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Reinsurance Group (RGA) Q1 Earnings Top, Premiums Rise Y/Y
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Reinsurance Group of America, Incorporated (RGA - Free Report) reported first-quarter 2024 adjusted operating earnings of $6.02 per share, which beat the Zacks Consensus Estimate by 33.5%. The bottom line increased 16.7% from the year-ago quarter.
Net foreign currency fluctuations had a favorable effect of 7 cents per share on net income available to RGA shareholders and 1 cent per share on adjusted operating income compared with the prior year.
Reinsurance Group witnessed a solid performance in the Canada, Europe, Middle East and Africa (EMEA) and Asia/Pacific segments, partially offset by weakness in the U.S. and Latin America segment. It witnessed higher premiums and investment income as well.
RGA's operating revenues of $6.5 billion improved 50% year over year, driven by higher net premiums, investment income, net of related expenses and other revenues.
Net premiums of $5.4 billion jumped 58.8% year over year. Investment income and net of related expenses increased 12.3% from the prior-year quarter to $961 million. The average investment yield declined 1 basis point to 4.70%, primarily due to higher new money rates, offset by lower variable investment income.
Total benefits and expenses at Reinsurance Group climbed 55.5% year over year to $6 billion on higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, other operating expenses and interest expense.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
U.S. and Latin America: Total pre-tax adjusted operating income was $218 million in the quarter, which decreased 3.9% from the year-ago quarter. The Traditional segment reported a pre-tax adjusted operating income of $128 million, up 4.9% year over year. Net premiums rose 6.2% from the year-ago quarter to $1.7 billion.
The Financial Solutions segment’s pre-tax adjusted operating income decreased 14.2% year over year to $90 million. Results were slightly below expectations due to lower variable investment income.
Canada: Total pre-tax adjusted operating income increased 35.8% to $53 million.
The Traditional segment’s pre-tax adjusted operating income jumped 58.6% year over year to $46 million. Net premiums rose 7.8% to $318 million. Foreign currency exchange rates had a favorable effect on net premiums of $1 million.
The Financial Solutions segment’s pre-tax adjusted operating income decreased 30% year over year to $7 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income.
EMEA: Total pre-tax adjusted operating income was $115 million, which increased 19.7% year over year.
Pre-tax adjusted operating income of the traditional segment climbed 40.7% year over year to $38 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income. Premiums rose 13.2% to $496 million in the quarter. Foreign currency exchange rates had a favorable effect on net premiums of $7 million for the quarter.
The Financial Solutions segment delivered pre-tax adjusted operating income of $77 million, up 11.6% year over year. Foreign currency exchange rates had a favorable effect on pre-tax adjusted operating income.
Asia/Pacific: Total pre-tax adjusted operating income was $168 million, up 41.2% year over year.
The Traditional segment’s pre-tax adjusted operating income was $109 million, up 38% year over year. Foreign currency exchange rates had an adverse effect of $2 million on pre-tax adjusted operating income. Premiums increased 8.1% to $716 million. Foreign currency exchange rates had an adverse effect on net premiums of $23 million.
The Financial Solutions segment’s pre-tax adjusted operating income climbed 47.5% to $59 million. Net premiums plunged 28% to $46 million. Results reflected a favorable overall experience.
Corporate and Other: Pre-tax adjusted operating loss was $38 million, wider than the year-ago loss of $25 million in the prior-year period.
Financial Update
As of Mar 31, 2024, Reinsurance Group had assets worth $106 billion, up 18.9% year over year.
As of Mar 31, 2024, RGA’s book value per share, excluding accumulated other comprehensive income, rose 6.8% year over year to $145.83.
Adjusted operating return on equity, excluding accumulated other comprehensive income, was 14.8%, reflecting an expansion of 360 basis points year over year.
Reinsurance Group exited the quarter with $0.6 billion in excess capital.
Capital Deployment
RGA deployed $737 million into in-force transactions.
On Apr 30, 2024, the board declared a regular quarterly dividend of 85 cents per share. The dividend will be paid out on May 28 to shareholders of record at the close of business as of May 14, 2024.
