| The following document contains supplemental quarterly statistical financial information for the quarter ended June 30, 2004. This document is dated August 3, 2004. Protective Life Corporation (the "Company") does not undertake a duty to update such information after such date. |
| All per share results are presented on a diluted basis. |
| Throughout this document, GAAP refers to accounting principles generally accepted in the United States of America. Operating income differs from the GAAP measure, net income, in that it excludes realized investment gains and losses and related amortization and gains and losses related to certain derivative financial instruments, and the cumulative effect of change in accounting principle. Consolidated and segment operating income excludes net realized investment gains (losses) and the related amortization of deferred policy acquisition costs and gains (losses) on derivative instruments. Periodic settlements of interest rate swaps associated with corporate debt and certain investments are included in realized gains (losses) but are considered part of operating income because the swaps are used to mitigate risk in items affecting operating income. Management believes that consolidated and segment operating income (loss) enhances an investor’s and the Company’s understanding of the Company’s results of operations, as it represents the basis on which the performance of the Company's business is internally assessed. |
| As prescribed by generally accepted accounting principles, certain investments are recorded at their market values with the resulting unrealized gains (losses) reduced by a related adjustment to deferred policy acquisition costs, net of income tax, reported as a component of share-owners’ equity. The market values of fixed maturities increase or decrease as interest rates rise or fall. The Company believes that an insurance company’s share-owners’ equity may be difficult to analyze without disclosing the effects of recording accumulated other comprehensive income, including unrealized gains (losses) on investments. Therefore, the Company reports the non-GAAP measure share owners’ equity per share excluding accumulated other comprehensive income, including unrealized gains (losses) on investments. This non-GAAP measure may be reconciled to the GAAP measure, share owners’ equity per share by including accumulated other comprehensive income, including unrealized gains (losses) on investments. |
| The sales statistics given in this document are used by the Company to measure the relative progress of its marketing efforts. These statistics and certain other information reported herein were derived from the Company’s various sales tracking and administrative systems and were not derived from the Company’s financial reporting systems or financial statements. These statistics attempt to measure only one of many factors that may affect future business segment profitability, and therefore are not intended to be predictive of future profitability. |
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PROTECTIVE LIFE CORPORATION Draft
Quarterly Financial Highlights 8/2/2004
(Dollars in Thousands) Page 1
(Unaudited)
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2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
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Pretax Operating Income *
- ---------------------------------------------------------------------------------------------
Life Marketing $40,458 $36,725 $30,635 $46,116 $39,501 $42,905 $41,601 $43,597 $76,751 $85,198
Acquisitions 25,118 26,441 22,772 24,281 24,831 23,266 21,203 23,461 47,053 44,664
Annuities 2,683 3,034 3,715 2,991 2,633 4,034 2,813 4,975 6,706 7,788
Stable Value Contracts 11,423 11,334 9,138 10,098 9,523 10,152 11,699 13,926 19,236 25,625
Asset Protection (1,416) (24,445) 1,242 9,761 5,112 4,078 4,603 4,371 11,003 8,974
Corporate & Other (1,390) (3,958) 960 (22,561) (7,849) (2,502) 4,305 3,128 (21,601) 7,433
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Total Pretax Operating Income $76,876 $49,131 $68,462 $70,686 $73,751 $81,933 $86,224 $93,458 $139,148 $179,682
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Balance Sheet Data
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Total GAAP Assets $21,369,140 $21,933,111 $22,748,452 $23,287,560 $23,295,984 $24,573,991 $25,417,656 $25,140,587
Share Owners' Equity $1,723,168 $1,720,702 $1,810,480 $2,026,445 $1,965,756 $2,002,144 $2,202,165 $1,890,542
Share Owners' Equity (excluding accumulated other comprehensive income) $1,462,608 $1,484,788 $1,513,566 $1,564,910 $1,606,569 $1,669,559 $1,716,619 $1,769,536
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Stock Data
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Closing Price $28.55 $30.77 $27.52 $28.55 $26.75 $29.85 $37.45 $38.67 $28.55 $38.67
Average Shares Outstanding
Basic 69,948,982 69,959,056 69,956,505 70,004,109 70,091,080 70,079,471 70,142,108 70,284,893 69,980,439 70,213,500
Diluted 70,491,409 70,488,160 70,483,448 70,561,795 70,722,885 70,806,034 70,887,591 71,030,983 70,522,838 70,959,287
* "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating Income" may be compared.
See Page 5 for a reconciliation of "Pretax Operating Income" to "Income Before Income Tax".
