||||||
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Total Assurant, Inc. stockholders’ equity | 4,597.7 | 1,445.8 | (553.8 | ) | 5,489.7 | 4,517.5 | 1,515.1 | (81.2 | ) | 5,951.4 | ||||||||||||||||||||||
Non-controlling interest | — | — | — | — | — | — | 3.4 | 3.4 | ||||||||||||||||||||||||
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Total equity | 4,597.7 | 1,445.8 | (553.8 | ) | 5,489.7 | 4,517.5 | 1,515.1 | (77.8 | ) | 5,954.8 | ||||||||||||||||||||||
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Total liabilities and equity | $ | 26,210.0 | $ | 4,131.2 | $ | 3,570.3 | $ | 33,911.5 | $ | 24,360.8 | $ | 4,014.3 | $ | 16,274.8 | $ | 44,649.9 | ||||||||||||||||
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(1) | Corporate and Other includes all accumulated other comprehensive income (loss), reinsurance recoverables and separate accounts related to the sale of businesses by reinsurance. Additionally, the Corporate and Other segment includes amounts related to the Assurant Health business, which is in runoff. |
(2) | Global Housing’s reinsurance recoverables and policyholder benefits and claims payable as of December 31, 2021 and 2020 include $144 million and $96 million, respectively, of balances ceded to the U.S. government. Assurant acts as an administrator for the U.S. government under the voluntary National Flood Insurance Program. |
9
Assurant, Inc.
Investments
(Unaudited)
($ in millions) | As of December 31, 2021 | As of December 31, 2020 | ||||||||||||||||||
Investments by type | ||||||||||||||||||||
Fixed maturity securities available for sale, at fair value | $ | 7,215.3 | 67.4 | % | $ | 6,815.5 | 65.3 | % | ||||||||||||
Equity securities, at fair value | ||||||||||||||||||||
Preferred stock | 261.3 | 2.4 | % | 232.7 | 2.2 | % | ||||||||||||||
Common stock | 151.1 | 1.4 | % | 15.2 | 0.2 | % | ||||||||||||||
Mutual funds | 33.3 | 0.3 | % | 42.3 | 0.4 | % | ||||||||||||||
Commercial mortgage whole loans on real estate, at amortized cost | 256.5 | 2.4 | % | 138.3 | 1.3 | % | ||||||||||||||
Short-term investments | 247.8 | 2.3 | % | 292.0 | 2.8 | % | ||||||||||||||
Other investments | 506.3 | 4.7 | % | 686.8 | 6.6 | % | ||||||||||||||
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Total investments | 8,671.6 | 80.9 | % | 8,222.8 | 78.8 | % | ||||||||||||||
Cash and cash equivalents | 2,040.8 | 19.1 | % | 2,207.6 | 21.2 | % | ||||||||||||||
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Total investments and cash and cash equivalents | $ | 10,712.4 | 100.0 | % | $ | 10,430.4 | 100.0 | % | ||||||||||||
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Fixed Maturity Securities by Credit Quality (Fair Value) | ||||||||||||||||||||
Aaa / Aa / A | $ | 4,066.5 | 56.4 | % | $ | 4,051.3 | 59.5 | % | ||||||||||||
Baa | 2,719.0 | 37.7 | % | 2,288.1 | 33.6 | % | ||||||||||||||
Ba | 333.7 | 4.6 | % | 384.4 | 5.6 | % | ||||||||||||||
B and lower | 96.1 | 1.3 | % | 91.7 | 1.3 | % | ||||||||||||||
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Total | $ | 7,215.3 | 100.0 | % | $ | 6,815.5 | 100.0 | % | ||||||||||||
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10
Assurant, Inc.
