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TheStreet Open House

Reinsurance Group Of America Reports Third-Quarter Results

Stocks in this article: RGA

Reinsurance Group of America, Incorporated (NYSE:RGA), a leading global provider of life reinsurance, reported third-quarter net income of $147.4 million, or $1.98 per diluted share, compared to $128.2 million, or $1.72 per diluted share in the prior-year quarter. Operating income* totaled $151.6 million, or $2.04 per diluted share, compared to $127.7 million, or $1.72 per diluted share in the year-ago quarter.

For the first nine months of 2011, net income increased to $441.1 million, or $5.94 per diluted share, from $377.7 million, or $5.06 per diluted share, in the year-ago period. Operating income* totaled $398.4 million, or $5.37 per diluted share, compared with $342.6 million, or $4.59 per diluted share, the year before.

    Quarterly Results     Year-to-Date Results
($ in thousands, except per share data) 2011     2010 2011     2010
Net premiums $ 1,776,165 $ 1,647,300 $ 5,300,971 $ 4,857,781
Net income 147,385 128,232 441,089 377,690
Net income per diluted share 1.98 1.72 5.94 5.06
Operating income* 151,618 127,703 398,446 342,610
Operating income per diluted share* 2.04 1.72 5.37 4.59
Book value per share 77.29 68.30

Book value per share (excl. Accumulated Other Comprehensive Income “AOCI”)*

59.48

53.82

Total assets 31,183,454 28,934,028

* See ‘Use of Non-GAAP Financial Measures’ below

 

For the quarter, consolidated net premiums increased 8 percent to $1,776.2 million from $1,647.3 million in the prior-year period. Net of the effects of changes in foreign currency exchange rates, net premiums were up 5 percent. The prior-year period benefited from an advance premium of $43.3 million associated with a new longevity transaction in Canada. Excluding that transaction, premiums rose 11 percent with the currency effect and 7 percent without it. Investment income decreased 7 percent to $268.2 million from $287.5 million in the year-earlier quarter, including a decline in fair value of option contracts supporting equity-indexed annuities. Excluding the effects of these option contracts, investment income was up $19.2 million, or 6 percent. Average invested assets increased approximately $1.9 billion to $17.7 billion and average yields, excluding the funds withheld assets, decreased 37 basis points to 5.29 percent quarter over quarter. The average investment yield in each of the first two quarters of 2011 was 5.35 percent. Net foreign currency fluctuations contributed $4.5 million, after taxes, to operating income, or $0.06 per diluted share.

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