Exhibit 99.2
THE PHOENIX COMPANIES, INC.
FINANCIAL SUPPLEMENT
WALL STREET COVERAGE
FIRM ANALYST
A.G. Edwards J. Jeffrey Hopson
Credit Suisse First Boston (CSFB) Tom Gallagher
Deutsche Bank Vanessa Wilson
Dowling & Partners Len Savage
Fox-Pitt, Kelton Jonathan Joseph
Keefe Bruyette & Woods Jukka Lipponen
Langen McAlenney Robert Glasspiegel
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 considered 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 net income from continuing operations (which is
a GAAP measure) before realized investment gains and losses, and certain other
items.
* Net realized investment gains and losses are excluded from segment income
because their size and timing are frequently subject to our discretion.
* Certain other items are excluded from segment income because we believe they
are not indicative of overall operating trends and are items that management
believes are infrequent and material and which result from a business
restructuring, a change in regulatory environment, or other unusual
circumstances.
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
SEPTEMBER 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............................................................ 18
ASSET MANAGEMENT - NET FLOWS AND ASSETS UNDER MANAGEMENT.................... 20
VENTURE CAPITAL SEGMENT..................................................... 22
CORPORATE AND OTHER......................................................... 24
CONSOLIDATED STATEMENT OF INCOME - GAAP FORMAT.............................. 26
CONSOLIDATING THIRD QUARTER 2003 INCOME STATEMENT........................... 28
CONDENSED CONSOLIDATED BALANCE SHEET........................................ 29
INVESTMENT PORTFOLIO SUMMARY................................................ 30
GAAP NET INVESTMENT INCOME YIELDS........................................... 31
REALIZED INVESTMENT GAINS AND LOSSES........................................ 32
THE PHOENIX COMPANIES, INC.
FINANCIAL HIGHLIGHTS
Third Quarter 2003 (unaudited)
(amounts in millions, except per share data)
BALANCE SHEET INFORMATION
For the Period Ended: December 31,
YTD September ---------------------------------------------------
2003 2002 2001 2000 1999
---------- ---------- ---------- ---------- -----------
Invested Assets $ 17,229.1 $ 16,770.7 $ 14,420.4 $ 12,770.6 $ 11,776.8
Separate Account and Investment Trust Assets 7,082.5 5,793.1 5,570.0 5,376.6 5,923.9
Total Assets 27,106.2 25,236.1 22,525.4 20,313.2 20,287.0
Indebtedness 642.5 644.3 599.3 425.1 499.4
Total Stockholders' Equity 2,005.6 2,031.7 2,395.7 1,840.9 1,756.0
Debt to Total Capitalization 24.3% 24.1% 20.0% 18.8% 22.1%
Debt (Excluding Equity Units) to Total Capitalization 18.5% 18.3%
Book Value Per Share (1) $ 21.30 $ 21.47 $ 23.51 $ 24.75 $ 23.94
Book Value Per Share, excluding SFAS 115 adjustment $ 20.13 $ 20.44 $ 22.72 $ 24.51 $ 23.70
Period-end Common (2) 94.2 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 13.8 15.6 (.8)
Bank Credit Facility 125.1 230.0 260.3
Other 20.1 64.1
----------- ----------- ----------- ----------- -----------
Total Indebtedness $ 642.5 $ 644.3 $ 599.3 $ 425.1 $ 499.4
=========== =========== =========== =========== ===========
- -------------------------------------------------------------------------------
STATUTORY FINANCIAL DATA FOR PHOENIX LIFE INSURANCE COMPANY (3)
Capital and Surplus $ 783.9 $ 861.0 $ 1,149.8 $ 1,322.8 $ 1,054.1
Asset Valuation Reserve (AVR) 206.3 147.0 221.5 559.7 368.7
----------- ----------- ----------- ----------- -----------
Capital, Surplus and AVR $ 990.2 $ 1,008.0 $ 1,371.3 $ 1,882.5 $ 1,422.8
=========== =========== =========== =========== ===========
Policyholder Dividend Liability $ 409.1 $ 403.0 $ 395.8 $ 383.2 $ 366.9
Interest Maintenance Reserve $ (22.7) $ (2.0) $ 11.6 $ (1.4) $ 24.4
Statutory Gain From Operations $ 42.3 $ 44.5 $ 119.9 $ 266.4 $ 150.2
Statutory Net Income (Loss) $ (8.4) $ 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. September 2003 amounts are preliminary.
1
THE PHOENIX COMPANIES, INC.
FINANCIAL HIGHLIGHTS
Third Quarter 2003 (unaudited)
(amounts in millions, except per share data)
INCOME STATEMENT SUMMARY YTD September December 31,
--------------------- ---------------------------------------------
2003 2002 2002 2001 2000 1999
--------- --------- --------- --------- --------- ---------
SEGMENT INCOME
Life Insurance $ 75.3 $ 69.7 $ 99.3 $ 68.6 $ 16.2 $ 41.4
Annuities (6.3) (15.5) (20.6) 10.9 4.2 30.8
--------- --------- --------- --------- --------- ---------
Life and Annuity Segment 69.0 54.2 78.7 79.5 20.4 72.2
Asset Management Segment (14.6) (71.5) (69.9) (8.7) 61.4 60.0
Venture Capital Segment 34.8 (56.9) (59.3) (159.6) 277.3 139.9
Corporate and Other Segment (34.4) (24.4) (39.9) (34.7) (60.8) (49.8)
--------- --------- --------- --------- --------- ---------
Total Segment Income (Loss), before income taxes 54.8 (98.6) (90.4) (123.5) 298.3 222.3
Applicable Income Taxes (Benefit) 15.0 (25.5) (28.7) (46.3) 99.1 76.1
--------- --------- --------- --------- --------- ---------
TOTAL SEGMENT INCOME (LOSS) 39.8 (73.1) (61.7) (77.2) 199.2 146.2
Net Realized Investment Gains (Losses), after income taxes (69.1) (16.7) (39.3) (43.0) 62.0 49.2
Management Restructuring and Early Retirement Costs (4.3) (25.4) (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 (1.2) (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) $ (32.3) $(231.6) $(246.0) $(202.7) $ 83.3 $ 89.2
========= ========= ========= ========= ========= =========
- ------------------------------------------------------------------------------
EARNINGS PER SHARE
Basic
Weighted-Average Shares Outstanding (1) 94.2 99.1 97.9 104.6 104.6 104.6
--------- --------- --------- --------- --------- ---------
Total Segment Income (Loss) Per Share $ 0.42 $ (0.74) $ (0.63) $ (0.74) $ 1.90 $ 1.40
Net Income (Loss) Per Share $ (0.34) $ (2.34) $ (2.51) $ (1.94) $ 0.80 $ 0.85
Diluted
Weighted-Average Shares Outstanding (1) 94.2 99.1 98.0 104.6 104.6 104.6
--------- --------- --------- --------- --------- ---------
Total Segment Income (Loss) Per Share $ 0.42 $ (0.74) $ (0.63) $ (0.74) $ 1.90 $ 1.40
Net Income (Loss) Per Share $ (0.34) $ (2.34) $ (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
Third Quarter 2003 (unaudited)
(amounts in millions, except per share data)
INCOME STATEMENT SUMMARY 2002 2003
--------------------------------------- -----------------------------
Quarters ended March June September December March June September
--------- --------- --------- --------- --------- --------- ---------
SEGMENT INCOME
Life Insurance $ 25.6 $ 27.1 $ 17.0 $ 29.5 $ 22.7 $ 28.6 $ 24.1
Annuities 2.6 .8 (18.9) (5.0) (5.3) (1.4) .3
--------- --------- --------- --------- --------- --------- ---------
Life and Annuity Segment 28.2 27.9 (1.9) 24.5 17.4 27.2 24.4
Asset Management Segment (1.1) (2.6) (67.8) 1.6 (5.8) (5.7) (3.1)
Venture Capital Segment (5.0) (29.9) (22.0) (2.4) 23.9 5.8 5.1
Corporate and Other Segment (5.7) (8.4) (10.1) (15.7) (11.4) (12.5) (10.5)
--------- --------- --------- --------- --------- --------- ---------
Total Segment Income (Loss), before income taxes 16.4 (13.0) (101.8) 8.0 24.1 14.8 15.9
Applicable Income Taxes (Benefit) 3.6 (8.9) (20.0) (3.3) 7.3 3.3 4.4
--------- --------- --------- --------- --------- --------- ---------
TOTAL SEGMENT INCOME (LOSS) 12.8 (4.1) (81.8) 11.3 16.8 11.5 11.5
Net Realized Investment Gains (Losses), after income
taxes 1.7 (10.8) (7.6) (22.6) (12.4) (59.2) 2.5
Management Restructuring and Early Retirement Costs (21.8) (3.6) (3.1) (2.5) (1.8)
Deferred Policy Acquisition Cost Adjustments 15.1
Demutualization Related Items, Net (.7) (.5) (.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 $ (49.5) $ 14.0
========= ========= ========= ========= ========= ========= ==========
- --------------------------------------------------------------
EARNINGS PER SHARE
Basic
Weighted-Average Shares Outstanding (1) 101.2 99.5 96.6 94.2 94.0 94.2 94.3
--------- --------- --------- --------- --------- --------- ---------
Total Segment Income (Loss) Per Share $ 0.13 $ (0.04) $ (0.85) $ 0.12 $ 0.18 $ 0.12 $ 0.12
Net Income (Loss) Per Share $ (1.00) $ (0.37) $ (0.96) $ (0.15) $ 0.03 $ (0.53) $ 0.15
Diluted
Weighted-Average Shares Outstanding (1) 101.2 99.5 96.6 94.7 95.0 94.2 98.3
--------- --------- --------- --------- --------- --------- ---------
Total Segment Income (Loss) Per Share $ 0.13 $ (0.04) $ (0.85) $ 0.12 $ 0.18 $ 0.12 $ 0.12
Net Income (Loss) Per Share $ (1.00) $ (0.37) $ (0.96) $ (0.15) $ 0.03 $ (0.53) $ 0.14
(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
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME YTD September December 31,
------------------- ---------------------------------------
2003 2002 2002 2001 2000 1999
--------- --------- --------- --------- --------- ---------
Variable Universal Life $ 26.0 $ 25.8 $ 35.9 $ 30.2 $ 20.1 $ .8
Universal Life (1) 15.8 19.2 26.3 17.4 18.2 19.5
Term Life .5 .6 4.7 1.3 (1.0) 1.5
Other Life and Annuity (2) 3.4 (.5) (.9) (1.7) 1.2 4.0
--------- --------- --------- --------- --------- ---------
Total, Non-participating Life 45.7 45.1 66.0 47.2 38.5 25.8
Participating Life 29.6 24.6 33.3 21.4 (22.3) 15.6
--------- --------- --------- --------- --------- ---------
Total, Life Insurance 75.3 69.7 99.3 68.6 16.2 41.4
Annuities (6.3) (15.5) (20.6) 10.9 4.2 30.8
--------- --------- --------- --------- --------- ---------
Segment Income, before income taxes 69.0 54.2 78.7 79.5 20.4 72.2
Allocated Income Taxes (3) 22.5 19.0 27.7 27.9 7.2 25.3
--------- --------- --------- --------- --------- ---------
Segment Income $ 46.5 $ 35.2 $ 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 WS 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
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME 2002 2003
--------------------------------------- -----------------------------
Quarters ended March June September December March June September
--------- --------- --------- --------- --------- --------- ---------
Variable Universal Life $ 10.0 $ 8.1 $ 7.7 $ 10.2 $ 6.3 $ 9.3 $ 10.5
Universal Life (1) 5.9 8.3 5.0 7.2 4.7 5.6 5.5
Term Life (.5) 1.9 (.8) 4.1 .4 (.8) .9
Other Life and Annuity (2) (1.8) 2.3 (.9) (.8) 2.5 .6 .2
--------- --------- --------- --------- --------- --------- ---------
Total, Non-participating Life 13.6 20.6 11.0 20.7 13.9 14.7 17.1
Participating Life 12.0 6.5 6.0 8.8 8.8 13.9 7.0
--------- --------- --------- --------- --------- --------- ---------
Total, Life Insurance 25.6 27.1 17.0 29.5 22.7 28.6 24.1
Annuities 2.6 .8 (18.9) (5.0) (5.3) (1.4) .3
--------- --------- --------- --------- --------- --------- ---------
Segment Income (Loss), before income taxes 28.2 27.9 (1.9) 24.5 17.4 27.2 24.4
Applicable Income Taxes (3) 10.0 9.9 (.7) 8.5 3.8 8.2 10.5
--------- --------- --------- --------- --------- --------- ---------
Segment Income (Loss) $ 18.2 $ 18.0 $ (1.2) $ 16.0 $ 13.6 $ 19.0 $ 14.0
========= ========= ========= ========= ========= ========= =========
(1) Universal Life includes interest sensitive whole life contracts.
