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Protective Life Corp. (PL - Analyst Report) reported operating earnings of 98 cents per share ahead of the Zacks Consensus Estimate of 88 cents per share. Earnings also came in a penny more than earnings of 97 cents reported in the year ago quarter.

The earnings beat came from higher contribution from across the company’s segments – Life Marketing, Acquisitions, Annuities, and Stable Value.

Operational Highlights

Total revenues were $869.6 million, down 1.9% year over year.

Gross premium earned was $721.6 million compared with $720.2 million in the year ago quarter.

Net investment income came in at $476.0 million, up 2.4% year over year.

Total benefits and expenses were $766.1 million, unchanged relative to the year-ago quarter.

Full Year Results

Operating income was $3.78 per share up 15.2% year over year. Earnings were also ahead of the Zacks Consensus Estimate of $3.68 per share.

Total revenue was $3.6 billion, up 1.5% year over year.

Segment Highlights

The Life Marketing segment reported before-tax operating income of $15.64 million, down 54% year over year. The decline came on the back of a reserve financing transaction closing and the transfer of investment income to the Corporate & Other segment, adverse mortality experience, and an increase in operating expenses. Sales were $41.9 million, up 66% year over year.

Before tax operating income of Acquisitions segment was $42.2 million up 1.6% year over year. The increase was primarily due to favorable mortality and lower transition expenses related to the United Investors Life Insurance Company and the Liberty Life Insurance Company blocks compared to the year ago quarter.

The Annuities segment reported before tax operating income of $45.3 million up by a significant 87% year over year. The increase was driven by increased contribution from fixed as well as variable annuity business.

The Stable Value segment reported before tax operating income of $18.7 million, up 31% year over year. The segment reported sales of $272.2 million, compared to $32.9 million in the year-ago quarter.

The Asset Protection segment reported before-tax operating income of $0.9 million, down significantly from $6.7 million in the year ago quarter. The decrease was primarily due to cost capital charge of $4.1 million related to software development.

Corporate & Other segment pre-tax operating income was $0.9 million compared to an operating loss of $4.4 million in the year-ago quarter.

During the reported quarter, the company repurchased 1,047,084 shares at a total cost of approximately $27.4 million.

Protective stands solid with respect to its capital position. Its RBC ratio is between 500-510%.  

Book value per share ended the year at $59.60, up 30% from $45.45 a year ago.

Other players in the same field include StanCorp Financial Group (SFG - Analyst Report), Lincoln National Corporation (LNC - Analyst Report), Reinsurance Group of America Inc. (RGA - Analyst Report). All reported operating earnings ahead of the Zacks Consensus Estimate.

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