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PROTECTIVE LIFE CORPORATION Draft
GAAP Consolidated Statements Of Income 8/2/2004
(Dollars in thousands) Page 2
(Unaudited)
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2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
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REVENUES
Gross Premiums and Policy Fees $ 392,131 $ 415,172 $ 387,094 $ 397,652 $ 424,590 $ 460,976 $ 443,796 $ 456,088 $ 784,746 $ 899,884
Reinsurance Ceded (121,744) (252,657) (189,417) (205,268) (237,996) (301,754) (249,339) (285,369) (394,685) (534,708)
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Net Premiums and Policy Fees 270,387 162,515 197,677 192,384 186,594 159,222 194,457 170,719 390,061 365,176
Net investment income 260,967 268,731 257,701 262,744 248,915 261,392 264,608 265,899 520,445 530,507
RIGL - Derivatives 4,253 2,194 (4,880) 4,334 (9,048) 22,144 5,083 8,740 (546) 13,823
RIGL - All Other Investments 2,106 (985) (1,178) 29,524 27,042 2,676 16,627 (923) 28,346 15,704
Other income 23,927 21,432 25,309 39,981 26,128 28,864 37,419 37,563 65,290 74,982
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Total Revenues 561,640 453,887 474,629 528,967 479,631 474,298 518,194 481,998 1,003,596 1,000,192
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BENEFITS & EXPENSES
Benefits and settlement expenses 305,952 293,601 297,273 304,933 281,693 267,675 287,316 282,469 602,206 569,785
Amortization of deferred policy acquisition costs 112,021 53,495 55,759 64,803 56,241 48,304 59,794 45,053 120,562 104,847
Amortization of goodwill 0 0 0 0 0 0 0 0 - -
Other operating expenses 56,191 52,355 55,297 58,697 51,872 45,946 59,726 46,769 113,994 106,495
Interest on indebtedness 9,840 10,796 10,261 11,242 11,033 11,084 11,959 12,337 21,503 24,296
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Total Benefits and Expenses 484,004 410,247 418,590 439,675 400,839 373,009 418,795 386,628 858,265 805,423
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INCOME BEFORE INCOME TAX 77,636 43,640 56,039 89,292 78,792 101,289 99,399 95,370 145,331 194,769
Income tax expense 26,661 13,296 18,334 29,916 26,383 33,729 34,094 34,075 48,250 68,169
Change in Acct Principle 0 0 0 0 0 0 (10,128) 0 - (10,128)
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NET INCOME $ 50,975 $ 30,344 $ 37,705 $ 59,376 $ 52,409 $ 67,560 $ 55,177 $ 61,295 $ 97,081 $ 116,472
====================================================================================================================================================== =================================
PER SHARE DATA FOR QUARTER
Operating income-diluted * $ 0.72 $ 0.48 $ 0.65 $ 0.67 $ 0.70 $ 0.77 $ 0.80 $ 0.84
RIGL - Derivatives net of gains related to corp debt and investments 0.00 (0.04) (0.10) (0.01) (0.13) 0.16 0.00 0.03
RIGL - All Other Investments 0.01 (0.01) (0.02) 0.19 0.17 0.02 0.12 (0.01)
Change in Accounting Principle 0.00 0.00 0.00 0.00 0.00 0.00 (0.14) 0.00
------------------------------------------------------------------------------------------------------------------------------------------------------
Net income-diluted $ 0.73 $ 0.43 $ 0.53 $ 0.85 $ 0.74 $ 0.95 $ 0.78 $ 0.86
Average shares outstanding-diluted 70,491,409 70,488,160 70,483,448 70,561,795 70,722,885 70,806,034 70,887,591 71,030,983
Dividends paid $ 0.150 $ 0.150 $ 0.150 $ 0.160 $ 0.160 $ 0.160 $ 0.160 $ 0.175
PER SHARE DATA FOR YTD
Operating income-diluted * $ 2.00 $ 2.48 $ 0.65 $ 1.32 $ 2.02 $ 2.79 $ 0.80 $ 1.64 $ 1.32 $ 1.64
RIGL - Derivatives net of gains related to corp debt and investments 0.09 0.05 (0.10) (0.11) (0.24) (0.08) 0.00 0.03 (0.11) 0.03
RIGL - All Other Investments 0.00 (0.01) (0.02) 0.17 0.34 0.36 0.12 0.11 0.17 0.11
Change in Accounting Principle 0.00 0.00 0.00 0.00 0.00 0.00 (0.14) (0.14) - (0.14)
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Net income-diluted $ 2.09 $ 2.52 $ 0.53 $ 1.38 $ 2.12 $ 3.07 $ 0.78 $ 1.64 $ 1.38 $ 1.64
Average shares outstanding-diluted 70,454,250 70,462,797 70,483,448 70,522,838 70,590,253 70,644,642 70,887,591 70,959,287 70,522,838 70,959,287
Dividends paid $ 0.440 $ 0.590 $ 0.150 $ 0.310 $ 0.470 $ 0.630 $ 0.160 $ 0.335 $ 0.310 $ 0.335
* "Operating Income" is a non-GAAP financial measure. "Net Income" is a GAAP financial measure to which "Operating Income" may be compared.
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PROTECTIVE LIFE CORPORATION Draft
GAAP Consolidated Balance Sheets 8/2/2004
(Dollars in thousands) Page 3
(Unaudited)
--------------------------------------------------------------------------------------------
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2002 2002 2003 2003 2003 2003 2004 2004
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR
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ASSETS
Fixed maturities $11,451,339 $ 11,664,065 $12,146,120 $12,504,655 $12,452,180 $13,355,911 $ 13,875,517 $ 13,295,606
Equity securities 70,326 64,523 55,416 56,248 52,460 46,731 58,362 57,802
Mortgage loans 2,591,417 2,518,152 2,483,630 2,543,013 2,678,360 2,733,722 2,746,706 2,836,683
Investment real estate 20,536 20,711 19,485 16,930 16,781 18,126 108,098 107,163
Policy loans 546,302 543,161 536,085 532,981 523,869 502,748 492,782 486,661
Other long-term investments 176,443 222,490 227,554 258,897 246,177 249,494 231,161 197,246
