American National Announces First Quarter 2022 Results
03 Mai 2022 - 6:21PM
American National Group, Inc. (NASDAQ: ANAT) and subsidiaries
(collectively, the “Company”) announced net income for the first
quarter of 2022 of $108.8 million or $4.05 per diluted share,
compared to net income of $170.2 million or $6.33 per diluted share
for the same period in 2021. The reduction in net income in the
first quarter of 2022 was primarily due to an $83.3 million
decrease in net gains on equity securities, partially offset by an
increase in realized investment earnings of $20.4 million.
Net losses on equity securities were $7.5 million or $0.28 per
diluted share in the first quarter of 2022, compared to a net gain
of $75.8 million or $2.82 per diluted share for the same period in
2021, primarily as a result of favorable market conditions for
equity securities during the first quarter of 2021. Additionally,
the Company liquidated almost its entire investment in equity
securities in the fourth quarter of 2021.
Net realized investment earnings for the first quarter of 2022
were $37.5 million or $1.39 per diluted share, compared to $17.1
million or $0.64 per diluted share for the same period in 2021. The
increase in net realized investment earnings was attributable to an
increase in sales of real estate development properties in the
first quarter of 2022.
After-tax adjusted net operating income for the first quarter of
2022 was $79.6 million or $2.97 per diluted share, compared to
$77.3 million or $2.87 per diluted share for the same period in
2021. The increase reflects an increase in earnings from our
corporate and other segment driven by higher investment income
coupled with increased earnings in our annuity segment partially
offset by a decrease in earnings from our life segment due to
adverse mortality experience.
For the first quarter of 2022, total life insurance in force
increased by $1.4 billion to $138.4 billion and book value per
share decreased by $10.60 to $249.56. The decrease in book value
per share is primarily attributable to unrealized losses on
available-for-sale bonds due to increased interest rates during the
quarter.
Update Regarding Pending Merger with Brookfield Asset
Management Reinsurance Partners Ltd.
As previously announced, the Company entered into a merger
agreement with Brookfield Asset Management Reinsurance Partners
Ltd. ("Brookfield Reinsurance") and its wholly-owned merger
subsidiary on August 6, 2021. Subject to the conditions set forth
in the merger agreement, at the closing of the transaction, the
Company will become a wholly owned subsidiary of Brookfield
Reinsurance and each then-outstanding share of the Company’s common
stock will be converted into the right to receive $190.00 per share
in cash, for total merger consideration of approximately $5.1
billion.
The only remaining significant merger closing condition is the
receipt of the required regulatory approval from the insurance
authorities in Texas, Missouri, New York, Louisiana, and
California. On September 3, 2021, Brookfield Reinsurance made the
required Form A filings with each of these state insurance
regulators. Those regulators are reviewing the filings and the
insurance regulatory process has been moving forward consistent
with our prior disclosures, and we continue to expect to complete
the Merger before the end of the first half of 2022. However,
because state insurance regulatory approval remains outstanding,
the Company cannot provide assurance the Merger will be completed
on the terms or timeline currently contemplated, or at all.