(2) Other Life and Annuity includes trust operations and WS 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
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
------------------------- -----------------------------------------------------
2003 2002 2002 2001 2000 1999
----------- ---------- ----------- ----------- ----------- -----------
PRE-TAX INCOME
Fees $ 23.1 $ 23.0 $ 31.4 $ 29.5 $ 24.9 $ 22.7
Cost of Insurance (COI) 53.6 48.2 66.4 60.0 46.2 38.5
Interest Earned 4.4 5.5 7.0 4.5 5.7 4.7
Surrender Charges 4.6 2.9 4.4 3.3 3.5 3.0
----------- ----------- ----------- ----------- ----------- -----------
Total Revenues 85.7 79.6 109.2 97.3 80.3 68.9
----------- ----------- ----------- ----------- ----------- -----------
Net Death and Disability Benefits 16.0 16.6 22.9 15.3 15.5 13.4
Incurred Expenses 40.9 34.0 45.9 48.2 41.6 52.5
Interest Credited 2.9 2.8 3.7 3.6 3.1 2.2
Minority Interest .4 .8
----------- ----------- ----------- ----------- ----------- -----------
Total Expenses 59.7 53.8 73.3 67.1 60.2 68.1
----------- ----------- ----------- ----------- ----------- -----------
Pre-tax Income 26.0 25.8 35.9 30.2 20.1 .8
=========== =========== =========== =========== =========== ===========
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions and Concessions 14.7 29.0 36.6 29.5 34.2 23.1
Controllable Expenses and Other 32.8 49.1 60.8 60.1 57.3 60.3
----------- ----------- ----------- ----------- ----------- -----------
Total Current Expenses 47.5 78.1 97.4 89.6 91.5 83.4
Acquisition Costs Deferred (23.7) (56.2) (68.1) (65.4) (56.9) (42.8)
Acquisition Costs Amortized 17.0 12.1 16.6 24.0 7.0 11.9
----------- ----------- ----------- ----------- ----------- -----------
Incurred Expenses 40.9 34.0 45.9 48.2 41.6 52.5
=========== =========== =========== =========== =========== ===========
- -----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 271.2 306.1 465.7 336.1 258.1 204.7
Surrenders (50.6) (22.9) (37.6) (31.2) (34.0) (22.2)
Deaths (.8) (1.5) (1.8) (1.7) (1.4) (1.7)
----------- ----------- ----------- ----------- ----------- -----------
Net Sales 219.8 281.7 426.3 303.2 222.7 180.8
Performance 153.9 (193.6) (149.8) (194.0) (128.1) 207.6
Fees (26.3) (26.5) (35.8) (34.5) (33.0) (25.8)
Cost of Insurance (51.9) (48.2) (66.4) (60.0) (46.2) (38.5)
Acquisitions 10.5
----------- ----------- ----------- ----------- ----------- -----------
Change in Funds Under Management 295.5 13.4 174.3 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 1,565.9 1,109.4 1,270.3 1,096.0 1,081.3 1,065.9
=========== =========== =========== =========== =========== ===========
LIFE INSURANCE IN FORCE $24,366.4 $22,719.1 $23,788.2 $20,436.1 $17,743.3 $13,740.3
=========== =========== =========== =========== =========== ===========
6
THE PHOENIX COMPANIES, INC.
VARIABLE UNIVERSAL LIFE
Third Quarter 2003 (unaudited)
($ in millions)
Quarters ended 2002 2003
---------------------------------------------------- ---------------------------------------
March June September December March June September
----------- ----------- ----------- ----------- ----------- ----------- -----------
PRE-TAX INCOME
Fees $ 7.7 $ 6.7 $ 8.6 $ 8.4 $ 7.6 $ 7.5 $ 8.1
Cost of Insurance (COI) 15.8 15.8 16.6 18.2 17.9 18.1 17.6
Interest Earned 1.8 1.7 2.1 1.5 1.6 1.5 1.3
Surrender Charges .8 1.0 1.1 1.5 1.2 1.6 1.8
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Revenues 26.1 25.2 28.4 29.6 28.3 28.7 28.7
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net Death and Disability Benefits 4.5 5.3 6.9 6.2 5.0 6.0 5.0
Incurred Expenses 10.6 10.8 12.6 11.9 16.1 12.5 12.3
Interest Credited .9 .9 1.0 .9 .9 1.0 1.0
Minority Interest .1 .1 .2 .4
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Expenses 16.1 17.1 20.7 19.4 22.0 19.5 18.3
----------- ----------- ----------- ----------- ----------- ----------- -----------
Pre-tax Income 10.0 8.1 7.7 10.2 6.3 9.3 10.5
=========== =========== =========== =========== =========== =========== ===========
- -----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions and Concessions 8.9 8.6 11.5 7.6 5.2 4.6 4.9
Controllable Expenses and Other 16.7 18.0 14.4 11.7 11.4 12.3 9.1
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Current Expenses 25.6 26.6 25.9 19.3 16.6 16.9 14.0
Acquisition Costs Deferred (18.4) (19.2) (18.6) (11.9) (8.0) (8.7) (7.0)
Acquisition Costs Amortized 3.4 3.4 5.3 4.5 7.5 4.3 5.3
----------- ----------- ----------- ----------- ----------- ----------- -----------
Incurred Expenses 10.6 10.8 12.6 11.9 16.1 12.5 12.3
=========== =========== =========== =========== =========== =========== ===========
- -----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 91.2 81.3 133.6 159.6 71.8 62.0 137.4
Surrenders (6.3) (9.5) (7.1) (14.7) (13.7) (11.5) (25.4)
Deaths (.6) (.6) (.3) (.3) (.2) (.1) (.5)
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net Sales 84.3 71.2 126.2 144.6 57.9 50.4 111.5
Performance (4.5) (79.6) (109.5) 43.8 (8.5) 110.4 52.0
Fees (9.2) (8.4) (8.9) (9.3) (8.4) (7.9) (10.0)
Cost of Insurance (15.8) (15.8) (16.6) (18.2) (17.9) (16.8) (17.2)
----------- ----------- ----------- ----------- ----------- ----------- -----------
Change in Funds Under Management 54.8 (32.6) (8.8) 160.9 23.1 136.1 136.3
Beginning Balance 1,096.0 1,150.8 1,118.2 1,109.4 1,270.3 1,293.5 1,429.6
----------- ----------- ----------- ----------- ----------- ----------- -----------
Ending Balance 1,150.8 1,118.2 1,109.4 1,270.3 1,293.4 1,429.6 1,565.9
=========== =========== =========== =========== =========== =========== ===========
LIFE INSURANCE IN FORCE $21,136.1 $22,168.9 $22,719.1 $23,788.2 $23,744.4 $24,096.1 $24,366.4
=========== =========== =========== =========== =========== =========== ===========
7
THE PHOENIX COMPANIES, INC.
