EXHIBIT 99.2
THE PHOENIX COMPANIES, INC.
FINANCIAL SUPPLEMENT March 31, 2003
EXHIBIT 99.2
The Phoenix Companies, Inc.
FINANCIAL SUPPLEMENT March 31, 2003
PNX
LISTED
NYSE [LOGO] PHOENIX WEALTH MANAGEMENT(R)
THE PHOENIX COMPANIES, INC.
FINANCIAL SUPPLEMENT
WALL STREET COVERAGE
FIRM ANALYST
A.G. Edwards J. Jeffrey Hopson
Deutsche Bank Vanessa Wilson
Dowling & Partners Len Savage
Keefe Bruyette & Woods Jukka Lipponen
Langen McAlleney Robert Glasspiegel
Legg Mason Thomas G. Gallagher
Lehman Brothers E. Stewart Johnson
Merrill Lynch Edward A. Spehar
Morgan Stanley Nigel Dally
UBS Warburg Andrew Kligerman
SHAREHOLDER INFORMATION
SECURITY LISTINGS
The common stock of The Phoenix Companies, Inc. is traded on the New York Stock
Exchange (NYSE) under the symbol "PNX." Our 7.25 percent equity units are traded
on the NYSE under the symbol "PNX PrA." Our 7.45 percent bond is traded on the
NYSE under the symbol "PFX."
TRANSFER AGENT AND REGISTRAR
For information or assistance regarding your account, please contact our
transfer agent and registrar:
EquiServe Trust Company, N.A. at: Phoenix Shareholder Services
C/O EquiServe Trust Company, P.O. Box 43076, Providence, RI 02940-3076
Toll-free: 1-800-490-4258 TTY 1-800-336-9449
Fax: 1-781-575-3583, e-mail: phoenix@equiserve.com
Web: phoenix.equiserve.com
FOR MORE INFORMATION
To receive additional information, including financial supplements and
Securities and Exchange Commission filings along with access to other
shareholder services, visit the Investor Relations Section on our Web site at
PhoenixWealthManagement.com or contact our Investor Relations Department at:
The Phoenix Companies, Inc.
Investor Relations
One American Row
P.O. Box 5056, Hartford, CT 06102-5056
Phone: 1-860-403-7100
Fax: 1-860-403-7880
e-mail: pnx.ir@PhoenixWealthManagement.com
For more information on our products and services, call your Phoenix
representative or visit our Web site at PhoenixWealthManagement.com.
In addition to net income presented in accordance with Generally Accepted
Accounting Principles ("GAAP"), Phoenix considers total segment income in
evaluating its financial performance. See page 2, Income Statement, for a
reconciliation of these measures. Total segment income is an internal
performance measure used by Phoenix in the management of its operations,
including its compensation plans and budgeting and planning processes. In
addition, management believes that total segment income provides additional
insight into the underlying trends in Phoenix's operations.
Total segment income represents income from continuing operations, (which is a
GAAP measure) before realized gains and losses and certain other items.
* Net realized investment gains and losses are excluded from total segment
income because their size and timing are frequently subject to our discretion.
* Certain other items which result from a business restructuring, a change in
regulatory requirements, or other unusual circumstances are excluded from
total segment income because we believe they are not indicative of overall
operating trends and are items that management believes are infrequent and
material.
Because certain of these items are excluded based on our discretion and involve
judgments by management, inconsistencies in their determination may exist and
total segment income may differ from similarly titled measures of other
companies.
THE PHOENIX COMPANIES, INC.
FINANCIAL SUPPLEMENT
MARCH 2003 (UNAUDITED)
TABLE OF CONTENTS
FINANCIAL HIGHLIGHTS 1
INCOME STATEMENT 2
LIFE AND ANNUITY EARNINGS SUMMARY 4
VARIABLE UNIVERSAL LIFE 6
UNIVERSAL LIFE / INTEREST SENSITIVE 8
LIFE SALES HIGHLIGHTS 10
ANNUITIES 12
ANNUITIES - NET FLOWS AND FUNDS UNDER MANAGEMENT 14
SUPPLEMENTARY LIFE AND ANNUITY INFORMATION 16
ASSET MANAGEMENT EARNINGS 18
ASSET MANAGEMENT - ASSETS UNDER MANAGEMENT 20
VENTURE CAPITAL SEGMENT 22
CORPORATE AND OTHER 24
CONSOLIDATED STATEMENT OF INCOME - GAAP FORMAT 26
CONSOLIDATING FIRST QUARTER 2003 INCOME STATEMENT 28
CONDENSED CONSOLIDATED BALANCE SHEET 29
INVESTMENT PORTFOLIO SUMMARY 30
REALIZED INVESTMENT GAINS AND LOSSES 31
THE PHOENIX COMPANIES, INC.
FINANCIAL HIGHLIGHTS
First Quarter 2003 (unaudited)
($ in millions, except per share data)
BALANCE SHEET INFORMATION December 31,
March ----------------------------------------------------------------
2003 2002 2001 2000 1999
-------------- -------------- --------------- -------------- ---------------
Invested Assets $ 17,182.9 $ 16,770.7 $ 14,420.4 $ 12,770.6 $ 11,776.8
Separate Account and Investment Trust Assets 5,990.7 5,793.1 5,570.0 5,376.6 5,923.9
Total Assets 25,932.5 25,236.1 22,525.4 20,313.2 20,287.0
Indebtedness 644.0 644.3 599.3 425.1 499.4
Total Stockholders' Equity 2,015.5 2,031.7 2,395.7 1,840.9 1,756.0
Debt to Total Capitalization 24.2% 24.1% 20.0% 18.8% 22.1%
Debt (Excluding Equity Units) to Total
Capitalization 18.4% 18.3%
Book Value Per Share (1) $ 21.20 $ 21.47 $ 23.51 $ 24.75 $ 23.94
Book Value Per Share, excluding SFAS 115
adjustment $ 20.42 $ 20.44 $ 22.72 $ 24.51 $ 23.70
Period-end Common and Equivalent Shares
Outstanding (2) 95.1 94.6 101.9 105.0 105.0
==============
- ------------------------------------------------------------------
Indebtedness: --------------
Surplus Notes 175.0 175.0 175.0 175.0 175.0
Equity Units 153.7 153.7
Senior Unsecured Bonds 300.0 300.0 300.0
Interest Rate Swap 15.3 15.6 (.8)
Bank Credit Facility 125.1 230.0 260.3
Other 20.1 64.1
-------------- -------------- --------------- -------------- ---------------
Total Indebtedness 644.0 644.3 599.3 425.1 499.4
============== ============== =============== ============== ===============
- ------------------------------------------------------------------
--------------
STATUTORY FINANCIAL DATA FOR PHOENIX LIFE
INSURANCE COMPANY (3)
Capital and Surplus $ 831.3 $ 861.0 $ 1,149.8 $ 1,322.8 $ 1,054.1
Asset Valuation Reserve (AVR) 181.5 147.0 221.5 559.7 368.7
-------------- -------------- --------------- -------------- ---------------
Capital, Surplus and AVR $ 1,012.8 $ 1,008.0 $ 1,371.3 $ 1,882.5 $ 1,422.8
============== ============== =============== ============== ===============
Policyholder Dividend Liability $ 562.2 $ 547.3 $ 167.2
Interest Maintenance Reserve $ (14.0) (2.0) $ 11.6 $ (1.4) $ 24.4
Statutory Gain From Operations $ 17.0 $ 44.5 $ 119.9 $ 266.4 $ 150.2
Statutory Net Income (Loss) $ (18.0) $ 7.5 $ (13.9) $ 266.1 $ 131.3
--------------
(1) Book value per share prior to June 30, 2001 is pro forma and assumes net
proceeds of $807.9 million, payout of cash and policy credits to
policyholders of $41.4 million and estimated remaining expenses of $9.0
million and 105.0 million shares outstanding.
(2) Shares outstanding through 2000 are pro forma due to IPO in 2001.
(3) Phoenix Life Insurance Company is required to file statements with state
regulatory authorities prepared on an accounting basis prescribed or
permitted by such authorities. March 2003 amounts are preliminary.
1
THE PHOENIX COMPANIES, INC.
FINANCIAL HIGHLIGHTS
First Quarter 2003 (unaudited)
($ in millions, except per share data)
INCOME STATEMENT SUMMARY March December 31,
--------------------------- ------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------ ------------- ------------ ------------ ------------ ------------
SEGMENT INCOME
Life Insurance $ 22.7 $ 25.6 $ 99.3 $ 68.6 $ 16.2 $ 41.4
Annuities (5.3) 2.6 (20.6) 10.9 4.2 30.8
------------ ------------- ------------ ------------ ------------ ------------
Life and Annuity Segment 17.4 28.2 78.7 79.5 20.4 72.2
Asset Management Segment (4.6) 1.9 (60.0) (.2) 71.0 65.7
Venture Capital Segment 23.9 (5.0) (59.3) (159.6) 277.3 139.9
Corporate and Other Segment (12.6) (8.7) (49.8) (43.2) (70.4) (55.5)
------------ ------------- ------------ ------------ ------------ ------------
Total Segment Income (Loss), before
income taxes 24.1 16.4 (90.4) (123.5) 298.3 222.3
Applicable Income Taxes (Benefit) 7.3 3.6 (28.7) (46.3) 99.1 76.1
------------ ------------- ------------ ------------ ------------ ------------
TOTAL SEGMENT OPERATING INCOME (LOSS) 16.8 12.8 (61.7) (77.2) 199.2 146.2
ADJUSTMENTS, AFTER INCOME TAXES:
Realized Gains (Losses), after
income taxes (12.4) 1.6 (39.3) (43.0) 62.0 49.2
Management Restructuring and Early
Retirement Costs (2.5) (28.5) (15.5) (17.6)
Deferred Policy Acquisition Cost
Adjustments 15.1 15.1 (141.8)
Expenses of Purchase of PXP Minority
Interest (52.8)
Demutualization Related Items, Net (.6) (1.3) (2.9) (24.5) (11.2)
Other income 1.3 5.3 (.1) (4.5)
Discontinued Operations (11.5) (72.9)
Cumulative Effect of Accounting Changes (130.3) (130.3) (16.6)
------------ ------------- ------------ ------------ ------------ ------------
NET INCOME (LOSS) $ 3.2 $ (101.4) $ (246.0) $ (202.7) $ 83.3 $ 89.2
============ ============= ============ ============ ============ ============
- -----------------------------------------------
EARNINGS PER SHARE
Basic
Weighted-Average Shares Outstanding (1) 94.0 101.2 97.9 104.6 104.6 104.6
------------ ------------- ------------ ------------ ------------ ------------
Total Segment Income (Loss) Per Share $ 0.18 $ 0.13 $ (0.63) $ (0.74) $ 1.90 $ 1.40
Net Income (Loss) Per Share $ 0.03 $ (1.00) $ (2.51) $ (1.94) $ 0.80 $ 0.85
------------
Diluted
------------
Weighted-Average Shares Outstanding (1) 95.0 101.2 98.0 104.6 104.6 104.6
------------ ------------- ------------ ------------ ------------ ------------
Total Segment Income (Loss) Per Share $ 0.18 $ 0.13 $ (0.63) $ (0.74) $ 1.90 $ 1.40
Net Income (Loss) Per Share $ 0.03 $ (1.00) $ (2.51) $ (1.94) $ 0.80 $ 0.85
------------
(1) Weighted-average shares outstanding through 2001 are pro forma due to
Initial Public Offering (IPO) in 2001.
