RGA - Earnings call transcript Q1 2018 | Reinsurance Group of America, Incorporated

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day and welcome to the Reinsurance Group of America First Quarter 2018 Results Conference Call. Today's call is being recorded. At this time, I would like to introduce Mr. Todd Larson, Senior Executive Vice President and Chief Financial Officer; and Ms. Anna Manning, President and Chief Executive Officer. Mr. ahead, go Please Larson.

Todd Larson

morning call. welcome Good quarter RGA's XXXX conference everyone you. to and first Thank

in Louis and me quick measures. and the Joining St. quarter reminder Chief RGA's Anna first and Executive President about Manning, forward-looking Officer. non-GAAP after Anna results I information discuss this will a morning financial is

subjects that prepared our help be certain and mind better yesterday. A important premiums contain RGA's understand will and is you things, including, factors earnings release RGA in will statements that of take among actual results potential that make call, could of or to relating investment results we earnings Following list happy we during issued discuss information, of forward-looking cause performance, certain materially revenue, business, and will differ results to financial remarks, results. expected To your future actual materially this could from we growth other expected questions. projections included Keep and our to the subsidiaries. differ in performance from statements

for that, more the and operating our at supplement over on measure of better regulations. I'll With profitability additional the this refer for believe on addition, be financial information our our comments. to segments. non-GAAP we on the comment Anna may release call financial found also web for Investor in considered adjusted press this income adjusted and under various Please which and of and turn site to These after-tax measure income underlying SEC In trends information will pre-tax quarterly operating measure a to rgare.com. her ongoing and call, this income, course reconciliations reflects Relations business. during the is business We net documents of the tables

Anna Manning

Thank you, and morning. good Todd,

that the normal year earnings is we reported in claims night, primarily variability below These release to reflecting a results ago. operating part business. of $X.XX EPS our our $X.XX expectations, of of last compared an As inherent were adjusted indicated

is exacerbated As we in by past, see pointed be quarterly the some business that such, out our claims of we do have of which in seasonal trends. both directions, can the nature volatility

and platform considerably. product in went business, quarter, elevated biggest this was reduced of where quarter, a mortality this more where against our adjusted volatility seasonally overall But source variance was of relative had the us. global individual Our have our diversified In lines we claims beyond the expectations. U.S. volatility

higher severe aware, that winter year, are surprised As the was especially not and entirely the we weather claims. you saw and flu this we were season thus

the given in We blocks. results The modest in will different Pacific, transactions, $XX that performed longevity in bright can also the quarter and this quarter not line summary, soft some over have momentum for of execute Asia share Todd we season a a entirely in tough winter us, time. the on in but of number There the our was few were transactions surprise, but to quarter. severe In U.S. the our of see well, flu concern additional remain transactions and no issues we for fundamentals mortality, experienced underlying quarter, volatility pipeline of results, continue also in-force into active approximately Asia fairly and in also we asset-intensive on see active, other were We our including is the business and and we attributable EMEA deploying optimistic swings to spots in details and and Canada underwriting some the a business. good countries. in top a EMEA.

our earnings view quarter first remain our business underlying the were expectations, term of financial outlook Although our fundamentals intermediate below and unchanged.

attractive our it financial and me with back to serve clients, deliver to ability strategies, on our turn Todd. about over that, excited are we And forward, results. Looking execute let

Todd Larson

on details I Anna. provide some more Thanks will quarter's the results. financial

the for XX equity XX% operating within trailing to was adjusted range return XX.X%, XX%. months on of our Our

AOCI, ago growth, a supporting While basis $X.X share, billion. by on a our is down into total the over transactions excess XX% With capital to return and excluding solid period. organic increased quarter slightly value book year per of deployment

investment to quarter on our excluding business, variable basis up XXXX, of investments; first to X.XX%, yield, points Moving the the compared XXXX. versus basis reflecting up average and spread X the was higher income investment quarter points fourth X of

X.X%, the provision that the U.S. the income as intangible of Related reform range, tax and we XX.X% rate effective foreign well from as negative due tax some quarter, continue involved, rate the global overall to end. benefit of higher We are mix was on new to with in and through operating higher rate was that timing Our tax towards from tax the pre-tax more rates, but flat to fourth of rates, investment so from XX% higher before adjusted GILTI was expected tax various higher rate, perhaps, to basically low tax toward do variable are was yield jurisdictions the there getting last less quarter in investment year reform. our have the to X.XX% our money work our of effective full quarter some the our core bill. up from fact income, expect of within interest be the The than income and rate year. the aspects issues we or effective primarily the expected XX%, fourth earnings impact

