Delivered on 2021 Financial Objectives Through
Double-Digit Earnings Growth Led by Global Lifestyle and
Significant Capital Return
Expects 8 to 10 percent Growth in Adjusted
EBITDA, Ex. Catastrophes, in 2022
Assurant, Inc. (NYSE: AIZ), a leading global provider of
lifestyle and housing solutions that support, protect and connect
major consumer purchases, today reported results for the fourth
quarter ended December 31, 2021.
“In 2021, we delivered our fifth consecutive year of profitable
growth with double-digit growth in earnings and earnings per
share,” said Assurant President and CEO Keith Demmings. “We also
significantly enhanced our value proposition to our clients and
their customers, while continuing to innovate to become the leading
service provider for consumers’ connected lifestyles.”
“For 2022, our key priorities to support our long-term vision
and strategy include developing our diverse talent, strengthening
our client partnerships while attracting key prospects globally,
and further enhancing our product and service capabilities that
differentiate Assurant in the marketplace. This will require an
accelerated pace of innovation and prioritizing investments across
our operations and technology to advance our market leading
positions. And finally, sustainability and inclusivity will
continue to be a top priority for the benefit of all stakeholders
and the communities in which we operate,” Demmings added.
(Unaudited)
Q4'21
Q4'20
Change
12M'21
12M'20
Change
$ in millions, except where
noted
GAAP net income
126.7
119.1
6%
613.5
520.4
18%
GAAP net income per diluted share
2.20
1.91
15%
10.20
8.22
24%
Net operating income1
142.8
96.6
48%
557.9
468.2
19%
Net operating income per diluted
share2
2.47
1.62
52%
9.36
7.71
21%
Net operating income, ex. reportable
catastrophes3
144.0
123.9
16%
672.0
605.4
11%
Net operating income, ex. reportable
catastrophes, per diluted share4
2.49
2.06
21%
11.26
9.88
14%
Adjusted EBITDA, ex. reportable
catastrophes5
245.4
227.5
8%
1,107.5
1,013.4
9%
Full-Year 2021 Summary:
- Net income increased 18 percent versus prior year period, while
net income per diluted share increased 24 percent
- Net operating income, excluding reportable catastrophes3, up 11
percent to $672.0 million
- Net operating income, excluding reportable catastrophes, per
diluted share4, up 14 percent to $11.26
- Adjusted EBITDA, excluding reportable catastrophes5, increased
9 percent to $1.11 billion
- Holding company liquidity was $1.05 billion, reflecting the
Global Preneed sale proceeds
- Share repurchases and common stock dividends totaled $1.0
billion
2022 Outlook
- In 2022, the company expects 8 to 10 percent growth in Adjusted
EBITDA, excluding reportable catastrophes6, driven by expansion
across Global Lifestyle and Global Housing Note: References to net
income, including in net income per diluted share, throughout this
press release refer to net income from continuing operations.
Metrics listed above other than net income and net income per
diluted share are non-GAAP measures of performance. A full
reconciliation of each non-GAAP measure to the most comparable GAAP
measure can be found in the Non-GAAP Financial Measures section
beginning on page 11.
Fourth Quarter and Full-Year 2021 Consolidated
Results
(Unaudited)
Q4'21
Q4'20
Change
12M'21
12M'20
Change
$ in millions
GAAP net income
126.7
119.1
6%
613.5
520.4
18%
GAAP Corporate and Other segment net
loss
(61.4)
(29.9)
(105)%
(115.8)
(150.6)
23%
Net operating
income
Global Lifestyle7
107.8
87.9
23%
484.7
437.2
11%
Global Housing7
80.3
61.1
31%
244.6
233.8
5%
Corporate and Other8
(23.9)
(26.6)
10%
(78.3)
(102.9)
24%
Interest expense
(21.4)
(21.1)
(1)%
(88.4)
(81.2)
(9)%
Preferred stock dividends
—
(4.7)
100%
(4.7)
(18.7)
75%
Net operating income1
142.8
96.6
48%
557.9
468.2
19%
Reportable catastrophes
1.2
27.3
114.1
137.2
Net operating income, ex. reportable
catastrophes3
144.0
123.9
16%
672.0
605.4
11%
Adjusted EBITDA, ex.
reportable catastrophes
Global Lifestyle5
158.9
137.2
16%
714.4
637.0
12%
Global Housing5
112.0
120.6
(7)%
486.4
500.8
(3)%
Corporate and Other5
(25.5)
(30.3)
16%
(93.3)
(124.4)
25%
Adjusted EBITDA, ex. reportable
catastrophes5
245.4
227.5
8%
1,107.5
1,013.4
9%
Note: Some of the metrics above are non-GAAP measures of
performance. A full reconciliation of each non-GAAP measure to the
most comparable GAAP measure can be found in the Non-GAAP Financial
Measures section beginning on page 11. Additional details regarding
key financial metrics are included in the Financial Supplement
located on Assurant’s Investor Relations website:
https://ir.assurant.com/investor/default.aspx
Fourth Quarter 2021 Consolidated Results
- Net income was $126.7 million, or $2.20 per diluted
share, compared to fourth quarter 2020 net income of $119.1
million, or $1.91 per diluted share. The increase was primarily
driven by $26.1 million of lower reportable catastrophes within
Global Housing and growth in Global Lifestyle, partially offset by
lower net realized gains on investments compared to the prior year
period.