------------------------------------------------------------------------------------------------------------------------------------------------------
Long-term investments 14,856,363 15,033,102 15,468,290 15,912,724 15,969,827 16,906,732 17,512,626 16,981,161
Short-term investments 455,494 448,399 912,999 804,923 582,830 519,419 516,988 694,002
------------------------------------------------------------------------------------------------------------------------------------------------------
Total investments 15,311,857 15,481,501 16,381,289 16,717,647 16,552,657 17,426,151 18,029,614 17,675,163
Cash 78,353 101,953 55,830 91,093 105,019 136,698 114,972 105,518
Accrued investment income 190,908 181,966 196,107 185,300 194,115 189,232 198,564 194,403
Accounts and premiums receivable 74,207 61,425 63,186 63,464 55,879 57,944 95,943 53,958
Reinsurance receivable 2,280,223 2,368,068 2,402,371 2,270,817 2,299,140 2,350,606 2,462,269 2,515,619
Deferred policy acquisition costs 1,644,367 1,707,253 1,703,410 1,727,076 1,815,071 1,861,020 1,867,195 1,932,737
Goodwill 47,312 47,312 47,312 47,312 47,312 47,312 46,619 46,619
Property and equipment, net 41,615 41,324 44,279 46,392 45,663 45,640 45,143 46,821
Other assets 183,273 309,791 282,602 278,554 214,499 238,581 256,894 254,920
Assets Related to Separate Accounts
Variable Annuity 1,412,028 1,513,824 1,452,098 1,718,478 1,813,738 2,045,038 2,113,413 2,121,517
Variable Universal Life 100,781 114,364 115,591 137,027 148,511 171,408 182,665 188,963
Other 4,216 4,330 4,377 4,400 4,380 4,361 4,365 4,349
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TOTAL ASSETS $21,369,140 $ 21,933,111 $22,748,452 $23,287,560 $23,295,984 $24,573,991 $ 25,417,656 $ 25,140,587
======================================================================================================================================================
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PROTECTIVE LIFE CORPORATION Draft
GAAP Consolidated Balance Sheets 8/2/2004
(Dollars in thousands) Page 4
(Unaudited)
- --------------------------------------------------------------------------------------------
LIABILITIES AND SHARE-OWNERS' EQUITY
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2002 2002 2003 2003 2003 2003 2004 2004
LIABILITIES 3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR
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Policy liabilities and accruals
Future policy benefits and claims $ 8,032,378 $ 8,248,182 $ 8,416,509 $ 8,626,989 $ 8,752,643 $ 8,948,131 $ 9,258,485 $ 9,452,459
Unearned premiums 790,360 875,956 848,457 782,440 786,396 784,566 701,914 697,031
Stable value product deposits 3,860,241 4,018,552 4,106,685 4,214,470 4,135,212 4,676,531 4,923,231 4,921,166
Annuity deposits 3,680,025 3,697,495 3,714,368 3,636,423 3,538,368 3,480,577 3,412,553 3,419,225
Other policyholders' funds 134,771 174,140 172,849 164,840 160,946 158,875 159,458 157,612
Securities sold under repurchase agreements 42,000 0 0 0 111,725 0 8,660 0
Other liabilities 648,697 697,578 1,175,568 969,069 901,997 859,034 799,288 884,200
Accrued income taxes 23,219 3,186 24,911 (19,843) (43,154) (34,261) 42,262 (12,074)
Deferred income taxes 250,023 242,593 264,342 374,306 362,991 377,990 415,849 213,967
Debt 376,137 406,110 426,103 436,394 440,344 461,329 376,457 385,449
Liabilities related to variable interest entities 0 0 0 0 0 400,000 477,128 476,591
Subordinated debt securities 290,000 215,000 215,000 215,000 215,000 221,650 324,743 324,743
Minority interest - subsidiaries 1,096 1,099 1,114 1,122 1,131 16,618 15,020 14,847
Liabilities related to separate accounts
Variable annuity 1,412,028 1,513,824 1,452,098 1,718,478 1,813,738 2,045,038 2,113,413 2,121,517
Variable universal life 100,781 114,364 115,591 137,027 148,511 171,408 182,665 188,963
Other 4,216 4,330 4,377 4,400 4,380 4,361 4,365 4,349
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TOTAL LIABILITIES $19,645,972 $ 20,212,409 $20,937,972 $21,261,115 $21,330,228 $22,571,847 $ 23,215,491 $ 23,250,045
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SHARE-OWNERS' EQUITY
- --------------------------------------------------------------------------------------------
Preferred stock 0 0 0 0 0 0 0 0
Common stock 36,626 36,626 36,626 36,626 36,626 36,626 36,626 36,626
Additional paid-in capital 406,000 408,397 409,007 412,282 412,368 418,351 419,147 423,257
Treasury stock (16,402) (16,402) (15,631) (15,578) (15,558) (15,275) (13,931) (13,783)
Stock held in trust (2,157) (2,417) (2,812) (3,149) (2,979) (2,788) (2,365) (2,855)
Unallocated ESOP shares (2,777) (2,777) (2,367) (2,367) (2,367) (2,367) (1,989) (1,989)
Retained earnings 1,041,318 1,061,361 1,088,743 1,137,096 1,178,479 1,235,012 1,279,131 1,328,280
Accumulated other comprehensive income 260,560 235,914 296,914 461,535 359,187 332,585 485,546 121,006
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Total Share-owners' Equity 1,723,168 1,720,702 1,810,480 2,026,445 1,965,756 2,002,144 2,202,165 1,890,542
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TOTAL LIABILITIES AND EQUITY $21,369,140 $ 21,933,111 $22,748,452 $23,287,560 $23,295,984 $24,573,991 $ 25,417,656 $ 25,140,587