Voya Financial, Inc. (VOYA - Free Report) reported first-quarter 2024 adjusted operating earnings of $1.88 per share, which beat the Zacks Consensus Estimate by 18.9%. The bottom line, however, increased 11.2% year over year. Adjusted operating revenues amounted to $1.9 billion, up 8.9% year over year, driven by higher fee income, premiums and other revenues.
Net investment income declined 2.9% year over year to $529 million. Meanwhile, fee income of $513 million increased 10.5% year over year. Premiums totaled $800 million, up 16.8% from the year-ago quarter. Total benefits and expenses were $1.7 billion, up 4.1% from the year-ago quarter. As of Mar 31, 2024, VOYA’s assets under management, assets under administration and advisement totaled $848.6 billion.
Unum Group’s (UNM - Free Report) first-quarter 2024 operating net income of $2.12 per share beat the Zacks Consensus Estimate by 7.6%. The bottom line rose 13.3% year over year. Total operating revenues of Unum Group were $3.2 billion, up 5.5% year over year, driven by higher premium income, net investment and other income. The top line beat the Zacks Consensus Estimate by 0.3%.
Premiums increased 6.1% from the prior-year quarter to $2.6 billion and were in line with our estimate. Total benefits and expenses rose 4.6% year over year to $2.7 billion. Our estimate was $2.6 billion.
Chubb Limited (CB - Free Report) reported first-quarter 2024 core operating income of $5.41 per share, which outpaced the Zacks Consensus Estimate by 2.3%. The bottom line jumped 22.7% year over year. Net premiums written improved 14.1% year over year to $12.2 billion in the quarter. Our estimate was $11.4 billion, while the Zacks Consensus Estimate was pegged at $13 billion.
Net investment income was $1.4 billion, up 25.7% year over year. The Zacks Consensus Estimate was pegged at $1.3 billion, while our estimate for the same was $1.4 billion. Property and Casualty (P&C) underwriting income was $1.4 billion, up 16.7% year over year. Global P&C underwriting income, excluding Agriculture, was $1.3 billion, up 10.9%.
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Reinsurance Group (RGA) Q1 Earnings Top, Premiums Rise Y/Y
Reinsurance Group of America, Incorporated (RGA - Free Report) reported first-quarter 2024 adjusted operating earnings of $6.02 per share, which beat the Zacks Consensus Estimate by 33.5%. The bottom line increased 16.7% from the year-ago quarter.
Net foreign currency fluctuations had a favorable effect of 7 cents per share on net income available to RGA shareholders and 1 cent per share on adjusted operating income compared with the prior year.
Reinsurance Group witnessed a solid performance in the Canada, Europe, Middle East and Africa (EMEA) and Asia/Pacific segments, partially offset by weakness in the U.S. and Latin America segment. It witnessed higher premiums and investment income as well.
RGA's operating revenues of $6.5 billion improved 50% year over year, driven by higher net premiums, investment income, net of related expenses and other revenues.
Net premiums of $5.4 billion jumped 58.8% year over year. Investment income and net of related expenses increased 12.3% from the prior-year quarter to $961 million. The average investment yield declined 1 basis point to 4.70%, primarily due to higher new money rates, offset by lower variable investment income.
Total benefits and expenses at Reinsurance Group climbed 55.5% year over year to $6 billion on higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, other operating expenses and interest expense.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
Reinsurance Group of America, Incorporated price-consensus-eps-surprise-chart | Reinsurance Group of America, Incorporated Quote
Quarterly Segment Update
U.S. and Latin America: Total pre-tax adjusted operating income was $218 million in the quarter, which decreased 3.9% from the year-ago quarter.
The Traditional segment reported a pre-tax adjusted operating income of $128 million, up 4.9% year over year. Net premiums rose 6.2% from the year-ago quarter to $1.7 billion.
The Financial Solutions segment’s pre-tax adjusted operating income decreased 14.2% year over year to $90 million. Results were slightly below expectations due to lower variable investment income.
Canada: Total pre-tax adjusted operating income increased 35.8% to $53 million.
The Traditional segment’s pre-tax adjusted operating income jumped 58.6% year over year to $46 million. Net premiums rose 7.8% to $318 million. Foreign currency exchange rates had a favorable effect on net premiums of $1 million.