- Net operating income1 totaled $142.8 million, or $2.47
per diluted share2, compared to fourth quarter 2020 net operating
income of $96.6 million, or $1.62 per diluted share. Assurant
incurred $1.2 million of reportable catastrophes in fourth quarter
2021, compared to $27.3 million in fourth quarter 2020. Excluding
reportable catastrophes, net operating income3 for fourth quarter
2021 increased 16 percent to $144.0 million compared to $123.9
million in the prior year period, which was mainly the result of
Global Lifestyle growth from continued expansion in Global
Automotive and Connected Living and the absence of preferred
dividends. This was partially offset by lower earnings in Global
Housing from a decline in specialty products. Adjusted EBITDA,
excluding reportable catastrophes5, increased 8 percent
compared to the prior year period, less than the increase in net
operating income, excluding reportable catastrophes, primarily due
to a modestly lower tax rate in the quarter and preferred stock
dividends in the prior year period, which are excluded from
Adjusted EBITDA
- Revenue from the Global Lifestyle and Global Housing
segments totaled $2.49 billion compared to $2.31 billion in fourth
quarter 2020, up 8 percent, primarily due to growth in Global
Automotive and higher mobile fee income in Connected Living within
Global Lifestyle. Note: Throughout this press release, revenue
refers to net earned premiums, fees and other income. GAAP revenue
is equal to net earned premiums, fees and other income, net
investment income and net realized gains (losses) on
investments.
Full-Year 2021 Consolidated Results
- Net income was $613.5 million, or $10.20 per diluted
share, compared to full-year 2020 net income of $520.4 million, or
$8.22 per diluted share. The increase was primarily driven by
higher net realized gains on investments, including $67.5 million
of fair value changes in unrealized equity positions within
Assurant Ventures for companies that went public in 2021, compared
to net losses in the prior year period, as well as growth in Global
Lifestyle. This was partially offset by the absence of a one-time
tax benefit in first quarter 2020.
- Net operating income1 totaled $557.9 million, or $9.36
per diluted share2, compared to full-year 2020 net operating income
of $468.2 million, or $7.71 per diluted share. Assurant incurred
$23.1 million fewer reportable catastrophes in 2021 compared to the
prior year. Excluding reportable catastrophes, net operating
income3 for 2021 increased 11 percent to $672.0 million compared to
$605.4 million in the prior year period, which was mainly the
result of growth across all lines of business within Global
Lifestyle, a lower Corporate and Other loss and the absence of
preferred dividends, partially offset by lower results in Global
Housing.
- Adjusted EBITDA, excluding reportable catastrophes5,
increased 9 percent compared to the prior year period, less than
the increase in net operating income, excluding reportable
catastrophes, primarily due to a modestly lower tax rate and
preferred stock dividends, which are excluded from Adjusted
EBITDA.
- Revenue from the Global Lifestyle and Global Housing
segments totaled $9.74 billion compared to $9.31 billion in fourth
quarter 2020, up 5 percent. This was primarily driven by strong
growth in Global Automotive within Global Lifestyle.
Global Lifestyle
$ in millions
Q4'21
Q4'20
Change
12M'21
12M'20
Change
Net operating income7
107.8
87.9
23%
484.7
437.2
11%
Adjusted EBITDA5
158.9
137.2
16%
714.4
637.0
12%
Revenue
1,984.6
1,817.0
9%
7,747.7
7,337.6
6%
Note: Throughout this press release, references to Adjusted
EBITDA within Global Lifestyle exclude reportable catastrophes.
- Net operating income7 increased in fourth quarter 2021
compared to the prior year period, primarily due to growth in
Global Automotive and mobile within Connected Living. The increase
in Global Automotive was mainly from underlying growth from prior
period sales across all distribution channels and favorable loss
experience in select ancillary products. Mobile growth was driven
by strong trade-in volumes, including HYLA Mobile, and improved
performance in Europe and Asia Pacific. Results were partially
offset by in-store mobile service and repair capability
investments. Full-year 2021 net operating income7 increased
compared to 2020, primarily driven by significant growth in Global
Automotive, continued expansion in mobile within Connected Living,
and greater contributions from Global Financial Services. Global
Automotive results included underlying growth from prior period
sales driven by expanded and new client relationships globally,
favorable loss experience in select ancillary products and $8.2
million of one-time benefits that occurred in first half 2021 that
are not expected to repeat. Mobile growth was primarily driven by
the same factors noted for fourth quarter 2021.
- Adjusted EBITDA5 increased compared to fourth quarter
2020, less than the increase in net operating income, primarily due
to a modestly lower tax rate in the quarter which is excluded from
Adjusted EBITDA. Full-year 2021 Adjusted EBITDA5 increased compared
to 2020, greater than the increase in net operating income, which
reflects higher amortization of purchased intangible assets from
mobile- and auto-related acquisitions and an increase in
depreciation expense related to information technology
initiatives.