Investments (continued)
(Unaudited)
As of December 31, 2021 | As of December 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||
($ in millions) | Book Value | Allowance for credit losses | Fair Value | % of Fair Value | Net Unrealized Gain (Loss) | Book Value | Allowance for credit losses | Fair Value | % of Fair Value | Net Unrealized Gain (Loss) | ||||||||||||||||||||||||||||||||||
Fixed Maturity Securities by Issuer Type: | ||||||||||||||||||||||||||||||||||||||||||||
Government: | ||||||||||||||||||||||||||||||||||||||||||||
U.S. Government and government agencies and authorities | $ | 83.0 | $ | — | $ | 85.0 | 1.2 | % | $ | 2.0 | $ | 90.4 | $ | — | $ | 94.1 | 1.4 | % | $ | 3.7 | ||||||||||||||||||||||||
States, municipalities and political subdivisions | 142.2 | — | 148.5 | 2.1 | % | 6.3 | 164.4 | — | 175.3 | 2.6 | % | 10.9 | ||||||||||||||||||||||||||||||||
Foreign governments | 436.0 | — | 437.7 | 6.1 | % | 1.7 | 442.4 | — | 469.7 | 6.9 | % | 27.3 | ||||||||||||||||||||||||||||||||
Corporate(1): | ||||||||||||||||||||||||||||||||||||||||||||
Canadian municipals | 22.2 | — | 22.9 | 0.3 | % | 0.7 | 16.6 | — | 18.1 | 0.3 | % | 1.5 | ||||||||||||||||||||||||||||||||
Consumer cyclical | 435.3 | — | 462.7 | 6.4 | % | 27.4 | 406.6 | — | 454.2 | 6.7 | % | 47.6 | ||||||||||||||||||||||||||||||||
Consumer non-cyclical | 263.5 | — | 277.3 | 3.8 | % | 13.8 | 251.6 | — | 277.5 | 4.1 | % | 25.9 | ||||||||||||||||||||||||||||||||
Energy | 318.5 | — | 337.3 | 4.7 | % | 18.8 | 296.3 | — | 319.3 | 4.7 | % | 23.0 | ||||||||||||||||||||||||||||||||
Financials | 1,624.3 | — | 1,706.4 | 23.6 | % | 82.1 | 1,459.0 | — | 1,610.1 | 23.6 | % | 151.1 | ||||||||||||||||||||||||||||||||
Health care | 354.0 | — | 367.5 | 5.1 | % | 13.5 | 346.6 | — | 376.0 | 5.5 | % | 29.4 | ||||||||||||||||||||||||||||||||
Industrials | 542.6 | — | 577.0 | 8.0 | % | 34.4 | 517.5 | — | 574.5 | 8.4 | % | 57.0 | ||||||||||||||||||||||||||||||||
Materials | 206.4 | — | 216.2 | 3.0 | % | 9.8 | 204.8 | (1.2 | ) | 221.4 | 3.2 | % | 17.8 | |||||||||||||||||||||||||||||||
Other | 8.3 | — | 8.2 | 0.1 | % | (0.1 | ) | 0.8 | — | 0.8 | — | % | — | |||||||||||||||||||||||||||||||
Technology | 363.8 | — | 382.3 | 5.3 | % | 18.5 | 278.6 | — | 312.2 | 4.6 | % | 33.6 | ||||||||||||||||||||||||||||||||
Telecommunications | 146.2 | — | 160.1 | 2.2 | % | 13.9 | 129.0 | — | 149.3 | 2.2 | % | 20.3 | ||||||||||||||||||||||||||||||||
Utilities | 501.4 | — | 527.6 | 7.3 | % | 26.2 | 437.2 | — | 486.5 | 7.1 | % | 49.3 | ||||||||||||||||||||||||||||||||
Asset-backed securities | 411.1 | — | 423.0 | 5.9 | % | 11.9 | 251.9 | — | 260.5 | 3.8 | % | 8.6 | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 466.7 | — | 473.7 | 6.6 | % | 7.0 | 266.3 | — | 281.4 | 4.1 | % | 15.1 | ||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 578.4 | — | 601.9 | 8.3 | % | 23.5 | 685.8 | — | 734.6 | 10.8 | % | 48.8 | ||||||||||||||||||||||||||||||||
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Total fixed maturity securities | $ | 6,903.9 | $ | — | $ | 7,215.3 | 100.0 | % | $ | 311.4 | $ | 6,245.8 | $ | (1.2 | ) | $ | 6,815.5 | 100.0 | % | $ | 570.9 | |||||||||||||||||||||||
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(1) | Industry classifications are based on a combination of published index classifications and Assurant’s view of underlying issuer risk. These resulting classifications are then mapped to the Global Industry Classification Standard (GICS®). |
11
Assurant, Inc.
Investment Results by Asset Category and Annualized Yields
(Unaudited)
Quarter Ended December 31 2021 | Quarter Ended December 31 2020 | |||||||||||||||||||||||||||
($ in millions) | Yield | Investment Income | Net realized gain (loss) | Yield | Investment Income | Net realized gain (loss) | ||||||||||||||||||||||
Fixed maturity securities, available for sale | 3.35 | % | $ | 59.5 | $ | (2.1 | ) | 3.75 | % | $ | 58.4 | $ | 6.3 | |||||||||||||||
Equity securities | 4.69 | % | 3.8 | 8.5 | 5.58 | % | 3.6 | 14.4 | ||||||||||||||||||||
Commercial mortgage loans on real estate | 5.27 | % | 3.2 | (0.2 | ) | 6.73 | % | 2.4 | (0.5 | ) | ||||||||||||||||||
Cash and short-term investments | 0.53 | % | 3.0 | 0.2 | 0.49 | % | 3.0 | 0.4 | ||||||||||||||||||||
Other investments(1) | 9.04 | % | 12.5 | (1.4 | ) | 7.09 | % | 10.1 | 9.1 | |||||||||||||||||||
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Total | 82.0 | $ | 5.0 | 77.5 | $ | 29.7 | ||||||||||||||||||||||
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Investment expenses | (2.8 | ) | (4.2 | ) | ||||||||||||||||||||||||
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Net investment income | $ | 79.2 | $ | 73.3 | ||||||||||||||||||||||||
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Gross realized gains on sales and other | $ | 5.0 | $ | — | ||||||||||||||||||||||||
Gross realized losses on sales and other | (13.9 | ) | 12.9 | |||||||||||||||||||||||||
Fair value changes to equity securities | 13.9 | 22.5 | ||||||||||||||||||||||||||
Net realized gains (losses) related to impairments | — | (5.7 | ) | |||||||||||||||||||||||||