2
THE PHOENIX COMPANIES, INC.
FINANCIAL HIGHLIGHTS
First Quarter 2003 (unaudited)
($ in millions, except per share data)
INCOME STATEMENT SUMMARY 2002 March
------------------------------------------------------------
Quarters ended March June September December 2003
------------ ------------- ------------- ------------ ------------
SEGMENT INCOME
Life Insurance $ 25.6 $ 27.2 $ 17.0 $ 29.5 $ 22.7
Annuities 2.6 .7 (18.9) (5.0) (5.3)
------------ ------------- ------------- ------------ ------------
Life and Annuity Segment 28.2 27.9 (1.9) 24.5 17.4
Asset Management Segment 1.9 .8 (65.2) 2.5 (4.6)
Venture Capital Segment (5.0) (29.9) (22.0) (2.4) 23.9
Corporate and Other Segment (8.7) (12.0) (12.6) (16.6) (12.6)
------------ ------------- ------------- ------------ ------------
Total Segment Income (Loss), before income
taxes 16.4 (13.2) (101.7) 8.0 24.1
Applicable Income Taxes (Benefit) 3.6 (9.1) (19.9) (3.3) 7.3
------------ ------------- ------------- ------------ ------------
TOTAL SEGMENT INCOME (LOSS) 12.8 (4.1) (81.8) 11.3 16.8
ADJUSTMENTS, AFTER INCOME TAXES:
Realized Gains (Losses), after income taxes 1.6 (10.7) (7.6) (22.6) (12.4)
Management Restructuring and Early Retirement
Costs (21.8) (3.6) (3.1) (2.5)
Deferred Policy Acquisition Cost Adjustments 15.1
Demutualization Related Items, Net (.6) (.6) (.1)
Other income 1.3
Cumulative Effect of Accounting Changes (130.3)
------------ ------------- ------------- ------------ ------------
NET INCOME (LOSS) $(101.4) $(37.2) $(93.0) $(14.5) $ 3.2
============ ============= ============= ============ ============
- -----------------------------------------------
EARNINGS PER SHARE
Basic
Weighted-Average Shares Outstanding (1) 101.2 99.5 96.6 94.2 94.0
------------ ------------- ------------- ------------ ------------
Total Segment Income (Loss) Per Share $ 0.13 $(0.04) $(0.85) $ 0.12 $ 0.18
Net Income (Loss) Per Share $(1.00) $(0.37) $(0.96) $(0.15) $ 0.03
------------
Diluted
------------
Weighted-Average Shares Outstanding (1) 101.2 99.5 96.6 94.7 95.0
------------ ------------- ------------- ------------ ------------
Total Segment Income (Loss) Per Share $ 0.13 $(0.04) $(0.85) $ 0.12 $ 0.18
Net Income (Loss) Per Share $(1.00) $(0.37) $(0.96) $(0.15) $ 0.03
------------
(1) Weighted-average shares outstanding through 2001 are pro forma due to
Initial Public Offering (IPO) in 2001.
3
THE PHOENIX COMPANIES, INC.
LIFE AND ANNUITY EARNINGS SUMMARY
First Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME March December 31,
----------------------------- -----------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------- ------------- ------------- ------------- -------------- -------------
Variable Universal Life $ 6.3 $ 10.0 $ 35.9 $ 30.2 $ 20.1 $ .8
Universal Life (1) 4.7 5.9 26.3 17.4 18.2 19.5
Term Life .4 (.5) 4.7 1.3 (1.0) 1.5
Other Life and Annuity (2) 2.5 (1.8) (.9) (1.7) 1.2 4.0
------------- ------------- ------------- ------------- -------------- -------------
Total, Non-participating Life 13.9 13.6 66.0 47.2 38.5 25.8
Participating Life 8.8 12.0 33.3 21.4 (22.3) 15.6
------------- ------------- ------------- ------------- -------------- -------------
Total, Life Insurance 22.7 25.6 99.3 68.6 16.2 41.4
Annuities (5.3) 2.6 (20.6) 10.9 4.2 30.8
------------- ------------- ------------- ------------- -------------- -------------
Segment Income, before income taxes 17.4 28.2 78.7 79.5 20.4 72.2
Allocated Income Taxes (3) 3.8 10.0 27.7 27.9 7.2 25.3
------------- ------------- ------------- ------------- -------------- -------------
Segment Income $ 13.6 $ 18.2 $ 51.0 $ 51.6 $ 13.2 $ 46.9
============= ============= ============= ============= ============== =============
(1) Universal Life includes interest sensitive whole life contracts.
(2) Other Life and Annuity includes trust operations and W.S. Griffith.
(3) Tax benefits related to tax advantaged investments have been allocated to
the Life and Annuity Segment beginning in the quarter ended March 2003.
4
THE PHOENIX COMPANIES, INC.
LIFE AND ANNUITY EARNINGS SUMMARY
First Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME 2002
----------------------------------------------------------- March
Quarters ended March June September December 2003
------------ ------------- ------------ ------------- -------------
Variable Universal Life $ 10.0 $ 8.1 $ 7.5 $ 10.2 $ 6.3
Universal Life (1) 5.9 8.3 5.0 7.2 4.7
Term Life (.5) 1.9 (.8) 4.1 .4
Other Life and Annuity (2) (1.8) 2.4 (.7) (.8) 2.5
------------ ------------- ------------ ------------- -------------
Total, Non-participating Life 13.6 20.7 11.0 20.7 13.9
Participating Life 12.0 6.5 6.0 8.8 8.8
------------ ------------- ------------ ------------- -------------
Total, Life Insurance 25.6 27.2 17.0 29.5 22.7
Annuities 2.6 .7 (18.9) (5.0) (5.3)
------------ ------------- ------------ ------------- -------------
Segment Income (Loss), before income taxes 28.2 27.9 (1.9) 24.5 17.4
Applicable Income Taxes (3) 10.0 9.9 (.7) 8.5 3.8
------------ ------------- ------------ ------------- -------------
Segment Income (Loss) $ 18.2 $ 18.0 $ (1.2) $ 16.0 $ 13.6
============ ============= ============ ============= =============
(1) Universal Life includes interest sensitive whole life contracts.
(2) Other Life and Annuity includes trust operations and W.S. Griffith.
(3) Tax benefits related to tax advantaged investments have been allocated to
the Life and Annuity Segment beginning in the quarter ended March 2003.
5
THE PHOENIX COMPANIES, INC.
VARIABLE UNIVERSAL LIFE
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
---------------------------- ----------------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------ ------------- ------------- -------------- -------------- --------------
PRE-TAX INCOME
Fees $ 7.6 $ 7.7 $ 31.4 $ 29.5 $ 24.9 $ 22.7
Cost of Insurance (COI) 17.9 15.8 66.4 60.0 46.2 38.5
Interest Earned 1.6 1.8 7.0 4.5 5.7 4.7
Surrender Charges 1.2 .8 4.4 3.3 3.5 3.0
------------ ------------- ------------- -------------- -------------- --------------
Total Revenues 28.3 26.1 109.2 97.3 80.3 68.9
------------ ------------- ------------- -------------- -------------- --------------
Net Death and Disability Benefits 5.0 4.5 22.9 15.3 15.5 13.4
Incurred Expenses 16.1 10.6 45.9 48.2 41.5 52.5
Interest Credited .9 .9 3.7 3.6 3.1 2.2
Minority Interest .1 .8
------------ ------------- ------------- -------------- -------------- --------------
Total Expenses 22.0 16.1 73.3 67.1 60.1 68.1
------------ ------------- ------------- -------------- -------------- --------------
Pre-tax Income 6.3 10.0 35.9 30.2 20.2 .8
============ ============= ============= ============== ============== ==============
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions and Concessions 5.2 8.9 36.6 29.5 34.1 23.1
Controllable Expenses and Other 11.4 16.7 60.8 60.1 57.3 60.3
------------ ------------- ------------- -------------- -------------- --------------
Total Current Expenses 16.6 25.6 97.4 89.6 91.4 83.4
Acquisition Costs Deferred (8.0) (18.4) (68.1) (65.4) (56.9) (42.8)
Acquisition Costs Amortized 7.5 3.4 16.6 24.0 7.0 11.9
------------ ------------- ------------- -------------- -------------- --------------
Incurred Expenses 16.1 10.6 45.9 48.2 41.5 52.5
============ ============= ============= ============== ============== ==============
- -----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 71.8 91.2 465.7 336.1 258.1 204.7
Surrenders (13.7) (6.3) (37.6) (31.2) (34.0) (22.2)
Deaths (.2) (.6) (1.8) (1.7) (1.4) (1.7)
------------ ------------- ------------- -------------- -------------- --------------
Net Sales 57.9 84.3 426.3 303.2 222.7 180.8
Performance (8.5) (4.5) (149.8) (194.0) (128.1) 207.6
Fees (8.4) (9.2) (35.8) (34.5) (33.0) (25.8)
Cost of Insurance (17.9) (15.8) (66.4) (60.0) (46.2) (38.5)
Acquisitions 10.5
------------ ------------- ------------- -------------- -------------- --------------
Change in Funds Under Management 23.1 54.8 174.3 14.7 15.4 334.6
Beginning Balance 1,270.3 1,096.0 1,096.0 1,081.3 1,065.9 731.3
------------ ------------- ------------- -------------- -------------- --------------
Ending Balance 1,293.4 1,150.8 1,270.3 1,096.0 1,081.3 1,065.9
============ ============= ============= ============== ============== ==============
LIFE INSURANCE IN FORCE $23,744.4 $21,136.1 $23,788.2 $20,436.1 $17,743.3 $13,740.3
============ ============= ============= ============== ============== ==============
6
THE PHOENIX COMPANIES, INC.