======================================================================================================================================================
SHARE-OWNERS' EQUITY PER SHARE
Total Share-owners' Equity $ 25.09 $ 25.06 $ 26.28 $ 29.41 $ 28.53 $ 29.02 $ 31.75 $ 27.24
Excluding accumulated other comprehensive income $ 21.30 $ 21.62 $ 21.97 $ 22.71 $ 23.31 $ 24.20 $ 24.75 $ 25.49
Share-owners' Equity (excluding accumulated other comprehensive income) $ 1,462,608 $ 1,484,788 $ 1,513,566 $ 1,564,910 $ 1,606,569 $ 1,669,559 $ 1,716,619 $ 1,769,536
Common shares outstanding 68,675,894 68,675,894 68,891,149 68,907,294 68,912,705 68,991,701 69,366,395 69,407,945
Treasury Stock Shares 4,576,066 4,576,066 4,360,811 4,344,666 4,339,255 4,260,259 3,885,565 3,844,015
PROTECTIVE LIFE CORPORATION Draft
Calculation of Operating Earnings Per Share 8/2/2004
(Dollars in thousands) Page 5
(Unaudited)
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2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
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CALCULATION OF NET INCOME PER SHARE
Net income $ 50,975 $ 30,344 $ 37,705 $ 59,376 $ 52,409 $ 67,560 $ 55,177 $ 61,295 $ 97,081 $ 116,472
Average shares outstanding-basic 69,948,982 69,959,056 69,956,505 70,004,109 70,091,080 70,079,471 70,142,108 70,284,893 69,980,439 70,213,500
Average shares outstanding-diluted 70,491,409 70,488,160 70,483,448 70,561,795 70,722,885 70,806,034 70,887,591 71,030,983 70,522,838 70,959,287
Net income per share-basic $ 0.73 $ 0.44 $ 0.54 $ 0.85 $ 0.75 $ 0.96 $ 0.79 $ 0.87 $ 1.39 $ 1.66
Net income per share-diluted $ 0.73 $ 0.43 $ 0.53 $ 0.85 $ 0.74 $ 0.95 $ 0.78 $ 0.86 $ 1.38 $ 1.64
Income from continuing operations $ 50,975 $ 30,344 $ 37,705 $ 59,376 $ 52,409 $ 67,560 $ 65,305 $ 61,295 $ 97,081 $ 126,600
EPS (basic) $ 0.73 $ 0.44 $ 0.54 $ 0.85 $ 0.75 $ 0.96 $ 0.93 $ 0.87 $ 1.39 $ 1.80
EPS (diluted) $ 0.73 $ 0.43 $ 0.53 $ 0.85 $ 0.74 $ 0.95 $ 0.92 $ 0.86 $ 1.38 $ 1.78
CALCULATION OF REALIZED INVESTMENT GAINS (LOSSES) PER SHARE
RIGL - Derivatives $ 4,253 $ 2,194 $ (4,880) $ 4,334 $ (9,048) $ 22,144 $ 5,083 $ 8,740 $ (546) $ 13,823
Derivative Gains related to Corporate Debt and Investments (5,234) (6,403) (5,634) (5,885) (4,786) (4,782) (4,875) (5,354) (11,519) (10,229)
RIGL - All Other Investments 2,106 (985) (1,178) 29,524 27,042 2,676 16,627 (923) 28,346 15,704
Related amortization of DAC (365) (297) (731) (9,367) (8,167) (682) (3,660) (551) (10,098) (4,211)
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760 (5,491) (12,423) 18,606 5,041 19,356 13,175 1,912 6,183 15,087
Tax effect (266) 1,922 4,348 (6,512) (1,764) (6,775) (4,611) (669) (2,164) (5,280)
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$ 494 $ (3,569) $ (8,075) $ 12,094 $ 3,277 $ 12,581 $ 8,564 $ 1,243 $ 4,019 $ 9,807
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RIGL - Derivatives per share-diluted $ - $ (0.04) $ (0.10) $ (0.01) $ (0.13) $ 0.16 $ - $ 0.03 $ (0.11) $ 0.03
RIGL - All Other Investments per share-diluted $ 0.01 $ (0.01) $ (0.02) $ 0.19 $ 0.17 $ 0.02 $ 0.12 $ (0.01) $ 0.17 $ 0.11
OPERATING INCOME PER SHARE
Net income per share-diluted $ 0.73 $ 0.43 $ 0.53 $ 0.85 $ 0.74 $ 0.95 $ 0.78 $ 0.86 $ 1.38 $ 1.64
RIGL - Derivatives per share-diluted - (0.04) (0.10) (0.01) (0.13) 0.16 - 0.03 (0.11) 0.03
RIGL - All Other Investments per share-diluted 0.01 (0.01) (0.02) 0.19 0.17 0.02 0.12 (0.01) 0.17 0.11
Change in accounting principle - - - - - - (0.14) - - (0.14)
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Operating income per share-diluted $ 0.72 $ 0.48 $ 0.65 $ 0.67 $ 0.70 $ 0.77 $ 0.80 $ 0.84 $ 1.32 $ 1.64
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NET OPERATING INCOME *
Net income $ 50,975 $ 30,344 $ 37,705 $ 59,376 $ 52,409 $ 67,560 $ 55,177 $ 61,295 $ 97,081 $ 116,472
RIGL - Derivatives net of tax & gains related to corp debt & investments (638) (2,736) (6,834) (1,008) (8,992) 11,285 135 2,201 (7,842) 2,336
RIGL - All Other Investments net of tax and amortization 1,132 (833) (1,241) 13,102 12,269 1,296 8,429 (959) 11,861 7,470
Change in accounting principle - - - - - - (10,128) - - (10,128)
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Net operating income $ 50,481 $ 33,913 $ 45,780 $ 47,282 $ 49,132 $ 54,979 $ 56,741 $ 60,053 $ 93,062 $ 116,794
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PRETAX OPERATING INCOME **
Income before income tax $ 77,636 $ 43,640 $ 56,039 $ 89,292 $ 78,792 $ 101,289 $ 99,399 $ 95,370 $ 145,331 $ 194,769
RIGL - Derivatives 4,253 2,194 (4,880) 4,334 (9,048) 22,144 5,083 8,740 (546) 13,823
Derivative Gains related to Corporate Debt and Investments (5,234) (6,403) (5,634) (5,885) (4,786) (4,782) (4,875) (5,354) (11,519) (10,229)
RIGL - All Other Investments 2,106 (985) (1,178) 29,524 27,042 2,676 16,627 (923) 28,346 15,704
Related amortization of DAC (365) (297) (731) (9,367) (8,167) (682) (3,660) (551) (10,098) (4,211)
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Pretax operating income $ 76,876 $ 49,131 $ 68,462 $ 70,686 $ 73,751 $ 81,933 $ 86,224 $ 93,458 $ 139,148 $ 179,682
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* "Net Operating Income" is a non-GAAP financial measure. "Net Income" is a GAAP financial measure to which "Net Operating Income" may be compared.
** "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating
Income" may be compared.