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Net realized gains on investments and fair value changes to equity securities | $ | 5.0 | $ | 29.7 | ||||||||||||||||||||||||
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Twelve months ended December 31, 2021 | Twelve months ended December 31,2020 | |||||||||||||||||||||||||||
Yield | Investment Income | Net realized gain (loss) | Yield | Investment Income | Net realized gain (loss) | |||||||||||||||||||||||
Fixed maturity securities, available for sale | 3.55 | % | $ | 232.8 | $ | 18.4 | 3.76 | % | $ | 228.4 | $ | 10.1 | ||||||||||||||||
Equity securities | 5.15 | % | 14.9 | 84.0 | 5.64 | % | 14.5 | 5.6 | ||||||||||||||||||||
Commercial mortgage loans on real estate | 4.66 | % | 8.9 | 0.5 | 5.38 | % | 8.2 | (1.2 | ) | |||||||||||||||||||
Cash and short-term investments | 0.45 | % | 10.6 | 1.3 | 0.82 | % | 19.0 | 1.5 | ||||||||||||||||||||
Other investments(1) | 10.70 | % | 61.0 | 24.0 | 5.48 | % | 36.0 | (24.2 | ) | |||||||||||||||||||
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Total | 328.2 | $ | 128.2 | 306.1 | $ | (8.2 | ) | |||||||||||||||||||||
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Investment expenses | (13.8 | ) | (20.5 | ) | ||||||||||||||||||||||||
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Net investment income | $ | 314.4 | $ | 285.6 | ||||||||||||||||||||||||
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Gross realized gains on sales and other | $ | 48.2 | $ | 43.5 | ||||||||||||||||||||||||
Gross realized losses on sales and other | (32.6 | ) | (47.0 | ) | ||||||||||||||||||||||||
Fair value changes to equity securities | 112.4 | 15.0 | ||||||||||||||||||||||||||
Net realized gains (losses) related to impairments | 0.2 | (19.7 | ) | |||||||||||||||||||||||||
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Net realized gains (losses) on investments and fair value changes to equity securities | $ | 128.2 | $ | (8.2 | ) | |||||||||||||||||||||||
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(1) | Consists primarily of investments in joint venture partnerships, invested assets associated with a modified coinsurance agreement, invested assets associated with deferred compensation and policy loans. |
12
Assurant, Inc.
Ratings Summary(1)
(Unaudited)
As of December 31, 2021 | ||||||||||||
A.M. Best | Moody’s | Standard & Poor’s | ||||||||||
Company | ||||||||||||
American Bankers Insurance Company of Florida | A | A3 | A | |||||||||
American Bankers Life Assurance Company of Florida | A- | A3 | A | |||||||||
American Security Insurance Company | A | A3 | A | |||||||||
Caribbean American Life Assurance Company | A- | N/A | N/A | |||||||||
Caribbean American Property Insurance Company | A | N/A | N/A | |||||||||
Reliable Lloyds Insurance Company | A | N/A | N/A | |||||||||
Standard Guaranty Insurance Company | A | N/A | N/A | |||||||||
Union Security Life Insurance Company of New York | N/A | N/A | N/A | |||||||||
Virginia Surety Insurance Company | A | N/A | N/A | |||||||||
Voyager Indemnity Insurance Company | A | N/A | N/A | |||||||||
Commercial Paper | AMB-1 | P-3 | A-2 | |||||||||
Senior Debt | bbb+ | Baa3 | BBB | |||||||||
Subordinated Debt | bbb | Ba1 | BB+ |
(1) | Additional information on Assurant’s ratings is available in the Investor Relations section on Assurant’s website www.assurant.com. |
13
Regulation G - Non GAAP Financial Measures (continued)
(1) Adjusted EBITDA: Assurant uses Adjusted EBITDA as an important measure of the company’s operating performance. Assurant defines Adjusted EBITDA as net income from continuing operations, excluding net realized gains (losses) on investments and fair value changes to equity securities, COVID-19 direct and incremental expenses, loss on extinguishment of debt, net income (loss) attributable to non-controlling interests, interest expense, provision (benefit) for income taxes, depreciation expense, amortization of purchased intangible assets, restructuring costs related to strategic exit activities (outside of normal periodic restructuring and cost management activities), as well as other highly variable or unusual items. The company believes this metric provides investors with an important measure of the company’s operating performance because it excludes items that do not represent the ongoing operations of the company, and therefore (i) enhances management’s and investors’ ability to analyze the ongoing operations of its businesses and (ii) facilitates comparisons of its operating performance over multiple periods, including because the amortization expense associated with purchased intangible assets may fluctuate from period to period based on the timing, size, nature and number of acquisitions. Although the company excludes amortization of purchased intangible assets from Adjusted EBITDA, revenue generated from such intangible assets is included within the revenue in determining Adjusted EBITDA. The comparable GAAP measure is net income from continuing operations. See Note 2 below for a full reconciliation.