CDC excess segment general harsh given terms unfortunately, the all reported of claims. winter $X.X mortality In reflects winter, of This the this operating at tends the exhibit comparison the Turning parts of million experience an winter provided respiratory quarter, data the from traditional year, flu business season. source to cancer. in mortality million this this quarter. In any in of non-large tough fairly additional than demonstrates, higher the especially million in terms frequency other of and adverse was was almost pre-tax mortality causes the an of to the the and ago. diseases year effect a reflects this death, population America and pneumonia We U.S. income results; And for our as Latin quantify of mortality excess roughly $XX adverse quarter U.S. adjusted $XX especially many versus other experience. Flu, time, in would the

long effects we the of seen quarter in negative last the as the existing Given claims. weak in results the the modification new care quarter, year. Also, that surprised our all market by comparison our well health last this, of were to treaty the modestly elevated has a this performance strong as year, Group we volumes. in from very mentioned below individual were quarter due term not down of expectations Premiums business decreased quarter, health, fourth as the this

period, Our slightly prepayment $XX.X $XX asset-intensive in markets. below of quarter, down level lower to expected range and million adjusted million, from an operating business pre-tax of income reported equity million year $XX hurt lower income ago $XX.X the million of by and this

pre-tax reported operating the line in $XX.X million reinsurance a of this versus financial the ago, increase business Our second due adjusted strong of half activity to period, an million new last income year $XX.X year.

million $XX.X pre-tax the Our period. Canada reported of traditional ago $XX.X year operating million, in up from segment adjusted income

million, last but line, unfavorable foreign as East a $X.X of year. adjust from income a reported by was million. longevity experience Premiums in execution impact year. operating experience in had fee underwriting underlying exchange asset transaction. an of with that longevity, financial million, to in-force on when quarter first $XX.X constant favorable first U.K. operating foreign favorable Middle you experience adjusted in had constant continental income income pre-tax stronger benefitting million. were based $XX.X of year's in and $X.X in Middle year which compared for Switching of $X.X business, of the mortality was currencies, up and had in was experience. the and Overall Reported solutions million, experience XX%, were $XX.X the last we as The our Europe line was and intensive, reported experience up Europe, flat in-force pre-tax currencies, up influence currency solutions business, longevity and with positive currency of the offset Canada's in the of X% quarter both transaction currency growth from unfavorable if transactions, region. Africa; premium last business expectations, was traditional in adjusted our as currency. East mortality quarter, foreign operating foreign and EMEA's effect business adjusted periods $XX positive for quarter, rates favorable to Longevity fee favorable million. million was the includes adjusted the positive experience increase reported XX%. million basically of financial to $X basis, based reflecting with a the a the ago, of versus transactions, both and pre-tax compared growth Premiums which translation modestly was includes periods, that This currency XX%,

compared Turning million $XX.X business; prior Asia operating pre-tax to in traditional million adjusted the to year our Pacific period. totaled income $XX.X

in reduction were Asia, reflecting individual versus the Our Asia primarily XX%. the Australia, both negative excludes Group in in particularly normal premium year is this we were quarter, for modestly premiums reflected and Asia, due the experience, experience the quarter up there more Australia, results recaptures business modestly normalized very reporting this Reported this some organic loss Australia quarter XX% of below The XX%, volatility. up XX% the the Asia, a period. results in expectations, reported was year. offset treaty small and Pacific to in in was ago while normal a premiums client fourth strong. small growth volatility quarter, profit last quarter the In in range were growth consider a XX%, ago current in traditional of year continued Australia, by growth the to in this but adverse where year while reflect strong The quarter, catch-ups, which weaker and

segment include and the the launch the $X.X that a of of generally revenues range note than ago basis. and Langhorne. loss a higher Asia that adjusted compensation our expect LOGiQX Our $X.X related adjusted current of we of operating some average, pre-tax negative a past. In acquisition. Solutions of volatility to quarter be million million quarter compared loss accruals, $XX to treaty pre-tax business. run-off costs loss Financial reported the this that reported The we level quarter operating of year of expected Results ago. reflected million expenses better the corporate million in experience higher in will reflected exceeded I costs, conclusion, segments the versus income On that to Pacific period. still $XX.X a in year operating to the project the $XX in million adjusted from and for onetime incentive mentioned pre-tax million also inherent the combination on is reflect have The quarterly corporate $XX.X business annual

important an on us. And be to to continue team priorities continues opportunities sources and our RGA earning to success. diversified component execute and platform global Our the before

Given objectives. our we financial strong balance our and can we achieve confident sheet are to improvement that strategy, continue goals

Before open you X support like call see appreciate questions, Investor With I remind would everyone the to we in call and hope the thank that, you we interest up June in of We New open will there. York. on for RGA, our for Day to we your upcoming and and questions.