UNIVERSAL LIFE / INTEREST SENSITIVE
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
------------------------ --------------------------------------------------
2003 2002 2002 2001 2000 1999
----------- ----------- ----------- ----------- ----------- -----------
PRE-TAX INCOME
Fees $ 11.5 $ 8.2 $ 11.9 $ 8.6 $ 8.4 $ 7.6
Cost of Insurance 57.8 52.8 71.6 66.2 64.8 64.2
Interest Earned 73.8 81.1 108.4 111.9 108.7 112.0
Surrender Charges 1.9 3.4 3.9 4.0 5.5 7.2
----------- ----------- ----------- ----------- ----------- -----------
Total Revenues 145.1 145.5 195.8 190.7 187.4 191.0
----------- ----------- ----------- ----------- ----------- -----------
Net Death Benefits and Supplemental Benefits 35.5 30.4 39.5 48.3 45.4 41.8
Incurred Expenses 34.9 31.7 44.3 34.6 32.5 35.0
Interest Credited 58.9 64.3 85.7 90.4 91.3 94.7
----------- ----------- ----------- ----------- ----------- -----------
Total Expenses 129.3 126.3 169.5 173.3 169.2 171.5
----------- ----------- ----------- ----------- ----------- -----------
Pre-tax Income 15.8 19.2 26.3 17.4 18.2 19.5
=========== =========== =========== =========== =========== ===========
- ----------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions 17.4 8.8 15.2 9.8 5.8 5.8
Controllable Expenses 52.5 32.7 52.6 32.1 23.7 19.7
----------- ----------- ----------- ----------- ----------- -----------
Total Current Expenses 69.9 41.5 67.8 41.9 29.5 25.5
Acquisition Cost Deferred (48.6) (23.0) (40.2) (20.0) (8.7) (7.3)
Acquisition Cost Amortized 13.6 13.2 16.7 12.7 11.7 16.8
----------- ----------- ----------- ----------- ----------- -----------
Incurred Expenses 34.9 31.7 44.3 34.6 32.5 35.0
=========== =========== =========== =========== =========== ===========
- ----------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 143.1 99.8 149.3 104.6 90.9 97.2
Surrenders (85.8) (81.9) (107.4) (99.0) (108.2) (158.5)
Deaths (14.6) (22.4) (25.0) (18.5) (20.9) (20.2)
----------- ----------- ----------- ----------- ----------- -----------
Net Sales 42.7 (4.5) 16.9 (12.9) (38.2) (81.5)
Interest Credited 58.9 64.3 85.8 90.4 91.3 94.7
Fees (15.8) (10.9) (16.7) (10.5) (6.2) (4.6)
Cost of Insurance (57.9) (52.8) (71.6) (66.2) (64.8) (64.2)
----------- ----------- ----------- ----------- ----------- -----------
Change in Funds Under Management 27.9 (3.9) 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 1,537.9 1,491.7 1,510.0 1,495.6 1,494.8 1,512.7
=========== =========== =========== =========== =========== ===========
LIFE INSURANCE IN FORCE $11,763.7 $ 9,907.3 $10,476.7 $ 9,465.6 $ 9,644.2 $ 9,955.7
=========== =========== =========== =========== =========== ===========
8
THE PHOENIX COMPANIES, INC.
UNIVERSAL LIFE / INTEREST SENSITIVE
Third Quarter 2003 (unaudited)
($ in millions)
PRE-TAX INCOME 2002 2003
Quarter ended ---------------------------------------------------- ---------------------------------------
March June September December March June September
----------- ----------- ----------- ----------- ----------- ----------- -----------
Fees $ 2.6 $ 2.7 $ 2.9 $ 3.7 $ 4.0 $ 2.9 $ 4.6
Cost of Insurance 17.2 17.7 17.9 18.8 18.8 19.3 19.7
Interest Earned 26.4 27.9 26.8 27.3 24.7 24.6 24.5
Surrender Charges 1.2 1.4 .8 .5 .7 .6 .6
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Revenues 47.4 49.7 48.4 50.3 48.2 47.4 49.4
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net Death Benefits and
Supplemental Benefits 10.1 9.6 10.6 9.1 12.3 9.2 14.0
Incurred Expenses 9.9 10.3 11.5 12.6 11.0 12.3 11.6
Interest Credited 21.5 21.5 21.3 21.4 20.2 20.3 18.4
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Expenses 41.5 41.4 43.4 43.1 43.5 41.8 43.9
----------- ----------- ----------- ----------- ----------- ----------- -----------
Pre-tax Income 5.9 8.3 5.0 7.2 4.7 5.6 5.5
=========== =========== =========== =========== =========== =========== ===========
- ------------------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions 2.0 3.1 3.7 6.4 6.2 4.3 6.9
Controllable Expenses 9.6 10.5 12.6 19.9 16.0 18.6 17.9
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Current Expenses 11.6 13.6 16.3 26.3 22.2 22.8 24.8
Acquisition Cost Deferred (5.8) (7.2) (10.0) (17.2) (15.3) (15.0) (18.2)
Acquisition Cost Amortized 4.1 3.9 5.2 3.5 4.1 4.5 5.0
----------- ----------- ----------- ----------- ----------- ----------- -----------
Incurred Expenses 9.9 10.3 11.5 12.6 11.0 12.3 11.6
=========== =========== =========== =========== =========== =========== ===========
- ------------------------------------------------------------------------------------------------------------------------------------
FUNDS UNDER MANAGEMENT
Deposits 31.6 34.9 33.3 49.5 45.6 41.2 56.3
Surrenders (25.0) (30.2) (26.7) (25.5) (30.9) (27.3) (27.6)
Deaths (7.3) (2.2) (12.9) (2.6) (5.9) (3.1) (5.6)
----------- ----------- ----------- ----------- ----------- ----------- -----------
Net Sales (.7) 2.5 (6.3) 21.4 8.8 10.8 23.1
Interest Credited 21.5 21.5 21.3 21.5 20.2 20.3 18.4
Fees (3.1) (3.4) (4.4) (5.8) (5.5) (4.2) (6.1)
Cost of Insurance (17.2) (17.7) (17.9) (18.8) (18.8) (19.3) (19.8)
----------- ----------- ----------- ----------- ----------- ----------- -----------
Change in Funds Under Management .5 2.9 (7.3) 18.3 4.7 7.6 15.6
Beginning Balance 1,495.6 1,496.1 1,499.0 1,491.7 1,510.0 1,514.7 1,522.3
----------- ----------- ----------- ----------- ----------- ----------- -----------
Ending Fund Balance 1,496.1 1,499.0 1,491.7 1,510.0 1,514.7 1,522.3 1,537.9
=========== =========== =========== =========== =========== =========== ===========
LIFE INSURANCE IN FORCE $9,683.1 $9,719.2 $9,907.3 $10,476.7 $10,914.9 $11,270.5 $11,763.7
=========== =========== =========== =========== =========== =========== ===========
9
THE PHOENIX COMPANIES, INC.
LIFE SALES HIGHLIGHTS
Third Quarter 2003 (unaudited)
($ in millions)
LIFE INSURANCE PREMIUM YTD September December 31,
------------------- ---------------------------------------
2003 2002 2002 2001 2000 1999
--------- --------- --------- --------- --------- ---------
Wholesaler Channel Variable Universal Life $ 19.0 $ 49.6 $ 62.5 $ 53.8 $ 61.1 $ 44.8
Private Placement Variable Universal Life 10.1 35.7 51.0 29.5 18.2
--------- --------- --------- --------- --------- ---------
Variable Universal Life 29.1 85.3 113.5 83.3 79.3 44.8
Universal Life/Interest Sensitive 36.9 18.5 36.9 14.5 8.0 7.6
Term Life 14.0 9.7 15.1 11.4 14.6 10.5
Participating Whole Life .6 3.4 4.8 9.7 22.6 35.7
--------- --------- --------- --------- --------- ---------
Life Insurance Annualized Premium (1) 80.6 116.9 170.3 118.9 124.5 98.6
========= ========= ========= ========= ========= =========
Wholesaler Channel Variable Universal Life 14.4 18.6 25.1 49.7 46.2 63.2
Private Placement Variable Universal Life 86.1 62.4 129.9 36.9 15.5
--------- --------- --------- --------- --------- ---------
Variable Universal Life 100.5 81.0 155.0 86.6 61.7 63.2
Universal Life/Interest Sensitive 35.8 15.5 29.9 14.5 1.8 .3
Participating Whole Life .7 .8 2.4 5.4 24.4
--------- --------- --------- --------- --------- ---------
Life Insurance Single Premium 136.3 97.2 185.7 103.5 68.9 87.9
========= ========= ========= ========= ========= =========
Wholesaler Channel Variable Universal Life 33.4 68.2 87.6 103.5 107.3 108.0
Private Placement Variable Universal Life 96.2 98.1 180.9 66.4 33.7
--------- --------- --------- --------- --------- ---------
Variable Universal Life 129.6 166.3 268.5 169.9 141.0 108.0
Universal Life/Interest Sensitive 72.7 34.0 66.8 29.0 9.8 7.9
Term Life 14.0 9.7 15.1 11.4 14.6 10.5
Participating Whole Life .7 4.1 5.6 12.1 28.0 60.1
--------- --------- --------- --------- --------- ---------
Total Life Insurance Premium $ 217.0 $ 214.1 $ 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
Third Quarter 2003 (unaudited)
($ in millions)
LIFE INSURANCE PREMIUM
Quarters ended 2002 2003
--------------------------------------- -----------------------------
March June September December March June September
--------- --------- --------- --------- --------- --------- ---------
Wholesaler Channel Variable Universal Life $ 22.3 $ 16.0 $ 11.3 $ 12.9 $ 6.3 $ 7.0 $ 5.7
Private Placement Variable Universal Life 3.5 13.2 19.0 15.3 4.4 5.5 .3
--------- --------- --------- --------- --------- --------- ---------
Variable Universal Life 25.8 29.2 30.3 28.2 10.7 12.5 5.9
Universal Life/Interest Sensitive 8.0 3.6 6.9 18.4 11.9 10.8 14.1
Term Life 2.7 3.3 3.7 5.3 4.5 4.8 4.8
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 28.1 24.8
========= ========= ========= ========= ========= ========= =========
Wholesaler Channel Variable Universal Life 4.9 6.8 6.9 6.5 4.1 7.1 3.2
Private Placement Variable Universal Life 10.9 4.4 47.1 67.5 10.8 .8 74.5
--------- --------- --------- --------- --------- --------- ---------
Variable Universal Life 15.8 11.2 54.0 74.0 14.9 7.9 77.7
Universal Life/Interest Sensitive 2.7 6.7 6.1 14.5 7.2 8.3 20.3
Participating Whole Life .4 .3 .1
--------- --------- --------- --------- --------- --------- ---------
Life Insurance Single Premium 18.9 18.2 60.1 88.6 22.1 16.2 98.0
========= ========= ========= ========= ========= ========= =========
Wholesaler Channel Variable Universal Life 27.2 22.8 18.2 19.4 10.4 14.1 8.9
Private Placement Variable Universal Life 14.4 17.6 66.1 82.8 15.2 6.3 74.8
--------- --------- --------- --------- --------- --------- ---------
Variable Universal Life 41.6 40.4 84.3 102.2 25.6 20.4 83.7
Universal Life/Interest Sensitive 10.7 10.3 13.0 32.9 19.1 19.1 34.4
Term Life 2.7 3.3 3.7 5.3 4.5 4.8 4.8
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 $ 44.3 $ 122.9
========= ========= ========= ========= ========= ========= =========
(1) Annualized Premium represents first year premiums on an annual basis.