(2) Adjusted EBITDA, Excluding Reportable Catastrophes: Assurant uses Adjusted EBITDA (defined above), excluding reportable catastrophes (which represents individual catastrophic events that generate losses in excess of $5.0 million, pre-tax, net of reinsurance and client profit sharing adjustments and including reinstatement and other premiums), as another important measure of the company’s performance. The company believes this metric provides investors with an important measure of the company’s performance for the reasons noted in Note 1 above, and because it excludes reportable catastrophes, which can be volatile. The comparable GAAP measure is net income from continuing operations.
($ in millions) | 2021 | 2020 | Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | |||||||||||||||||||||||||||||||
GAAP net income from continuing operations | $ | 126.7 | $ | 153.6 | $ | 184.7 | $ | 148.5 | $ | 119.1 | $ | 88.0 | $ | 164.7 | $ | 148.6 | $ | 613.5 | $ | 520.4 | ||||||||||||||||||||
Less: | ||||||||||||||||||||||||||||||||||||||||
Interest expense | 27.1 | 27.5 | 28.8 | 28.4 | 26.8 | 25.5 | 26.7 | 25.5 | 111.8 | 104.5 | ||||||||||||||||||||||||||||||
Provision (benefit) for income taxes | 35.1 | 37.9 | 51.9 | 44.6 | 39.8 | 24.5 | 44.6 | (48.5 | ) | 169.5 | 60.4 | |||||||||||||||||||||||||||||
Depreciation expense | 21.4 | 18.1 | 17.5 | 16.8 | 15.5 | 13.9 | 14.3 | 12.4 | 73.8 | 56.1 | ||||||||||||||||||||||||||||||
Amortization of purchased intangible assets | 15.8 | 15.7 | 17.3 | 17.0 | 16.7 | 12.5 | 12.3 | 11.2 | 65.8 | 52.7 | ||||||||||||||||||||||||||||||
Adjustments, pre-tax: | ||||||||||||||||||||||||||||||||||||||||
Net realized (gains) losses on investments and fair value changes to equity securities(1) | (5.1 | ) | (112.1 | ) | (10.3 | ) | (0.9 | ) | (29.6 | ) | (17.1 | ) | (28.9 | ) | 85.0 | (128.4 | ) | 9.4 | ||||||||||||||||||||||
COVID-19 direct and incremental expenses | 2.8 | 2.0 | 2.2 | 3.0 | 5.3 | (0.6 | ) | 17.5 | 3.0 | 10.0 | 25.2 | |||||||||||||||||||||||||||||
Loss on extinguishment of debt | — | 20.7 | — | — | — | — | — | — | 20.7 | — | ||||||||||||||||||||||||||||||
Other Adjustments: | ||||||||||||||||||||||||||||||||||||||||
Assurant Health runoff operations(2) | (0.3 | ) | — | (0.3 | ) | — | (15.5 | ) | (0.5 | ) | (0.2 | ) | 0.1 | (0.6 | ) | (16.1 | ) | |||||||||||||||||||||||
Net charge related to Iké(3) | — | — | — | — | — | — | 4.5 | 1.4 | — | 5.9 | ||||||||||||||||||||||||||||||
Amortization of deferred gains on disposal of businesses | (0.1 | ) | — | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | (1.8 | ) | (0.3 | ) | (2.1 | ) | |||||||||||||||||||||
Acquisition integration expenses | 5.0 | 2.1 | 4.9 | 1.9 | 8.4 | 4.2 | 3.1 | 2.3 | 13.9 | 18.0 | ||||||||||||||||||||||||||||||
Foreign exchange related losses(4) | 7.1 | 2.2 | 0.9 | 3.6 | 2.9 | 2.7 | 2.4 | 3.5 | 13.8 | 11.5 | ||||||||||||||||||||||||||||||
Current expected credit losses for businesses in runoff | (0.6 | ) | — | — | (1.1 | ) | 0.1 | (0.2 | ) | 0.3 | 3.1 | (1.7 | ) | 3.3 | ||||||||||||||||||||||||||
Gain related to benefit plan activity | (2.8 | ) | (4.6 | ) | (5.4 | ) | (3.4 | ) | (4.5 | ) | (4.9 | ) | (4.3 | ) | (1.9 | ) | (16.2 | ) | (15.6 | ) | ||||||||||||||||||||
Net loss (gain) from deconsolidation of consolidated investment entities(5) | — | — | — | — | 0.1 | (8.7 | ) | 1.6 | — | — | (7.0 | ) | ||||||||||||||||||||||||||||
Restructuring costs(6) | 6.8 | — | 5.0 | — | — | — | — | — | 11.8 | — | ||||||||||||||||||||||||||||||
Change in fair value of derivative investment and other expenses related to merger and acquisition activities | 5.0 | 0.5 | 0.2 | 0.1 | 7.5 | 2.2 | (0.6 | ) | 5.2 | 5.8 | 14.3 | |||||||||||||||||||||||||||||
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Total other adjustments | 20.1 | 0.2 | 5.2 | 1.0 | (1.1 | ) | (5.3 | ) | 6.7 | 11.9 | 26.5 | 12.2 | ||||||||||||||||||||||||||||
(Income) loss attributable to non-controlling interests | — | — | (0.2 | ) | 0.2 | 0.3 | 0.2 | (0.3 | ) | (1.4 | ) | — | (1.2 | ) | ||||||||||||||||||||||||||