Operator

our will question [Operator Markets. Lee with take from first Instructions]. Kenneth Capital RBC And today we

Kenneth Lee

Hi. taking my for Thanks question.

finally, whether sides the to call other mean, any want frequency, spillover you'd the due the quarter, of was that to and expect severity out, or there Thanks. terms it's wondering kind to of either the in whether and non-facultative any to pattern the whether it income mainly mortality business, factors? other if sounded into due U.S.-LATAM and Just though, business. within between experience like I facultative second -- timing just of you there's

Anna Manning

indicated, to against bad that's consistent was The size in well performance. and contributor, have that have the elevated those this of to claims. and higher mentioned, Todd less an a average the key a flu virus, season, we the the We And with this with number strain. non-large effective start me as as claims, virulent season strain frequency, frequency. had elevation quarter of as both, was more Let saw as we that vaccine

bad particularly a saw winter. also We

and expect impact to volatility, see in other a it's causes all almost countries. So lot observable flu, chapters generally. around research we outside additional of claims, is most the would than There phenomenon, and that this would seasonal of

and it it. the term, In for them reason out reinsurance that why fact, even we part the clients. get this, the expect that's is even to volatility our It fact valuable we is though over exists, longer why of helps manage this to paid

about wish we it. having are better. given results, the worried all So that, said disappointed we in claim the it we not were are quarter's But circumstances,

much what a results; in I about respect us your point, say with the really say your question the worse and can is is Now blocks us. across is at data, obviously, also too consistent this then early performance to of at business claims, behind there automatic time to our and focused ages. lag areas question pretty according to and our was with CDC But business, on to respect the for else, much [ph] versus April facultative, the older that, of it's the

Kenneth Lee

great. million of you longevity that Okay, on and way between out can excess mortality, $XX deployment, follow-up, just annuity just the one proportion And break any the capital the transactions? Thanks. any

Anna Manning

provide of level that We information. don't typically

Kenneth Lee

Thanks. Okay.

Operator

And Jimmy Bhullar to move next JPMorgan. we with

Jimmy Bhullar

morning. good Hi,

had see I wanted just you mentioned any on. think if to you comments this briefly, but

sort longer If you of in the years. difficult winter carried it on than think about season,

related flu into is So as claims possibility continue there the well? XQ that a

Anna Manning

any have have the earlier. information, than to we don't that possible, It's indicated data other I CDC and

too tell. us I as said, So it's to early for

Jimmy Bhullar

driver the in your you for been had changed it And that, think loss quarters; quarter? a I loss last a Australia, whether can and generating profit that of you the the few that this then had has business, expectations discuss modest

Todd Larson

Yeah.

volatility level still some probably We of in see will Australia.

treaty anything DI business. it, any and last or reduced pleased Group some individual the as there any the like client Australia in know, caused of nothing of you quarter, are split business risk the was overall between that of year. we us was that. with and we the But I the at in at quite nothing that really particular We concern, of underperformance look or the recaptures first But have the amount end

would we the view expect for still it volatility, we as would So normal a show to and profit Australia year.

Jimmy Bhullar

competitive actually taxed environment can market, comment you Okay. that you and the And your versus feel the in the in on still with in position lower will if whether and were competitive improve feel that it case? then just think that's reform, the -- some of lastly, tax I mentioned you if the you jurisdictions have past, peers

Anna Manning

us moving All competitors the competitors make else being things around offshore will and we'd I reinsurers. affect say, somewhat that had would the of our position. many are more should against reducing ultimately the and and our react by competitive, do, like still But equal, changes the disadvantage what they tax that's, how

and we that us a on can are is, So ends taking at it's up. time some stage. see hard that line actions what how and means this take it emerging to to we competitors isolate see up What where will deal-by-deal position basis, trends our relative

Jimmy Bhullar

Thank Okay. you.

Operator

And with next, we on Erik Bass will move Autonomous Research. to

Erik Bass

Hi. Thank you.

if winter picture, ages, a time, sort see in the it flu increasing just just talk more could particularly tradition, in U.S. your maybe your seasonality if block about Just for business, over of that events? of you bigger wondering you susceptible weather the and and is level as

Anna Manning

we are higher seasonality, compared And U.S. third by what would mean So of and let that There would the countries. first show and debts seasonality lots in is the that, being somewhere equal, in the we just expect, me we and between. else with start quarter, in have studies in all second quarter to reports that fourth not many it's seasonality

on Now basis. variance variability; basis, business because don't isn't is relative has it our on aging. getting increasing that's But it its absolute increasing. a see an and older We our and increased

on dollar if -- you look increases. business to the relative But because to see you. price I volatility equity, I that the that's and is dollar is the of and may volatility we answer business relative price the you, of volatility, as don't a the offer But So increasing. the it share basis. not, that's variance scale would analogy the may our share Yes, on our an would the or increasing increase, point at aging provide

Erik Bass

Got some it. color That's additional provide helpful. -- And can you

Anna Manning

sorry, I And am I pardon. beg your

older impact the question would we hard age, had a flues, to as And have tend also on You expect people disproportionate increase to the yes, seasonality. because about winters, ages. seasonality