GAAP Reconciliation of Non-GAAP Measures
A reconciliation of GAAP net income to adjusted net operating
income, a non-GAAP measure, is shown in the table below:
American National Consolidated Financial
Highlights |
(Preliminary & Unaudited in $USD millions, except per
share data) |
|
|
|
|
|
|
|
Quarters Ended March 31, |
|
|
|
2022 |
|
|
|
2021 |
|
Net income (GAAP
basis) |
|
$ |
108.8 |
|
|
$ |
170.2 |
|
Adjustments to eliminate the
impact of: |
|
|
|
|
Net gains (losses) on equity securities |
|
$ |
(7.5 |
) |
|
$ |
75.8 |
|
|
|
|
|
|
Adjustments to eliminate the
impact of: |
|
|
|
|
Net realized investment gains |
|
$ |
8.1 |
|
|
$ |
15.2 |
|
Increase in credit loss |
|
|
(9.2 |
) |
|
|
(3.5 |
) |
Equity in earnings of unconsolidated real estate joint ventures and
other investments |
|
|
40.0 |
|
|
|
5.5 |
|
Net income attributable to noncontrolling interest |
|
|
1.4 |
|
|
|
0.1 |
|
Net realized investment earnings |
|
$ |
37.5 |
|
|
$ |
17.1 |
|
|
|
|
|
|
Adjustments to eliminate the
impact of: |
|
|
|
|
Nonrecurring Merger expenses |
|
$ |
(0.8 |
) |
|
$ |
— |
|
Net nonrecurring expenses |
|
$ |
(0.8 |
) |
|
$ |
— |
|
|
|
|
|
|
Adjusted net operating
income(1)(non-GAAP
basis)* |
|
$ |
79.6 |
|
|
$ |
77.3 |
|
|
|
|
|
|
Per diluted share |
|
|
|
|
Net income (GAAP basis) |
|
$ |
4.05 |
|
|
$ |
6.33 |
|
Net gains (losses) on equity securities |
|
|
(0.28 |
) |
|
|
2.82 |
|
Net realized investment earnings |
|
|
1.39 |
|
|
|
0.64 |
|
Net nonrecurring expenses |
|
|
(0.03 |
) |
|
|
— |
|
Adjusted net operating
income(1)(non-GAAP
basis)* |
|
$ |
2.97 |
|
|
$ |
2.87 |
|
|
|
|
|
|
Weighted average number of
diluted shares upon which computations are based |
|
|
26,884,741 |
|
|
|
26,884,899 |
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
March 31, 2022 |
|
December 31, 2021 |
Book value per diluted
share |
|
$ |
249.56 |
|
|
$ |
260.16 |
|
|
|
|
|
|
|
|
|
|
* This measure is non-GAAP because it is not based on accounting
principles generally accepted in the United States. This non-GAAP
measure is used by the Company to enhance comparability between
periods and to eliminate the impact of certain items listed in
footnote (1) below, which can fluctuate in a manner unrelated to
core operations due to factors such as market volatility, interest
rate changes and credit risk. In the opinion of the Company’s
management, inclusion of this non-GAAP measure is meaningful to
provide an understanding of the significant factors that comprise
the Company’s periodic results of operations.
(1) Adjusted net operating income excludes the after-tax impact
of net gains (losses) on equity securities, net realized investment
earnings (losses) and nonrecurring expenses. Net realized
investment earnings are comprised of realized investment gains on
assets (excluding equity securities), increase in credit loss, and
earnings from unconsolidated real estate joint ventures and other
investments that do not back insurance products and non-controlling
interests. Nonrecurring expenses are related to the pending merger
with Brookfield Reinsurance.
American National Group, Inc. is a family of companies that has,
on a consolidated GAAP basis, $30.9 billion in assets, $24.2
billion in liabilities and $6.7 billion in stockholders’ equity as
of March 31, 2022. American National Insurance Company, founded in
1905 and headquartered in Galveston, Texas, and other American
National subsidiaries offer a broad portfolio of products and
services, which include life insurance, annuities, property and
casualty insurance, health insurance, credit insurance, and pension
products. The American National companies operate in all 50 states.
In addition to American National Insurance Company, major
subsidiaries include American National Life Insurance Company of
Texas, American National Life Insurance Company of New York,
American National Property and Casualty Company, Garden State Life
Insurance Company, Standard Life and Accident Insurance Company,
Farm Family Casualty Insurance Company and United Farm Family
Insurance Company.
American National Insurance Company has been assigned an ‘A u’
rating by A.M. Best Company and an ‘A’ rating by S&P Global
Ratings(1), both of which are nationally recognized rating
agencies, and is licensed to conduct the business of insurance in
all states except New York.
For more information, including company news and investor
relations information, visit the Company’s web site at
www.AmericanNational.com.
(1) A.M. Best has placed American National’s
issuer credit and financial strength ratings under review with
developing implications and S&P Global Ratings has placed the
ratings on CreditWatch with negative implications due to the
pending merger with Brookfield Reinsurance.
Contact: Brody J. Merrill (409) 766-6826
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