- Revenue increased in fourth quarter 2021 compared to the
prior year period, primarily due to continued growth in Global
Automotive from strong prior period sales and further expansion in
Connected Living, including strong fee income growth in mobile from
higher trade-in volumes, as well as domestic subscriber growth,
which was partially offset by runoff mobile programs. Full-year
2021 revenue increased compared to 2020, primarily driven by Global
Automotive from strong sales across the U.S., as well as growth in
Connected Living from extended service contracts. In mobile, higher
trade-in volumes and subscriber growth were offset by declines from
runoff programs and the $176 million reduction from the previously
disclosed program contract change.
Global Housing
$ in millions
Q4'21
Q4'20
Change
12M'21
12M'20
Change
Net operating income7
80.3
61.1
31%
244.6
233.8
5%
Reportable catastrophes
1.0
27.3
113.9
137.2
Net operating income, ex. reportable
catastrophes
81.3
88.4
(8)%
358.5
371.0
(3)%
Adjusted EBITDA, ex. reportable
catastrophes5
112.0
120.6
(7)%
486.4
500.8
(3)%
Revenue
505.8
496.7
2%
1,996.6
1,977.3
1%
- Net operating income7 increased in fourth quarter 2021
compared to the prior year period. Fourth quarter 2021 included
$1.0 million of reportable catastrophes compared to $27.3 million
of reportable catastrophes in fourth quarter 2020. Excluding
reportable catastrophes, net operating income decreased, due to
higher non-catastrophe loss experience including an $8.2 million
year-over-year increase within small commercial that was primarily
related to reserve strengthening for run-off claims. This was
partially offset by an increase in lender-placed, primarily from
higher average insured values and lower expenses. Full-year 2021
net operating income7 increased compared to 2020. Full-year 2021
included $113.9 million of reportable catastrophes, compared to
$137.2 million in 2020. Excluding reportable catastrophes, net
operating income decreased primarily due to higher non-catastrophe
loss experience from an anticipated increase to more normalized
levels, as well as a $12.3 million year-over-year increase within
small commercial that was primarily related to reserve
strengthening for run-off claims. The decrease was partially offset
by higher premium rates and average insured values in
lender-placed.
- Revenue increased modestly year-over-year, mainly from
growth in lender-placed and Multifamily Housing. This was partially
offset by a decline in specialty products from client runoff.
Full-year 2021 revenue increased modestly compared to 2020,
primarily driven by growth in Multifamily Housing across affinity
and PMC channels as well as lender-placed. The increase was
partially offset by declines in specialty products from client
runoff.
Corporate and Other
$ in millions
Q4'21
Q4'20
Change
12M'21
12M'20
Change
GAAP segment net loss
(61.4)
(29.9)
(105)%
(115.8)
(150.6)
23%
Net operating loss8
(23.9)
(26.6)
10%
(78.3)
(102.9)
24%
Adjusted EBITDA5
(25.5)
(30.3)
16%
(93.3)
(124.4)
25%
- Segment net loss increased in fourth quarter 2021
compared to the prior year period loss due to lower net realized
gains on investments and the absence of income from recoveries of
legacy Affordable Care Act receivables. For full-year 2021, segment
net loss decreased compared to 2020, primarily due to higher net
realized gains on investments compared to net losses in the prior
year, partially offset by the absence of a one-time tax benefit in
first quarter 2020.
- Net operating loss8 decreased in fourth quarter 2021
compared to the prior year period, primarily driven by an increase
in investment income from higher asset balances. For full-year
2021, net operating loss8 decreased compared to 2020, primarily due
to lower expenses, including employee-related and third-party
expenses, in addition to savings from reduced real estate costs,
and higher investment income.
Holding Company Liquidity Position
- Holding company liquidity totaled $1.05 billion as of
December 31, 2021, or $827 million above the company’s current
targeted minimum level of $225 million, primarily reflecting the
remaining proceeds from the sale of Global Preneed. Dividends paid
by operating segments to the holding company in fourth quarter 2021
totaled $176 million. For full-year 2021, dividends paid to the
holding company totaled $729 million, equal to approximately one
hundred percent of segment earnings.
- Share repurchases and common stock dividends totaled
$329 million in fourth quarter 2021. During fourth quarter 2021,
Assurant repurchased 1.8 million shares of common stock for $290
million and paid $39 million in common stock dividends. From
January 1 through February 4, 2022, the company repurchased an
additional 526 thousand shares for approximately $80 million, with
$762 million remaining under the current repurchase authorization.
For full-year 2021, share repurchases and common and preferred
dividends totaled $1.0 billion. Assurant repurchased 5.3 million
shares of common stock for $844 million and paid dividends to
shareholders totaling $163 million, including $158 million in
common stock dividends and $5 million in preferred stock dividends,
all of which converted to common stock in March 2021.
2022 Company Outlook6
Given its ongoing shift to more service-oriented, fee-based
businesses, the company believes Adjusted EBITDA, excluding
reportable catastrophes, is a better representation of the
company’s operating performance as compared to net operating
income. As a result, the company will use Adjusted EBITDA,
excluding reportable catastrophes, as its performance metric for
the enterprise and its reportable segments going forward and will
no longer report net operating income and other related non-GAAP
metrics beginning in first quarter 2022.