VARIABLE UNIVERSAL LIFE
First Quarter 2003 (unaudited)
($ in millions)
2002
------------------------------------------------------------------ March
Quarters ended March June September December 2003
-------------- -------------- -------------- -------------- --------------
PRE-TAX INCOME
Fees $ 7.7 $ 6.7 $ 8.6 $ 8.4 $ 7.6
Cost of Insurance (COI) 15.8 15.8 16.6 18.2 17.9
Interest Earned 1.8 1.7 2.0 1.5 1.6
Surrender Charges .8 1.0 1.1 1.5 1.2
-------------- -------------- -------------- -------------- --------------
Total Revenues 26.1 25.2 28.3 29.6 28.3
-------------- -------------- -------------- -------------- --------------
Net Death and Disability Benefits 4.5 5.3 6.9 6.2 5.0
Incurred Expenses 10.6 10.8 12.6 11.9 16.1
Interest Credited .9 .9 1.0 .9 .9
Minority Interest .1 .1 .3 .4
-------------- -------------- -------------- -------------- --------------
Total Expenses 16.1 17.1 20.8 19.4 22.0
-------------- -------------- -------------- -------------- --------------
Pre-tax Income 10.0 8.1 7.5 10.2 6.3
============== ============== ============== ============== ==============
- ---------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions and Concessions 8.9 8.6 11.5 7.6 5.2
Controllable Expenses and Other 16.7 18.0 14.4 11.7 11.4
-------------- -------------- -------------- -------------- --------------
Total Current Expenses 25.6 26.6 25.9 19.3 16.6
Acquisition Costs Deferred (18.4) (19.2) (18.6) (11.9) (8.0)
Acquisition Costs Amortized 3.4 3.4 5.3 4.5 7.5
-------------- -------------- -------------- -------------- --------------
Incurred Expenses 10.6 10.8 12.6 11.9 16.1
============== ============== ============== ============== ==============
- ---------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 91.2 81.3 133.6 159.6 71.8
Surrenders (6.3) (9.5) (7.1) (14.7) (13.7)
Deaths (.6) (.6) (.3) (.3) (.2)
-------------- -------------- -------------- -------------- --------------
Net Sales 84.3 71.2 126.2 144.6 57.9
Performance (4.5) (79.6) (109.5) 43.8 (8.5)
Fees (9.2) (8.4) (8.9) (9.3) (8.4)
Cost of Insurance (15.8) (15.8) (16.6) (18.2) (17.9)
-------------- -------------- -------------- -------------- --------------
Change in Funds Under Management 54.8 (32.6) (8.8) 160.9 23.1
Beginning Balance 1,096.0 1,150.8 1,118.2 1,109.4 1,270.3
-------------- -------------- -------------- -------------- --------------
Ending Balance 1,150.8 1,118.2 1,109.4 1,270.3 1,293.4
============== ============== ============== ============== ==============
LIFE INSURANCE IN FORCE $21,136.1 $22,168.9 $22,719.1 $23,788.2 $23,744.4
============== ============== ============== ============== ==============
7
THE PHOENIX COMPANIES, INC.
UNIVERSAL LIFE / INTEREST SENSITIVE
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
------------------------------- --------------------------------------------------------------
2003 2002 2002 2001 2000 1999
-------------- -------------- -------------- ------------- ------------- -------------
PRE-TAX INCOME
Fees $ 4.0 $ 2.6 $ 11.9 $ 8.6 $ 8.4 $ 7.6
Cost of Insurance 18.8 17.2 71.6 66.2 64.8 64.2
Interest Earned 24.7 26.4 108.4 111.9 108.7 112.0
Surrender Charges .7 1.2 3.9 4.0 5.5 7.2
-------------- -------------- -------------- ------------- ------------- -------------
Total Revenues 48.2 47.4 195.8 190.7 187.4 191.0
-------------- -------------- -------------- ------------- ------------- -------------
Net Death Benefits and
Supplemental Benefits 12.3 10.1 39.5 48.3 45.4 41.8
Incurred Expenses 11.0 9.9 44.3 34.6 32.5 35.0
Interest Credited 20.2 21.5 85.7 90.4 91.3 94.7
-------------- -------------- -------------- ------------- ------------- -------------
Total Expenses 43.5 41.5 169.5 173.3 169.2 171.5
-------------- -------------- -------------- ------------- ------------- -------------
Pre-tax Income 4.7 5.9 26.3 17.4 18.2 19.5
============== ============== ============== ============= ============= =============
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions 6.2 2.0 15.2 9.8 5.8 5.8
Controllable Expenses 16.0 9.6 52.6 32.1 23.7 19.7
-------------- -------------- -------------- ------------- ------------- -------------
Total Current Expenses 22.2 11.6 67.8 41.9 29.5 25.5
Acquisition Cost Deferred (15.3) (5.8) (40.2) (20.0) (8.7) (7.3)
Acquisition Cost Amortized 4.1 4.1 16.7 12.7 11.7 16.8
-------------- -------------- -------------- ------------- ------------- -------------
Incurred Expenses 11.0 9.9 44.3 34.6 32.5 35.0
============== ============== ============== ============= ============= =============
- -----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 45.6 31.6 149.3 104.6 90.9 97.2
Surrenders (30.9) (25.0) (107.4) (99.0) (108.2) (158.5)
Deaths (5.9) (7.3) (25.0) (18.5) (20.9) (20.2)
-------------- -------------- -------------- ------------- ------------- -------------
Net Sales 8.8 (.7) 16.9 (12.9) (38.2) (81.5)
Interest Credited 20.2 21.5 85.8 90.4 91.3 94.7
Fees (5.5) (3.1) (16.7) (10.5) (6.2) (4.6)
Cost of Insurance (18.8) (17.2) (71.6) (66.2) (64.8) (64.2)
-------------- -------------- -------------- ------------- ------------- -------------
Change in Funds Under Management 4.7 .5 14.4 .8 (17.9) (55.6)
Beginning Balance 1,510.0 1,495.6 1,495.6 1,494.8 1,512.7 1,568.3
-------------- -------------- -------------- ------------- ------------- -------------
Ending Fund Balance 1,514.7 1,496.1 1,510.0 1,495.6 1,494.8 1,512.7
============== ============== ============== ============= ============= =============
LIFE INSURANCE IN FORCE $10,914.9 $ 9,683.1 $10,476.7 $9,465.6 $ 9,644.2 $ 9,955.7
============== ============== ============== ============= ============= =============
8
THE PHOENIX COMPANIES, INC.
UNIVERSAL LIFE / INTEREST SENSITIVE
First Quarter 2003 (unaudited)
($ in millions)
PRE-TAX INCOME 2002
------------------------------------------------------------- March
Quarter ended March June September December 2003
------------- ------------ ------------- -------------- --------------
Fees $ 2.6 $ 2.7 $ 2.9 $ 3.7 $ 4.0
Cost of Insurance 17.2 17.7 17.9 18.8 18.8
Interest Earned 26.4 27.9 26.8 27.3 24.7
Surrender Charges 1.2 1.4 .8 .5 .7
------------- ------------ ------------- -------------- --------------
Total Revenues 47.4 49.7 48.4 50.3 48.2
------------- ------------ ------------- -------------- --------------
Net Death Benefits and Supplemental Benefits 10.1 9.6 10.6 9.1 12.3
Incurred Expenses 9.9 10.3 11.5 12.6 11.0
Interest Credited 21.5 21.5 21.3 21.4 20.2
------------- ------------ ------------- -------------- --------------
Total Expenses 41.5 41.4 43.4 43.1 43.5
------------- ------------ ------------- -------------- --------------
Pre-tax Income 5.9 8.3 5.0 7.2 4.7
============= ============ ============= ============== ==============
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions 2.0 3.1 3.7 6.4 6.2
Controllable Expenses 9.6 10.5 12.6 19.9 16.0
------------- ------------ ------------- -------------- --------------
Total Current Expenses 11.6 13.6 16.3 26.3 22.2
Acquisition Cost Deferred (5.8) (7.2) (10.0) (17.2) (15.3)
Acquisition Cost Amortized 4.1 3.9 5.2 3.5 4.1
------------- ------------ ------------- -------------- --------------
Incurred Expenses 9.9 10.3 11.5 12.6 11.0
============= ============ ============= ============== ==============
- -----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 31.6 34.9 33.3 49.5 45.6
Surrenders (25.0) (30.2) (26.7) (25.5) (30.9)
Deaths (7.3) (2.2) (12.9) (2.6) (5.9)
------------- ------------ ------------- -------------- --------------
Net Sales (.7) 2.5 (6.3) 21.4 8.8
Interest Credited 21.5 21.5 21.3 21.5 20.2
Fees (3.1) (3.4) (4.4) (5.8) (5.5)
Cost of Insurance (17.2) (17.7) (17.9) (18.8) (18.8)
------------- ------------ ------------- -------------- --------------
Change in Funds Under Management .5 2.9 (7.3) 18.3 4.7
Beginning Balance 1,495.6 1,496.1 1,499.0 1,491.7 1,510.0
------------- ------------ ------------- -------------- --------------
Ending Fund Balance 1,496.1 1,499.0 1,491.7 1,510.0 1,514.7
============= ============ ============= ============== ==============
LIFE INSURANCE IN FORCE $9,683.1 $9,719.2 $9,907.3 $10,476.7 $10,914.9
============= ============ ============= ============== ==============
9
THE PHOENIX COMPANIES, INC.