The Financial Solutions segment’s pre-tax adjusted operating income decreased 30% year over year to $7 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income.
EMEA: Total pre-tax adjusted operating income was $115 million, which increased 19.7% year over year.
Pre-tax adjusted operating income of the traditional segment climbed 40.7% year over year to $38 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income. Premiums rose 13.2% to $496 million in the quarter. Foreign currency exchange rates had a favorable effect on net premiums of $7 million for the quarter.
The Financial Solutions segment delivered pre-tax adjusted operating income of $77 million, up 11.6% year over year. Foreign currency exchange rates had a favorable effect on pre-tax adjusted operating income.
Asia/Pacific: Total pre-tax adjusted operating income was $168 million, up 41.2% year over year.
The Traditional segment’s pre-tax adjusted operating income was $109 million, up 38% year over year. Foreign currency exchange rates had an adverse effect of $2 million on pre-tax adjusted operating income. Premiums increased 8.1% to $716 million. Foreign currency exchange rates had an adverse effect on net premiums of $23 million.
The Financial Solutions segment’s pre-tax adjusted operating income climbed 47.5% to $59 million. Net premiums plunged 28% to $46 million. Results reflected a favorable overall experience.
Corporate and Other: Pre-tax adjusted operating loss was $38 million, wider than the year-ago loss of $25 million in the prior-year period.
Financial Update
As of Mar 31, 2024, Reinsurance Group had assets worth $106 billion, up 18.9% year over year.
As of Mar 31, 2024, RGA’s book value per share, excluding accumulated other comprehensive income, rose 6.8% year over year to $145.83.
Adjusted operating return on equity, excluding accumulated other comprehensive income, was 14.8%, reflecting an expansion of 360 basis points year over year.
Reinsurance Group exited the quarter with $0.6 billion in excess capital.
Capital Deployment
RGA deployed $737 million into in-force transactions.
On Apr 30, 2024, the board declared a regular quarterly dividend of 85 cents per share. The dividend will be paid out on May 28 to shareholders of record at the close of business as of May 14, 2024.
Zacks Rank
Reinsurance Group 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 Insurers
Voya Financial, Inc. (VOYA - Free Report) reported first-quarter 2024 adjusted operating earnings of $1.88 per share, which beat the Zacks Consensus Estimate by 18.9%. The bottom line, however, increased 11.2% year over year. Adjusted operating revenues amounted to $1.9 billion, up 8.9% year over year, driven by higher fee income, premiums and other revenues.
Net investment income declined 2.9% year over year to $529 million. Meanwhile, fee income of $513 million increased 10.5% year over year. Premiums totaled $800 million, up 16.8% from the year-ago quarter. Total benefits and expenses were $1.7 billion, up 4.1% from the year-ago quarter. As of Mar 31, 2024, VOYA’s assets under management, assets under administration and advisement totaled $848.6 billion.
Unum Group’s (UNM - Free Report) first-quarter 2024 operating net income of $2.12 per share beat the Zacks Consensus Estimate by 7.6%. The bottom line rose 13.3% year over year. Total operating revenues of Unum Group were $3.2 billion, up 5.5% year over year, driven by higher premium income, net investment and other income. The top line beat the Zacks Consensus Estimate by 0.3%.
Premiums increased 6.1% from the prior-year quarter to $2.6 billion and were in line with our estimate. Total benefits and expenses rose 4.6% year over year to $2.7 billion. Our estimate was $2.6 billion.
Chubb Limited (CB - Free Report) reported first-quarter 2024 core operating income of $5.41 per share, which outpaced the Zacks Consensus Estimate by 2.3%. The bottom line jumped 22.7% year over year. Net premiums written improved 14.1% year over year to $12.2 billion in the quarter. Our estimate was $11.4 billion, while the Zacks Consensus Estimate was pegged at $13 billion.
Net investment income was $1.4 billion, up 25.7% year over year. The Zacks Consensus Estimate was pegged at $1.3 billion, while our estimate for the same was $1.4 billion. Property and Casualty (P&C) underwriting income was $1.4 billion, up 16.7% year over year. Global P&C underwriting income, excluding Agriculture, was $1.3 billion, up 10.9%.