The company expects to provide full-year 2022 outlook on a per
share basis, along with its long-term financial objectives, at its
Investor Day on March 24, 2022. In the interim, the company
expects:
$ in millions, unless otherwise
noted
FY 2021
2022 Outlook6
Adjusted EBITDA, ex. reportable
catastrophes5
1,107.5
8 to 10 percent growth
Global Lifestyle
714.4
Low double-digit growth
Global Housing, ex. reportable
catastrophes
486.4
Mid- to high-single-digit
growth
Corporate and Other
(93.3)
~ (105.0)
Note: Some of the metrics above are non-GAAP measures of
performance. A full reconciliation of each non-GAAP measure to the
most comparable GAAP measure can be found in the Non-GAAP Financial
Measures section beginning on page 10. Additional details regarding
key financial metrics are included in the Financial Supplement
located on Assurant’s Investor Relations website:
https://ir.assurant.com/investor/default.aspx
- For full-year 2022, Adjusted EBITDA, excluding reportable
catastrophes, to grow 8 to 10 percent, driven by growth across
Global Lifestyle and Global Housing. Global Lifestyle Adjusted
EBITDA is expected to increase by low double-digits, driven mainly
by mobile in Connected Living from global expansion in existing and
new clients across device protection and trade-in and upgrade
programs. This will be partially offset by strategic investments to
support new business opportunities including in-store mobile
service and repair capabilities. Global Housing Adjusted EBITDA,
excluding reportable catastrophes, is expected to increase by mid-
to high-single-digits, primarily from growth in lender-placed from
higher average insured values, expense initiatives and improved
results in Specialty and Other. Corporate and Other Adjusted EBITDA
loss is expected to be approximately $105.0 million, reflecting
lower net investment income as compared to 2021. Assurant’s
consolidated effective tax rate is expected to be approximately 23
to 25 percent.
- Business segment dividends to approximate three quarters of
segment Adjusted EBITDA, including reportable catastrophes, which
represents roughly the same historical conversion levels to the
holding company. This is subject to the growth of the businesses,
rating agency and regulatory capital requirements, investment
portfolio performance and a potential increase in U.S. corporate
tax rates.
- Capital to be deployed to support business growth by funding
investments and M&A and return capital to shareholders in the
form of share repurchases and dividends, subject to Board approval
and market conditions.
Earnings Conference Call
The fourth quarter 2021 earnings conference call and webcast
will be held Wednesday, February 9, 2022 at 8:00 a.m. ET. The live
and archived webcast, along with supplemental information, will be
available on Assurant’s Investor Relations website:
https://ir.assurant.com/investor/default.aspx
About Assurant
Assurant, Inc. (NYSE: AIZ) is a leading global provider of
lifestyle and housing solutions that support, protect and connect
major consumer purchases. Anticipating the evolving needs of
consumers, Assurant partners with the world’s leading brands to
develop innovative products and services and to deliver an enhanced
customer experience. A Fortune 300 company with a presence in 21
countries, Assurant offers mobile device solutions; extended
service contracts; vehicle protection services; renters insurance;
lender-placed insurance products; and other specialty products. The
Assurant Foundation strengthens communities by supporting
charitable partners that help protect where people live and can
thrive, connect with local resources, inspire inclusion and prepare
leaders of the future.
Learn more at assurant.com or on Twitter @Assurant.
Safe Harbor Statement
Some of the statements included in this news release and its
exhibits, including our business and financial plans and any
statements regarding the company’s anticipated future financial
performance, business prospects, growth and operating strategies
and similar matters, may constitute forward-looking statements
within the meaning of the U.S. Private Securities Litigation Reform
Act of 1995.
You can identify forward-looking statements by the use of words
such as “outlook,” “will,” “may,” “can,” “anticipates,” “expects,”
“estimates,” “projects,” “intends,” “plans,” “believes,” “targets,”
“forecasts,” “potential,” “approximately,” and the negative version
of those words and other words and terms with a similar meaning.
Any forward-looking statements contained in this news release or
its exhibits are based upon our historical performance and on
current plans, estimates and expectations. The inclusion of this
forward-looking information should not be regarded as a
representation by us or any other person that our future plans,
estimates or expectations will be achieved. Our actual results
might differ materially from those projected in the forward-looking
statements. We undertake no obligation to update or review any
forward-looking statement, whether as a result of new information,
future events or other developments. The following factors could
cause our actual results to differ materially from those currently
estimated by management, including those projected in the company
outlook:
(i)
the loss of significant clients,
distributors or other parties with whom we do business, or if we
are unable to renew contracts with them on favorable terms, or if
those parties face financial, reputational or regulatory
issues;
(ii)
significant competitive pressures, changes
in customer preferences and disruption;
(iii)
the failure to execute our strategy,
including through the continuing service of key executives, senior
