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01/11 03:13
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights strong financial performance with significant growth in adjusted earnings and sales across various products. Shareholder returns are robust, with increased dividends and share buybacks. Despite some competitive pressures and supply chain challenges, the company maintains a strong capital position. The Q&A section reveals management's confidence in growth strategies and risk mitigation, though some responses lacked clarity. Overall, the positive financial metrics and shareholder returns outweigh the concerns, suggesting a likely positive stock price movement.
Adjusted Operating Earnings $376,000,000, a growth of 13% over the previous year due to higher earnings on spread products, benefiting from gains in net investment income.
Adjusted Operating Earnings per Share $5.1, up 25% from $4.16 in the prior year’s first quarter, primarily due to growth in spread income and a reduction in diluted share count from common share repurchase activity.
Retail Annuity Sales Over $4,000,000,000, up more than 9% from a year ago, driven by strong spread income and sales growth across all products.
Variable Annuities Sales $2,700,000,000, an increase of 9% from a year ago, with notable growth in sales of variable annuities without living benefits, which were up 40%.
RILA Product Sales $1,200,000,000, up 3% from a year ago, supported by the launch of the plus income optional benefit and expanded distribution opportunities.
Fixed and Fixed Indexed Annuity Sales $174,000,000, reflecting meaningful growth compared to a year ago.
Advisory Sales Increased 28% over the first quarter of twenty twenty four, with an annual run rate of more than $1,000,000,000.
Free Capital Generation $240,000,000 distributed to JFI, bringing the trailing twelve month total to nearly $1,100,000,000.
Free Cash Flow $213,000,000 in the quarter, bringing the trailing twelve month total to nearly $1,000,000,000.
Statutory Capital Generation $441,000,000 in the first quarter, benefiting from a tax benefit driven by utilization of net operating losses and additional admitted deferred tax assets.
Estimated RBC Ratio 585%, up from the fourth quarter of twenty twenty four, remaining well above the minimum of four twenty five percent.
Holding Company Cash and Liquid Assets More than $600,000,000, providing substantial financial flexibility.
Book Value on a Diluted Share Basis Increased 2% to $152.84 due to a reduction in diluted share count from buyback activity.
Retail Annuity Sales: First quarter retail annuity sales were over $4,000,000,000, up more than 9% from a year ago.
Variable Annuities Sales: Sales of variable annuities increased 9% from a year ago to $2,700,000,000.
Elite Access Sales: Sales of Elite Access, an investment-only variable annuity, benefited from the recently introduced Principal Guard feature.
RILEH Product Suite Sales: RILEH product suite sales were $1,200,000,000 for the quarter, up 3% from a year ago.
Advisory Sales Growth: Advisory sales increased 28% over the first quarter of twenty twenty four.
Market Positioning in RILEH: Jackson is a top five provider in the RILE market, well positioned to meet demand through product innovation and distribution.
Expansion in Fee-Based Advisory Business: The fee-based advisory business is expanding the overall market for annuity products.
Adjusted Operating Earnings: Adjusted operating earnings of $376,000,000, a growth of 13% over the previous year.
Capital Return to Shareholders: Jackson has returned over $2,000,000,000 in capital to shareholders since becoming independent.
Cash Dividend: A second quarter cash dividend of $0.80 per common share was approved.
Free Capital Generation: Free capital generation is on pace to exceed $1,000,000,000 for full year 2025.
M&A Philosophy: Jackson evaluates inorganic growth opportunities against the value of share buybacks or balance sheet strengthening.
Focus on Annuity Industry: Jackson remains committed to serving distribution partners and clients with flexible protection and income-oriented solutions.
Market Volatility: The company experienced historic levels of market volatility in early April, comparable to previous extreme market stress periods. This volatility can challenge dynamic hedging programs.
Hedging Program: The hedging program performed well during periods of market volatility, providing substantial payoffs and stabilizing equity positions. However, heightened volatility combined with major equity market and interest rate shifts can pose challenges.