Total Premium represents Annualized and Single premiums.
11
THE PHOENIX COMPANIES, INC.
ANNUITIES
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
------------------- ---------------------------------------
2003 2002 2002 2001 2000 1999
--------- --------- --------- --------- --------- ---------
PRE-TAX INCOME
Fees $ 41.2 $ 43.6 $ 57.1 $ 64.6 $ 78.2 $ 71.9
Interest Earned 104.1 69.7 98.3 40.3 16.3 13.7
Surrender Charges 4.7 4.6 6.6 3.9 5.1 5.5
--------- --------- --------- --------- --------- ---------
Total Revenues 150.0 117.9 162.0 108.8 99.6 91.1
--------- --------- --------- --------- --------- ---------
Policy Benefits and Change in Reserves
Mortality Cost 4.6 9.1 10.8 4.3 3.0 2.7
Incurred Expenses 57.3 60.6 79.8 54.4 77.3 48.9
Interest Credited 94.4 63.7 92.0 39.2 15.1 8.7
--------- --------- --------- --------- --------- ---------
Total Expenses 156.3 133.4 182.6 97.9 95.4 60.3
--------- --------- --------- --------- --------- ---------
Pre-tax Income (Loss) (6.3) (15.5) (20.6) 10.9 4.2 30.8
========= ========= ========= ========= ========= =========
- ---------------------------------------------------------------------------------------------------------------------------
INCURRED EXPENSES
Commissions/Concessions 39.8 73.0 81.3 44.0 29.2 14.5
Controllable Expenses 49.1 49.1 66.5 75.2 54.1 32.4
--------- --------- --------- --------- --------- ---------
Total Current Expenses 88.9 122.1 147.8 119.2 83.2 46.9
Acquisition Cost Deferred (53.3) (92.0) (102.9) (83.8) (43.0) (21.1)
Acquisition Cost Amortized 21.9 30.5 34.9 19.0 37.0 23.1
--------- --------- --------- --------- --------- ---------
Incurred Expenses $ 57.3 $ 60.6 $ 79.8 $ 54.4 $ 77.3 $ 48.9
========= ========= ========= ========= ========= =========
12
THE PHOENIX COMPANIES, INC.
ANNUITIES
Third Quarter 2003 (unaudited)
($ in millions)
PRE-TAX INCOME
Quarters ended 2002 2003
--------------------------------------- -----------------------------
March June September December March June September
--------- --------- --------- --------- --------- --------- ---------
Fees $ 15.2 $ 14.4 $ 14.0 $ 13.5 $ 12.8 $ 13.3 $ 15.0
Interest Earned 16.6 22.8 30.3 28.6 34.1 34.1 35.9
Surrender Charges 1.1 1.2 2.3 2.0 1.5 1.4 1.8
--------- --------- --------- --------- --------- --------- ---------
Total Revenues 32.9 38.4 46.6 44.1 48.4 48.8 52.7
--------- --------- --------- --------- --------- --------- ---------
Policy Benefits and Change in Reserves
Mortality Cost 2.0 1.9 5.2 1.7 2.8 1.8
Incurred Expenses 13.1 16.5 31.0 19.2 19.4 20.0 17.9
Interest Credited 15.3 19.2 29.3 28.2 31.5 30.2 32.7
--------- --------- --------- --------- --------- --------- ---------
Total Expenses 30.4 37.6 65.5 49.1 53.7 50.2 52.4
--------- --------- --------- --------- --------- --------- ---------
Pre-tax Income (Loss) 2.6 .8 (18.9) (5.0) (5.3) (1.4) .3
========= ========= ========= ========= ========= ========= =========
- -------------------------------------------------------------------------------------------------------------------------- ---------
INCURRED EXPENSES
Commissions/Concessions 11.4 17.5 44.1 8.3 16.7 11.6 11.5
Controllable Expenses 16.3 16.7 16.1 17.4 18.0 16.3 14.8
--------- --------- --------- --------- --------- --------- ---------
Total Current Expenses 27.7 34.2 60.2 25.7 34.7 27.9 26.3
--------- --------- --------- --------- --------- --------- ---------
Acquisition Cost Deferred (18.9) (24.6) (48.5) (10.9) (24.7) (14.0) (14.7)
Acquisition Cost Amortized 4.3 6.9 19.3 4.4 9.4 6.1 6.3
--------- --------- --------- --------- --------- --------- ---------
Incurred Expenses $ 13.1 $ 16.5 $ 31.0 $ 19.2 $ 19.4 $ 20.0 $ 17.9
========= ========= ========= ========= ========= ========= =========
13
THE PHOENIX COMPANIES, INC.
ANNUITIES NET FLOWS AND FUNDS UNDER MANAGEMENT
Third Quarter 2003 (unaudited)
($ in millions)
FUNDS UNDER MANAGEMENT YTD September December 31,
--------------------- --------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ---------- ----------- ---------- ---------- ----------
Annuities
Deposits $ 1,255.2 $ 2,040.6 $ 2,258.4 $ 1,492.9 $ 687.0 $ 377.4
Surrenders (641.3) (496.9) (736.7) (482.3) (608.5) (618.1)
---------- ---------- ----------- ---------- ---------- ----------
Net Sales 613.9 1,543.7 1,521.7 1,010.6 78.5 (240.7)
Performance and Interest Credited 511.7 (515.1) (338.0) (563.1) (415.2) 991.1
Fees (41.3) (45.4) (58.8) (67.3) (78.2) (71.9)
Deaths (52.3) (27.6) (40.6) (34.3) (24.9) (22.0)
Acquisitions 114.9
---------- ---------- ----------- ---------- ---------- ----------
Change in Funds Under Management 1,032.0 955.6 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 $ 6,865.4 $ 5,704.7 $ 5,833.4 $ 4,749.1 $ 4,403.2 $ 4,843.7
========== ========== =========== ========== ========== ==========
VA Funds in Guaranteed Interest Accounts (1) $ 2,155.5 $ 2,118.1 $ 2,159.3 $ 955.0 $ 333.5 $ 210.9
========== ========== =========== ========== ========== ==========
Fixed Annuities (1) $ 1,055.7 $ 706.6 $ 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
Third Quarter 2003 (unaudited)
($ in millions)
FUNDS UNDER MANAGEMENT 2002 2003
------------------------------------------ --------------------------------
Quarters ended March June September December March June September
---------- ---------- --------- ---------- --------- ---------- -----------
Annuities
Deposits $ 575.4 $ 661.0 $ 804.2 $ 217.8 $ 432.1 $ 371.0 $ 452.1
Surrenders (127.0) (189.4) (180.5) (239.8) (231.6) (195.1) (214.6)
---------- ---------- --------- ---------- --------- ---------- -----------
Net Sales 448.4 471.6 623.7 (22.0) 200.5 175.9 237.5
Performance and Interest Credited (1.4) (219.0) (294.7) 177.1 20.2 351.4 140.1
Fees (15.9) (15.7) (13.8) (13.4) (11.5) (15.4) (14.4)
Deaths (7.2) (9.0) (11.4) (13.0) (22.6) (13.0) (16.7)
---------- ---------- --------- ---------- --------- ---------- -----------
Change in Funds Under Management 423.9 227.9 303.8 128.7 186.6 498.9 346.5
Beginning Balance 4,749.1 5,173.0 5,400.9 5,704.7 5,833.4 6,020.0 6,518.9
---------- ---------- --------- ---------- --------- ---------- -----------
Ending Balance $ 5,173.0 $5,400.9 $5,704.7 $5,833.4 $6,020.0 $6,518.9 $ 6,865.4
========== ========== ========= ========== ========= ========== ===========
VA Funds in Guaranteed Interest Accounts (1) $ 1,179.5 $1,534.2 $2,118.1 $2,159.3 $2,224.8 $2,210.5 $ 2,155.5
========== ========== ========= ========== ========= ========== ===========
Fixed Annuities (1) $ 378.1 $ 559.7 $ 706.6 $ 737.2 $ 921.4 $1,002.2 $ 1,055.7
========== ========== ========= ========== ========= ========== ===========
(1) Amounts are included in the annuities funds under management table above.
15
THE PHOENIX COMPANIES, INC.
SUPPLEMENTARY LIFE AND ANNUITY INFORMATION
Third Quarter 2003 (unaudited)
($ in millions)
September 30, December 31,
--------------------- ---------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ---------- ---------- ---------- ---------- ----------
DEFERRED ACQUISITION COSTS
Variable Universal Life $ 323.5 $ 303.0 $ 310.4 $ 252.8 $ 211.4 $ 161.5
Universal Life 196.7 147.2 163.1 134.7 127.4 130.4
Variable Annuities 288.9 267.6 264.9 211.4 147.0 141.0
Fixed Annuities 37.2 17.0 26.3 .4
Participating 551.2 555.6 554.6 517.4 554.8 786.6
Other 26.4 19.8 21.2 17.5 17.4 21.7
Adjustment for Unrealized Gains and Losses (88.2) (74.9) (106.4) (10.5) (39.0) 77.6
---------- ---------- ---------- ---------- ---------- ----------
Total $ 1,335.6 $ 1,235.3 $ 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 $ 797.0 $ 822.5 $ 1,148.4
Death Benefit in Excess of Fund Value, Net of Reinsurance 161.1 214.0 234.9
Statutory Reserve 19.2 16.6 15.8
GAAP Reserve 8.1 8.1 8.7
========== ========== ==========
16
THE PHOENIX COMPANIES, INC.