leaders, highly-skilled personnel and a high-performing
workforce;
(iv)
the failure to find suitable acquisitions
at attractive prices, integrate acquired businesses effectively or
identify new areas for organic growth;
(v)
our inability to recover should we
experience a business continuity event;
(vi)
the failure to manage vendors and other
third parties on whom we rely to conduct business and provide
services to our clients;
(vii)
risks related to our international
operations;
(viii)
declines in the value of mobile devices,
or export compliance or other risks in our mobile business;
(xi)
our inability to develop and maintain
distribution sources or attract and retain sales representatives
and executives with key client relationships;
(x)
risks associated with joint ventures,
franchises and investments in which we share ownership and
management with third parties;
(xi)
the impact of catastrophe and
non-catastrophe losses, including as a result of climate
change;
(xii)
negative publicity relating to our
business or industry;
(xiii)
the impact of general economic, financial
market and political conditions and conditions in the markets in
which we operate;
(xiv)
the impact of the COVID-19 pandemic and
measures taken in response thereto;
(xv)
the adequacy of reserves established for
claims and our inability to accurately predict and price for
claims;
(xvi)
a decline in financial strength ratings of
our insurance subsidiaries or in our corporate senior debt
ratings;
(xvii)
fluctuations in exchange rates;
(xviii)
an impairment of goodwill or other
intangible assets;
(xix)
the failure to maintain effective internal
control over financial reporting;
(xx)
unfavorable conditions in the capital and
credit markets;
(xxi)
a decrease in the value of our investment
portfolio, including due to market, credit and liquidity risks, and
changes in interest rates;
(xxii)
an impairment of our deferred tax
assets;
(xxiii)
the unavailability or inadequacy of
reinsurance coverage and the credit risk of reinsurers, including
those to whom we have sold business through reinsurance;
(xxiv)
the credit risk of some of our agents,
third-party administrators and clients;
(xxv)
the inability of our subsidiaries to pay
sufficient dividends to the holding company and limitations on our
ability to declare and pay dividends or repurchase shares;
(xxvi)
limitations in the analytical models we
use to assist in our decision-making;
(xxvii)
the failure to effectively maintain and
modernize our information technology systems and infrastructure, or
the failure to integrate those of acquired businesses;
(xxviii)
breaches of our information systems or
those of third parties with whom we do business, or the failure to
protect the security of data in such systems, including due to
cyber-attacks and as a result of working remotely;
(xxix)
the costs of complying with, or the
failure to comply with, extensive laws and regulations to which we
are subject, including those related to privacy, data security,
data protection or tax;
(xxx)
the impact of litigation and regulatory
actions;
(xxxi)
reductions or deferrals in the insurance
premiums we charge;
(xxxii)
changes in insurance, tax and other
regulations;
(xxxiii)
volatility in our common stock price and
trading volume; and
(xxxiv)
employee misconduct.
For additional information on factors that could affect our
actual results, please refer to the factors identified in the
reports we file with the U.S. Securities and Exchange Commission
(the “SEC”), including but not limited to the risk factors
identified in our most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q, each as filed with the SEC.
Non-GAAP Financial Measures
Assurant uses the following non-GAAP financial measures to
analyze the company’s operating performance. Assurant’s non-GAAP
financial measures should not be considered in isolation or as a
substitute for GAAP financial measures. Because Assurant’s
calculation of these measures may differ from similar measures used
by other companies, investors should be careful when comparing
Assurant’s non-GAAP financial measures to those of other
companies.
(1)
Assurant uses net operating income as an
important measure of the company’s operating performance. Net
operating income equals GAAP net income from continuing operations,
excluding net realized gains (losses) on investments (which
includes unrealized gains (losses) on equity securities and changes
in fair value of direct investments in collateralized loan
obligations), COVID-19 direct and incremental expenses, the CARES
Act tax benefit, loss on extinguishment of debt, net income (loss)
attributable to non-controlling interests, as well as other highly
variable or unusual items other than reportable catastrophes. It
also excludes restructuring costs related to strategic exit
activities as these are highly unusual, transformative actions
associated with realigning resources to the company’s business
strategies, outside of normal periodic restructuring and cost
management activities. The company believes net operating income
provides investors with an important measure of the performance of
the company’s ongoing business because the excluded items do not
represent the ongoing operations of the company. The comparable
GAAP measure is net income from continuing operations.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
($ in millions)
2021
2020
2021
2020
GAAP net income from continuing
operations
$
126.7
$
119.1
$
613.5
$
520.4
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(5.1
)
(29.6
)
(128.4
)
9.4
COVID-19 direct and incremental
expenses
2.8
5.3
10.0
26.8
CARES Act tax benefit (after-tax)
—
—
—
(84.4
)
Loss on extinguishment of debt
—