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Adjusted EBITDA | 243.9 | 163.6 | 297.1 | 258.6 | 192.8 | 141.6 | 257.6 | 247.7 | 963.2 | 839.7 | ||||||||||||||||||||||||||||||
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Reportable catastrophes | 1.5 | 98.7 | 0.5 | 43.6 | 34.7 | 110.1 | 12.6 | 16.3 | 144.3 | 173.7 | ||||||||||||||||||||||||||||||
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Adjusted EBITDA, excluding reportable catastrophes | $ | 245.4 | $ | 262.3 | $ | 297.6 | $ | 302.2 | $ | 227.5 | $ | 251.7 | $ | 270.2 | $ | 264.0 | $ | 1,107.5 | $ | 1,013.4 | ||||||||||||||||||||
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(1) | 4Q 2021, 3Q 2021, 2Q 2021, 4Q 2020, 3Q 2020 and 2Q 2020 included net unrealized gains of $13.9 million pre-tax ($11.0 million after-tax), $94.0 million pre-tax ($74.3 million after-tax), $7.1 million pre-tax ($5.6 million after-tax), $22.5 million pre-tax ($17.8 million after-tax), $12.7 million pre-tax ($10.0 million after-tax) and $30.6 million pre-tax ($24.2 million after-tax), respectively, from changes in fair value of our equity securities and our collateralized loan obligations. 1Q 2021 and 1Q 2020 included net unrealized losses of $2.6 million pre-tax ($2.1 million after-tax) and $83.1 million pre-tax ($65.6 million after-tax), respectively, from changes in fair value of our equity securities and our collateralized loan obligations. |
(2) | 4Q 2020 included $14.9 million pre-tax ($11.8 million after-tax) of income related to the reduction of the valuation allowance on the company’s Patient Protection and Affordable Health Care Act of 2010 (“ACA”) risk corridor program receivables. The reductions in the allowance related to the company’s 4Q 2019 entry into an agreement to sell its right to any future claim proceeds related to the associated receivables and the 4Q 2020 final settlement of the receivables. |
(3) | 2Q 2020 included a loss of $3.9 million pre-tax ($2.9 million after-tax) on the sale of the Company’s interests in Iké. The pre-tax loss includes an increase in liability related to the Company’s obligation to acquire the remainder of Iké from the majority shareholders of $84.7 million and an other-than-temporary impairment loss on the Company’s 40% ownership interest in Iké of $78.3 million. |
(4) | 4Q 2021, 3Q 2021, 2Q 2021, 1Q 2021, 4Q 2020, 3Q 2020, 2Q 2020 and 1Q 2020 included $(1.1) million, $(1.8) million, $(1.0) million, $(3.1) million, $(2.2) million, $(1.3) million, $(2.0) million and $(2.0) million of net losses, respectively, from foreign exchange related to the remeasurement of net monetary assets in Argentina as a result of the classification of Argentina’s economy as highly inflationary beginning July 1, 2018. |
(5) | 4Q 2020 included (1) a net gain of $0.7 million pre-tax ($0.6 million after-tax) from the sale of our CLO asset management platform and (2) additional exit related expenses of $0.8 million pre-tax ($0.6 million after-tax) associated with the sale of the CLO asset management platform. 3Q 2020 included (1) a net gain of $17.6 million pre-tax ($13.9 million after-tax) from the sale of our CLO asset management platform, (2) additional exit related expenses of $6.1 million pre-tax ($4.8 million after-tax) associated with the sale of the CLO asset management platform and (3) $2.8 million pre-tax ($2.2 million after-tax) of expenses related to the outsourcing of our real estate management. 2Q 2020 included exit related expenses of $1.4 million pre-tax ($1.1 million after-tax) and $0.2 million pre-tax ($0.2 million after-tax) of expenses related to the outsourcing of our real estate management. |
(6) | Includes impairment losses due to lease abandonment incurred as part of a post-pandemic work-from-home strategy to consolidate real estate and accommodate permanent work-from-home arrangements for certain employees. |
14
Regulation G – Non GAAP Financial Measures (continued)