LIFE SALES HIGHLIGHTS
First Quarter 2003 (unaudited)
($ in millions)
LIFE INSURANCE PREMIUM March December 31,
--------------------------- -------------------------------------------------
2003 2002 2002 2001 2000 1999
----------- ---------- ---------- ---------- ---------- -----------
Wholesaler Channel Variable Universal Life $ 6.3 $ 22.3 $ 62.5 $ 53.8 $ 61.1 $ 44.8
Private Placement Variable Universal Life 4.4 3.5 51.0 29.5 18.2
----------- ---------- ---------- ---------- ---------- -----------
Variable Universal Life 10.7 25.8 113.5 83.3 79.3 44.8
Universal Life/Interest Sensitive 11.9 8.0 36.9 14.5 8.0 7.6
Term Life 4.5 2.7 15.1 11.4 14.6 10.5
Participating Whole Life .6 1.1 4.8 9.7 22.6 35.7
----------- ---------- ---------- ---------- ---------- -----------
Life Insurance Annualized Premium (1) 27.7 37.6 170.3 118.9 124.5 98.6
=========== ========== ========== ========== ========== ===========
Wholesaler Channel Variable Universal Life 4.1 4.9 25.1 49.7 46.2 63.2
Private Placement Variable Universal Life 10.8 10.9 129.9 36.9 15.5
----------- ---------- ---------- ---------- ---------- -----------
Variable Universal Life 14.9 15.8 155.0 86.6 61.7 63.2
Universal Life/Interest Sensitive 7.2 2.7 29.9 14.5 1.8 .3
Participating Whole Life .4 .8 2.4 5.4 24.4
----------- ---------- ---------- ---------- ---------- -----------
Life Insurance Single Premium 22.1 18.9 185.7 103.5 68.9 87.9
=========== ========== ========== ========== ========== ===========
Wholesaler Channel Variable Universal Life 10.4 27.2 87.6 103.5 107.3 108.0
Private Placement Variable Universal Life 15.2 14.4 180.9 66.4 33.7
----------- ---------- ---------- ---------- ---------- -----------
Variable Universal Life 25.6 41.6 268.5 169.9 141.0 108.0
Universal Life/Interest Sensitive 19.1 10.7 66.8 29.0 9.8 7.9
Term Life 4.5 2.7 15.1 11.4 14.6 10.5
Participating Whole Life .6 1.5 5.6 12.1 28.0 60.1
----------- ---------- ---------- ---------- ---------- -----------
Total Life Insurance Premium $ 49.8 $ 56.5 $ 356.0 $ 222.4 $ 193.4 $ 186.5
=========== ========== ========== ========== ========== ===========
(1) Annualized Premium represents first year premiums on an annual basis. Total
Premium represents Annualized and Single premiums.
10
THE PHOENIX COMPANIES, INC.
LIFE SALES HIGHLIGHTS
First Quarter 2003 (unaudited)
($ in millions)
LIFE INSURANCE PREMIUM 2002
---------------------------------------------------------- March
Quarters ended March June September December 2003
------------ ------------- ------------ ------------ ------------
Wholesaler Channel Variable Universal Life $ 22.3 $ 16.0 $ 11.3 $ 12.9 $ 6.3
Private Placement Variable Universal Life 3.5 13.2 19.0 15.3 4.4
------------ ------------- ------------ ------------ ------------
Variable Universal Life 25.8 29.2 30.3 28.2 10.7
Universal Life/Interest Sensitive 8.0 3.6 6.9 18.4 11.9
Term Life 2.7 3.3 3.7 5.3 4.5
Participating Whole Life 1.1 1.6 .7 1.4 .6
------------ ------------- ------------ ------------ ------------
Life Insurance Annualized Premium (1) 37.6 37.7 41.6 53.3 27.7
============ ============= ============ ============ ============
Wholesaler Channel Variable Universal Life 4.9 6.8 6.9 6.5 4.1
Private Placement Variable Universal Life 10.9 4.4 47.1 67.5 10.8
------------ ------------- ------------ ------------ ------------
Variable Universal Life 15.8 11.2 54.0 74.0 14.9
Universal Life/Interest Sensitive 2.7 6.7 6.1 14.5 7.2
Participating Whole Life .4 .3 .1
------------ ------------- ------------ ------------ ------------
Life Insurance Single Premium 18.9 18.2 60.1 88.6 22.1
============ ============= ============ ============ ============
Wholesaler Channel Variable Universal Life 27.2 22.8 18.2 19.4 10.4
Private Placement Variable Universal Life 14.4 17.6 66.1 82.8 15.2
------------ ------------- ------------ ------------ ------------
Variable Universal Life 41.6 40.4 84.3 102.2 25.6
Universal Life/Interest Sensitive 10.7 10.3 13.0 32.9 19.1
Term Life 2.7 3.3 3.7 5.3 4.5
Participating Whole Life 1.5 1.9 .7 1.5 .6
------------ ------------- ------------ ------------ ------------
Total Life Insurance Premium $ 56.5 $ 55.9 $ 101.7 $ 141.9 $ 49.8
============ ============= ============ ============ ============
(1) Annualized Premium represents first year premiums on an annual basis. Total
Premium represents Annualized and Single premiums.
11
THE PHOENIX COMPANIES, INC.
ANNUITIES
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
----------------------------- ---------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------- ------------- ------------- ------------ ------------ -----------
PRE-TAX INCOME
Premiums
Fees $ 12.8 $ 15.2 $ 57.1 $ 64.6 $ 78.2 $ 71.9
Interest Earned 34.1 16.6 98.3 40.3 16.3 13.7
Surrender Charges 1.5 1.1 6.6 3.9 5.1 5.5
------------- ------------- ------------- ------------ ------------ -----------
Total Revenues 48.4 32.9 162.0 108.8 99.6 91.1
------------- ------------- ------------- ------------ ------------ -----------
Policy Benefits and Change in Reserves
Mortality Cost 2.8 1.9 10.8 4.3 3.0 2.7
Incurred Expenses 19.4 13.1 79.8 54.4 77.3 48.9
Interest Credited 31.5 15.3 92.0 39.2 15.1 8.7
------------- ------------- ------------- ------------ ------------ -----------
Total Expenses 53.7 30.3 182.6 97.9 95.4 60.3
------------- ------------- ------------- ------------ ------------ -----------
Pre-tax Income (Loss) (5.3) 2.6 (20.6) 10.9 4.2 30.8
============= ============= ============= ============ ============ ===========
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions/Concessions 16.7 11.4 81.3 44.0 29.2 14.5
Controllable Expenses 18.0 16.3 66.5 75.2 54.1 32.4
------------- ------------- ------------- ------------ ------------ -----------
Total Current Expenses 34.7 27.7 147.8 119.2 83.2 46.9
Acquisition Cost Deferred (24.7) (18.9) (102.9) (83.8) (43.0) (21.1)
Acquisition Cost Amortized 9.4 4.3 34.9 19.0 37.0 23.1
------------- ------------- ------------- ------------ ------------ -----------
Incurred Expenses $ 19.4 $ 13.1 $ 79.8 $ 54.4 $ 77.3 $ 48.9
============= ============= ============= ============ ============ ===========
12
THE PHOENIX COMPANIES, INC.
ANNUITIES
First Quarter 2003 (unaudited)
($ in millions)
PRE-TAX INCOME 2002
----------------------------------------------------------- March
Quarters ended March June September December 2003
------------- ------------ ------------ ------------ ------------
Premiums
Fees $ 15.2 $ 14.4 $ 14.0 $ 13.5 $ 12.8
Interest Earned 16.6 22.8 30.3 28.6 34.1
Surrender Charges 1.1 1.2 2.3 2.0 1.5
------------- ------------ ------------ ------------
------------
Total Revenues 32.9 38.4 46.6 44.1 48.4
------------- ------------ ------------ ------------ ------------
Policy Benefits and Change in Reserves
Mortality Cost 1.9 2.0 5.2 1.7 2.8
Incurred Expenses 13.1 16.5 31.0 19.2 19.4
Interest Credited 15.3 19.2 29.3 28.2 31.5
------------- ------------ ------------ ------------ ------------
Total Expenses 30.3 37.7 65.5 49.1 53.7
------------- ------------ ------------ ------------ ------------
Pre-tax Income (Loss) 2.6 .7 (18.9) (5.0) (5.3)
============= ============ ============ ============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions/Concessions 11.4 17.5 44.1 8.3 16.7
Controllable Expenses 16.3 16.7 16.1 17.4 18.0
------------- ------------ ------------ ------------ ------------
Total Current Expenses 27.7 34.2 60.2 25.7 34.7
Acquisition Cost Deferred (18.9) (24.6) (48.5) (10.9) (24.7)
Acquisition Cost Amortized 4.3 6.9 19.3 4.4 9.4
------------- ------------ ------------ ------------ ------------
Incurred Expenses $ 13.1 $ 16.5 $ 31.0 $ 19.2 $ 19.4
============= ============ ============ ============ ============
13
THE PHOENIX COMPANIES, INC.
ANNUITIES NET FLOWS AND FUNDS UNDER MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
FUNDS UNDER MANAGEMENT March December 31,
---------------------------- --------------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------- ------------- ------------- -------------- ------------- -------------
Annuities
Deposits $ 432.1 $ 575.4 $ 2,258.4 $ 1,492.9 $ 687.0 $ 377.4
Surrenders (231.6) (127.0) (736.7) (482.3) (608.5) (618.1)
------------- ------------- ------------- -------------- ------------- -------------
Net Sales 200.5 448.4 1,521.7 1,010.6 78.5 (240.7)
Performance and Interest Credited 20.2 (1.4) (338.0) (563.1) (415.2) 991.1
Fees (11.5) (15.9) (58.8) (67.3) (78.2) (71.9)
Deaths (22.6) (7.2) (40.6) (34.3) (24.9) (22.0)
Acquisitions 114.9
------------- ------------- ------------- -------------- ------------- -------------
Change in Funds Under Management 186.6 423.9 1,084.3 345.9 (439.8) 771.4
Beginning Balance 5,833.4 4,749.1 4,749.1 4,403.2 4,843.0 4,072.3
------------- ------------- ------------- -------------- ------------- -------------
Ending Balance $ 6,020.0 $ 5,173.0 $ 5,833.4 $ 4,749.1 $ 4,403.2 $ 4,843.7
============= ============= ============= ============== ============= =============
------------
VA Funds in Guaranteed Interest
Accounts (1) $ 2,224.8 $ 1,179.5 $ 2,159.3 $ 955.0 $ 333.5 $ 210.9
============= ============= ============= ============== ============= =============
-------------
Fixed Annuities (1) $ 921.4 $ 378.1 $ 737.2 $ 267.3
============= ============= ============= ==============
(1) Amounts are included in the annuities funds under management table above.
14
THE PHOENIX COMPANIES, INC.