—
20.7
—
Other adjustments(1)
22.4
(1.2
)
31.5
17.9
(Benefit) provision for income taxes
(4.0
)
7.5
15.3
(2.3
)
Net loss (income) attributable to
non-controlling interests
—
0.2
—
(0.9
)
Preferred stock dividends
—
(4.7
)
(4.7
)
(18.7
)
Net operating income
$
142.8
$
96.6
$
557.9
$
468.2
(1)
Throughout this press release, additional details about the
components of Other adjustments and other key financial metrics are
included in the Financial Supplement located on Assurant’s Investor
Relations website:
https://ir.assurant.com/investor/default.aspx
(2)
Assurant uses net operating
income per diluted share as an important measure of the company’s
stockholder value. Net operating income per diluted share equals
net operating income (defined above) plus any dilutive preferred
stock dividends divided by the weighted average number of diluted
shares outstanding. The company believes this metric provides
investors with an important measure of stockholder value because it
excludes items that do not represent the ongoing operations of the
company. The comparable GAAP measure is net income from continuing
operations per diluted share, defined as net income from continuing
operations plus any dilutive preferred stock dividends less net
income from non-controlling interests divided by the weighted
average number of diluted shares outstanding.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
2021
2020
2021
2020
GAAP net income from continuing
operations per diluted share(1)
$
2.20
$
1.91
$
10.20
$
8.22
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(0.09
)
(0.47
)
(2.14
)
0.16
COVID-19 direct and incremental
expenses
0.05
0.08
0.17
0.42
CARES Act tax benefit (after-tax)
—
—
—
(1.34
)
Loss on extinguishment of debt
—
—
0.34
—
Other adjustments
0.38
(0.02
)
0.53
0.29
(Benefit) provision for income taxes
(0.07
)
0.12
0.26
(0.04
)
Net operating income per diluted
share(1)
$
2.47
$
1.62
$
9.36
$
7.71
(1)
Throughout this press release, information
on the share counts used in the per share calculations are included
in the Financial Supplement located on Assurant’s Investor
Relations website https://ir.assurant.com/investor/default.aspx
(3)
Assurant uses net operating income
(defined above), excluding reportable catastrophes (which
represents individual catastrophic events that generate losses in
excess of $5.0 million, pre-tax, net of reinsurance and client
profit sharing adjustments and including reinstatement and other
premiums), as another important measure of the company’s operating
performance. The company believes this metric provides investors
with an important measure of the performance of the company’s
ongoing business because it excludes reportable catastrophes, which
can be volatile. The comparable GAAP measure is net income from
continuing operations.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
($ in millions)
2021
2020
2021
2020
GAAP net income from continuing
operations
$
126.7
$
119.1
$
613.5
$
520.4
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(5.1
)
(29.6
)
(128.4
)
9.4
Reportable catastrophes
1.5
34.7
144.3
173.7
COVID-19 direct and incremental
expenses
2.8
5.3
10.0
26.8
CARES Act tax benefit (after-tax)
—
—
—
(84.4
)
Loss on extinguishment of debt
—
—
20.7
—
Other adjustments
22.4
(1.2
)
31.5
17.9
(Benefit) provision for income taxes
(4.3
)
0.1
(14.9
)
(38.8
)
Net loss (income) attributable to
non-controlling interests
—
0.2
—
(0.9
)
Preferred stock dividends
—
(4.7
)
(4.7
)
(18.7
)
Net operating income, excluding
reportable catastrophes
$
144.0
$
123.9
$
672.0
$
605.4
(4)
Assurant uses net operating income,
excluding reportable catastrophes (defined above), per diluted
share (defined above) as another important measure of the company's
stockholder value. The company believes this metric provides
investors with an important measure of stockholder value because it
excludes reportable catastrophes, which can be volatile. The
comparable GAAP measure is net income from continuing operations
per diluted share, defined as net income from continuing operations
plus any dilutive preferred stock dividends less net income from
non-controlling interests divided by the weighted average number of
diluted shares outstanding.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
2021
2020
2021
2020
GAAP net income from continuing
operations per diluted share
$
2.20
$
1.91
$
10.20
$
8.22
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(0.09
)
(0.47
)
(2.14
)
0.16
Reportable catastrophes
0.03
0.56
2.40
2.75
COVID-19 direct and incremental
expenses
0.05
0.08
0.17
0.42
CARES Act tax benefit (after-tax)
—
—
—
(1.34
)
Loss on extinguishment of debt
—
—
0.34
—
Other adjustments
0.38
(0.02
)
0.53
0.29
Benefit for income taxes
(0.08
)
—
(0.24
)
(0.62
)
Net operating income, excluding
reportable catastrophes, per diluted share(1)
$
2.49
$
2.06
$
11.26
$
9.88
(5)
Assurant uses Adjusted EBITDA, excluding
reportable catastrophes, as an important measure of the company’s
operating performance. Assurant defines Adjusted EBITDA, excluding
reportable catastrophes, as net operating income, excluding
reportable catastrophes (defined above), excluding interest
expense, provision (benefit) for income taxes, depreciation expense
and amortization of purchased intangible assets. The company
believes Adjusted EBITDA is a better representation of the
company’s operating performance, as compared to net operating
income, because it reflects the company’s ongoing shift to more
service-oriented, fee-based businesses and it excludes amortization
of purchased intangible assets related to acquisitions. The company
believes it (i) enhances management’s and investors’ ability to
analyze the ongoing operations of its businesses and (ii)