SUPPLEMENTARY LIFE AND ANNUITY INFORMATION
Third Quarter 2003 (unaudited)
($ in millions)
2002 2003
--------------------------------------- ------------------------------
Quarters ended March June September December March June September
--------- --------- --------- -------- -------- -------- ----------
DEFERRED ACQUISITION COSTS
Variable Universal Life $ 268.6 $ 284.3 $ 303.0 $ 310.4 $ 310.9 $ 315.4 $ 323.5
Universal Life 139.1 142.4 147.2 163.1 172.6 183.4 196.7
Variable Annuities 219.5 230.9 267.6 264.9 271.2 277.5 288.9
Fixed Annuities 6.1 12.4 17.0 26.3 35.3 36.8 37.2
Participating 544.8 557.5 555.6 554.6 556.4 549.9 551.2
Other 17.7 18.8 19.8 21.2 22.6 24.4 26.4
Adjustment for Unrealized Investment Gains and Losses (3.9) (34.3) (74.9) (106.4) (99.0) (139.4) (88.2)
--------- --------- --------- --------- --------- --------- ----------
Total $1,191.9 $1,212.0 $1,235.3 $1,234.1 $1,270.0 $1,248.0 $1,335.6
========= ========= ========= ========= ========= ========= ==========
- ------------------------------------------------------------------------------------------------------------------------------------
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 $ 898.6 $ 797.0
Death Benefit in Excess of Fund Value, Net of Reinsurance 5.7 10.3 214.0 234.9 242.3 178.7 161.1
Statutory Reserve 5.3 6.0 16.6 15.8 16.1 12.9 19.2
GAAP Reserve .3 .5 8.1 8.7 9.2 7.9 8.1
========= ========= ========= ========= ========= ========= ==========
17
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME YTD September December 31,
--------------------- ---------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ---------- ---------- ---------- ---------- ----------
Investment Management Fees $ 151.7 $ 176.6 $ 227.4 $ 221.6 $ 282.1 $ 247.0
Mutual Funds - Ancillary Fees 13.4 15.6 20.4 24.3 32.4 31.7
Other Revenue 6.5 7.4 10.2 12.9 8.8 4.7
---------- ---------- ---------- ---------- ---------- ----------
Total Revenues 171.6 199.6 258.0 258.8 323.3 283.4
---------- ---------- ---------- ---------- ---------- ----------
Employment Expenses 100.2 111.7 140.5 130.0 137.4 114.0
Other Operating Expenses 55.3 59.8 77.7 83.2 79.9 69.7
Amortization of Intangibles 24.9 24.6 32.5 49.0 31.8 30.3
Intangible Asset Impairments 66.3 66.3
---------- ---------- ---------- ---------- ---------- ----------
Total Operating Expenses 180.5 262.4 317.0 262.2 249.1 214.0
---------- ---------- ---------- ---------- ---------- ----------
Management Income (Loss) (8.9) (62.8) (59.0) (3.4) 74.2 69.4
Other Income (Expense) - Net 1.9 .5 1.0 1.6 3.7 4.0
Minority Interest (7.6) (9.2) (11.9) (6.9) (16.5) (13.4)
---------- ---------- ---------- ---------- ---------- ----------
Segment Income, before income taxes (14.6) (71.5) (69.9) (8.7) 61.4 60.0
Applicable Income taxes (Benefit) (5.6) (7.1) (6.0) 2.6 32.0 28.9
---------- ---------- ---------- ---------- ---------- ----------
Segment Income (Loss) $ (9.0) $ (64.4) $ (63.9) $ (11.3) $ 29.4 $ 31.1
========== ========== ========== ========== ========== ==========
- -------------------------------------------------------------------------------------------------------------------------------
18
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME 2002 2003
---------------------------------------- ------------------------------
Quarters ended March June September December March June September
-------- --------- --------- --------- -------- --------- ---------
Investment Management Fees $ 59.2 $ 61.8 $ 55.6 $ 50.8 $ 48.7 $ 49.4 $ 53.6
Mutual Funds - Ancillary Fees 5.4 5.3 4.9 4.8 4.4 4.7 4.3
Other Revenue 2.4 2.7 2.3 2.8 1.6 2.2 2.7
-------- -------- --------- --------- -------- --------- --------
Total Revenues 67.0 69.8 62.8 58.4 54.7 56.3 60.6
-------- -------- --------- --------- -------- --------- --------
Employment Expenses 38.2 40.7 32.1 28.8 30.7 34.6 34.9
Other Operating Expenses 18.9 21.0 20.5 18.0 19.5 17.7 18.2
Amortization of Intangibles 8.1 7.8 8.7 7.9 8.4 8.2 8.3
Intangible Asset Impairments 66.3
-------- -------- --------- --------- -------- --------- --------
Total Operating Expenses 65.2 69.5 127.6 54.7 58.6 60.5 61.4
-------- -------- --------- --------- -------- --------- --------
Management Income (Loss) 1.8 .3 (64.8) 3.7 (3.9) (4.2) (.8)
Other Income (Expense) - Net .4 .1 .5 .9 .4 .6
Minority Interest (2.9) (3.3) (3.1) (2.6) (2.8) (1.9) (2.9)
-------- -------- --------- --------- -------- --------- --------
Segment Income, before income taxes (1.1) (2.6) (67.8) 1.6 (5.8) (5.7) (3.1)
Applicable Income Taxes (Benefit) (.5) (1.4) (5.2) 1.1 (2.1) (2.3) (1.2)
-------- -------- --------- --------- -------- --------- --------
Segment Income (Loss) $ (.6) $ (1.2) $ (62.6) $ .5 $ (3.7) $ (3.4) $ (1.9)
======== ======== ========= ========= ======== ========= ========
- ------------------------------------------------------------------------------------------------------------------------------------
19
THE PHOENIX COMPANIES, INC.
ASSET MANAGEMENT NET FLOWS AND ASSETS UNDER MANAGEMENT
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
--------------------- ---------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ---------- ---------- ---------- ---------- ----------
PRIVATE CLIENT PRODUCTS:
Managed Accounts
Inflows $ 1,645.9 $ 3,774.4 $ 4,421.1 $ 2,721.9 $ 3,869.4 $ 2,143.2
Outflows (1,860.5) (2,164.4) (2,716.3) (2,546.4) (1,619.8) (1,034.3)
---------- ---------- ---------- ---------- ---------- ----------
Net Flows (214.6) 1,610.0 1,704.8 175.5 2,249.6 1,108.9
Performance 2,015.6 (3,540.9) (3,278.2) (3,545.8) (2,859.1) 1,939.0
Acquisitions (Divestitures) 5,914.3 5,914.3 748.5 (130.0) 433.0
---------- ---------- ---------- ---------- ---------- ----------
Change in Assets Under Management 1,801.0 3,983.4 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 14,980.2 12,821.7 13,179.2 8,838.3 11,460.1 12,199.6
---------- ---------- ---------- ---------- ---------- ----------
Mutual Funds
Inflows 1,339.1 971.0 1,332.8 1,817.8 2,068.5 1,657.8
Outflows (1,639.9) (1,942.2) (2,754.0) (2,756.4) (3,492.0) (3,216.3)
---------- ---------- ---------- ---------- ---------- ----------
Net Flows (300.8) (971.2) (1,421.2) (938.6) (1,423.5) (1,558.5)
Performance 1,094.9 (2,194.7) (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 794.1 (2,832.4) (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 9,116.2 8,389.2 8,322.1 11,221.6 14,716.7 18,073.4
---------- ---------- ---------- ---------- ---------- ----------
INSTITUTIONAL PRODUCTS:
Inflows 2,288.7 3,591.9 4,380.4 4,989.0 5,572.5 5,843.7
Outflows (2,438.3) (3,973.1) (4,480.0) (3,766.9) (7,355.6) (5,025.6)
---------- ---------- ---------- ---------- ---------- ----------
Net Flows (149.6) (381.2) (99.6) 1,222.1 (1,783.1) 818.1
Performance (1) 211.5 (2,601.0) (2,773.1) (1,152.2) 935.4 1,628.2
Other (1) 722.1 1,528.5 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 784.0 54.0 424.0 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 33,238.2 32,084.2 32,454.2 32,030.2 30,416.0 34,328.4
---------- ---------- ---------- ---------- ---------- ----------
TOTAL PRIVATE CLIENT AND INSTITUTIONAL PRODUCTS:
Inflows 5,273.7 8,337.3 10,134.3 9,528.7 11,510.4 9,644.7
Outflows (5,938.7) (8,079.7) (9,950.3) (9,069.7) (12,467.4) (9,276.2)
---------- ---------- ---------- ---------- ---------- ----------
Net Flows (665.0) 257.6 184.0 459.0 (957.0) 368.5
Performance (1) 3,322.0 (8,336.6) (7,863.1) (7,254.5) (3,856.9) 6,691.9
Other (1) 722.1 1,528.5 1,789.0 1,438.4 141.3 274.3
Acquisitions (Divestitures) 7,755.5 7,755.5 854.4 (3,336.0) 3,779.3
---------- ---------- ---------- ---------- ---------- ----------
Change in Assets Under Management 3,379.1 1,205.0 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 $57,334.6 $53,295.1 $53,955.5 $52,090.1 $56,592.8 $64,601.4
========== ========== ========== ========== ========== ==========
Variable Product Change in Assets Under
Management included in Mutual Funds above $ 102.7 $ (711.9) $ (686.5) $ (734.7) $ (634.6) $ 576.4
========== ========== ========= ========= ========== ==========
(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
Third Quarter 2003 (unaudited)
($ in millions)
2002 2003
------------------------------------------- -------------------------------
Quarters ended March June September December March June September
---------- ---------- ---------- ---------- --------- ---------- ----------
PRIVATE CLIENT PRODUCTS:
Managed Accounts
Inflows $ 1,149.7 $ 1,732.5 $ 892.2 $ 646.8 $ 568.8 $ 551.2 $ 525.9
Outflows (538.0) (816.3) (810.1) (551.9) (688.4) (612.6) (559.5)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Flows 611.7 916.2 82.1 94.9 (119.6) (61.4) (33.6)
Performance 661.2 (1,882.0) (2,320.1) 262.6 434.8 1,341.4 239.4
Acquisitions (Divestitures) 5,809.0 105.3
---------- ---------- ---------- ---------- ---------- ---------- ----------
Change in Assets Under Management 7,081.9 (965.8) (2,132.7) 357.5 315.2 1,280.0 205.8
Beginning Balance 8,838.3 15,920.2 14,954.4 12,821.7 13,179.2 13,494.4 14,774.4
---------- ---------- ---------- ---------- ---------- ---------- ----------
Ending Balance 15,920.2 14,954.4 12,821.7 13,179.2 13,494.4 14,774.4 14,980.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
Mutual Funds:
Inflows 282.1 370.5 318.4 361.8 313.3 449.2 576.6
Outflows (603.7) (727.9) (610.6) (811.9) (498.8) (542.9) (598.2)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Flows (321.6) (357.4) (292.2) (450.1) (185.5) (93.7) (21.6)
Performance (90.2) (1,109.9) (994.6) 383.0 (101.4) 897.1 299.2
Acquisitions (Divestitures) 333.5
---------- ---------- ---------- ---------- ---------- ---------- ----------
Change in Assets Under Management (78.3) (1,467.3) (1,286.8) (67.1) (286.9) 803.4 277.6
Beginning Balance 11,221.6 11,143.3 9,676.0 8,389.2 8,322.1 8,035.2 8,838.6
---------- ---------- ---------- ---------- ---------- ---------- ----------
Ending Balance 11,143.3 9,676.0 8,389.2 8,322.1 8,035.2 8,838.6 9,116.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
INSTITUTIONAL PRODUCTS:
Inflows 832.7 960.6 1,798.6 788.5 793.7 918.2 576.8
Outflows (723.3) (2,071.5) (1,178.3) (506.9) (640.9) (1,075.1) (722.3)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Flows 109.4 (1,110.9) 620.3 281.6 152.8 (156.9) (145.5)
Performance (1) (425.9) (1,112.0) (1,063.1) (172.1) (1,724.4) 1,529.4 406.5
Other (1) 409.4 518.8 600.3 260.5 496.4 154.7 71.0
Acquisitions (Divestitures) 1,507.7
---------- ---------- ---------- ---------- ---------- ---------- ----------
Change in Assets Under Management 1,600.6 (1,704.1) 157.5 370.0 (1,075.2) 1,527.2 332.0
Beginning Balance 32,030.2 33,630.8 31,926.7 32,084.2 32,454.2 31,379.0 32,906.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
Ending Balance 33,630.8 31,926.7 32,084.2 32,454.2 31,379.0 32,906.2 33,238.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
TOTAL PRIVATE CLIENT AND INSTITUTIONAL PRODUCTS:
Inflows 2,264.5 3,063.6 3,009.2 1,797.1 1,675.8 1,918.6 1,679.3
Outflows (1,865.0) (3,615.7) (2,599.0) (1,870.7) (1,828.1) (2,230.6) (1,880.0)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net Flows 399.5 (552.1) 410.2 (73.6) (152.3) (312.0) (200.7)
Performance (1) 145.1 (4,103.9) (4,377.8) 473.5 (1,391.0) 3,767.9 945.1
Other (1) 409.4 518.8 600.3 260.5 496.4 154.7 71.0
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) 3,610.6 815.4
Beginning Balance 52,090.1 60,694.3 56,557.1 53,295.1 53,955.5 52,908.6 56,519.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
Ending Balance $60,694.3 $56,557.1 $53,295.1 $53,955.5 $52,908.6 $56,519.2 $57,334.6
========== ========== ========== ========== ========== ========== ==========
Variable Product Change in Assets Under
Management included in Mutual Funds above $ (123.2) $ (314.9) $ (273.8) $ 25.4 $ (106.4) $ 155.1 $ 54.0
========== ========== ========== ========== ========== ========== ==========
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
21
THE PHOENIX COMPANIES, INC.