Erik Bass

Got on into? additional quarter, maybe some those executed other you color that business it. questions, And the then this transactions the Thank of geographies fell the provide types if could you. and

Anna Manning

The deal. I XXXX. U.K. fairly restructuring blocks. that activity balance in them We continuation we We deals we as interest in non-core countries, in those and remarks, a one one likely and was it on, increases three sheet, the active of we mortality they the different Sure. the executed the varied, saw margin, in say, start three in U.S. a rates, we asset indicated prepared were in of to had felt pickup deal our due an and with, in one Well, in deal, actually Canada, had overall longevity intensive I'd quarter, to would on and the compared

We a few completed in quarter. FinRe the also transactions

So this on us for a we consider very deals. quarter nice

further I or suggest add Now, would be competition to strong. continues further that

the we the spot we pursuing have and talked about approach looking edge. that that However, about past, fit in have are an sweet things for where we our

So what share the new a I'd had last new we three other where is limited transactions, of that were transaction from past, transactions with third transaction, on to with the and you with had to either or look idea, client. those was us on or about particular, work a because a transactions experience and structure three client, benefit. our two that in transactions in these translated taken then their like exclusive, a new a we done And approach the into a we the prior repeating competition,

pursuing highlight, we deals are that them So these actively.

ideas. bringing are We new

to transactions, for looking the working. repeat approach are our and We market is

Erik Bass

color. That's you. Thank right. All helpful

Operator

and move with Lee Dowling Humphrey to next, And we Partners.

Humphrey Lee

first regarding to the that amount and will you and to want your get that, as fluctuation the the as increase, morning question I thank volatility block earlier for results. I response you gets on follow grow question. bigger. the the dollar in just quarter business, point Good Anna's taking Erik's

that's mean look a to I a lot the kind quarter quarter. kind the definitely ranges are kind And like year range when low and XXXX a bad think if the of at earnings, look the than expecting. convey. of kind of full maybe, same the on may have were to what time, But you it XXXX, of -- to or the -- basis. quarter first XX% we I teens back were of X% this the quarter, historically, to in same what you full for range was typically But trying XX% million back worse at year thing a like $X.X like if earnings is XX% mid of it people

So to I was explained guess, range going on the other wider something given by block ask some what is, trying well? all the of the the I volatility, aging there is as or was of things -- that

Anna Manning

a are There factors. couple of

predictable One changes few that's I factors over think are suggesting, trends, give volume I the mortality of look we we really and at when that's in a stable sense quarter relatively our in difficult, mortality, a think talking We the is term, you are the term, quarters, long you the very and that but even I is, mortality, of multiple years. our can't larger we of long one and nature the think what quarter. believe, think limited and business. of is any given

Humphrey Lee

in Todd's remarks, I the was the guess, unfavorable quarter in $XX million range. the around so so roughly mortality

compared on bad million a where That would $XX $XX then maybe seems be, you to first $XX like million to to $XX range, So low for $XX that be million maybe the be historically a to tend to first would quarter. million. you, million quarter, in and quarter put in

wondering, pattern? is of was shift what I earnings in of just terms driving So that kind

Anna Manning

Our not earnings are pattern quarter-by-quarter. leveled

the and have quarter. I seen fourth are question, understand I and stronger in quarter in So am that struggling we our earnings it. first and am that not we typically, I the really am afraid to expect lighter your answering

Humphrey Lee

offline. follow-up will I Maybe

GILTI well higher you Just GILTI of geographic jurisdictions, as the is impact. think mentioned, to should of Can -- tax tax as so going and the related about a the question, of the impact as portion the forward? tax kind the second you about mix, components income guess the the in quarter, quarter; kind from there in talk the I we rate higher how

Todd Larson

Yeah Humphrey.

first bit, about the item, just the just a really of had little on talking here. that U.S. mix So up business, the the effective it's we we was are I given the think rate a because -- --

that a profits, better just little So bit sort of and little given businesses rate had the other a the up non-U.S. rode more the of it bit. performed

move U.S. XX%. On to the lower GILTI, -- business companies under as know, territorial might still off you moving unfortunately, tax moving want more they U.S. the below their I reform, think under a of to system. tax to U.S. And tax we system, didn't jurisdictions that be tried

companies, income, tax a by So through that are financial companies the they definition go a on, fixed up you pretty type will service insurance of produced and income and it's securities so that's the bonds and the only income broad have to on this income, called reform as to tax, income like GILTI considered lot but GILTI intangible tend things calculation. and income, being unfortunately, what's intangible tax like our ended insurance

GILTI a going, early And tax will range. in I range our that the so, the might our feel of we first conservative as a that, of we would it various the that what fairly basis, still we that local higher like And something be and and manageable it time, terms our because IRS looks should do our We look that, being then emerging range, still is this we far in we be provided is, companies. it on XX%, manageable will this time, at. what that end although that point, this. the that were good towards still look -- income so think taxes regulations, to we like at and be all for XX% of as all say over need over effective are on under said, maybe position operating to details very believe that's calculation what quarter to calculation, relates

Humphrey Lee

the pushing the of probably the the guided why of range? end it's impacts to GILTI upper of you So, was your reason kind essentially

Todd Larson

time. here. as sorts we it be it of early I over all think again, That's hopefully, will over part on manage to But out, it time, able

Humphrey Lee

Okay. Thank you.