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PROTECTIVE LIFE CORPORATION Draft
Invested Asset Summary 8/2/2004
(Dollars in millions) Page 6
(Unaudited)
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3rd QTR 4th QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR
2002 2002 2003 2003 2003 2003 2004 2004
------------------------------------------------------------------------------------------------------------
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Total Portfolio
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Fixed Income $11,451.3 $11,664.1 $12,146.1 $12,504.7 $12,452.2 $13,355.9 $13,875.5 $13,295.6
Mortgage Loans 2,591.4 2,518.1 2,483.6 2,543.0 2,678.4 2,733.7 2,746.7 2,836.7
Real Estate 20.5 20.7 19.5 16.9 16.8 18.1 108.1 107.2
Equities 70.3 64.5 55.4 56.2 52.4 46.7 58.4 57.8
Policy Loans 546.3 543.2 536.1 533.0 523.9 502.8 492.8 486.7
Short Term Investments 455.5 448.4 913.0 804.9 582.8 519.4 517.0 694.0
Other Long Term Investments 176.5 222.5 227.6 258.9 246.2 249.5 231.1 197.2
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Total Invested Assets $15,311.8 $15,481.5 $16,381.3 $16,717.6 $16,552.7 $17,426.1 $18,029.6 $17,675.2
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Fixed Income
- -------------------------------------------------------------------
Corporate Bonds $5,805.1 $5,911.6 $6,082.8 $6,620.5 $6,516.6 $6,882.0 $6,951.2 $7,051.5
Mortgage Backed Securities 4,319.0 4,339.0 4,546.8 4,248.9 4,307.2 4,782.6 5,130.8 4,451.7
US Govt Bonds 122.9 96.4 92.6 95.2 90.8 90.2 87.8 77.4
Public Utilities 1,110.1 1,173.4 1,282.3 1,420.3 1,414.2 1,526.9 1,663.8 1,673.8
States, Municipals and Political Subdivisions 19.8 29.4 25.8 23.6 27.3 27.1 27.5 26.9
Preferred Securities 0.4 1.8 1.8 2.1 0.7 3.2 3.3 3.4
Convertibles and Bonds with Warrants 74.0 112.5 114.0 94.1 95.4 43.9 11.1 10.9
------------------------------------------------------------------------------------------------------------
Total Fixed Income Portfolio $11,451.3 $11,664.1 $12,146.1 $12,504.7 $12,452.2 $13,355.9 $13,875.5 $13,295.6
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Fixed Income - Quality
- -------------------------------------------------------------------
AAA 38.1% 37.7% 37.7% 34.3% 34.9% 36.9% 37.8% 34.2%
AA 5.3% 5.1% 4.9% 5.1% 5.7% 5.9% 5.9% 6.4%
A 23.0% 22.0% 21.8% 22.2% 22.8% 22.9% 21.8% 23.5%
BBB 28.3% 27.7% 27.5% 28.9% 28.3% 26.8% 27.4% 28.6%
BB or Less 5.2% 7.4% 8.0% 9.5% 8.3% 7.5% 7.1% 7.3%
Redeemable Preferred Stock 0.1% 0.1% 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%
------------------------------------------------------------------------------------------------------------
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
- -------------------------------------------------------------------
Mortgage Loans - Type
- -------------------------------------------------------------------
Retail 76.4% 76.2% 75.7% 76.0% 74.2% 74.7% 73.0% 73.2%
Apartments 8.7% 7.5% 7.2% 7.2% 8.0% 7.9% 9.4% 9.2%
Office Buildings 6.7% 7.4% 7.8% 7.2% 8.4% 8.0% 8.3% 8.7%
Warehouses 6.9% 7.4% 7.5% 7.9% 7.9% 8.0% 7.8% 7.4%
Miscellaneous 1.3% 1.5% 1.8% 1.7% 1.5% 1.4% 1.5% 1.5%
------------------------------------------------------------------------------------------------------------
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
- -------------------------------------------------------------------
Problem Mortgage Loans
- -------------------------------------------------------------------
60 Days Past Due $1.6 $1.8 $2.6 $2.6 $0.0 $0.0 $7.5 $0.0
90 Days Past Due 9.6 1.8 1.1 5.3 7.3 1.3 1.3 3.2
Renegotiated Loans 5.9 5.7 5.7 5.7 5.7 5.7 6.9 5.7
Foreclosed Real Estate 1.5 6.9 0 0 0 4.8 0.0 0.0
------------------------------------------------------------------------------------------------------------
$18.6 $16.2 $9.4 $13.6 $13.0 $11.8 $15.7 $8.9
- ----------------------------------------------------------------------------------------
PROTECTIVE LIFE CORPORATION Draft
Life Marketing and Acquisitions - Quarterly Earnings Trends 8/2/2004
(Dollars in thousands) Page 7
(Unaudited)
- ----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INDIVIDUAL LIFE
REVENUES
Gross Premiums and Policy Fees $ 116,775 $ 126,273 $ 128,268 $ 137,150 $ 147,848 $ 156,051 $ 155,620 $ 165,924 $ 265,418 $ 321,544
Reinsurance Ceded (12,655) (107,043) (80,223) (90,880) (111,140) (135,537) (106,125) (136,547) (171,103) (242,672)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 104,120 19,230 48,045 46,270 36,708 20,514 49,495 29,377 94,315 78,872
Net investment income 21,452 21,907 22,389 22,674 24,195 23,256 21,903 22,389 45,063 44,292
Realized investment gains (losses) - - - - - - - - - -
Other income 13,409 13,277 13,972 16,972 13,613 15,239 21,243 22,348 30,944 43,591
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 138,981 54,414 84,406 85,916 74,516 59,009 92,641 74,114 170,322 166,755
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 28,810 21,908 40,558 30,159 34,982 23,111 38,485 31,494 70,717 69,979
Amortization of deferred policy acquisition costs 72,551 7,749 15,237 11,609 5,643 4,254 12,206 4,588 26,846 16,794
Amortization of goodwill - - - - - - - - - -
Other operating expenses 8,376 5,291 11,739 12,218 12,704 8,736 20,442 15,000 23,957 35,442
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 109,737 34,948 67,534 53,986 53,329 36,101 71,133 51,082 121,520 122,215
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX $ 29,244 $ 19,466 $ 16,872 $ 31,930 $ 21,187 $ 22,908 $ 21,508 $ 23,032 $ 48,802 $ 44,540
=================================================================================================================================== =================================
WEST COAST
REVENUES
Gross Premiums and Policy Fees $ 48,127 $ 72,944 $ 58,279 $ 64,663 $ 71,562 $ 92,610 $ 80,366 $ 85,007 $ 122,942 $ 165,373
Reinsurance Ceded (39,304) (71,083) (43,815) (51,021) (56,566) (88,596) (62,661) (68,525) (94,836) (131,186)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 8,823 1,861 14,464 13,642 14,996 4,014 17,705 16,482 28,106 34,187