ANNUITIES NET FLOWS AND FUNDS UNDER MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
FUNDS UNDER MANAGEMENT 2002
----------------------------------------------------------- March
Quarters ended March June September December 2003
------------- ------------ ------------ ------------ ------------
Variable Annuities
Deposits $ 575.4 $ 661.0 $ 804.2 $ 217.8 $ 432.1
Surrenders (127.0) (189.4) (180.5) (239.8) (231.6)
------------- ------------ ------------ ------------ ------------
Net Sales 448.4 471.6 623.7 (22.0) 200.5
Performance and Interest Credited (1.4) (219.0) (294.7) 177.1 20.2
Fees (15.9) (15.7) (13.8) (13.4) (11.5)
Deaths (7.2) (9.0) (11.4) (13.0) (22.6)
------------- ------------ ------------ ------------ ------------
Change in Funds Under Management 423.9 227.9 303.8 128.7 186.6
Beginning Balance 4,749.1 5,173.0 5,400.9 5,704.7 5,833.4
------------- ------------ ------------ ------------ ------------
Ending Balance $ 5,173.0 $ 5,400.9 $5,704.7 $5,833.4 $ 6,020.0
============= ============ ============ ============ ============
------------
VA Funds in Guaranteed Interest
Accounts (1) $ 1,179.5 $ 1,534.2 $2,118.1 $2,159.3 $ 2,224.8
============= ============ ============ ============ ============
------------
Fixed Annuities (1) $ 378.1 $ 559.7 $ 706.6 $ 737.2 $ 921.4
============= ============ ============ ============ ============
(1) Amounts are included in the annuities funds under management table above.
15
THE PHOENIX COMPANIES, INC.
SUPPLEMENTARY LIFE AND ANNUITY INFORMATION
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
----------------------------- -----------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------ -------------- -------------- ------------- ------------- -------------
DEFERRED ACQUISITION COSTS
Variable Universal Life $ 310.9 $ 268.6 $ 310.4 $ 252.8 $ 211.4 $ 161.5
Universal Life 172.6 139.1 163.1 134.7 127.4 130.4
Variable Annuities 271.2 219.5 264.9 211.4 147.0 141.0
Fixed Annuities 35.3 6.1 26.3 .4
Participating 556.4 544.8 554.6 517.4 554.8 786.6
Other 22.6 17.7 21.2 17.5 17.4 21.7
Adjustment for Unrealized Gains
and Losses (99.0) (3.9) (106.4) (10.5) (39.0) 77.6
------------ -------------- -------------- ------------- ------------- -------------
Total $ 1,270.0 $ 1,191.9 $ 1,234.1 $ 1,123.7 $ 1,019.0 $ 1,318.8
============ ============== ============== ============= ============= =============
- -----------------------------------------------------------------------------------------------------------------------------------
VARIABLE ANNUITY GUARANTEED MINIMUM
DEATH BENEFITS
Death Benefit in Excess of Fund Value $ 1,188.4 $ 337.5 $ 1,148.4
Death Benefit in Excess of Fund Value,
Net of Reinsurance 242.3 5.7 234.9
Statutory Reserve 16.1 5.3 15.8
GAAP Reserve 9.2 .3 8.7
============ ============== ==============
16
THE PHOENIX COMPANIES, INC.
SUPPLEMENTARY LIFE AND ANNUITY INFORMATION
First Quarter 2003 (unaudited)
($ in millions)
2002
------------------------------------------------------------ March
Quarters ended March June September December 2003
------------- ------------ ------------- ------------- ------------
DEFERRED ACQUISITION COSTS
Variable Universal Life $ 268.6 $ 284.3 $ 303.0 $ 310.4 $ 310.9
Universal Life 139.1 142.4 147.2 163.1 172.6
Variable Annuities 219.5 230.9 267.6 264.9 271.2
Fixed Annuities 6.1 12.4 17.0 26.3 35.3
Participating 544.8 557.5 555.6 554.6 556.4
Other 17.7 18.8 19.8 21.2 22.6
Adjustment for Unrealized Gains and Losses (3.9) (34.3) (74.9) (106.4) (99.0)
------------- ------------ ------------- ------------- ------------
Total $1,191.9 $1,212.0 $1,235.3 $ 1,234.1 $1,270.0
============= ============ ============= ============= ============
- -----------------------------------------------------------------------------------------------------------------------------------
VARIABLE ANNUITY GUARANTEED MINIMUM DEATH BENEFITS
Death Benefit in Excess of Fund Value $ 337.5 $ 440.8 $ 822.5 $ 1,148.4 $1,188.4
Death Benefit in Excess of Fund Value,
Net of Reinsurance 5.7 10.3 194.3 234.9 242.3
Statutory Reserve 5.3 6.0 16.6 15.8 16.1
GAAP Reserve .3 .5 8.1 8.7 9.2
============= ============ ============= ============= ============
17
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME March December 31,
------------------------------- ------------------------------------------------------------
2003 2002 2002 2001 2000 1999
-------------- -------------- ------------- ------------- -------------- ------------
Investment Management Fees $ 48.7 $ 59.2 $ 227.4 $ 221.6 $ 282.1 $ 247.0
Mutual Funds - Ancillary Fees 4.4 5.4 20.4 24.3 32.4 31.7
Other Revenue 1.6 2.4 10.2 12.9 8.8 4.7
-------------- -------------- ------------- ------------- -------------- ------------
Total Revenues 54.7 67.0 258.0 258.8 323.3 283.4
-------------- -------------- ------------- ------------- -------------- ------------
Employment Expenses 30.7 38.2 140.5 130.0 137.4 114.0
Other Operating Expenses 19.5 18.9 77.7 83.2 79.9 69.7
Amortization of Intangibles 8.4 8.1 32.5 49.0 31.8 30.3
Intangible Asset Impairments 66.3
-------------- -------------- ------------- ------------- -------------- ------------
Total Operating Expenses 58.6 65.2 317.0 262.2 249.1 214.0
-------------- -------------- ------------- ------------- -------------- ------------
Management Income (Loss) (3.9) 1.8 (59.0) (3.4) 74.2 69.4
Other Income (Expense) - Net .9 1.0 1.6 3.7 4.0
Equity in Aberdeen Asset Management
Net Income 1.2 3.0 9.9 8.5 9.6 5.7
Minority Interest (2.8) (2.9) (11.9) (6.9) (16.5) (13.4)
-------------- -------------- ------------- ------------- -------------- ------------
Segment Income, before income taxes (4.6) 1.9 (60.0) (.2) 71.0 65.7
Applicable Income Taxes (Benefit) (1.7) (.5) (6.0) 5.6 35.4 30.9
-------------- -------------- ------------- ------------- -------------- ------------
Segment Income (Loss) $ (2.9) $ 2.4 $ (54.0) $ (5.8) $ 35.6 $ 34.8
============== ============== ============= ============= ============== ============
- ------------------------------------------------------------------------------------------------------------------------------------
18
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
2002
SEGMENT INCOME ----------------------------------------------------------- March
Quarters ended March June September December 2003
------------ ------------- ------------ ------------- -------------
Investment Management Fees $59.2 $61.8 $ 55.6 $50.8 $ 48.7
Mutual Funds - Ancillary Fees 5.4 5.3 4.9 4.8 4.4
Other Revenue 2.4 2.7 2.3 2.8 1.6
------------ ------------- ------------ ------------- -------------
Total Revenues 67.0 69.8 62.8 58.4 54.7
------------ ------------- ------------ ------------- -------------
Employment Expenses 38.2 40.7 32.8 28.8 30.7
Other Operating Expenses 18.9 21.0 19.8 18.0 19.5
Amortization of Intangibles 8.1 7.8 8.7 7.9 8.4
Intangible Asset Impairments 66.3
------------ ------------- ------------ ------------- -------------
Total Operating Expenses 65.2 69.5 127.6 54.7 58.6
------------ ------------- ------------ ------------- -------------
Management Income (Loss) 1.8 .3 (64.8) 3.7 (3.9)
Other Income (Expense) - Net .4 .1 .5 .9
Equity in Aberdeen Asset Management Net Income 3.0 3.4 2.6 .9 1.2
Minority Interest (2.9) (3.3) (3.1) (2.6) (2.8)
------------ ------------- ------------ ------------- -------------
Segment Income, before income taxes 1.9 .8 (65.2) 2.5 (4.6)
Applicable Income Taxes (Benefit) (.5) (1.4) (5.2) 1.1 (1.7)
------------ ------------- ------------ ------------- -------------
Segment Income (Loss) $ 2.4 $ 2.2 $(60.0) $ 1.4 $ (2.9)
============ ============= ============ ============= =============
- -----------------------------------------------------------------------------------------------------------------------------------
19
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT NET FLOWS AND ASSETS UNDER MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
------------------------------- ------------------------------------------------------------
2003 2002 2002 2001 2000 1999
-------------- -------------- -------------- ------------- ------------- -------------
PRIVATE CLIENT PRODUCTS:
Managed Accounts
Inflows $ 568.8 $ 1,149.7 $ 4,421.1 $ 2,721.9 $ 3,869.4 $ 2,143.2
Outflows (688.4) (538.0) (2,716.3) (2,546.4) (1,619.8) (1,034.3)
-------------- -------------- -------------- ------------- ------------- -------------
Net Flows (119.6) 611.7 1,704.8 175.5 2,249.6 1,108.9
Performance 434.8 661.2 (3,278.2) (3,545.8) (2,859.1) 1,939.0
Acquisitions (Divestitures) 5,809.0 5,914.3 748.5 (130.0) 433.0
-------------- -------------- -------------- ------------- ------------- -------------
Change in Assets Under Management 315.2 7,081.9 4,340.9 (2,621.8) (739.5) 3,480.9
Beginning Balance 13,179.2 8,838.3 8,838.3 11,460.1 12,199.6 8,718.7
-------------- -------------- -------------- ------------- ------------- -------------
Ending Balance 13,494.4 15,920.2 13,179.2 8,838.3 11,460.1 12,199.6
-------------- -------------- -------------- ------------- ------------- -------------
Mutual Funds
Inflows 313.3 282.1 1,332.8 1,817.8 2,068.5 1,657.8