Operator

And move we to next, Ryan with Krueger KBW. on

Ryan Krueger

Good Hi. did the mortality of normalize kind claims, it as season just the Can the you down. had was entire went throughout -- perspective, the it as towards and on through just we of quarter March, it as give to, or end -- the Did you some morning. quarter U.S. got quarter? food elevated the calmed

Anna Manning

we detail. provide Ryan, business, And a for our specific and a don't that on for detail report some that reason, so, mortality of noisy typically reasons. uniform information of the other can our don't and quarter, clients throughout basis be on

Ryan Krueger

Okay. Understood.

your Just expectation? can much of you maybe us a on experience from sense how Asia, differed underwriting give typical

Todd Larson

Yeah.

So was for offices. for quarter, $X $XX it this and -- And across compared million overall, expectation, was million to then, Australia negative, offices, about than $XX call experience million is it as the I excluding or underwriting the our $XX Australia; a a mentioned, was or -- off various it small the the let's Asia loss had million.

Ryan Krueger

About between million total Okay. the two? in $XX

Todd Larson

Yeah.

Ryan Krueger

remind it. RGA's then last balance Langhorne, on it us, own into of what's a size transaction you threshold one would And Langhorne versus Got the can just sheet? that move of

Anna Manning

hard RGA be focused these stops. would sheet. clearly RGA and deals starts is not -- would do balance on that, would on Langhorne be its you can't I than Other and the so that specific deals, deals that give larger Well typically these or

Ryan Krueger

All Thank it. you. Got right. Okay.

Operator

with move And next, to Bergman we Citi. Dan

Dan Bergman

morning. Good Thanks.

was seemed modestly it adverse again. start group underwriting U.S. to the like So

any I to this repricing So you you just if and are taking? seeing had wanted business, updated thoughts actions what any see are potentially on you

Todd Larson

So basis. does an this on as -- group repricing mentioned, come you business, for so annual it up, is

we So were quarter positive the negative first quarter, have that's as this if is go bit this last at point, first difficult do year-over-year. to the But we look at year so significantly comparison opportunity But year's pretty was little why that. for we the a on adjust, business. you

U.S. Now nicely business, the overall business, it adds we in continue our the to -- still it like traditional business. to overall was

Dan Bergman

Got the X% Thanks. between just it. health Australia helpful. growth in I U.S. deal there treaty moving the some Canada. in the think That's noise And clearly is and modification, premiums, maybe reported recaptures, FX, new

if exclude and was a outlook premium rate sense, to any quarter, maybe you the what So normalized your in more items, forward? growth is were those organic what going

Todd Larson

X%, tough; It's But have yeah, growth premium adjust if I sort right, call think organic growth say X%. currency, the have the you total probably that, you X% the you because reported reporting that pure down was the growth -- it we about to get in just also are for and -- everything. treaty you below the X%. fluctuations would slightly of about the to is

Dan Bergman

Got it. Thank you.

Operator

And we next, move Nadel to UBS. with John

John Nadel

How past, been have in in the shy expectations, and good this, well guess you your has been like everybody. quarter, of the know, come there expectations you where claims forward, your I is Hey, decision morning you you own a preannounce, I times quarter handle had there got also earnings I to kind volatility or have should haven't times and you'd done guess, expect actually number what has am in the difficult volatility? I then times, guess, we in of when of going when just this that. elevated census And of tactical you claims. around where philosophy there or you sort that. making this is, shortfall. And have curious,

Todd Larson

Yeah.

to are some explaining we normal for negative in of look volatility, our as we now, at we are way part have claims been positive to of have going a business, that's the we the going our sort it business, volatility. have time is, volatility So

part So reasons talked the higher, business, due of our the that's bit we about to little of before. albeit, just nature this quarter a was

the the around had back significant I strengthening it we probably reserve preannounced last that unusual a a view think had -- claims. we versus call the when time we where volatility was event, we normal charge, Australia just and an as

John Nadel

Okay.

it, that's So of to in how just more think ought a opposed as about to discrete fluctuation event we business? normal your

Todd Larson

Yes. at way look we That's it. the

John Nadel

business. transaction release writing any how business it's follow-up guess, it issue And a Langhorne about Okay. couple happens, yet? say it That's that Has I something into that understand of press first press that? written And bit a know as Is would entered well. written, a issue on a little issuing -- maybe would would release, I I Langhorne questions; wanted or not Langhorne a yet? helpful. when new I to you has we