(3) | Adjusted Earnings per Diluted Share: Assurant uses Adjusted earnings per diluted share as an important measure of the company’s stockholder value. Assurant defines Adjusted earnings per diluted share as net income from continuing operations, excluding net realized gains (losses) on investments and fair value changes to equity securities, amortization of purchased intangible assets, COVID-19 direct and incremental expenses, the CARES Act tax benefit, loss on extinguishment of debt, net income (loss) attributable to non-controlling interests, restructuring costs related to strategic exit activities (outside of normal periodic restructuring and cost management activities), as well as other highly variable or unusual items, plus any dilutive preferred stock dividends, divided by the weighted average diluted shares outstanding. The company believes this metric provides investors with an important measure of stockholder value because it excludes items that do not represent the ongoing operations of the company, and therefore (i) enhances management’s and investors’ ability to analyze the ongoing operations of its businesses and (ii) facilitates comparisons of its operating performance over multiple periods, including because the amortization expense associated with purchased intangible assets may fluctuate from period to period based on the timing, size, nature and number of acquisitions. Although the company excludes amortization of purchased intangible assets from Adjusted earnings, revenue generated from such intangible assets is included within the revenue in determining Adjusted earnings. The comparable GAAP measure is net income from continuing operations per diluted share, defined as net income from continuing operations plus any dilutive preferred stock dividends less net income from non-controlling interests, divided by the weighted average diluted shares outstanding. See Note 4 below for a full reconciliation. |
(4) | Adjusted Earnings, Excluding Reportable Catastrophes, per Diluted Share: Assurant uses Adjusted earnings, excluding reportable catastrophes, per diluted share (each as defined above) as another important measure of the company’s stockholder value. The company believes this metric provides investors with a valuable measure of stockholder value because it excludes reportable catastrophes, which can be volatile. The comparable GAAP measure is net income from continuing operations per diluted share, defined as net income from continuing operations plus any dilutive preferred stock dividends less net income from non-controlling interests, divided by the weighted average diluted shares outstanding. |
($ in millions) | 2021 | 2020 | Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | |||||||||||||||||||||||||||||||
GAAP net income from continuing operations | $ | 126.7 | $ | 153.6 | $ | 184.7 | $ | 148.5 | $ | 119.1 | $ | 88.0 | $ | 164.7 | $ | 148.6 | $ | 613.5 | $ | 520.4 | ||||||||||||||||||||
Adjustments, pre-tax: | ||||||||||||||||||||||||||||||||||||||||
Net realized (gains) losses on investments and fair value changes to equity securities | (5.1 | ) | (112.1 | ) | (10.3 | ) | (0.9 | ) | (29.6 | ) | (17.1 | ) | (28.9 | ) | 85.0 | (128.4 | ) | 9.4 | ||||||||||||||||||||||
Amortization of purchased intangible assets | 15.8 | 15.7 | 17.3 | 17.0 | 16.7 | 12.5 | 12.3 | 11.2 | 65.8 | 52.7 | ||||||||||||||||||||||||||||||
COVID-19 direct and incremental expenses | 2.8 | 2.0 | 2.2 | 3.0 | 5.3 | (0.4 | ) | 18.9 | 3.0 | 10.0 | 26.8 | |||||||||||||||||||||||||||||
CARES Act tax benefit (after-tax) | — | — | — | — | — | — | (5.1 | ) | (79.3 | ) | — | (84.4 | ) | |||||||||||||||||||||||||||
Loss on extinguishment of debt | — | 20.7 | — | — | — | — | — | — | 20.7 | — | ||||||||||||||||||||||||||||||
Other Adjustments: | ||||||||||||||||||||||||||||||||||||||||
Assurant Health runoff operations | (0.3 | ) | — | (0.3 | ) | — | (15.5 | ) | (0.5 | ) | (0.2 | ) | 0.1 | (0.6 | ) | (16.1 | ) | |||||||||||||||||||||||
Net charge related to Iké | — | — | — | — | — | — | 4.5 | 1.4 | — | 5.9 | ||||||||||||||||||||||||||||||
Amortization of deferred gains on disposal of businesses | (0.1 | ) | — | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | (0.1 | ) | (1.8 | ) | (0.3 | ) | (2.1 | ) | |||||||||||||||||||||
Acquisition integration expenses | 6.0 | 3.0 | 5.8 | 2.8 | 9.6 | 5.2 | 4.0 | 3.3 | 17.6 | 22.1 | ||||||||||||||||||||||||||||||