VENTURE CAPITAL SEGMENT
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
-------------------- -------------------------------------------
2003 2002 2002 2001 2000 1999
--------- --------- --------- ---------- -------- --------
SEGMENT INCOME
Operating Loss $ (5.3) $ (5.8) $ (7.4) $ (7.3) $ (7.8) $ (8.9)
Realized Gains (Losses) on Cash and Stock Distributions 1.1 (7.2) (4.7) 26.2 222.2 84.7
Change in Unrealized Gains on Investments Held in
Partnerships 39.1 (43.9) (47.2) (178.5) 62.9 64.1
--------- --------- -------- --------- -------- --------
Equity in Partnership Earnings, before income taxes 34.8 (56.9) (59.3) (159.6) 277.3 139.9
Applicable Income Taxes (Benefit) 12.2 (19.9) (20.7) (55.9) 97.1 49.0
--------- --------- -------- --------- -------- --------
Segment Income (Loss) $ 22.6 $ (37.0) $ (38.6) $ (103.7) $ 180.2 $ 90.9
========= ========= ======== ========= ======== ========
- ------------------------------------------------------------------------------------------------------------------------------
VENTURE CAPITAL INVESTMENTS
Contributions (Dollars Invested) 27.5 30.7 42.2 47.0 97.0 108.5
Equity In Earnings of Partnerships 34.8 (56.9) (59.3) (159.6) 277.3 139.9
Distributions (21.2) (34.9) (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 (14.2) (5.0)
--------- --------- -------- --------- -------- --------
Change in Venture Capital Investments (25.3) (61.1) (63.9) (175.6) 129.2 146.9
Beginning Balance 227.8 291.7 291.7 467.3 338.1 191.2
--------- --------- -------- --------- -------- --------
Ending Balance $ 202.5 $ 230.6 $ 227.8 $ 291.7 $ 467.3 $ 338.1
========= ========= ======== ========= ======== ========
- ------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO BREAKDOWN
Technology 37.3 20.3 25.0 41.3
Telecom 12.2 8.7 10.2 19.1
Biotech 15.8 10.4 11.1 14.1
Healthcare 7.8 8.9 9.2 10.7
---------
Consumer and Business Products and Services 27.8 Included 45.9 46.6
Financial Services 29.2 in Other 28.1 30.3
---------
Other 42.1 118.8 50.6 57.8
--------- --------- -------- ---------
Total Private Holdings 172.2 167.1 180.1 219.9
Public Holdings 18.1 21.5 23.0 39.8
Cash and Cash Equivalents 10.8 27.2 21.6 22.5
Other 1.4 14.8 3.1 9.5
--------- --------- -------- ---------
Total $ 202.5 $ 230.6 $ 227.8 $ 291.7
========= ========= ======== =========
22
THE PHOENIX COMPANIES, INC.
VENTURE CAPITAL SEGMENT
Third Quarter 2003 (unaudited)
($ in millions)
2002 2003
------------------------------------------ ---------------------------------
Quarters ended March June September December March June September
---------- ---------- --------- --------- ---------- ---------- -----------
SEGMENT INCOME
Operating Loss $ (2.0) $ (1.6) $ (2.2) $ (1.6) $ (.9) $ (2.6) $ (1.8)
Realized Gains (Losses) on Cash and Stock
Distributions (12.5) 7.4 (2.1) 2.5 (6.2) 1.0 6.2
Change in Unrealized Gains on Investments Held in
Partnerships 9.5 (35.7) (17.7) (3.3) 31.0 7.4 .7
---------- --------- --------- --------- -------- --------- ---------
Equity in Partnership Earnings, before income taxes (5.0) (29.9) (22.0) (2.4) 23.9 5.8 5.1
Applicable Income Taxes (Benefit) (1.8) (10.4) (7.7) (.8) 8.4 2.0 1.8
---------- --------- --------- --------- -------- --------- ---------
Segment Income (Loss) (3.2) (19.5) (14.3) (1.6) 15.5 3.8 3.3
========== ========= ========= ========= ======== ========= =========
- ---------------------------------------------------------------------------------------------------------------------- ----------
VENTURE CAPITAL INVESTMENTS
Contributions (Dollars Invested) 13.0 7.5 10.2 11.5 11.6 9.9 6.0
Equity In Earnings of Partnerships (5.0) (29.9) (22.0) (2.4) 23.9 5.8 5.1
Distributions (9.4) (6.1) (19.4) (6.9) (3.0) (5.7) (12.4)
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) (.5)
---------- --------- --------- -------- -------- -------- --------
Change in Venture Capital Investments (1.4) (28.5) (31.2) (2.8) (33.5) 9.5 (1.3)
Beginning Balance 291.7 290.3 261.8 230.6 227.8 194.3 203.8
---------- --------- --------- -------- -------- -------- --------
Ending Balance 290.3 261.8 230.6 227.8 194.3 203.8 202.5
========== ========= ========= ======== ======== ======== ========
- --------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO BREAKDOWN
Technology 43.6 29.4 20.3 25 23.5 36.6 37.3
Telecom 17.3 10.5 8.7 10.2 7.4 12.6 12.2
Biotech 15.7 9.7 10.4 11.1 9.8 14.9 15.8
Healthcare 8.4 6.8 8.9 9.2 6.7 8.0 7.8
--------------------------------
Consumer and Business Products and Services Included in Other 45.9 32.0 29.6 27.8
Financial Services 28.1 29.7 28.2 29.2
--------------------------------
Other 140.6 142.7 118.8 50.6 57.7 34.3 42.1
---------- --------- --------- -------- ------- -------- --------
Total Private Holdings 225.6 199.1 167.1 180.1 166.8 164.2 172.2
Public Holdings 39.1 29.9 21.5 23.0 11.4 15.6 18.1
Cash and Cash Equivalents 16.1 24.9 27.2 21.6 9.2 9.2 10.8
Other 9.5 7.9 14.8 3.1 6.9 14.8 1.4
---------- --------- --------- -------- -------- -------- --------
Total $ 290.3 $ 261.8 $ 230.6 $ 227.8 $ 194.3 $ 203.8 $ 202.5
========== ========= ========= ======== ======== ======== ========
23
THE PHOENIX COMPANIES, INC.
CORPORATE AND OTHER
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME YTD September December 31,
--------------------- ------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ---------- ---------- -------- ---------- ---------
Corporate Investment Income $ 2.8 $ 3.5 $ 1.5 $ 7.2 $ 36.7 $ 13.1
Interest Expense (29.5) (23.1) (31.4) (27.3) (32.7) (34.0)
Corporate Expenses (7.7) (8.1) (10.4) (19.9) (53.5) (42.4)
International (.1) 6.5 4.2 7.7 12.1 10.0
Other .2 (3.2) (3.8) (2.4) (23.4) 3.5
--------- --------- --------- -------- ---------- ---------
Segment Loss, before income taxes (34.4) (24.4) (39.9) (34.7) (60.8) (49.8)
Applicable Income Tax Benefit (14.1) (17.5) (26.2) (20.9) (37.2) (27.1)
--------- --------- --------- -------- ---------- ---------
Segment Loss $ (20.3) $ (6.9) $ (13.7) $ (13.8) $ (23.6) $ (22.7)
========= ========= ========= ======== ========== =========
24
THE PHOENIX COMPANIES, INC.
CORPORATE AND OTHER
Third Quarter 2003 (unaudited)
($ in millions)
SEGMENT INCOME 2002 2003
------------------------------------------- ---------------------------------
Quarters ended March June September December March June September
---------- ---------- ---------- ---------- ---------- ---------- -----------
Corporate Investment Income (Loss) $ 2.7 $ 1.1 $ (.3) $ (1.9) $ .5 $ .9 $ 1.5
Interest Expense (7.7) (7.7) (7.7) (8.3) (9.8) (9.9) (9.9)
Corporate Expenses (4.3) (2.5) (1.3) (2.3) .1 (3.1) (4.8)
International 3.8 2.1 .6 (2.2) (1.3) 1.2
Other (.2) (1.4) (1.3) (1.0) (.9) (.4) 1.5
-------- -------- -------- -------- -------- -------- --------
Segment Income, before income taxes (5.7) (8.4) (10.1) (15.7) (11.4) (12.5) (10.5)
Applicable Income Tax Benefit (4.1) (7.0) (6.4) (12.1) (2.8) (4.6) (6.7)
-------- -------- -------- -------- -------- -------- --------
Segment Loss $ (1.8) $ (1.4) $ (3.7) $ (3.6) $ (8.6) $ (7.9) $ (3.8)
======== ======== ======== ======== ======== ======== ========
25
THE PHOENIX COMPANIES, INC.