Net investment income 31,103 32,767 34,149 34,841 34,504 35,230 36,037 36,540 68,990 72,577
Realized investment gains (losses) - - - - - - - - - -
Other income 101 335 - 9 (43) 199 (100) - 9 (100)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 40,027 34,963 48,613 48,492 49,457 39,443 53,642 53,022 97,105 106,664
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 28,554 25,061 34,664 31,717 33,559 25,035 33,541 35,198 66,381 68,739
Amortization of deferred policy acquisition costs 3,670 5,569 5,647 7,424 7,145 9,119 8,875 6,338 13,071 15,213
Amortization of goodwill - - - - - - - - - -
Other operating expenses (3,411) (12,926) (5,461) (4,835) (9,561) (14,708) (8,867) (9,079) (10,296) (17,946)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 28,813 17,704 34,850 34,306 31,143 19,446 33,549 32,457 69,156 66,006
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX $ 11,214 $ 17,259 $ 13,763 $ 14,186 $ 18,314 $ 19,997 $ 20,093 $ 20,565 $ 27,949 $ 40,658
=================================================================================================================================== =================================
ACQUISITIONS
REVENUES
Gross Premiums and Policy Fees $ 79,341 $ 77,218 $ 73,063 $ 71,326 $ 71,903 $ 73,614 $ 69,469 $ 69,659 $ 144,389 $ 139,128
Reinsurance Ceded (12,468) (27,973) (18,626) (18,531) (17,573) (21,264) (17,101) (17,840) (37,157) (34,941)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 66,873 49,245 54,437 52,795 54,330 52,350 52,368 51,819 107,232 104,187
Net investment income 67,128 67,508 62,296 62,520 61,004 60,323 58,655 58,704 124,816 117,359
Realized investment gains (losses) - - - - - - - - - -
Other income 168 395 905 1,542 (329) 522 717 468 2,447 1,185
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 134,169 117,148 117,638 116,857 115,005 113,195 111,740 110,991 234,495 222,731
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 83,335 73,802 72,619 72,951 72,500 73,698 73,020 71,340 145,570 144,360
Amortization of deferred policy acquisition costs 11,891 6,648 10,081 8,474 7,817 6,318 7,849 7,476 18,555 15,325
Amortization of goodwill - - - - - - - - - -
Other operating expenses 13,825 10,257 12,166 11,151 9,857 9,913 9,668 8,714 23,317 18,382
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 109,051 90,707 94,866 92,576 90,174 89,929 90,537 87,530 187,442 178,067
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX $ 25,118 $ 26,441 $ 22,772 $ 24,281 $ 24,831 $ 23,266 $ 21,203 $ 23,461 $ 47,053 $ 44,664
=================================================================================================================================== =================================
PROTECTIVE LIFE CORPORATION Draft
Life Marketing and Annuities Data 8/2/2004
(Dollars in thousands) Page 8
(Unaudited)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INDIVIDUAL LIFE
SALES BY PRODUCT
Term $ 19,536 $ 19,652 $ 21,904 $ 32,718 $ 35,168 $ 30,666 $ 24,688 $ 22,413 $ 54,622 $ 47,101
U/L 7,601 8,600 8,609 9,642 10,824 11,619 10,353 10,710 18,251 21,063
VUL 1,683 1,605 876 1,105 1,245 1,332 1,125 1,474 1,981 2,599
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 28,820 $ 29,857 $ 31,389 $ 43,465 $ 47,237 $ 43,617 $ 36,166 $ 34,597 $ 74,854 $ 70,763
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
SALES BY DISTRIBUTION
RSM System $ 9,902 $ 10,006 $ 10,622 $ 12,382 $ 13,252 $ 13,951 $ 12,741 $ 12,569 $ 23,004 $ 25,310
Empire General 10,978 12,026 14,307 22,672 26,081 21,678 16,733 15,027 36,979 31,760
Stockbrokers 5,079 4,887 4,500 6,746 6,634 7,053 6,059 6,780 11,246 12,839
Direct Response 2,756 2,567 1,950 1,665 1,272 936 633 221 3,615 854
All Other 105 371 10 0 (2) (1) 0 0 10 0
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 28,820 $ 29,857 $ 31,389 $ 43,465 $ 47,237 $ 43,617 $ 36,166 $ 34,597 $ 74,854 $ 70,763
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
WEST COAST
SALES BY PRODUCT
Term $ 16,033 $ 19,305 $ 19,306 $ 20,276 $ 21,204 $ 24,093 $ 22,148 $ 19,794 $ 39,582 $ 41,942
U/L 8,348 14,493 7,627 11,004 9,274 11,153 7,344 8,556 18,631 15,900
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 24,381 $ 33,798 $ 26,933 $ 31,280 $ 30,478 $ 35,246 $ 29,492 $ 28,350 $ 58,213 $ 57,842
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
SALES BY DISTRIBUTION
BGA $ 21,233 $ 22,781 $ 22,420 $ 24,362 $ 26,346 $ 28,845 $ 26,014 $ 24,553 $ 46,782 $ 50,567
BOLI 3,148 11,017 4,513 6,918 4,132 6,401 3,478 3,797 11,431 7,275
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 24,381 $ 33,798 $ 26,933 $ 31,280 $ 30,478 $ 35,246 $ 29,492 $ 28,350 $ 58,213 $ 57,842
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
ANNUITIES
SALES
Variable Annuity $ 96,902 $ 78,348 $ 102,525 $ 94,336 $ 87,459 $ 66,270 $ 61,724 $ 63,317 $ 196,861 $ 125,041
Immediate Annuity 24,499 22,934 26,839 26,092 12,709 16,379 10,966 33,576 52,931 44,542
Market Value Adjusted Annuity 83,371 50,156 49,529 21,326 3,239 7,403 5,128 74,729 70,855 79,857
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 204,772 $ 151,438 $ 178,893 $ 141,754 $ 103,407 $ 90,052 $ 77,818 $ 171,622 $ 320,647 $ 249,440
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
EARNINGS BEFORE INCOME TAX
Variable Annuity $ (1,167) $ (318) $ (211) $ (123) $ 232 $ 672 $ 625 $ 3,492 $ (334) $ 4,117
Fixed Annuity 3,850 3,352 3,926 3,114 2,401 3,362 2,188 1,483 7,040 3,671
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 2,683 $ 3,034 $ 3,715 $ 2,991 $ 2,633 $ 4,034 $ 2,813 $ 4,975 $ 6,706 $ 7,788
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
DEPOSIT BALANCE
VA Fixed Annuity $ 311,977 $ 321,586 $ 363,741 $ 357,937 $ 334,644 $ 305,203 $ 275,462 $ 269,353 $ 357,937 $ 269,353
VA Sep Acct Annuity 1,296,572 1,397,586 1,366,633 1,611,964 1,714,999 1,940,877 2,012,396 2,026,781 1,611,964 2,026,781
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Sub-total 1,608,549 1,719,172 1,730,374 1,969,901 2,049,643 2,246,080 2,287,858 2,296,134 1,969,901 2,296,134