Outflows (498.8) (603.7) (2,754.0) (2,756.4) (3,492.0) (3,216.3)
-------------- -------------- -------------- ------------- ------------- -------------
Net Flows (185.5) (321.6) (1,421.2) (938.6) (1,423.5) (1,558.5)
Performance (101.4) (90.2) (1,811.8) (2,556.5) (1,933.2) 3,124.7
Acquisitions (Divestitures) 333.5 333.5 2,099.8
-------------- -------------- -------------- ------------- ------------- -------------
Change in Assets Under Management (286.9) (78.3) (2,899.5) (3,495.1) (3,356.7) 3,666.0
Beginning Balance 8,322.1 11,221.6 11,221.6 14,716.7 18,073.4 14,407.4
-------------- -------------- -------------- ------------- ------------- -------------
Ending Balance 8,035.2 11,143.3 8,322.1 11,221.6 14,716.7 18,073.4
-------------- -------------- -------------- ------------- ------------- -------------
INSTITUTIONAL PRODUCTS:
Inflows 793.7 832.7 4,380.4 4,989.0 5,572.5 5,843.7
Outflows (640.9) (723.3) (4,480.0) (3,766.9) (7,355.6) (5,025.6)
-------------- -------------- -------------- ------------- ------------- -------------
Net Flows 152.8 109.4 (99.6) 1,222.1 (1,783.1) 818.1
Performance (1) (1,724.4) (425.9) (2,773.1) (1,152.2) 935.4 1,628.2
Other (1) 496.4 409.4 1,789.0 1,438.4 141.3 274.3
Acquisitions (Divestitures) 1,507.7 1,507.7 105.9 (3,206.0) 1,246.5
-------------- -------------- -------------- ------------- ------------- -------------
Change in Assets Under Management (1,075.2) 1,600.6 424.0 1,614.2 (3,912.4) 3,967.1
Beginning Balance 32,454.2 32,030.2 32,030.2 30,416.0 34,328.4 30,361.3
-------------- -------------- -------------- ------------- ------------- -------------
Ending Balance 31,379.0 33,630.8 32,454.2 32,030.2 30,416.0 34,328.4
-------------- -------------- -------------- ------------- ------------- -------------
TOTAL PRIVATE CLIENT AND
INSTITUTIONAL PRODUCTS:
Inflows 1,675.8 2,264.5 10,134.3 9,528.7 11,510.4 9,644.7
Outflows (1,828.1) (1,865.0) (9,950.3) (9,069.7) (12,467.4) (9,276.2)
-------------- -------------- -------------- ------------- ------------- -------------
Net Flows (152.3) 399.5 184.0 459.0 (957.0) 368.5
Performance (1) (1,391.0) 145.1 (7,863.1) (7,254.5) (3,856.9) 6,691.9
Other (1) 496.4 409.4 1,789.0 1,438.4 141.3 274.3
Acquisitions (Divestitures) 7,650.2 7,755.5 854.4 (3,336.0) 3,779.3
-------------- -------------- -------------- ------------- ------------- -------------
Change in Assets Under Management (1,046.9) 8,604.2 1,865.4 (4,502.7) (8,008.6) 11,114.0
Beginning Balance 53,955.5 52,090.1 52,090.1 56,592.8 64,601.4 53,487.4
-------------- -------------- -------------- ------------- ----------------------------
Ending Balance $52,908.6 $60,694.3 $53,955.5 $52,090.1 $56,592.8 $64,601.4
============== ============== ============== ============= ============================
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
20
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT NET FLOWS AND ASSETS UNDER MANAGEMENT
First Quarter 2003 (unaudited)
($ in millions)
2002
---------------------------------------------------------------- March
Quarters ended March June September December 2003
------------- -------------- -------------- -------------- ---------------
PRIVATE CLIENT PRODUCTS:
Managed Accounts
Inflows $ 1,149.7 $ 1,732.5 $ 892.2 $ 646.8 $ 568.8
Outflows (538.0) (816.3) (810.1) (551.9) (688.4)
------------- -------------- -------------- -------------- ---------------
Net Flows 611.7 916.2 82.1 94.9 (119.6)
Performance 661.2 (1,882.0) (2,320.1) 262.6 434.8
Acquisitions (Divestitures) 5,809.0 105.3
------------- -------------- -------------- -------------- ---------------
Change in Assets Under Management 7,081.9 (965.8) (2,132.7) 357.5 315.2
Beginning Balance 8,838.3 15,920.2 14,954.4 12,821.7 13,179.2
------------- -------------- -------------- -------------- ---------------
Ending Balance 15,920.2 14,954.4 12,821.7 13,179.2 13,494.4
------------- -------------- -------------- -------------- ---------------
Mutual Funds
Inflows 282.1 370.5 318.4 361.8 313.3
Outflows (603.7) (727.9) (610.6) (811.9) (498.8)
------------- -------------- -------------- -------------- ---------------
Net Flows (321.6) (357.4) (292.2) (450.1) (185.5)
Performance (90.2) (1,109.9) (994.6) 383.0 (101.4)
Acquisitions (Divestitures) 333.5
------------- -------------- -------------- -------------- ---------------
Change in Assets Under Management (78.3) (1,467.3) (1,286.8) (67.1) (286.9)
Beginning Balance 11,221.6 11,143.3 9,676.0 8,389.2 8,322.1
------------- -------------- -------------- -------------- ---------------
Ending Balance 11,143.3 9,676.0 8,389.2 8,322.1 8,035.2
------------- -------------- -------------- -------------- ---------------
INSTITUTIONAL PRODUCTS:
Inflows 832.7 960.6 1,798.6 788.5 793.7
Outflows (723.3) (2,071.5) (1,178.3) (506.9) (640.9)
------------- -------------- -------------- -------------- ---------------
Net Flows 109.4 (1,110.9) 620.3 281.6 152.8
Performance (1) (425.9) (1,112.0) (1,063.1) (172.1) (1,724.4)
Other (1) 409.4 518.8 600.3 260.5 496.4
Acquisitions (Divestitures) 1,507.7
------------- -------------- -------------- -------------- ---------------
Change in Assets Under Management 1,600.6 (1,704.1) 157.5 370.0 (1,075.2)
Beginning Balance 32,030.2 33,630.8 31,926.7 32,084.2 32,454.2
------------- -------------- -------------- -------------- ---------------
Ending Balance 33,630.8 31,926.7 32,084.2 32,454.2 31,379.0
------------- -------------- -------------- -------------- ---------------
TOTAL PRIVATE CLIENT AND
INSTITUTIONAL PRODUCTS:
Inflows 2,264.5 3,063.6 3,009.2 1,797.1 1,675.8
Outflows (1,865.0) (3,615.7) (2,599.0) (1,870.7) (1,828.1)
------------- -------------- -------------- -------------- ---------------
Net Flows 399.5 (552.1) 410.2 (73.6) (152.3)
Performance (1) 145.1 (4,103.9) (4,377.8) 473.5 (1,391.0)
Other (1) 409.4 518.8 600.3 260.5 496.4
Acquisitions (Divestitures) 7,650.2 105.3
------------- -------------- -------------- -------------- ---------------
Change in Assets Under Management 8,604.2 (4,137.2) (3,262.0) 660.4 (1,046.9)
Beginning Balance 52,090.1 60,694.3 56,557.1 53,295.1 53,955.5
------------- -------------- -------------- -------------- ---------------
Ending Balance $60,694.3 $56,557.1 $53,295.1 $53,955.5 $52,908.6
============= ============== ============== ============== ===============
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
21
THE PHOENIX COMPANIES, INC.
VENTURE CAPITAL SEGMENT
First Quarter 2003 (unaudited)
($ in millions)
March December 31,
---------------------------- ----------------------------------------------------
2003 2002 2002 2001 2000 1999
----------- ------------ ------------ ------------ ------------ -------------
SEGMENT INCOME
Operating Loss $ (.9) $ (2.0) $ (7.4) $ (7.3) $ (7.8) $ (8.9)
Realized Gains (Losses) on Cash
and Stock Distributions (6.2) (12.5) (4.7) 26.2 222.2 84.7
Change in Unrealized Gains on Investments
Held in Partnerships 31.0 9.5 (47.2) (178.5) 62.9 64.1
----------- ------------ ------------ ------------ ------------ -------------
Equity in Partnership Earnings, before
income taxes 23.9 (5.0) (59.3) (159.6) 277.3 139.9
Applicable Income Taxes (Benefit) 8.4 (1.8) (20.7) (55.9) 97.1 49.0
----------- ------------ ------------ ------------ ------------ -------------
Segment Income (Loss) $ 15.5 $ (3.2) $ (38.6) $ (103.7) $ 180.2 $ 90.9
=========== ============ ============ ============ ============ =============
- -----------------------------------------------------------------------------------------------------------------------------------
VENTURE CAPITAL INVESTMENTS
Contributions (Dollars Invested) 11.6 13.0 42.2 47.0 97.0 108.5
Equity In Earnings of Partnerships 23.9 (5.0) (59.3) (159.6) 277.3 139.9
Distributions (3.0) (9.4) (41.8) (63.0) (245.1) (101.5)
Sale of partnership interests and transfer
to closed block (52.2)
Realized Loss on sale of partnership interests
and transfer to closed block (13.8) (5.0)
----------- ------------ ------------ ------------ ------------ -------------
Change in Venture Capital Investments (33.5) (1.4) (63.9) (175.6) 129.2 146.9
Beginning Balance 227.8 291.7 291.7 467.3 338.1 191.2
----------- ------------ ------------ ------------ ------------ -------------
Ending Balance $ 194.3 $ 290.3 $ 227.8 $ 291.7 $ 467.3 $ 338.1
=========== ============ ============ ============ ============ =============
- -----------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO BREAKDOWN
Technology 23.5 43.6 25.0 41.3
Telecom 7.4 17.3 10.2 19.1
Biotech 9.8 15.7 11.1 14.1
Healthcare 6.7 8.4 9.2 10.7
------------
Consumer and Business Products and Services 32.0 Included 45.9 46.6
Financial Services 29.7 in Other 28.1 30.3
------------
Other 57.7 140.6 50.6 57.8
----------- ------------ ------------ ------------
Total Private Holdings 166.8 225.6 180.1 219.9
Public Holdings 11.4 39.1 23.0 39.8
Cash and Cash Equivalents 9.2 16.1 21.6 22.5
Other 6.9 9.5 3.1 9.5
----------- ------------ ------------ ------------
Total $ 194.3 $ 290.3 $ 227.8 $ 291.7
=========== ============ ============ ============
22
THE PHOENIX COMPANIES, INC.