Anna Manning

So the And doing. bigger and pipeline last and the Langhorne risks are the and up are and there recall, launched like we remit Langhorne longevity. it's running, remit. in mortality that Langhorne fit on effectively opportunities intensive, is we deals that quarter, asset deal Risks

it's to actively assume when the deals quite say, engaged these to would would in take fair on executed. announce, the I these It's very opportunities, quarter. with we in the deals is assessed deal one a depending that So and up remember, expect client, and But and is and Langhorne Langhorne negotiated specially all quarter. We for be executed sourced and a stood structured larger deal while. to unusual, last

John Nadel

No, I you there a mean at on Do new the RGA, with. market that? appreciate I from see brand the is not to like it's I where deal same entire time, that. company am But it's knows So correct? coming

Anna Manning

specific announce do. expect would I on do. And I any we to to as considerations. execution, client I subject said,

John Nadel

anywhere does or markets Okay. it go currently? Understood. very targeted specific sort are And geographically, of there

Anna Manning

Yeah. and targeted Europe. the to It is U.S.

John Nadel

U.S. and Europe.

things sort too? annuity of out sort I that And pension longevity, the opportunity we transfer risk of can a about comments U.K., understand perhaps around deals about does, or things bulk Okay. your RGA that retroceded think of

Anna Manning

Yeah.

are those fair assumptions. all think I

Todd Larson

idea company. the go will transactions is the to not concept; directly you would to Langhorne They just for the mentioned Langhorne. the that, RGA flow through currently But since clarify, retroceded

John Nadel

of offloading Prudential to clear maybe all. a annuity, a am That's no, capital that, the I maybe there. from otherwise of very Yeah I probably or perspective and thought, then issuer management Langhorne. retroceding sorry. is some it wasn't group I

Todd Larson

thanks. Okay,

Anna Manning

exactly And that's right.

John Nadel

I full reform, in expectations, being for quarters for even the of does we to this Okay. that just, fair And the X% last last internal the question we term adjustment tax with But it's point and -- line at if think an applicable three the had is with to it's X% about XXXX, understand of intermediate assume us not year not reach thought so correct? year. own your rest necessarily about guide, year, this single I if

Anna Manning

go that far. wouldn't I

we years very subsequent had claims. think -- I at suggest year. have QX claims, would look you had we last I quarter past, by followed in high the look where favorable

XXXX, Now that at didn't happen if in right? XXXX. look doesn't back we happen, Again, always that

I happen suggest, certainty guess would it year. possible, no but So it's will that is there I this again

Todd Larson

-- maybe And

John Nadel

I your own am with internal saying, ex-favorable, results underwriting line sort all? more expectations, of in, that's in of

Todd Larson

had our do Yeah. not I results And would of quarter the the itself. add, change we business first underlying as view mentioned, maybe

we would results is view of change the there the And of outperform. [indiscernible] year. our quarters first in So that three can that quarter nothing remaining the hopefully, the

John Nadel

Absolutely. Thank you.

Operator

And with next, we move to Alex Sachs. Goldman Scott

Alex Scott

Good morning.

pre-tax just to First was a to after-tax $XX question that mortality, of representative I seasonal number relative -- bit is normal clarify a unfavorable sorry, The was pre-tax, million just want unfavorable, housekeeping $XX XQ a item. and a an report? that or the million of number, the

Todd Larson

That's pre-tax.

Anna Manning

adjusted And yes, for it's expectation to our XQ. relative seasonally

Alex Scott

Got it.

I you in do? planned, and may anything guess if to I action the then, do in being have the light And few any recently, does years, you U.S. repriced done helpful. just some quarter any need this Okay. that guess, transactions the change repricing you reinsurance last have of, repricing of about over That's

Anna Manning

Yeah.

So their are that most and of caused cases. reinsurers cost have in aware reinsurer the clients some to at we a raised rates, and that has business, obviously recapture obviously,

that also We we U.S. mortality XXXX better. the identified point business. in approach. that four two years that basis, slightly so era the quarters haven't ago, XXXX time, at, taken had back difficulty our eight then, Since has had XXXX, business. on performed cumulative our difficulty, and quarters looking the in the four that updated this performance I'd Recall, on for that a the we assumptions. years, they isolated And out, are we

Now us when you we this and for continued behind, it's I are not and underlying add it that but seeing causes any quarter, change there think is nothing us, that just monitor. to concern, slightly

Alex Scott

repurchase there? a not one your share has is kind can, that if to quarter, can more the function reflective pipeline see And this that decision is or where color you shares you provide the that of of more of maybe more Okay. been, I price any just

Todd Larson

Yes.

business as any can factor where that way quarter part as view support quarter-to-quarter a And term, second consider, July. capital. also, is price in to we on of which certainly on we do like, but of deploy share the that do certainly, the is So the as to you we we preference will still not capital a at changes here, in the that into it our looking always the we basis. longer over get will the well And as as, back be deals the viable redeploy we a And good very we to announce share repurchase we transactions manage dividend we the our level returns like. know, types

here. keep something certainly, So the we it's on screen will radar that

Alex Scott

Okay, thanks very much.