Fixed Annuity 2,928,945 2,986,596 3,005,278 2,989,964 2,904,016 2,900,002 2,877,159 2,930,544 2,989,964 2,930,544
---------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 4,537,494 $ 4,705,768 $ 4,735,652 $ 4,959,865 $ 4,953,659 $ 5,146,082 $ 5,165,017 $ 5,226,678 $ 4,959,865 $ 5,226,678
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
- ----------------------------------------------------------------------------------------
PROTECTIVE LIFE CORPORATION Draft
Annuities, Stable Value Contracts, and Asset Protection 8/2/2004
Quarterly Earnings Trends (Dollars in thousands) Page 9
(Unaudited)
- ----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
ANNUITIES
REVENUES
Gross Premiums and Policy Fees $ 6,415 $ 5,962 $ 5,883 $ 6,387 $ 6,864 $ 7,131 $ 7,628 $ 7,594 $ 12,270 $ 15,222
Reinsurance Ceded - - - - - - - - - -
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 6,415 5,962 5,883 6,387 6,864 7,131 7,628 7,594 12,270 15,222
Net investment income 56,759 58,223 58,442 57,780 54,660 53,450 51,588 51,523 116,222 103,111
RIGL - All Other Investments 363 (1,324) 27 11,206 8,582 2,918 6,004 290 11,233 6,294
Other income 2,060 1,922 1,941 2,075 2,368 2,361 1,785 1,555 4,016 3,340
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 65,597 64,783 66,293 77,448 72,474 65,860 67,005 60,962 143,741 127,967
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 48,466 50,193 52,986 51,339 48,385 45,245 46,046 44,456 104,325 90,502
Amortization of deferred policy acquisition costs 5,734 5,258 4,386 13,967 13,508 6,335 9,057 7,119 18,353 16,176
Amortization of goodwill - - - - - - - - - -
Other operating expenses 8,716 7,919 5,910 7,312 7,533 8,010 6,745 4,673 13,222 11,418
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 62,916 63,370 63,282 72,618 69,426 59,590 61,848 56,248 135,900 118,096
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX 2,681 1,413 3,011 4,830 3,048 6,270 5,157 4,714 7,841 9,871
Adjustments to Reconcile to Operating Income:
Less: RIGL - All Other Investments 363 (1,324) 27 11,206 8,582 2,918 6,004 290 11,233 6,294
Add back: Related amortization of deferred policy acquisition costs 365 297 731 9,367 8,167 682 3,660 551 10,098 4,211
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
PRETAX OPERATING INCOME * $ 2,683 $ 3,034 $ 3,715 $ 2,991 $ 2,633 $ 4,034 $ 2,813 $ 4,975 $ 6,706 $ 7,788
=================================================================================================================================== =================================
STABLE VALUE CONTRACTS
REVENUES
Gross Premiums and Policy Fees $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Reinsurance Ceded - - - - - - - - - -
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees - - - - - - - - - -
Net investment income 61,725 62,840 58,532 59,090 56,441 59,041 64,033 66,666 117,622 130,699
RIGL - Derivatives (2,338) 1,363 (661) 940 523 173 271 135 279 406
RIGL - All Other Investments (4,028) (2,314) (6,041) 3,320 9,222 2,280 3,608 1,887 (2,721) 5,495
Other income - - - - - - - - - -
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 55,359 61,889 51,830 63,350 66,186 61,494 67,912 68,688 115,180 136,600
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 48,290 49,375 47,765 46,957 45,374 46,469 49,769 50,720 94,722 100,489
Amortization of deferred policy acquisition costs 581 563 599 519 542 619 761 803 1,118 1,564
Amortization of goodwill - - - - - - - - - -
Other operating expenses 1,431 1,568 1,030 1,516 1,002 1,801 1,804 1,217 2,546 3,021
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 50,302 51,506 49,394 48,992 46,918 48,889 52,334 52,740 98,386 105,074
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX 5,057 10,383 2,436 14,358 19,268 12,605 15,578 15,948 16,794 31,526
Adjustments to Reconcile to Operating Income:
Less: RIGL-Derivatives (2,338) 1,363 (661) 940 523 173 271 135 279 406
Less: RIGL-All Other Investments (4,028) (2,314) (6,041) 3,320 9,222 2,280 3,608 1,887 (2,721) 5,495
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
PRETAX OPERATING INCOME * $ 11,423 $ 11,334 $ 9,138 $ 10,098 $ 9,523 $ 10,152 $ 11,699 $ 13,926 $ 19,236 $ 25,625
=================================================================================================================================== =================================
ASSET PROTECTION
REVENUES
Gross Premiums and Policy Fees $ 123,411 $ 114,947 $ 105,924 $ 104,153 $ 112,850 $ 118,276 $ 118,179 $ 115,354 $ 210,077 $ 233,533
Reinsurance Ceded (52,683) (42,546) (44,152) (44,026) (52,128) (56,128) (63,106) (62,120) (88,178) (125,226)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 70,728 72,401 61,772 60,127 60,722 62,148 55,073 53,234 121,899 108,307
Net investment income 10,251 10,294 9,246 9,132 9,484 8,790 7,541 7,500 18,378 15,041
Realized investment gains (losses) - - - - - - - - - -
Other income 7,236 4,812 6,971 18,167 8,833 8,267 9,062 9,117 25,138 18,179
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 88,215 87,507 77,989 87,426 79,039 79,205 71,676 69,851 165,415 141,527
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 53,541 60,792 36,458 33,868 34,676 37,164 32,199 33,363 70,326 65,562
Amortization of deferred policy acquisition costs 15,738 20,402 18,483 21,425 19,838 20,574 19,956 17,522 39,908 37,478
Amortization of goodwill - - - - - - - - - -
Other operating expenses 20,352 30,758 21,806 22,372 19,413 17,389 14,918 14,595 44,178 29,513
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 89,631 111,952 76,747 77,665 73,927 75,127 67,073 65,480 154,412 132,553
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX $ (1,416) $ (24,445) $ 1,242 $ 9,761 $ 5,112 $ 4,078 $ 4,603 $ 4,371 $ 11,003 $ 8,974
=================================================================================================================================== =================================
* "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating
Income" may be compared.