CONSOLIDATED STATEMENT OF INCOME - GAAP FORMAT (1)
Third Quarter 2003 (unaudited)
($ in millions)
YTD September December 31,
----------------------- -------------------------------------------------
2003 2002 2002 2001 2000 1999
---------- ----------- ---------- ---------- ---------- ----------
REVENUES
Premiums $ 781.5 $ 813.9 $ 1,082.0 $1,112.7 $ 1,147.4 $ 1,175.7
Insurance and Investment Product Fees 410.3 425.6 563.3 546.4 631.0 574.6
Net Investment Income 794.7 675.7 915.2 843.2 1,137.2 958.6
Net Realized Investment Gains (Losses) (119.5) (74.1) (107.6) (72.4) 89.2 75.8
--------- ---------- ---------- ---------- ---------- ----------
Total Revenues 1,867.0 1,841.1 2,452.9 2,429.9 3,004.8 2,784.7
--------- ---------- ---------- ---------- ---------- ----------
BENEFITS AND EXPENSES
Policy Benefits and Increase in Policy Liabilities 1,088.2 1,070.7 1,436.1 1,406.7 1,409.8 1,373.1
Policyholder Dividends 310.2 294.4 401.8 400.1 378.0 360.5
Policy Acquisition Cost Amortization 76.6 41.6 59.2 133.0 356.0 147.9
Intangible Asset Impairments 66.3
Intangible Asset Amortization 24.9 24.8 98.8 49.4 36.9 40.1
Interest Expense 29.5 23.1 31.4 27.3 32.7 34.0
Demutualization Expenses 1.7 1.8 25.9 21.8
Other Operating Expenses 393.3 451.0 583.9 628.1 604.5 557.9
--------- ---------- ---------- ---------- ---------- ----------
Total Expenses 1,922.7 1,973.6 2,613.0 2,670.5 2,839.7 2,513.5
--------- ---------- ---------- ---------- ---------- ----------
Income (Loss) from Continuing Operations
Before Income Taxes and Minority Interest (55.7) (132.5) (160.1) (240.6) 165.1 271.2
Applicable Income Taxes (Benefit) (31.4) (40.4) (56.8) (110.5) 56.2 99.0
--------- ---------- ---------- ---------- ---------- ----------
Income (Loss) from Continuing Operations before
Minority Interest (24.3) (92.1) (103.3) (130.1) 108.9 172.2
Minority Interest in Net Income of Subsidiaries (8.0) (9.2) (12.4) (7.2) (14.1) (10.1)
--------- ---------- ---------- ---------- ---------- ----------
Income (Loss) from Continuing Operations (32.3) (101.3) (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 (32.3) (101.3) (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) $ (32.3) $ (231.6) $ (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)
Third Quarter 2003 (unaudited)
($ in millions)
2002 2003
------------------------------------------- -------------------------------
Quarters ended March June September December March June September
---------- ---------- ---------- ---------- ---------- ---------- ---------
REVENUES
Premiums $ 257.4 $ 259.4 $ 297.1 $ 268.1 $ 246.1 $ 248.5 $ 286.9
Insurance and Investment Product Fees 140.3 145.9 139.4 137.7 132.9 133.8 143.6
Net Investment Income 231.2 215.7 228.8 239.5 276.7 263.8 254.2
Net Realized Investment Losses (35.0) (28.6) (10.5) (33.5) (12.3) (104.6) (2.6)
--------- --------- --------- --------- --------- --------- ---------
Total Revenues 593.9 592.4 654.8 611.8 643.4 541.5 682.1
--------- --------- --------- --------- --------- --------- ---------
BENEFITS AND EXPENSES
Policy Benefits and Increase in Policy Liabilities 333.9 338.9 397.9 365.4 350.8 348.4 389.0
Policyholder Dividends 74.2 107.5 112.7 107.4 116.5 94.2 99.5
Policy Acquisition Cost Amortization (10.9) 11.4 41.1 17.6 28.0 25.9 22.7
Intangible Asset Impairments 66.3
Intangible Asset Amortization 8.1 7.8 8.9 7.7 8.4 8.2 8.3
Interest Expense 7.7 7.7 7.7 8.3 9.8 9.9 9.8
Demutualization Expenses .9 .6 .2 .1
Other Operating Expenses 136.0 179.1 135.9 133.8 126.5 136.5 130.3
--------- --------- --------- --------- --------- --------- ---------
Total Expenses 549.9 653.0 770.7 640.3 640.0 623.1 659.6
--------- --------- --------- --------- --------- --------- ---------
Income (Loss) from Continuing Operations
Before Income Taxes and Minority Interest 44.0 (60.6) (115.9) (28.5) 3.4 (81.6) 22.5
Applicable Income Taxes (Benefit) 12.3 (26.7) (26.0) (16.7) (2.6) (34.4) 5.6
--------- --------- --------- --------- --------- --------- ---------
Income (Loss) from Continuing Operations before
Minority Interest 31.7 (33.9) (89.9) (11.8) 6.0 (47.2) 16.9
Minority Interest in Net Income of Subsidiaries (2.8) (3.3) (3.1) (2.7) (2.8) (2.3) (2.9)
--------- --------- --------- --------- --------- --------- ---------
Income (Loss) Before Cumulative Effect of Accounting
Changes 28.9 (37.2) (93.0) (14.5) 3.2 (49.5) 14.0
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 $ (49.5) $ 14.0
========= ========= ========= ========= ========= ========= =========
(1) Certain reclassifications have been made to prior periods to conform with
the current presentation.
27
THE PHOENIX COMPANIES, INC.
CONSOLIDATING THIRD QUARTER 2003 INCOME STATEMENT
Third Quarter 2003 (unaudited)
($ in millions)
Exclusions from
Year-to-date September 30, 2003 Operating Segments Other Segments Segment Income
--------------------- --------------------- ---------------------
Realized
Life & Asset Venture Corporate Investment
Consolidated Annuity Management Capital & Other Losses Other
------------ ---------- ---------- ---------- ---------- ---------- ----------
REVENUES
Premiums $ 781.5 $ 781.5
Insurance and Investment Product Fees 410.3 242.5 $ 173.2 $ 11.4 $ (16.8)
Net Investment Income 794.7 742.8 .3 $ 34.8 10.5 6.3
Net Realized Investment Losses (119.5) $ (119.1) (.4)
---------- ---------- --------- --------- --------- ---------- --------
Total Revenues 1,867.0 1,766.8 173.5 34.8 21.9 (119.1) (10.9)
---------- ---------- --------- --------- --------- ---------- --------
BENEFITS AND EXPENSES
Policy Benefits and Increase in Policy Liabilities 1,088.2 1,082.3 5.9
Policyholder Dividends 310.2 314.7 (4.5)
Policy Acquisition Cost Amortization 76.6 77.7 (1.1)
Intangible Asset Amortization 24.9 24.9
Interest Expense 29.5 29.5
Other Operating Expenses 393.3 222.7 155.6 20.9 (5.9)
---------- ---------- --------- --------- --------- ---------- --------
Total Expenses 1,922.7 1,697.4 180.5 - 56.3 (5.6) (5.9)
---------- ---------- --------- --------- --------- ---------- --------
Income (Loss) from Continuing Operations Before
Income Taxes and Minority Interest (55.7) 69.4 (7.0) 34.8 (34.4) (113.5) (5.0)
Applicable Income Taxes (Benefit) (31.4) 22.5 (5.6) 12.2 (14.1) (44.4) (2.0)
---------- ---------- --------- --------- --------- ---------- --------
Income (Loss) from Continuing Operations before
Minority Interest (24.3) 46.9 (1.4) 22.6 (20.3) (69.1) (3.0)
Minority Interest in Net Income of Subsidiaries (8.0) (.4) (7.6)
---------- ---------- --------- --------- --------- ---------- --------
Income (Loss) from Continuing Operations $ (32.3) $ 46.5 $ (9.0) $ 22.6 $ (20.3) $ (69.1) $ (3.0)
========== ========== ========= ========= ========= ========== ========
28
THE PHOENIX COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEET -- PRELIMINARY
Third Quarter 2003 (unaudited)
($ in millions, except par value)
December 31,
September ---------------------------------------------------
2003 2002 2001 2000 1999
------------ ------------ ------------ ------------- -----------
ASSETS:
Available-for-Sale Debt Securities, at fair value $ 13,007.5 $ 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, at fair value 357.4 391.2 290.9 335.5 437.2
Mortgage Loans, at unpaid principal balances 328.1 468.8 535.8 593.4 716.8
Policy Loans, at unpaid principal balances 2,212.1 2,195.9 2,172.2 2,105.2 2,042.6
Venture Capital Partnerships, at equity in net assets 240.3 228.6 291.7 467.3 338.1
Affiliate Equity and Debt Securities, at cost plus
equity in undistributed earnings 41.9 134.7 150.6 103.7 106.6
Other Investments 413.5 398.9 376.0 313.6 280.0
------------ ------------ ----------- ----------- -----------
Total Investments 16,600.8 15,712.2 13,604.9 12,050.6 11,460.1
Cash and Cash Equivalents 628.3 1,058.5 815.5 720.0 316.7
Deferred Policy Acquisition Costs 1,335.6 1,234.1 1,123.7 1,019.0 1,318.8
Goodwill and intangible assets 721.7 747.7 858.6 582.6 577.9
Other General Account Assets 703.7 690.5 563.2 564.4 689.6
Separate Account Assets and Investment Trust assets 7,082.5 5,793.1 5,570.0 5,376.6 5,923.9
------------ ------------ ----------- ----------- -----------
Total Assets 27,106.2 25,236.1 22,535.9 20,313.2 20,287.0
============ ============ =========== =========== ===========
LIABILITIES:
Policy Liabilities and Accruals 12,964.7 12,680.0 11,846.4 11,372.6 10,899.8
Policyholder Deposit Funds 3,737.8 3,395.7 1,515.2 678.4 538.2
Indebtedness 642.5 644.3 599.3 425.1 499.4
Stock Purchase Contracts 124.1 137.6
Other General Account Liabilities 549.0 553.7 614.4 619.6 669.7
Separate Account and Investment Trust Liabilities 7,082.5 5,793.1 5,564.9 5,376.6 5,923.9
------------ ------------ ----------- ----------- -----------
Total Liabilities and minority interest 25,100.6 23,204.4 20,140.2 18,472.3 18,531.0
------------ ------------ ----------- ----------- -----------
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value, 1.0 billion shares
authorized; 94,339,705 shares outstanding
(September 30, 2003) 1.0 1.0 1.0
Additional paid in capital 2,425.7 2,424.4 2,413.3
Deferred Compensation on Restricted Stock Units (3.9)
Retained Earnings (339.9) (292.6) (30.8) 1,820.7 1,731.5
Treasury stock, at cost: 12,036,586 shares
(September 30, 2003) (187.7) (195.7) (66.0)
Accumulated Other Comprehensive Income 110.4 94.6 78.2 20.2 24.5
------------ ------------ ----------- ----------- -----------
Total Stockholders' Equity 2,005.6 2,031.7 2,395.7 1,840.9 1,756.0
------------ ------------ ----------- ----------- -----------
Total Liabilities and Stockholders' Equity $ 27,106.2 $ 25,236.1 $ 22,535.9 $ 20,313.2 $ 20,287.0
============ ============ =========== =========== ===========
29
THE PHOENIX COMPANIES, INC.