Regulatory Capital: The company maintains a risk management framework to ensure sufficient capital above the minimum regulatory levels, which is crucial during adverse market scenarios.
Economic Risks: The company’s capital position and RBC ratio are less sensitive to equity market movements due to the establishment of Brook Re, which mitigates immediate capital reductions.
Competitive Pressures: The competitive landscape for spread products is becoming more active, with other companies forming partnerships with alternative asset managers, which may put Jackson at a competitive disadvantage.
Supply Chain Challenges: The company is closely monitoring market conditions for profitable growth opportunities, indicating potential supply chain challenges in the annuity market.
Economic Factors: The company is navigating through periods of market uncertainty, which can impact capital generation and overall business performance.
Adjusted Operating Earnings: Adjusted operating earnings of $376 million, a growth of 13% over the previous year.
Shareholder Returns: Returned over $2 billion in capital to shareholders since becoming an independent public company.
Retail Annuity Sales: First quarter retail annuity sales were over $4 billion, up more than 9% from a year ago.
RILEH Product Suite Sales: Sales of RILEH product suite were $1.2 billion for the quarter, up 3% from a year ago.
Advisory Sales Growth: Advisory sales increased 28% over the first quarter of 2024, with an annual run rate of more than $1 billion.
Cash Dividend: Announced a second quarter cash dividend of $0.80 per common share.
Free Capital Generation: Free capital generation is on pace to exceed $1 billion for full year 2025.
2025 Financial Targets: Confident in achieving 2025 financial targets despite market volatility.
Capital Return Targets: Highly confident in ability to meet full year 2025 capital return target.
RBC Ratio: Estimated RBC ratio was up to 585%, well above the minimum of 425%.
Future Growth in RILE Business: Future growth in RILE business supported by the 2024 launch of plus income optional benefit.
Market Position: Well positioned to meet market demand through product innovation and strong distribution.
Cash Dividend: The Board approved a second quarter cash dividend of $0.80 per common share.
Shareholder Capital Return: Jackson has returned over $2,000,000,000 in capital to shareholders since becoming an independent public company.
Quarterly Shareholder Return: In the first quarter, Jackson returned $231,000,000 to common shareholders, up 44% from the previous year.
Adjusted Operating Earnings per Share: Adjusted operating earnings per share were $5.1 for the current quarter, up 25% from the prior year.
Share Buyback Impact: The reduction in diluted share count from buyback activity drove a 2% increase in book value on a diluted share basis.
The earnings call reveals mixed results: declining shell egg sales but significant growth in prepared foods. Specialty egg sales grew slightly, but overall financial performance was weak, with declines in gross profit and net income. The Q&A highlights optimism in prepared foods and specialty eggs, but management's lack of precise guidance raises concerns. The positive impact of the prepared foods segment and strategic diversification is offset by underwhelming shell egg performance and vague guidance, leading to a neutral sentiment.
The earnings call reveals strong financial performance, with significant growth in annuity sales and free capital generation. The company maintains a robust capital position and continues to return substantial capital to shareholders. Positive market trends and product innovation further support a positive outlook. However, concerns about policyholder behavior and management's reluctance to disclose specific capital allocations slightly temper the sentiment. Overall, the strong earnings and optimistic guidance suggest a positive stock price movement, but not overwhelmingly so.
The earnings call presents a generally positive outlook with strong financial performance, robust free capital generation, and strategic growth in RILA sales. Shareholder returns are emphasized, and the company shows confidence in meeting 2025 targets. The Q&A reveals openness to strategic partnerships and innovation, though some management responses were vague. Overall, the company's strong performance and strategic initiatives are likely to lead to a positive stock price movement.
The earnings call highlights strong financial performance with increased operating earnings, high annuity sales, and significant capital returns to shareholders. The approval of a cash dividend and substantial capital generation are positive indicators. While there are concerns about market volatility and unclear responses in the Q&A, the overall sentiment is positive due to the robust financial metrics, shareholder returns, and optimistic outlook on product sales.
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