Operator

to move we Fargo. next, Dargan with Sean Wells And

Sean Dargan

Thank guarantee morning. through up of do with I wish carriers would risk, help you any a I as guarantees. the may solutions carriers, question life term, yearly a issues grew renewable have life, reinsurer about that you. secondary but primary for? mortality universal and primarily Good secondary to that that have find solution the they a universal you know have primary

Anna Manning

area. participated have life it our But guarantee in market, financial we our YRT secondary reinsurance in have We through mortality. you said, solutions done the as through also universal

reinsurance do support we AXXX reserves. So the on financial deals

fundamental to around question you If asking is your risks? underlying guarantees the about risks, consumer are lapse the underlying behavior any maybe other, that your

Sean Dargan

Yes.

Anna Manning

No.

We haven't to-date. participated

solution support fits to see that -- of with looking and can are hasn't the find provides are type up for. To-date, at appetites a we that that always clients We if risk ideas idea. haven't we our come new looking

Sean Dargan

to ownership. I us if on of the other new new bank you lot can where think of an you and insurance I terms think just give them handful what Australia, of an conditions that trying on to, of entities have the changed terms has if ownership a from insurance if how and switched ago you conditions just in then dictate And a carriers, loose. conditions think, years update the basically and business, terms of if wondering, -- in said there? idea, couple terms hands guess, I And that give switch Thanks. reinsurers and really anything since -- am can time, Australia, you to us you that life market you spans today primary I and Okay. were very can gotten

Anna Manning

we I would improvements years five of in XXXX, that say, relative seen market. have to ago, the group part

writing we on stronger and are so or deals protections. somewhat new having selectively that are stronger And provisions targeted

that new in have underlying market, been room for haven't a instance, and We disability, that we individual to writing number We not the similar business years. market movement in of that individual seen has move. still think

that a is to interesting slower me, is market. what's a is or reinsurers, individual may the least, slower that from there in, a new capacity in Now, new at resulted in so change that lot market have of movement and that

Sean Dargan

you. Thank Okay.

Operator

And to next, with we Suisse. move Andrew Kligerman Credit

Andrew Kligerman

in know are of good you little a zone, Latin a growth. talk came that can Latin still treaty line first, operating morning. net to flattish, grow term and X% for second X% some more U.S. in guiding America. then and you But and throughout and do like I'd the to you Maybe of think bit that being the care with X% kind starting to X% I Hey, the America, about top revenue think trends part you premiums broadly question, U.S. long had I off.

quarter are in overall. You about down X% the

stay So whether issues? X% there that are maybe in zone, color to a X% maybe course the you little give on can some kind other or of

Todd Larson

actually of I negative end will quarter the Andrew, got impact at premiums on here. have treaty health restructured It in a start. could year. the last first the was a Hey That that

have in for adjust the the first some quarter you if think I that, here. premiums we growth positive for do

Anna Manning

the Actuaries information some This that's the preliminary analyzing fresh, And on We it with But Of U.S. are still year Andrew, Society XXXX business, I individual so XXXX would increase reinsurance for that in business. the survey. looks reinsurance an will just add; there market is information like received it. is are from signs. be mortality market. the The organic Munich of encouraging the size straight we second

that's hope signs some to a additional top the We business, for And so with it's good see. business. beginning pattern, new nice line of for

Andrew Kligerman

the some realm? and And about see you the kind back board across feel X% I Got of Latin your up revenue so so to line? for doesn't last it. could in And then do still about X%, think traditional just just to that overall out top of that it sort decent good year, -- think you guidance U.S. America, X%? of seem was

Anna Manning

want LTC been the and the the underlying insurance is to factor of It's been time. reinsurers, period this and business more contraction care has contracting the we term that direct to the is of range, of years. itself, risk. lower the or be for available for the not on clear, shrinking treaty, -- market And many new causing it's business. keeping long because the lost has more market, little that long standalone end this of that the that Perhaps the market that's companies, is that is that, I Very a

active the We are market. combo not in

not growing. is our LTC business So

very not business. of treaties, we it's have much it's in seeing again, quarter, not down the loss new We are -- this little I of believe it way actually, and was X%

Andrew Kligerman

Interesting. Interesting. lot. Thanks a

Operator

Instructions]. [Operator

to move Gallagher Tom we Next, with Evercore.

