Voya Financial ( VOYA Quick Quote VOYA - Free Report) reported first-quarter 2023 adjusted operating earnings of $1.69 per share, which missed the Zacks Consensus Estimate by 1.7%. The bottom line however increased 15% year over year. Our estimate was $1.71. The increase reflects the benefits of diverse revenue streams and strong margins across Voya’s businesses. Behind the Headlines
Adjusted operating revenues amounted to $261 billion, which decreased 4.4% year over year. The top line also missed the Zacks Consensus Estimate by 9.4%. Our estimate was $274.1 million.
Net investment income declined 13.9% year over year to $545 million. Our estimate was $2519.2 million. Meanwhile, fee income of $464 million increased 7.2% year over year. Our estimate was $410.8 million. Premiums totaled $685 million, up 12.7% from the year-ago quarter. Our estimate was $836.2 million. Total benefits and expenses were $1.7 billion, up 22.4% from the year-ago quarter. Our estimate was $1.3 billion. As of Mar 31, 2023, VOYA’s assets under management, assets under administration and advisement totaled $771.2 million. Segmental Update Wealth Solutions reported adjusted operating earnings of $132 million, which decreased 42.1% year over year, primarily due to lower alternative investment income. Full-service recurring deposits grew 9.6% to $13.6 billion. Health Solutions adjusted operating earnings amounted to $94 million, which increased more than four-fold year over year due to strong sales growth, favorable underwriting results and the positive impact of the Benefitfocus acquisition, which closed in January 2023. Annualized in-force premiums and fees grew 22% to $3.3 billion. The strong increase reflects growth across all product lines and the positive impact of the Benefitfocus acquisition. Investment Management posted adjusted operating earnings of $33 million, which plunged 15.4% year over year, due to higher expenses, reflecting timing and elevated seasonal impacts. Net outflows were $0.9 billion during the trailing 12 months ended Mar 31, 2023. Corporate incurred an adjusted operating loss of $69 million, flat year over year. Financial Update
Voya Financial exited the quarter with cash and cash equivalents of $724 million, which decreased 21.2% year over year. Total investments amounted to $38.7 billion, down 1% year over year.
Long-term debt at quarter-end was flat from 2022 end at $2.1 billion. The financial leverage ratio deteriorated 630 basis points year over year to 36.1%. As of Mar 31, 2023, book value per share (excluding AOCI) was $59.95, which increased 17.2% year over year. Voya Financial exited the first quarter with more than $0.5 billion in excess capital. Acquisition Update
On Jan 24, 2023, Voya completed the acquisition of Benefitfocus, Inc., an industry leader in benefits administration technology, which will help accelerate Voya’s workplace-centered strategy.
As of Mar 31, 2023, VOYA had $275 million remaining under its share-repurchase authorization effective through Sep 30, 2023. It expects to resume share repurchase activity in the second quarter of 2023 and plans to increase the common stock dividend to an annual yield of approximately 2% in the second half of 2023.
VOYA currently carries a Zacks Rank #3 (Hold). You can see
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