INVESTMENT PORTFOLIO SUMMARY
Third Quarter 2003 (unaudited)
($ in millions, except par value)
Total Debt Securities Public Debt Securities Private Debt Securities
------------------------- -------------------------- ------------------------
9/30/2003 12/31/2002 9/30/2003 12/31/2002 9/30/2003 12/31/2002
------------ ------------ ------------ ------------- ----------- ------------
DEBT SECURITIES BY CREDIT QUALITY (CARRYING VALUE)
AAA/AA/A $ 8,583.7 $ 7,976.1 $ 7,223.3 $ 6,565.0 $ 1,360.5 $ 1,411.1
BBB 3,304.2 2,849.0 2,089.8 1,767.1 1,214.4 1,081.9
------------ ------------ ------------ ----------- ----------- ----------
Total Investment Grade 11,887.9 10,825.1 9,313.1 8,332.1 2,574.9 2,493.0
BB 781.4 785.7 655.3 577.4 126.1 208.3
B 178.9 105.4 130.5 82.2 48.4 23.2
CCC and Lower 119.1 118.5 77.9 53.3 41.1 65.2
In or Near Default 40.2 59.4 30.1 25.4 10.1 34.0
------------ ------------ ------------ ----------- ----------- ----------
Total Debt Securities $ 13,007.5 $ 11,894.1 $ 10,206.9 $ 9,070.4 $ 2,800.6 $ 2,823.7
============ ============ ============ =========== =========== ==========
% Below Investment Grade 8.6% 9.0% 8.8% 8.1% 8.1% 11.7%
- -----------------------------------------------------------------------------------------------------------------------------------
UNREALIZED GAINS AND LOSSES ON DEBT AND EQUITY
SECURITIES
As of September 30, 2003 Total Outside Closed Block Closed Block
------------------------- -------------------------- ------------------------
Gains Losses Gains Losses Gains Losses
------------ ------------ ------------ ------------- ----------- ------------
Total Debt Securities $ 733.9 $ (117.7) $ 251.1 $ (69.4) $ 482.8 $ (48.3)
Equity Securities 108.5 (2.8) 107.1 (1.6) 1.4 (1.2)
----------- ----------- ----------- ------------ ---------- ----------
Total Unrealized Gains (Losses) 842.4 (120.5) 358.2 (70.9) 484.2 (49.5)
----------- ----------- ----------- ------------ ---------- ----------
Applicable Policyholder Dividend Obligation 484.2 (49.5) 484.2 (49.5)
Applicable Deferred Acquisition Cost (Credit) 115.5 (27.5) 115.5 (27.5)
Applicable Deferred Income Tax 85.0 (15.2) 85.0 (15.2)
----------- ----------- ----------- ------------ ---------- ----------
Total Offsets to Net Unrealized Gains 684.7 (92.3) 200.5 (42.7) 484.2 (49.5)
----------- ----------- ----------- ------------ ---------- ----------
Net Unrealized Gains $ 157.7 $ (28.2) $ 157.7 $ (28.2) $ - $ -
=========== =========== =========== ============ ========== ==========
$ 129.5 $ 129.5 $ -
=========== =========== =========
30
THE PHOENIX COMPANIES, INC.
GAAP NET INVESTMENT INCOME YIELDS
Third Quarter 2003 (unaudited)
($ in millions)
Quarters ended 2002 2003
------------------------------------------- ---------------------------------
March June September December March June September
---------- ---------- ---------- ---------- ---------- ---------- -----------
GAAP NET INVESTMENT INCOME
Debt Securities $ 174.5 $ 185.5 $ 192.7 $ 180.8 $ 187.1 $ 199.1 $ 184.0
Equity Securities 1.1 1.1 .9 1.1 1.3 .9 .9
Mortgages 10.7 10.6 9.8 9.3 12.1 7.3 7.0
Policy Loans 42.5 42.3 42.7 44.3 42.6 42.6 42.2
Venture Capital (5.0) (29.9) (22.1) (2.3) 28.9 6.5 10.2
Cash & Cash Equivalents 1.9 2.9 3.0 4.1 3.1 1.4 1.4
Other * 7.9 6.4 4.6 3.0 4.5 8.6 11.0
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Cash and Invested Assets 233.6 218.9 231.6 240.3 279.6 266.4 256.7
---------- ---------- ---------- ---------- ---------- ---------- ----------
Investment Expenses 2.4 3.2 2.8 .8 2.9 2.6 2.5
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Net Investment Income $ 231.2 $ 215.7 $ 228.8 $ 239.5 $ 276.7 $ 263.8 $ 254.2
========== ========== ========== ========== ========== ========== ==========
ANNUALIZED YIELDS
Debt Securities 7.2% 7.3% 7.0% 6.2% 6.2% 6.1% 5.8%
Equity Securities 1.5% 1.4% 1.2% 1.3% 1.4% 1.0% 1.0%
Mortgages 8.4% 8.7% 8.3% 8.1% 9.1% 8.0% 8.6%
Policy Loans 8.2% 8.1% 8.1% 8.4% 8.1% 8.0% 7.9%
Venture Capital -6.6% -35.6% -30.4% -3.9% 67.9% 11.9% 18.7%
Cash & Cash Equivalents 1.1% 1.9% 1.8% 1.9% 1.5% 0.9% 0.9%
Other * 6.4% 5.2% 3.5% 2.3% 3.4% 7.0% 10.3%
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Cash and Invested Assets 6.6% 6.1% 6.1% 6.0% 6.7% 6.2% 6.1%
---------- ---------- ---------- ---------- ---------- ---------- ----------
Investment Expenses 0.1% 0.1% 0.1% 0.0% 0.1% 0.1% 0.1%
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Net Investment Income 6.6% 6.0% 6.0% 5.9% 6.7% 6.1% 6.0%
========== ========== ========== ========== ========== ========== ==========
* Includes real estate, affiliates, and other invested assets.
31
THE PHOENIX COMPANIES, INC.
REALIZED INVESTMENT GAINS AND LOSSES
Third Quarter 2003 (unaudited)
($ in millions, except par value)
2003 Quarter Ended 2003 December 31,
-------------------------------- -----------------------------
September June March YTD September 2002 2001 2000
---------- ---------- ---------- ------------- ---------- --------- --------
REALIZED INVESTMENT GAINS AND LOSSES
Debt Security Impairments $ (15.0) $ (19.8) $ (25.6) $ (60.4) $ (122.9) $ (72.6) $ (7.5)
Equity Security Impairments (3.2) (1.1) (4.3) (9.8)
Affiliated Equity Securities (96.9) (96.9)
Venture Capital Partnerships Impairments (.3) (4.3) (4.6) (5.1)
Mortgage Loan Impairments (.9) (2.8) (.4) (4.1) (.6) (6.1) (1.8)
Real Estate Impairments (.4) (.4) (6.1)
Other Invested Asset Impairments (0.9) (8.7) (9.6) (22.6) (3.7)
---------- ---------- ---------- ---------- ---------- -------- --------
Total Impairment Losses (19.5) (121.8) (39.0) (180.3) (160.4) (82.4) (15.4)
---------- ---------- ---------- ---------- ---------- -------- --------
Debt Security Net Transaction Gains (Losses) 11.1 5.2 41.3 57.6 48.4 21.7 (46.9)
Equity Security Net Transaction Gains (Losses) 4.9 7.4 (2.2) 10.1 2.1 (8.8) 146.8
Venture Capital Net Investment Gains (Losses) (.2) (9.5) (9.7)
Mortgage Loan Net Transaction Gains (Losses) (.6) (.4) (.4) (1.4) .2 7.1 4.8
Real Estate Net Transaction Gains (Losses) (.4) .5 .1 4.0 (2.5) 1.8
Other Invested Asset Net Transactions Gains (Losses) 1.6 5.6 (3.0) 4.1 (1.9) (7.5) (1.9)
---------- ---------- ---------- ---------- ---------- -------- --------
Total Net Transactions Gains 17.0 17.2 26.7 60.8 52.8 10.0 104.6
---------- ---------- ---------- ---------- ---------- -------- --------
Net Realized Investment Gains (Losses) (2.5) (104.6) (12.3) (119.5) (107.6) (72.4) 89.2
========== ========== ========== ========== ========== ======== ========
Closed Block Applicable PDO (Reduction) (3.5) (9.5) 8.5 (4.5) (40.3) (15.4)
Applicable Deferred Acquisition Costs (Credit) (2.8) 1.3 .4 (1.1) (7.2) 10.5 (10.7)
Applicable Deferred Income Tax (Credit) 1.3 (37.2) (8.8) (44.8) (20.8) (24.5) 32.9
---------- ---------- ---------- ---------- ---------- -------- --------
Net Realized Investment Gains (Losses) Included in Net
Income $ 2.5 $ (59.2) $ (12.4) $ (69.1) $ (39.3) $ (43.0) $ 67.0
========== ========== ========== ========== ========== ======== ========
32