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Brighthouse (BHF) Q1 Earnings & Revenues Miss, Fall Y/Y
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Brighthouse Financial Inc. (BHF - Free Report) reported first-quarter 2023 adjusted net income of $2.86 per share, which missed the Zacks Consensus Estimate by 9.2%. The bottom line dropped 46% year over year. Our estimate was $3.01 per share.
The reported quarter witnessed lower revenues and higher expenses.
Brighthouse Financial, Inc. Price, Consensus and EPS Surprise
Total operating revenues of $2 billion decreased 11.2% year over year due to lower universal life and investment-type product policy fees and net investment income. The top line missed the consensus mark by 4.1% but was almost in line with our estimate.
Premiums of $197 million increased 18.7% year over year. Our estimate was $234.4 million.
Adjusted net investment income was $1.1 billion in the quarter under review, down 5.2% year over year, due to lower alternative investment income, partially offset by asset growth. The investment income yield was 3.8%.
Total expenses increased to $1.9 billion from $10 million incurred in the year-ago quarter due to change in market risk benefits. It was almost in line with our estimate. Corporate expenses were $210 million.
Quarterly Segmental Update
Annuities reported an adjusted operating income of $314 million, down 11.3% year over year, reflecting lower fees and higher interest credited, partially offset by higher net investment income. Annuity sales increased 35.2% to $2.8 billion, driven by higher sales of fixed deferred annuities.
Life’s adjusted operating earnings were $1 million compared with earnings of $66 million in the year-ago quarter on lower net investment income and a lower underwriting margin. Life insurance sales increased 15% to $23 million.
Adjusted operating loss at Run-off was $106 million against the year-ago earnings of $24 million due to lower net investment income and a lower underwriting margin, partially offset by lower expenses.
Corporate & Other delivered an adjusted operating loss of $14 million, narrower than the prior-year loss of $64 million, on higher net investment income and tax benefit.
Financial Update
Cash and cash equivalents were $3.7 billion, down 10.1% from 2021 end.
Shareholders’ equity of $5.8 billion at the end of the first quarter of 2023 increased 3.9% from 2022 end.
Book value per share, excluding accumulated other comprehensive income, was $138.62 as of Mar 31, 2023, up 30.3% year over year.
Statutory combined total adjusted capital was $8.2 billion on Mar 31, 2023, down 3.5% year over year.
As of Mar 31, 2023, the estimated combined RBC ratio was 460%-480%.
Share Buyback Program
Brighthouse bought back shares worth $62 million in the first quarter of 2023 and another $27 million year through May 5, 2023.
Reinsurance Group of America, Incorporated (RGA - Free Report) reported first-quarter 2023 adjusted operating earnings of $5.16 per share, which beat the Zacks Consensus Estimate by 53%. The bottom line, however, increased 23.4% from the year-ago quarter. Operating revenues of $4.3 billion beat the Zacks Consensus Estimate by 2.4%. The top line also improved 6.7% year over year driven by higher net premiums and investment income and net of related expenses.
Net premiums of $3.4 billion rose 7.3% year over year. Investment income and net of related expenses increased 5.6% from the prior-year quarter to $856 million. The average investment yield was down 58 basis points (bps) to 4.71% due to lower variable investment income, partially offset by higher yields.
Voya Financial (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. 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. As of Mar 31, 2023, VOYA’s assets under management, assets under administration and advisement totaled $771.2 million.
American Equity Investment Life Holding Company (AEL - Free Report) reported first-quarter 2023 adjusted net earnings of $1.47 per share, which beat the Zacks Consensus Estimate by 27.8% and our estimate of $1.02. The bottom line however increased 34.8% on a year-over-year basis. Operating total revenues were $644.4 million, up 0.9% year over year on the back of higher annuity product charges and other revenues.
Premiums and other considerations decreased 58.9% year over year to $4.1 million. The figure was lower than our estimate of $11.2 million. Net investment income decreased 1.1% on a year-over-year basis to $561 million. The investment spread was 2.67%, up from 2.51% in the year-ago quarter.