Foreign exchange related losses | 7.1 | 2.2 | 0.9 | 3.6 | 2.9 | 2.7 | 2.4 | 3.5 | 13.8 | 11.5 | ||||||||||||||||||||||||||||||
Current expected credit losses for businesses in runoff | (0.6 | ) | — | — | (1.1 | ) | 0.1 | (0.2 | ) | 0.3 | 3.1 | (1.7 | ) | 3.3 | ||||||||||||||||||||||||||
Gain related to benefit plan activity | (2.8 | ) | (4.6 | ) | (5.4 | ) | (3.4 | ) | (4.5 | ) | (4.9 | ) | (4.3 | ) | (1.9 | ) | (16.2 | ) | (15.6 | ) | ||||||||||||||||||||
State tax for AEB sale (after-tax) | — | — | — | — | — | 2.9 | — | — | — | 2.9 | ||||||||||||||||||||||||||||||
Net loss (gain) from deconsolidation of consolidated investment entities | — | — | — | — | 0.1 | (8.7 | ) | 1.6 | — | — | (7.0 | ) | ||||||||||||||||||||||||||||
Restructuring costs | 8.1 | — | 5.0 | — | — | — | — | — | 13.1 | — | ||||||||||||||||||||||||||||||
Impact of Tax Cuts and Jobs Act at enactment (after-tax) | — | — | — | — | (1.3 | ) | — | — | — | — | (1.3 | ) | ||||||||||||||||||||||||||||
Change in fair value of derivative investment and other expenses related to merger and acquisitionactivities | 5.0 | 0.5 | 0.2 | 0.1 | 7.5 | 2.2 | (0.6 | ) | 5.2 | 5.8 | 14.3 | |||||||||||||||||||||||||||||
(Benefit) provision for income taxes | (7.3 | ) | 15.5 | (2.9 | ) | (3.8 | ) | 4.0 | 2.1 | (1.2 | ) | (18.3 | ) | 1.5 | (13.4 | ) | ||||||||||||||||||||||||
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Total adjustments, after-tax | 28.6 | (57.1 | ) | 12.4 | 17.2 | (4.8 | ) | (4.3 | ) | 3.6 | 14.5 | 1.1 | 9.0 | |||||||||||||||||||||||||||
Net (income) loss attributable to non-controlling interests | — | — | (0.2 | ) | 0.2 | 0.2 | 0.3 | (0.3 | ) | (1.1 | ) | — | (0.9 | ) | ||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | (4.7 | ) | (4.7 | ) | (4.7 | ) | (4.6 | ) | (4.7 | ) | (4.7 | ) | (18.7 | ) | |||||||||||||||||||||||
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Adjusted earnings | $ | 155.3 | $ | 96.5 | $ | 196.9 | $ | 161.2 | $ | 109.8 | $ | 79.3 | $ | 163.4 | $ | 157.3 | $ | 609.9 | $ | 509.8 | ||||||||||||||||||||
Reportable catastrophes, pre-tax | 1.5 | 98.7 | 0.5 | 43.6 | 34.7 | 110.1 | 12.6 | 16.3 | 144.3 | 173.7 | ||||||||||||||||||||||||||||||
Tax impact of reportable catastrophes | (0.3 | ) | (20.7 | ) | (0.1 | ) | (9.1 | ) | (7.4 | ) | (23.1 | ) | (2.6 | ) | (3.4 | ) | (30.2 | ) | (36.5 | ) | ||||||||||||||||||||
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Adjusted earnings, excluding reportable catastrophes | $ | 156.5 | $ | 174.5 | $ | 197.3 | $ | 195.7 | $ | 137.1 | $ | 166.3 | $ | 173.4 | $ | 170.2 | $ | 724.0 | $ | 647.0 | ||||||||||||||||||||
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($ per share) | 2021 | 2020 | Twelve Months Ended December 31, | |||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | |||||||||||||||||||||||||||||||
GAAP net income from continuing operations per diluted share | $ | 2.20 | $ | 2.58 | $ | 3.01 | $ | 2.41 | $ | 1.91 | $ | 1.38 | $ | 2.59 | $ | 2.32 | $ | 10.20 | $ | 8.22 | ||||||||||||||||||||
Adjustments per diluted share, pre-tax: | ||||||||||||||||||||||||||||||||||||||||
Net realized (gains) losses on investments and fair value changes to equity securities | (0.09 | ) | (1.88 | ) | (0.17 | ) | (0.02 | ) | (0.47 | ) | (0.28 | ) | (0.46 | ) | 1.34 | (2.14 | ) | 0.15 | ||||||||||||||||||||||
Amortization of purchased intangible assets | 0.28 | 0.25 | 0.25 | 0.24 | 0.23 | 0.17 | 0.16 | 0.14 | 1.10 | 0.83 | ||||||||||||||||||||||||||||||
COVID-19 direct and incremental expenses | 0.05 | 0.03 | 0.04 | 0.05 | 0.08 | (0.01 | ) | 0.30 | 0.05 | 0.17 | 0.42 | |||||||||||||||||||||||||||||
CARES Act tax benefit (after tax) | — | — | — | — | — | — | (0.08 | ) | (1.25 | ) | — | (1.34 | ) | |||||||||||||||||||||||||||
Loss on extinguishment of debt | — | 0.35 | — | — | — | — | — | — | 0.34 | — | ||||||||||||||||||||||||||||||
Other Adjustments: | ||||||||||||||||||||||||||||||||||||||||
Assurant Health runoff operations | (0.01 | ) | — | — | — | (0.25 | ) | (0.01 | ) | — | — | (0.01 | ) | (0.25 | ) | |||||||||||||||||||||||||
Net charge related to Iké | — | — | — | — | — | — | 0.08 | 0.02 | — | 0.09 | ||||||||||||||||||||||||||||||