VENTURE CAPITAL SEGMENT
First Quarter 2003 (unaudited)
($ in millions)
2002
----------------------------------------------------------- March
Quarters ended March June September December 2003
------------- ------------ ------------- ------------ ------------
SEGMENT INCOME
Operating Loss $ (2.0) $ (1.6) $ (2.2) $ (1.6) $ (.9)
Realized Gains (Losses) on Cash and
Stock Distributions (12.5) 7.4 (2.1) 2.5 (6.2)
Change in Unrealized Gains on Investments
Held in Partnerships 9.5 (35.7) (17.8) (3.2) 31.0
------------- ------------ ------------- ------------ ------------
Equity in Partnership Earnings, before
income taxes (5.0) (29.9) (22.1) (2.3) 23.9
Applicable Income Taxes (Benefit) (1.8) (10.4) (7.7) (.8) 8.4
------------- ------------ ------------- ------------ ------------
Segment Income (Loss) (3.2) (19.5) (14.4) (1.5) 15.5
============= ============ ============= ============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
VENTURE CAPITAL INVESTMENTS
Contributions (Dollars Invested) 13.0 7.5 10.2 11.5 11.6
Equity In Earnings of Partnerships (5.0) (29.9) (22.1) (2.3) 23.9
Distributions (9.4) (6.1) (19.3) (7.0) (3.0)
Sale of partnership interests and transfer
to closed block (52.2)
Realized Loss on sale of partnership interests
and transfer to closed block (5.0) (13.8)
------------- ------------ ------------- ------------ ------------
Change in Venture Capital Investments (1.4) (28.5) (31.2) (2.8) (33.5)
Beginning Balance 291.7 290.3 261.8 230.6 227.8
------------- ------------ ------------- ------------ ------------
Ending Balance 290.3 261.8 230.6 227.8 194.3
============= ============ ============= ============ ============
- ---------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO BREAKDOWN
Technology 43.6 29.4 20.3 25 23.5
Telecom 17.3 10.5 8.7 10.2 7.4
Biotech 15.7 9.7 10.4 11.1 9.8
Healthcare 8.4 6.8 8.9 9.2 6.7
--------------------------------------------
Consumer and Business Products and Services Included in Other 45.9 32.0
Financial Services 28.1 29.7
--------------------------------------------
Other 140.6 142.7 118.8 50.6 57.7
------------- ------------ ------------- ------------ ------------
Total Private Holdings 225.6 199.1 167.1 180.1 166.8
Public Holdings 39.1 29.9 21.5 23.0 11.4
Cash and Cash Equivalents 16.1 24.9 27.2 21.6 9.2
Other 9.5 7.9 14.8 3.1 6.9
------------- ------------ ------------- ------------ ------------
Total $ 290.3 $ 261.8 $ 230.6 $ 227.8 $ 194.3
============= ============ ============= ============ ============
23
THE PHOENIX COMPANIES, INC.
CORPORATE AND OTHER
First Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME March December 31,
----------------------------- ----------------------------------------------------------
2003 2002 2002 2001 2000 1999
------------- ------------- ------------- ---------- ------------- -------------
Corporate Investment Income $ .5 $ 2.7 $ 1.5 $ 7.2 $ 36.7 $ 13.1
Interest Expense (9.8) (7.7) (31.4) (27.3) (32.7) (34.0)
Corporate Expenses .1 (4.3) (10.4) (19.9) (53.5) (42.4)
International (2.5) .8 (5.7) (.8) 2.5 4.3
Other (.9) (.2) (3.8) (2.4) (23.4) 3.5
------------- ------------- ------------- ---------- ------------- -------------
Segment Income (Loss),
before income taxes (12.6) (8.7) (49.8) (43.2) (70.4) (55.5)
Applicable Income Taxes
(Benefit) (3.2) (4.1) (29.7) (23.9) (40.6) (29.1)
------------- ------------- ------------- ---------- ------------- -------------
Segment Income (Loss) $ (9.4) $ (4.6) $ (20.1) $ (19.3) $ (29.8) $ (26.4)
============= ============= ============= ========== ============= =============
24
THE PHOENIX COMPANIES, INC.
CORPORATE AND OTHER
First Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME 2002
------------------------------------------------------------ March
Quarters ended March June September December 2003
------------- ------------ ------------ ------------- -------------
Corporate Investment Income $ 2.7 $ 1.1 $ (.3) $ (1.9) $ .5
Interest Expense (7.7) (7.7) (7.7) (8.3) (9.8)
Corporate Expenses (4.3) (2.5) (1.3) (2.3) .1
International .8 (1.5) (2.0) (3.1) (2.5)
Other (.2) (1.4) (1.3) (1.0) (.9)
------------- ------------ ------------ ------------- -------------
Segment Income (Loss), before income taxes (8.7) (12.0) (12.6) (16.6) (12.6)
Applicable Income Taxes (Benefit) (4.1) (7.2) (6.3) (12.1) (3.2)
------------- ------------ ------------ ------------- -------------
Segment Income (Loss) $ (4.6) $ (4.8) $ (6.2) $ (4.6) $ (9.4)
============= ============ ============ ============= =============
25
THE PHOENIX COMPANIES, INC.
CONSOLIDATED STATEMENT OF INCOME - GAAP FORMAT (1) First Quarter 2003
(unaudited)
($ in millions)
March December 31,
------------------------- ----------------------------------------------------
2003 2002 2002 2001 2000 1999
------------ ----------- ----------- ------------ ------------ -----------
REVENUES
Premiums $ 246.1 $ 257.4 $ 1,082.0 $1,112.7 $ 1,147.4 $ 1,175.7
Insurance and Investment Product Fees 132.9 140.3 563.3 546.4 631.0 574.6
Net Investment Income 276.7 231.2 915.2 843.2 1,137.2 958.6
Net Realized Investment Gains (Losses) (12.3) (35.0) (107.6) (72.4) 89.2 75.8
------------ ----------- ----------- ------------ ------------ -----------
Total Revenues 643.4 593.9 2,452.9 2,429.9 3,004.8 2,784.7
------------ ----------- ----------- ------------ ------------ -----------
BENEFITS AND EXPENSES
Policy Benefits and Increase in Policy Liabilities 350.8 333.9 1,436.1 1,406.7 1,409.8 1,373.1
Policyholder Dividends 116.5 74.2 401.8 400.1 378.0 360.5
Policy Acquisition Cost Amortization 28.0 (10.9) 59.2 133.0 356.0 147.9
Intangible Asset Amortization 8.4 8.1 98.8 49.4 36.9 40.1
Interest Expense 9.8 7.7 31.4 27.3 32.7 34.0
Demutualization Expenses .9 1.8 25.9 21.8
Other Operating Expenses 126.5 136.0 583.9 628.1 604.5 557.9
------------ ----------- ----------- ------------ ------------ -----------
Total Expenses 640.0 549.9 2,613.0 2,670.5 2,839.7 2,513.5
------------ ----------- ----------- ------------ ------------ -----------
Income (Loss) from Continuing Operations
Before Income Taxes and Minority Interest 3.4 44.0 (160.1) (240.6) 165.1 271.2
Applicable Income Taxes (Benefit) (2.6) 12.3 (56.8) (110.5) 56.2 99.0
------------ ----------- ----------- ------------ ------------ -----------
Income (Loss) from Continuing Operations before
Minority Interest 6.0 31.7 (103.3) (130.1) 108.9 172.2
Minority Interest in Net Income of Subsidiaries (2.8) (2.8) (12.4) (7.2) (14.1) (10.1)
------------ ----------- ----------- ------------ ------------ -----------
Income (Loss) from Continuing Operations 3.2 28.9 (115.7) (137.3) 94.8 162.1
Discontinued Operations
Income from Discontinued Operations 9.4 36.1
Loss on Disposal (20.9) (109.0)
------------ ----------- ----------- ------------ ------------ -----------
Income (Loss) Before Cumulative Effect of
Accounting Changes 3.2 28.9 (115.7) (137.3) 83.3 89.2
Cumulative Effect of Accounting Changes:
Goodwill and Other Intangible Assets (130.3) (130.3)
Venture Capital Partnerships (48.8)
Securitized Financial Instruments (20.5)
Derivative Financial Instruments 3.9
------------ ----------- ----------- ------------ ------------ -----------
Net Income (Loss) $ 3.2 $ (101.4) $ (246.0) $ (202.7) $ 83.3 $ 89.2
============ =========== =========== ============ ============ ===========
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
26
THE PHOENIX COMPANIES, INC.
CONSOLIDATED STATEMENT OF INCOME - GAAP FORMAT (1) First Quarter 2003
(unaudited)
($ in millions)
2002
---------------------------------------------------------- March
Quarters ended March June September December 2003
------------ ------------- ------------ ------------ ------------
REVENUES
Premiums $ 257.4 $ 259.4 $ 297.1 $ 268.1 $ 246.1
Insurance and Investment Product Fees 140.3 145.9 139.4 137.7 132.9
Net Investment Income 231.2 215.7 228.8 239.5 276.7
Net Realized Investment Gains (Losses) (35.0) (28.6) (10.5) (33.5) (12.3)
------------ ------------- ------------ ------------ ------------
Total Revenues 593.9 592.4 654.8 611.8 643.4
------------ ------------- ------------ ------------ ------------
BENEFITS AND EXPENSES
Policy Benefits and Increase in
Policy Liabilities 333.9 338.9 397.9 365.4 350.8
Policyholder Dividends 74.2 107.5 112.7 107.4 116.5
Policy Acquisition Cost Amortization (10.9) 11.4 41.1 17.6 28.0
Intangible Asset Amortization 8.1 7.8 75.2 7.7 8.4
Interest Expense 7.7 7.7 7.7 8.3 9.8
Demutualization Expenses .9 .6 .2 .1
Other Operating Expenses 136.0 179.1 135.9 133.8 126.5
------------ ------------- ------------ ------------ ------------
Total Expenses 549.9 653.0 770.7 640.3 640.0
------------ ------------- ------------ ------------ ------------
Income (Loss) from Continuing Operations
Before Income Taxes and Minority Interest 44.0 (60.6) (115.9) (28.5) 3.4
Applicable Income Taxes (Benefit) 12.3 (26.7) (26.0) (16.7) (2.6)
------------ ------------- ------------ ------------ ------------
Income (Loss) from Continuing Operations before
Minority Interest 31.7 (33.9) (89.9) (11.8) 6.0
Minority Interest in Net Income of Subsidiaries (2.8) (3.3) (3.1) (2.7) (2.8)
------------ ------------- ------------ ------------ ------------
Income (Loss) Before Cumulative Effect of
Accounting Changes 28.9 (37.2) (93.0) (14.5) 3.2
Cumulative Effect of Accounting Changes:
Goodwill and Other Intangible Assets (130.3)
------------ ------------- ------------ ------------ ------------
Net Income (Loss) $ (101.4) $ (37.2) $ (93.0) $ (14.5) $ 3.2
============ ============= ============ ============ ============
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
27
THE PHOENIX COMPANIES, INC.