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Brighthouse (BHF) Q1 Earnings & Revenues Miss, Fall Y/Y
Brighthouse Financial Inc. (BHF - Free Report) reported first-quarter 2023 adjusted net income of $2.86 per share, which missed the Zacks Consensus Estimate by 9.2%. The bottom line dropped 46% year over year. Our estimate was $3.01 per share.
The reported quarter witnessed lower revenues and higher expenses.
Brighthouse Financial, Inc. Price, Consensus and EPS Surprise
Brighthouse Financial, Inc. price-consensus-eps-surprise-chart | Brighthouse Financial, Inc. Quote
Behind the Headlines
Total operating revenues of $2 billion decreased 11.2% year over year due to lower universal life and investment-type product policy fees and net investment income. The top line missed the consensus mark by 4.1% but was almost in line with our estimate.
Premiums of $197 million increased 18.7% year over year. Our estimate was $234.4 million.
Adjusted net investment income was $1.1 billion in the quarter under review, down 5.2% year over year, due to lower alternative investment income, partially offset by asset growth. The investment income yield was 3.8%.
Total expenses increased to $1.9 billion from $10 million incurred in the year-ago quarter due to change in market risk benefits. It was almost in line with our estimate. Corporate expenses were $210 million.
Quarterly Segmental Update
Annuities reported an adjusted operating income of $314 million, down 11.3% year over year, reflecting lower fees and higher interest credited, partially offset by higher net investment income. Annuity sales increased 35.2% to $2.8 billion, driven by higher sales of fixed deferred annuities.
Life’s adjusted operating earnings were $1 million compared with earnings of $66 million in the year-ago quarter on lower net investment income and a lower underwriting margin. Life insurance sales increased 15% to $23 million.
Adjusted operating loss at Run-off was $106 million against the year-ago earnings of $24 million due to lower net investment income and a lower underwriting margin, partially offset by lower expenses.
Corporate & Other delivered an adjusted operating loss of $14 million, narrower than the prior-year loss of $64 million, on higher net investment income and tax benefit.
Financial Update
Cash and cash equivalents were $3.7 billion, down 10.1% from 2021 end.
Shareholders’ equity of $5.8 billion at the end of the first quarter of 2023 increased 3.9% from 2022 end.
Book value per share, excluding accumulated other comprehensive income, was $138.62 as of Mar 31, 2023, up 30.3% year over year.
Statutory combined total adjusted capital was $8.2 billion on Mar 31, 2023, down 3.5% year over year.
As of Mar 31, 2023, the estimated combined RBC ratio was 460%-480%.
Share Buyback Program
Brighthouse bought back shares worth $62 million in the first quarter of 2023 and another $27 million year through May 5, 2023.
Zacks Rank
Brighthouse currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Life Insurers
Reinsurance Group of America, Incorporated (RGA - Free Report) reported first-quarter 2023 adjusted operating earnings of $5.16 per share, which beat the Zacks Consensus Estimate by 53%. The bottom line, however, increased 23.4% from the year-ago quarter. Operating revenues of $4.3 billion beat the Zacks Consensus Estimate by 2.4%. The top line also improved 6.7% year over year driven by higher net premiums and investment income and net of related expenses.
Net premiums of $3.4 billion rose 7.3% year over year. Investment income and net of related expenses increased 5.6% from the prior-year quarter to $856 million. The average investment yield was down 58 basis points (bps) to 4.71% due to lower variable investment income, partially offset by higher yields.
Voya Financial (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. 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. As of Mar 31, 2023, VOYA’s assets under management, assets under administration and advisement totaled $771.2 million.
American Equity Investment Life Holding Company (AEL - Free Report) reported first-quarter 2023 adjusted net earnings of $1.47 per share, which beat the Zacks Consensus Estimate by 27.8% and our estimate of $1.02. The bottom line however increased 34.8% on a year-over-year basis. Operating total revenues were $644.4 million, up 0.9% year over year on the back of higher annuity product charges and other revenues.
Premiums and other considerations decreased 58.9% year over year to $4.1 million. The figure was lower than our estimate of $11.2 million. Net investment income decreased 1.1% on a year-over-year basis to $561 million. The investment spread was 2.67%, up from 2.51% in the year-ago quarter.