facilitates comparisons of its operating performance over multiple
periods, as the amortization expense associated with purchased
intangible assets may fluctuate from period to period based on the
timing, size, nature and number of acquisitions. Although the
company excludes amortization of purchased intangible assets from
Adjusted EBITDA, revenue generated from such intangible assets is
included within the revenue in determining Adjusted EBITDA. In
addition, it excludes reportable catastrophes, which can be
volatile. The comparable GAAP measure is net income from continuing
operations.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
($ in millions)
2021
2020
2021
2020
GAAP net income from continuing
operations
$
126.7
$
119.1
$
613.5
$
520.4
Less:
Interest expense
27.1
26.8
111.8
104.5
Provision for income taxes
35.1
39.8
169.5
60.4
Depreciation expense
21.4
15.5
73.8
56.1
Amortization of purchased intangible
assets
15.8
16.7
65.8
52.7
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(5.1
)
(29.6
)
(128.4
)
9.4
Reportable catastrophes
1.5
34.7
144.3
173.7
COVID-19 direct and incremental
expenses
2.8
5.3
10.0
25.2
Loss on extinguishment of debt
—
—
20.7
—
Other adjustments
20.1
(1.1
)
26.5
12.2
Loss (income) attributable to
non-controlling interests
—
0.3
—
(1.2
)
Adjusted EBITDA, excluding reportable
catastrophes
$
245.4
$
227.5
$
1,107.5
$
1,013.4
(UNAUDITED)
4Q 2021
4Q 2020
($ in millions)
Global
Lifestyle
Global
Housing
Corporate
and Other
Global
Lifestyle
Global
Housing
Corporate
and Other
GAAP net income from continuing
operations
$
107.8
$
80.3
$
(61.4
)
$
87.9
$
61.1
$
(29.9
)
Less:
Interest expense
—
—
27.1
—
—
26.8
Provision (benefit) for income taxes
24.7
22.7
(12.3
)
26.1
16.9
(3.2
)
Depreciation expense
11.5
6.6
3.3
8.9
5.5
1.1
Amortization of purchased intangible
assets
14.7
1.1
—
14.3
2.4
—
Adjustments, pre-tax:
Net realized gains on investments
—
—
(5.1
)
—
—
(29.6
)
Reportable catastrophes
0.2
1.3
—
—
34.7
—
COVID-19 direct and incremental
expenses
—
—
2.8
—
—
5.3
Loss on extinguishment of debt
—
—
—
—
—
—
Other adjustments
—
—
20.1
—
—
(1.1
)
Net loss attributable to non-controlling
interests
—
—
—
—
—
0.3
Adjusted EBITDA, excluding reportable
catastrophes
$
158.9
$
112.0
$
(25.5
)
$
137.2
$
120.6
$
(30.3
)
(UNAUDITED)
12 Months 2021
12 Months 2020
($ in millions)
Global
Lifestyle
Global
Housing
Corporate
and Other
Global
Lifestyle
Global
Housing
Corporate
and Other
GAAP net income from continuing
operations
$
484.7
$
244.6
$
(115.8
)
$
437.2
$
233.8
$
(150.6
)
Less:
Interest expense
—
—
111.8
—
—
104.5
Provision (benefit) for income taxes
130.5
65.4
(26.4
)
127.1
61.3
(128.0
)
Depreciation expense
39.7
25.8
8.3
29.5
22.5
4.1
Amortization of purchased intangible
assets
59.3
6.5
—
43.2
9.5
—
Adjustments, pre-tax:
Net realized (gains) losses on
investments
—
—
(128.4
)
—
—
9.4
Reportable catastrophes
0.2
144.1
—
—
173.7
—
COVID-19 direct and incremental
expenses
—
—
10.0
—
—
25.2
Loss on extinguishment of debt
—
—
20.7
—
—
—
Other adjustments
—
—
26.5
—
—
12.2
Net income attributable to non-controlling
interests
—
—
—
—
—
(1.2
)
Adjusted EBITDA, excluding reportable
catastrophes
$
714.4
$
486.4
$
(93.3
)
$
637.0
$
500.8
$
(124.4
)
(6)
The company outlook for Adjusted EBITDA,
excluding reportable catastrophes, for Assurant, Global Lifestyle,
Global Housing and Corporate and Other each constitute
forward-looking information and the company believes that it cannot
reconcile such forward-looking information to the most comparable
GAAP measure without unreasonable efforts. Many of the GAAP
components cannot be reliably quantified due to the combination of
variability and volatility of such components and may, depending on
the size of the components, have a significant impact on the
reconciliation. The company is able to quantify a full-year
estimate of interest expense, depreciation expense and amortization
of purchased intangible assets, each on a pre-tax basis, which are
expected to be approximately $109 million, $85 million and $70
million, respectively. The interest expense estimate assumes no
additional debt is incurred or extinguished in the forecast period
and excludes after-tax interest expenses included in debt
extinguishment and other related costs.
(7)
Segment net operating income of the Global
Lifestyle and Global Housing operating segments is equal to GAAP
segment net income.
(8)
Assurant uses Corporate and Other net
operating loss as an important measure of the Corporate and Other
segment’s performance. Corporate and Other net operating loss
equals GAAP Corporate and Other segment net loss from continuing
operations, excluding interest expense, net realized gains (losses)
on investments (which includes unrealized gains (losses) on equity
securities and changes in fair value of direct investments in
collateralized loan obligations), COVID-19 direct and incremental
expenses, the CARES Act tax benefit, net income (loss) attributable
to non-controlling interests, as well as other highly variable or
unusual items other than reportable catastrophes. It also excludes
restructuring costs related to strategic exit activities as these
are highly unusual, transformative actions associated with
realigning resources to the company’s business strategies, outside
of normal periodic restructuring and cost management activities.
The company believes Corporate and Other net operating loss
provides investors with an important measure of the performance of
the company’s Corporate and Other segment because it excludes
highly variable items that do not represent the ongoing results of
such segment. The comparable GAAP measure is Corporate and Other
segment net loss from continuing operations.