PROTECTIVE LIFE CORPORATION Draft
Stable Value Contracts and Asset Protection Data 8/2/2004
(Dollar in thousands unless otherwise noted) Page 10
(Unaudited)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
STABLE VALUE CONTRACTS
SALES (millions)
GIC $ 92 $ 91 $ 219 $ 30 $ 25 $ 1 $ - $ 39 $ 249 $ 39
GFA - Direct Institutional 0 300 25 0 0 353 0 1 25 1
GFA - Non registered 0 0 200 100 100 105 0 0 300 0
GFA - Registered - Institutional 0 0 0 0 0 450 300 0 0 300
GFA - Registered - Retail 0 0 0 0 0 0 222 68 0 290
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 92 $ 391 $ 444 $ 130 $ 125 $ 909 $ 522 $ 108 $ 574 $ 630
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
DEPOSIT BALANCE (thous)
Quarter End Balance $ 3,860,241 $ 4,018,552 $ 4,106,685 $ 4,214,470 $ 4,135,212 $ 4,676,531 $ 4,923,231 $ 4,921,166 $ 4,214,470 $ 4,921,166
Average Daily Balance $ 3,973,202 $ 4,112,986 $ 4,035,367 $ 4,153,071 $ 4,147,034 $ 4,424,234 $ 4,851,592 $ 5,062,014 $ 4,094,474 $ 4,956,987
OPERATING SPREAD 1.17% 1.12% 0.93% 1.01% 0.95% 0.95% 1.00% 1.13% 0.97% 1.06%
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2003 2003 2003 2003 2004 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
ASSET PROTECTION
SALES
Credit $ 48,297 $ 37,990 $ 45,642 $ 51,168 $ 53,418 $ 48,024 $ 50,524 $ 59,035 $ 96,810 $ 109,559
Service Contracts 57,754 40,729 38,709 53,869 59,421 52,811 44,275 54,861 92,578 99,136
Other 25,547 28,150 17,386 23,650 18,410 9,905 8,873 8,941 41,036 17,814
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total $ 131,598 $ 106,869 $ 101,737 $ 128,687 $ 131,249 $ 110,740 $ 103,672 $ 122,837 $ 230,424 $ 226,509
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
PROTECTIVE LIFE CORPORATION Draft
Corp & Other Segment - Quarterly Earnings Trends 8/2/2004
(Dollars in thousands) Page 11
(Unaudited)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
2002 2002 2003 2003 2003 2003 2004 2004 6 MOS 6 MOS
3RD QTR 4TH QTR 1ST QTR 2ND QTR 3RD QTR 4TH QTR 1ST QTR 2ND QTR 2003 2004
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
REVENUES
Gross Premiums and Policy Fees $ 18,062 $ 17,828 $ 15,677 $ 13,973 $ 13,563 $ 13,294 $ 12,534 $ 12,550 $ 29,650 $ 25,084
Reinsurance Ceded (4,634) (4,012) (2,601) (810) (589) (229) (346) (337) (3,411) (683)
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Net Premiums and Policy Fees 13,428 13,816 13,076 13,163 12,974 13,065 12,188 12,213 26,239 24,401
Net investment income 12,549 15,192 12,647 16,707 8,627 21,302 24,851 22,577 29,354 47,428
RIGL - Derivatives 6,591 831 (4,219) 3,394 (9,571) 21,971 4,812 8,605 (825) 13,417
RIGL - All Other Investments 5,771 2,653 4,836 14,998 9,238 (2,522) 7,015 (3,100) 19,834 3,915
Other income 953 691 1,520 1,216 1,686 2,276 4,712 4,075 2,736 8,787
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Revenues 39,292 33,183 27,860 49,478 22,954 56,092 53,578 44,370 77,338 97,948
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
BENEFITS & EXPENSES
Benefits and settlement expenses 14,956 12,470 12,223 37,942 12,217 16,953 14,256 15,898 50,165 30,154
Amortization of deferred policy acquisition costs 1,856 7,306 1,326 1,385 1,748 1,085 1,090 1,207 2,711 2,297
Amortization of goodwill 0 0 0 0 0 0 0 0 0 0
Other operating expenses 16,742 20,284 18,368 20,205 21,957 25,889 26,975 23,986 38,573 50,961
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
Total Benefits and Expenses 33,554 40,060 31,917 59,532 35,922 43,927 42,321 41,091 91,449 83,412
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
INCOME BEFORE INCOME TAX 5,738 (6,877) (4,057) (10,054) (12,968) 12,165 11,257 3,279 (14,111) 14,536
Adjustments to Reconcile to Operating Income:
Less: RIGL-Derivatives 6,591 831 (4,219) 3,394 (9,571) 21,971 4,812 8,605 (825) 13,417
Less: RIGL-All Other Investments 5,771 2,653 4,836 14,998 9,238 (2,522) 7,015 (3,100) 19,834 3,915
Add back: Derivative Gains related to Corporate Debt and Investments 5,234 6,403 5,634 5,885 4,786 4,782 4,875 5,354 11,519 10,229
----------------------------------------------------------------------------------------------------------------------------------- ---------------------------------
PRETAX OPERATING INCOME * $ (1,390) $ (3,958) $ 960 $ (22,561) $ (7,849) $ (2,502) $ 4,305 $ 3,128 $ (21,601) $ 7,433
=================================================================================================================================== =================================
* "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating
Income" may be compared.