Amortization of deferred gains on disposal of businesses | — | — | — | — | — | (0.01 | ) | — | (0.04 | ) | — | (0.03 | ) | |||||||||||||||||||||||||||
Acquisition integration expenses | 0.10 | 0.05 | 0.09 | 0.05 | 0.15 | 0.09 | 0.06 | 0.05 | 0.29 | 0.35 | ||||||||||||||||||||||||||||||
Foreign exchange related losses | 0.12 | 0.04 | 0.02 | 0.06 | 0.05 | 0.04 | 0.04 | 0.07 | 0.23 | 0.18 | ||||||||||||||||||||||||||||||
Current expected credit losses for businesses in runoff | (0.01 | ) | — | — | (0.02 | ) | — | — | — | 0.05 | (0.03 | ) | 0.05 | |||||||||||||||||||||||||||
Gain related to benefit plan activity | (0.05 | ) | (0.08 | ) | (0.09 | ) | (0.06 | ) | (0.07 | ) | (0.08 | ) | (0.07 | ) | (0.03 | ) | (0.27 | ) | (0.25 | ) | ||||||||||||||||||||
State tax for AEB sale (after-tax) | — | — | — | — | — | 0.05 | — | — | — | 0.05 | ||||||||||||||||||||||||||||||
Net (gain) loss from deconsolidation of consolidated investment entities | — | — | — | — | — | (0.14 | ) | 0.03 | — | — | (0.11 | ) | ||||||||||||||||||||||||||||
Restructuring costs | 0.14 | — | 0.08 | — | — | — | — | — | 0.22 | — | ||||||||||||||||||||||||||||||
Impact of Tax Cuts and Jobs Act at enactment (after-tax) | — | — | — | — | (0.02 | ) | — | — | — | — | (0.02 | ) | ||||||||||||||||||||||||||||
Change in fair value of derivative investment and other expenses related to merger and acquisition activities | 0.09 | 0.01 | — | — | 0.12 | 0.04 | (0.01 | ) | 0.08 | 0.10 | 0.23 | |||||||||||||||||||||||||||||
(Benefit) provision for income taxes | (0.13 | ) | 0.26 | (0.05 | ) | (0.05 | ) | 0.07 | 0.04 | (0.02 | ) | (0.28 | ) | 0.02 | (0.21 | ) | ||||||||||||||||||||||||
Adjusted earnings, per diluted share | $ | 2.69 | $ | 1.61 | $ | 3.18 | $ | 2.66 | $ | 1.80 | $ | 1.28 | $ | 2.62 | $ | 2.52 | $ | 10.22 | $ | 8.36 | ||||||||||||||||||||
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Reportable catastrophes, pre-tax | 0.03 | 1.66 | 0.01 | 0.71 | 0.56 | 1.83 | 0.20 | 0.26 | 2.40 | 2.75 | ||||||||||||||||||||||||||||||
Tax impact of reportable catastrophes | (0.01 | ) | (0.35 | ) | — | (0.16 | ) | (0.12 | ) | (0.39 | ) | (0.04 | ) | (0.06 | ) | (0.50 | ) | (0.57 | ) | |||||||||||||||||||||
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Adjusted earnings, excluding reportable catastrophes, per diluted share | $ | 2.71 | $ | 2.92 | $ | 3.19 | $ | 3.21 | $ | 2.24 | $ | 2.72 | $ | 2.78 | $ | 2.72 | $ | 12.12 | $ | 10.54 | ||||||||||||||||||||
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15
Regulation G – Non GAAP Financial Measures (continued)
(5) Debt to Total Capital Ratio, Excluding AOCI: Assurant uses a ratio of debt to total capital, excluding AOCI, as an important measure of the Company’s financial leverage. Assurant defines debt to total capital ratio, excluding AOCI, as debt divided by the sum of debt and total stockholders’ equity, excluding AOCI. The Company believes that the debt to total capital ratio, excluding AOCI, provides investors with an important measure of financial leverage, because it excludes the effect of unrealized gains (losses) on investments and other AOCI items, which do not represent the operations of the Company and tend to be highly variable from period-to-period. The comparable GAAP measure is the ratio of debt to total capital.
2021 | 2020 | Twelve Months Ended December 31, | ||||||||||||||||||||||||||||||||||||||
4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 2021 | 2020 | |||||||||||||||||||||||||||||||
Debt to total capital ratio | 28.6 | % | 27.7 | % | 30.2 | % | 27.5 | % | 27.5 | % | 25.3 | % | 27.0 | % | 29.1 | % | 28.6 | % | 27.5 | % | ||||||||||||||||||||
Change due to effect of including AOCI | (0.5) | % | (0.3) | % | 2.3 | % | 1.8 | % | 2.6 | % | 2.3 | % | 2.0 | % | 0.4 | % | (0.5) | % | 2.6 | % | ||||||||||||||||||||
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Debt to total capital ratio, excluding AOCI | 28.1 | % | 27.4 | % | 32.5 | % | 29.3 | % | 30.1 | % | 27.6 | % | 29.0 | % | 29.5 | % | 28.1 | % | 30.1 | % | ||||||||||||||||||||
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16