(UNAUDITED)
4Q
4Q
12 Months
12 Months
($ in millions)
2021
2020
2021
2020
GAAP Corporate and Other segment net
loss from continuing operations
$
(61.4
)
$
(29.9
)
$
(115.8
)
$
(150.6
)
Adjustments, pre-tax:
Net realized (gains) losses on
investments
(5.1
)
(29.6
)
(128.4
)
9.4
COVID-19 direct and incremental
expenses
2.8
5.3
10.0
26.8
CARES Act tax benefit (after-tax)
—
—
—
(84.4
)
Interest expense
27.1
26.8
111.8
102.9
Loss on extinguishment of debt
—
—
20.7
—
Other adjustments
22.4
(1.2
)
31.5
17.9
(Benefit) provision for income taxes
(9.7
)
1.8
(8.1
)
(24.0
)
Net loss (income) attributable to
non-controlling interests
—
0.2
—
(0.9
)
Corporate and Other net operating
loss
$
(23.9
)
$
(26.6
)
$
(78.3
)
$
(102.9
)
Assurant, Inc.
Consolidated Statement of Operations
(unaudited)
Three and Twelve Months Ended December
31, 2021 and 2020
4Q
12 Months
2021
2020
2021
2020
($ in millions except number
of shares and per share amounts)
Revenues
Net earned premiums
$
2,175.8
$
2,102.2
$
8,572.1
$
8,275.8
Fees and other income
314.9
212.9
1,172.9
1,042.3
Net investment income
79.2
73.3
314.4
285.6
Net realized gains (losses) on
investments
5.0
29.7
128.2
(8.2
)
Total revenues
2,574.9
2,418.1
10,187.6
9,595.5
Benefits, losses and expenses
Policyholder benefits
514.5
567.6
2,195.7
2,264.9
Selling, underwriting, general and
administrative expenses
1,871.5
1,664.8
7,076.4
6,645.3
Interest expense
27.1
26.8
111.8
104.5
Loss on extinguishment of debt
—
—
20.7
—
Total benefits, losses and expenses
2,413.1
2,259.2
9,404.6
9,014.7
Income from continuing operations before
provision for income taxes
161.8
158.9
783.0
580.8
Provision for income taxes
35.1
39.8
169.5
60.4
Net income from continuing operations
126.7
119.1
613.5
520.4
Net (loss) income from discontinued
operations(1)
(3.1
)
19.9
758.9
(77.7
)
Net income
123.6
139.0
1,372.4
442.7
Less: Net loss (income) attributable to
non-controlling interests
—
0.2
—
(0.9
)
Net income attributable to
stockholders
123.6
139.2
1,372.4
441.8
Less: Preferred stock dividends
—
(4.7
)
(4.7
)
(18.7
)
Net income attributable to common
stockholders
$
123.6
$
134.5
$
1,367.7
$
423.1
Net income from continuing operations
per share:
Basic
$
2.21
$
1.93
$
10.29
$
8.33
Diluted
$
2.20
$
1.91
$
10.20
$
8.22
Common stock dividends per
share
$
0.68
$
0.66
$
2.66
$
2.55
Share data:
Basic weighted average shares
outstanding
57,274,878
59,310,101
59,140,861
60,114,670
Diluted weighted average shares
outstanding
57,728,138
62,399,318
60,123,694
63,179,938
(1)
Twelve Months 2021 net income from
discontinued operations reflects the $720 million after-tax gain on
the sale of Global Preneed, which included $606 million of net
after-tax gains from AOCI, mainly related to net unrealized gains
and losses.
Assurant, Inc.
Consolidated Condensed Balance Sheets
(unaudited)
At December 31, 2021 and December 31,
2020
December 31,
December 31,
2021
2020
($ in millions)
Assets
Investments and cash and cash
equivalents
$
10,712.4
$
10,430.4
Reinsurance recoverables
6,178.9
6,605.4
Deferred acquisition costs
8,811.0
7,388.0
Goodwill
2,571.6
2,589.3
Value of business acquired
583.4
1,152.2
Assets held in separate accounts
11.9
11.5
Other assets
3,965.4
3,254.4
Assets held for sale
1,076.9
13,218.7
Total assets
$
33,911.5
$
44,649.9
Liabilities
Policyholder benefits and claims
payable
$
2,009.1
$
2,968.8
Unearned premiums
18,623.7
17,293.1
Debt
2,202.5
2,252.9
Liabilities related to separate
accounts
11.9
11.5
Accounts payable and other liabilities
4,509.8
4,057.5
Liabilities held for sale
1,064.8
12,111.3
Total liabilities
28,421.8
38,695.1
Stockholders’ equity
Equity, excluding accumulated other
comprehensive income
5,639.7
5,241.6
Accumulated other comprehensive (loss)
income
(150.0
)
709.8
Total Assurant, Inc. stockholders’
equity
5,489.7
5,951.4
Non-controlling interest
—
3.4
Total equity
5,489.7
5,954.8
Total liabilities and equity
$
33,911.5
$
44,649.9
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220208005820/en/
Media Contacts: Linda Recupero Senior Vice President,
Global Enterprise Communications Phone: 201.519.9773
linda.recupero@assurant.com
Stacie Sherer Vice President, Corporate Communications Phone:
917.420.0980 stacie.sherer@assurant.com
Investor Relations Contacts:
Suzanne Shepherd Senior Vice President, Investor Relations and
Sustainability Phone: 201.788.4324
suzanne.shepherd@assurant.com
Sean Moshier Assistant Vice President, Investor Relations Phone:
914.204.2253 sean.moshier@assurant.com
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