Tom Gallagher

Good morning.

to GILTI tax clarity this expect that? situation, do you get you can when on comment Just on on

Todd Larson

And work the calculate forward. talk more go working we and throughout are will year, they will and something to we It's said, through as that with as to with again, and clarity. manageable get continue others we something like we I it, as it be folks, our talk it's well. I think have But we more that we think with. we tax and go

Tom Gallagher

you survey growing. or the to you it mentioned companies growth can the flow organic you at your reinsurance at ceding, When primary in-force Re do as look reinsurance that Munich amount, market look is you I know those to you if your really showing you just organic are underlying business, when growth mortality need And that are that organically? you and business actually grow at to seeing? look are you order statistics book I in U.S. apart. are treaties, don't split two relates things seeing know of Okay. do

Anna Manning

I I think can.

has the increasing, in business XXXX our organic the has with at the we increased, XXXX. it consistent look and U.S., when So market, been it

As indications. I said, early

premium given scale for for on always debts compensate forgot we what are small, the blocks. to That larger the Yes, growth organic to and that always But I that you the yes, of blocks. the the in-force am on and of appreciate can I looking mortality So second has from and other that, additive our growing. are loss business, part medium been be sorry, pursuing causes. isn't -- business. the enough wouldn't

Tom Gallagher

mean, you that add about could right, to flow -- than deals. that take way something single when in-force any reinsurance, in is Is low higher that to is there or to you then I should So get that, and digit growth

Anna Manning

no. about right. No, That's

Tom Gallagher

quick is, trends under I issues there? control, the And know so -- I fairly might on just there just has Australia, seeing been worse. a you was Okay. you final then, but get loss not are making some feel just I you question think question signs with it that that, sure, had stable Do small current that in just in seeing that's like loss past, are any warning there, you with know

Todd Larson

getting the the business Australia lot we good pushing for there. and few seen years, over have past a in times, de-risking growth shape, we been of Yes, haven't and

and So to be we them the volatility, normal first as it, the the looked expect continue Australia does still at we quarter, operation really and year, for we profitable. the in like for to results evaluate it look

Tom Gallagher

of a And given to you follow-up really market, consideration, it? of out there that the pulling just history any on are that, final sorry, just or committed

Anna Manning

that It's a market to an committed in it's market for are RGA. We context, important important market. and very global a

Tom Gallagher

thanks. Okay,

Operator

with Nadel next, move UBS. John And to we

John Nadel

that Thank transferring there business I blocks you run-off purchasing, potential increase block a secondly, you is care first is, interest in you, question. in appetite that something different for for from an business? maybe of on would the and that there has recently that the appetite heard or particular else. concur, in in-force you couple a long is outright the we that And term that that RGA then questions that two increased based risk, market, appetite an maybe have follow-up potentially from is for? have or is companies, I for an guess see somebody in reinsuring what to Anna, some

Anna Manning

your and to then first second your question. answer back will I first circle question

structure the legacy with a line last number a blocks. evaluation been block, finding have of get expectations, deal. a where up to the of doable our at LTC at And a successful we risks number or and finding not looked of years, Over the client's we have we

characteristics we in say, to our with -- So legacy a a back if occasionally, But efforts I at we LTC blocks is block, will scale might our low. block approached if are risk interest comes where the look would interesting, or market be we it. quite-quite

ahead? to respect sorry, with your go -- Now

John Nadel

I had just quick go follow-up, Sorry go ahead. ahead. one but

Anna Manning

not respect Okay. would is these And see about, I competitors, any that a surprised, A evidence hard. at maybe too competitors opportunities. a some be to number we with your new were did new few there of question that number few, of that interest; competitors, looking is probably a are there

John Nadel

to take helpful. to the going agreement pay a the a I have it to -- client. very the to pay some but needs am us willing a an of Can difficult on X this and imagine would wide how frankly, you if one, where and be come multiple more somebody understand you that done that who this I can't with for case the a is maybe X. guess taken a bid-ask, there's Got when to assume far And work give in and That's the punt want the -- there's is willing couldn't close I client then of payment client. counterparty counterparty you on, look, and I real-real sense to you apart past, how you.

Anna Manning

the risks, I just wasn't to structuring I attractive the was of out opportunity answer some contemplating can't you, enough up we some still that with an really for that that the even off, whited question. client. it removing risks. would It offer of were

I a wouldn't that. similar a into much conservative so, new into would organization. or doesn't we read much mean too Now, have that and are view, competitors That

John Nadel

Anna. helpful. Thank very you, That's

Operator

move we to next, And Ryan Krueger with KBW.

Ryan Krueger

follow-up me with earlier. for have wanted didn't record, clarify mike hot actually question, wasn't just that the I a Thanks. to Thanks. transcript the

Anna Manning

All right.

Todd Larson

everyone some you morning. Investor this New you much conclude X our annual we on we the We thank to With will our of And appreciate Well again, participating forward for Okay. look call. in that, it. York seeing Day. call June for very on

Operator

today's for conclude will participation. thank We that you And your call.

Reinsurance Group of America (RGA) 27 Apr 182018 Q1 Earnings call transcript