CONSOLIDATING FIRST QUARTER 2003 INCOME STATEMENT
First Quarter 2003 (unaudited)
($ in millions)
Quarter ended March 31, 2003 Exclusions from
Operating Segments Other Segments Segment Income
-------------------------- -------------------------- --------------------------
Realized
Life & Asset Venture Corporate & Investment
Consolidated Annuity Management Capital Other Losses Other
------------ ------------ ------------ ------------ ------------ ------------ ------------
REVENUES
Premiums $ 246.1 $ 246.1
Insurance and Investment
Product Fees 132.9 78.3 $ 55.5 $ 4.8 $ (5.7)
Net Investment Income 276.7 248.4 1.3 $ 23.9 1.0 2.1
Net Realized Investment
Gains (Losses) (12.3) $ (12.3)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Revenues 643.4 572.8 56.8 23.9 5.8 (12.3) (3.6)
------------ ------------ ------------ ------------ ------------ ------------ ------------
BENEFITS AND EXPENSES
Policy Benefits and Increase
in Policy Liabilities 350.8 347.3 3.5
Policyholder Dividends 116.5 108.0 8.5
Policy Acquisition Cost
Amortization 28.0 27.5 .5
Intangible Asset Amortization 8.4 8.4
Intangible Asset Impairments
Interest Expense 9.8 9.8
Demutualization Expenses
Other Operating Expenses 126.5 72.6 50.2 5.1 (1.4)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Expenses 640.0 555.4 58.6 18.4 9.0 (1.4)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Income (Loss) from Continuing
Operations Before Income
Taxes and Minority Interest 3.4 17.4 (1.8) 23.9 (12.6) (21.3) (2.2)
Applicable Income Taxes (Benefit) (2.6) 3.8 (1.7) 8.4 (3.2) (8.9) (1.0)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Income (Loss) from Continuing
Operations before Minority
Interest 6.0 13.6 (.1) 15.5 (9.4) (12.4) (1.2)
Minority Interest in Net Income
of Subsidiaries (2.8) (2.8)
------------ ------------ ------------ ------------ ------------ ------------ ------------
Income (Loss) from Continuing
Operations $ 3.2 $ 13.6 $ (2.9) $ 15.5 $ (9.4) $ (12.4) $ (1.2)
============ ============ ============ ============ ============ ============ ============
28
THE PHOENIX COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
First Quarter 2003 (unaudited)
($ in millions, except par value)
December 31,
March --------------------------------------------------------------------
2003 2002 2001 2000 1999
-------------- --------------- --------------- ---------------- ----------------
ASSETS:
Available-for-Sale Debt Securities $ 12,818.4 $ 11,894.1 $ 9,787.7 $ 6,022.3 $ 5,580.6
Held-to-Maturity Debt Securities 2,109.6 1,958.2
Equity Securities 361.1 391.2 290.9 335.5 437.2
Mortgage Loans 407.3 468.8 535.8 593.4 716.8
Real Estate 68.6 69.6 83.1 77.9 92.0
Policy Loans 2,202.9 2,195.9 2,172.2 2,105.2 2,042.6
Venture Capital Partnerships 227.4 228.6 291.7 467.3 338.1
Affiliate Equity Securities, at cost
plus equity in earnings 131.3 134.7 150.6 103.7 106.6
Other Investments 352.9 329.3 292.9 235.7 188.0
-------------- --------------- --------------- ---------------- ----------------
Total Investments 16,569.9 15,712.2 13,604.9 12,050.6 11,460.1
Cash and Cash Equivalents 613.0 1,058.5 815.5 720.0 316.7
Deferred Policy Acquisition Costs 1,270.0 1,234.1 1,123.7 1,019.0 1,318.8
Goodwill and Other Intangible Assets 748.3 762.0 858.6 582.6 577.9
Other General Account Assets 740.6 676.2 563.2 564.4 689.6
Separate Account and Investment
Trust Assets 5,990.7 5,793.1 5,570.0 5,376.6 5,923.9
-------------- --------------- --------------- ---------------- ----------------
Total Assets 25,932.5 25,236.1 22,535.9 20,313.2 20,287.0
============== =============== =============== ================ ================
LIABILITIES:
Policy Liabilities and Accruals 12,798.4 12,680.0 11,846.4 11,372.6 10,899.8
Policyholder Deposit Funds 3,679.0 3,395.7 1,515.2 678.4 538.2
Indebtedness 644.0 644.3 599.3 425.1 499.4
Delivery Obligations Under Stock
Purchase Contracts 118.5 137.6
Other General Account Liabilities 686.4 553.7 614.4 619.6 669.7
Separate Account and Investment
Trust Liabilities 5,990.7 5,793.1 5,564.9 5,376.6 5,923.9
------------- --------------- --------------- ---------------- ----------------
Total Liabilities 23,917.0 23,204.4 20,140.2 18,472.3 18,531.0
------------- --------------- --------------- ---------------- ----------------
STOCKHOLDERS' EQUITY:
Common Stock and Additional
Paid-In Capital 2,428.1 2,425.4 2,414.3
Deferred Compensation on
Restricted Stock Units (2.8)
Retained Earnings
(Accumulated Deficit) (289.4) (292.6) (30.8) 1,820.7 1,731.5
Treasury Stock, at Cost (195.0) (195.7) (66.0)
Accumulated Other Comprehensive
Income 74.6 94.6 78.2 20.2 24.5
------------- --------------- --------------- ---------------- ----------------
Total Stockholders' Equity 2,015.5 2,031.7 2,395.7 1,840.9 1,756.0
------------- --------------- --------------- ---------------- ----------------
Total Liabilities and
Stockholders' Equity $ 25,932.5 $ 25,236.1 $ 22,535.9 $ 20,313.2 $ 20,287.0
============= =============== =============== ================ ================
29
THE PHOENIX COMPANIES, INC.
INVESTMENT PORTFOLIO SUMMARY
First Quarter 2003 (unaudited)
($ in millions, except par value)
Total Debt Securities Public Debt Securities Private Debt Securities
------------------------------- ------------------------------- ------------------------------
3/31/2003 12/31/2002 3/31/2003 12/31/2002 3/31/2003 12/31/2002
-------------- --------------- -------------- --------------- -------------- --------------
DEBT SECURITIES BY CREDIT QUALITY
(CARRYING VALUE) (1)
AAA/AA/A $ 8,913.3 $ 7,960.9 $ 7,453.2 $ 6,549.8 $ 1,460.1 $ 1,411.1
BBB 2,781.8 2,811.5 1,768.4 1,767.1 1,013.4 1,044.4
-------------- --------------- -------------- --------------- -------------- --------------
Total Investment Grade 11,695.1 10,772.4 9,221.6 8,316.9 2,473.5 2,455.5
BB 767.9 785.7 544.2 577.4 223.7 208.3
B 155.6 105.4 106.1 82.2 49.5 23.2
CCC and Lower 97.8 118.5 42.0 53.3 55.8 65.2
In or Near Default 53.6 59.4 19.6 25.4 34.0 34.0
-------------- --------------- -------------- --------------- -------------- --------------
Total Debt Securities $ 12,770.0 $ 11,841.4 $ 9,933.5 $ 9,055.2 $ 2,836.5 $ 2,786.2
============== =============== ============== =============== ============== ==============
% Below Investment Grade 8.4% 9.0% 7.2% 8.2% 12.8% 11.9%
- ------------------------------------------------------------------------------------------------------------------------------------
UNREALIZED GAINS AND LOSSES ON
DEBT AND EQUITY SECURITIES
As of March 31, 2003 Total Outside Closed Block Closed Block
------------------------------- ------------------------------- ------------------------------
Gains Losses Gains Losses Gains Losses
-------------- --------------- -------------- --------------- -------------- --------------
Total Debt Securities $ 810.6 $ (181.3) $ 255.2 $ (107.4) $ 555.4 $ (73.9)
Equity Securities 118.2 (17.3) 118.2 (17.3)
-------------- --------------- -------------- --------------- -------------- --------------
Total Unrealized Gains (Losses) 928.8 $ (198.6) 373.4 $ (124.7) 555.4 $ (73.9)
-------------- =============== -------------- =============== -------------- ==============
Net Unrealized Gains 730.2 248.7 481.5
-------------- -------------- --------------
Applicable Policyholder Dividend
Obligation 481.5 481.5
Applicable Deferred Acquisition
Cost (Credit) 99.2 99.2
Applicable Deferred Income Tax 52.3 52.3
-------------- -------------- --------------
Total Offsets to Net Unrealized
Gains 633.0 151.5 481.5
-------------- -------------- --------------
Net Unrealized Gains $ 97.2 $ 97.2 $ -
============== ============== ==============
(1) Excludes affiliated debt securities
30
THE PHOENIX COMPANIES, INC.
REALIZED INVESTMENT GAINS AND LOSSES First Quarter 2003 (unaudited) ($ in
millions, except par value)
December 31,
March -----------------------------------------------------
2003 2002 2001 2000
------------ -------------- ------------- -------------
REALIZED INVESTMENT GAINS AND LOSSES
Debt Security Impairments $ (25.6) $ (122.9) $ (72.6) $ (7.5)
Equity Security Impairments (9.8)
Venture Capital Partnerships Impairments (4.3) (5.1)
Mortgage Loan Impairments (.4) (.6) (6.1) (1.8)
Real Estate Impairments (6.1)
Other Invested Asset Impairments (8.7) (22.6) (3.7)
------------ -------------- ------------- -------------
Total Impairment Losses (39.0) (160.4) (82.4) (15.4)
------------ -------------- ------------- -------------
Debt Security Net Transaction Gains (Losses) 41.3 48.4 21.7 (46.9)
Equity Security Net Transaction Gains (Losses) (2.2) 2.1 (8.8) 146.8
Venture Capital Net Investment Gains (Losses) (9.5)
Mortgage Loan Net Transaction Gains (Losses) (.4) .2 7.1 4.8
Real Estate Net Transaction Gains (Losses) .5 4.0 (2.5) 1.8
Other Invested Asset Net Transactions
Gains (Losses) (3.0) (1.9) (7.5) (1.9)
------------ -------------- ------------- -------------
Total Net Transactions Gains 26.7 52.8 10.0 104.6
------------ -------------- ------------- -------------
Net Realized Investment Gains (Losses) (12.3) (107.6) (72.4) 89.2
============ ============== ============= =============
Closed Block Applicable PDO (Reduction) 8.5 (40.3) (15.4)
Applicable Deferred Acquisition Costs (Credit) .4 (7.2) 10.5 (10.7)
Applicable Deferred Income Tax (Credit) (8.8) (20.8) (24.5) 32.9
------------ -------------- ------------- -------------
Net Realized Investment Gains (Losses Included
in Net Income) $ (12.4) $ (39.3) $ (43.0) $ 67.0
============ ============== ============= =============
31