Delaware
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001-16517
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06-1599088
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(State or other jurisdiction
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(Commission File Number)
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(IRS Employer
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of incorporation)
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Identification No.)
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One American Row, Hartford, CT
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06102 -5056
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area code:
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(860) 403-5000
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NOT APPLICABLE
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(Former name or former address, if changed since last report)
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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o
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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THE PHOENIX COMPANIES, INC.
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Date: April 1, 2014
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By:
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/s/ Bonnie J. Malley | |
Name: Bonnie J. Malley | |||
Titlle: Executive Vice President | |||
and Chief Financial Officer
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Contacts:
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Media Relations
Alice S. Ericson, 860-403-5946
alice.ericson@phoenixwm.com
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Investor Relations
Naomi Baline Kleinman, 860-403-7100
pnx.ir@phoenixwm.com
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●
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the audited consolidated balance sheet as of Dec. 31, 2011 and consolidated statements of comprehensive income, changes in stockholders’ equity and cash flows for each of the years ended Dec. 31, 2011 and 2010;
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●
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the selected financial data as of and for each of the years ended Dec. 31, 2011, 2010, 2009 and 2008;
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●
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the unaudited consolidated statements of comprehensive income, unaudited consolidated balance sheets, unaudited statements of cash flow and unaudited statements of changes in stockholders’ equity for the year-to-date periods ended March 31 and June 30, 2012; and
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●
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the unaudited consolidated statements of comprehensive income for each of the quarterly periods ended March 31 and June 30, 2012 and in fiscal year 2011.
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Period
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As previously reported
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Correction of errors1
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Adjusted prior to the retrospective adoption
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Retrospective adoption2
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As restated and amended
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|||||||||||||||
Year ending 12/31/2010
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$ | 1,155.5 | $ | (151.0 | ) | $ | 1,004.5 | $ | (204.1 | ) | $ | 800.4 | ||||||||
Year ending 12/31/2011
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$ | 1,126.2 | $ | (264.0 | ) | $ | 862.2 | $ | (166.5 | ) | $ | 695.7 | ||||||||
Year-to-date 6/30/2012
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$ | 946.6 | $ | (294.3 | ) | $ | 652.3 | -- | $ | 652.3 |
Period
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As previously reported
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Correction of errors1
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Adjusted prior to the retrospective adoption
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Retrospective adoption2
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As restated and amended
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|||||||||||||||
Year ending 12/31/2010
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$ | (24.6 | ) | $ | (36.2 | ) | $ | (60.8 | ) | $ | 29.5 | $ | (31.3 | ) | ||||||
Year ending 12/31/2011
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$ | 30.1 | $ | (62.1 | ) | $ | (32.0 | ) | $ | 22.4 | $ | (9.6 | ) | |||||||
Year-to-date 6/30/2012
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$ | (14.5 | ) | $ | (28.6 | ) | $ | (43.1 | ) | -- | $ | (43.1 | ) |
Period
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As previously reported
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Correction of errors1
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Adjusted prior to the retrospective adoption
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Retrospective adoption2
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As restated and amended
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|||||||||||||||
Year ending 12/31/2010
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$ | (12.6 | ) | $ | (51.3 | ) | $ | (63.9 | ) | $ | 29.5 | $ | (34.4 | ) | ||||||
Year ending 12/31/2011
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$ | 8.1 | $ | (61.2 | ) | $ | (53.1 | ) | $ | 22.4 | $ | (30.7 | ) | |||||||
Year-to-date 6/30/2012
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$ | (21.3 | ) | $ | (27.6 | ) | $ | (48.9 | ) | -- | $ | (48.9 | ) |
1 Adjustments related to the correction of errors reflect amounts prior to the retrospective adoption of amended guidance to ASC 944, Financial Services – Insurance (ASU 2010-26).
2 Adjustments related to the retrospective adoption of amended guidance to ASC 944, Financial Services – Insurance (ASU 2010-26), have been updated from those originally disclosed in the First Quarter 2012 Quarterly Report on Form 10-Q filing to reflect the correction of errors identified related to the adoption of the amended guidance as well as indirect impact of the correction of errors associated with the restatement.
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●
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A $92.8 million charge stemming from the company’s annual actuarial assumption review conducted in the third and fourth quarters of 2012 in which interest rate assumptions were lowered. The review included the following:
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o
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a $44.1 million increase in universal life (UL) reserves related to the lower interest rate assumptions; and
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a $55.2 million deferred acquisition cost unlocking for traditional and UL product lines, offset by $6.5 million of positive reserve adjustments.
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●
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An additional $46.0 million increase in UL reserves, also reflecting the continued low interest rate environment.
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A $20.4 million impact from an increase in reserves for future guaranteed withdrawal benefit payments in the fixed indexed annuity block made in the third quarter of 2012.
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Consolidated Statements of Income
($ in millions, except per share data)
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2012
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2011
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As restated
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and amended
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REVENUES:
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Premiums
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$
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402.3
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$
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448.7
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Fee income
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556.2
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596.8
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Net investment income
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829.3
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822.9
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Net realized investment gains (losses):
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Total other-than-temporary impairment (“OTTI”) losses
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(51.7)
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(65.3)
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Portion of OTTI losses recognized in other comprehensive income (“OCI”)
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22.9
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38.5
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Net OTTI losses recognized in earnings
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(28.8)
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(26.8)
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Net realized investment gains (losses), excluding OTTI losses
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18.3
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(5.3)
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Net realized investment gains (losses)
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(10.5)
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(32.1)
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Gain on debt repurchase
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11.9
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0.2
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Total revenues
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$
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1,789.2
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$
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1,836.5
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BENEFITS AND EXPENSES:
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Policy benefits, excluding policyholder dividends
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$
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1,166.1
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$
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1,137.0
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Policyholder dividends
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294.8
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259.2
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Policy acquisition cost amortization
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200.0
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157.9
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Interest expense on indebtedness
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30.8
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31.8
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Other operating expenses
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253.5
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247.9
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Total benefits and expenses
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$
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1,945.2
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$
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1,833.8
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Income (loss) from continuing operations before income taxes
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(156.0)
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2.7
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Income tax expense (benefit)
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(3.7)
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12.3
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Income (loss) from continuing operations
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(152.3)
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(9.6)
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Loss from discontinued operations, net of income taxes
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(15.6)
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(21.6)
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Net loss
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(167.9)
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(31.2)
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Less: Net income (loss) attributable to noncontrolling interests
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0.6
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(0.5)
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Net loss attributable to The Phoenix Companies, Inc.
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$
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(168.5)
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$
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(30.7)
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LOSS PER SHARE: (1)
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Loss from continuing operations – basic
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$
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(26.40)
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$
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(1.65)
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Loss from continuing operations – diluted
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$
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(26.40)
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$
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(1.65)
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Loss from discontinued operations – basic
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$
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(2.70)
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$
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(3.71)
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Loss from discontinued operations – diluted
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$
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(2.70)
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$
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(3.71)
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Net loss attributable to The Phoenix Companies, Inc. – basic
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$
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(29.20)
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$
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(5.28)
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Net loss attributable to The Phoenix Companies, Inc. – diluted
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$
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(29.20)
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$
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(5.28)
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Basic weighted-average common shares outstanding (in thousands)
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5,770
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5,815(2)
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Diluted weighted-average common shares outstanding (in thousands)
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5,770
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5,815(2)
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(1)
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All share amounts for all periods reflect the 1-for-20 reverse stock split, which was effective August 10, 2012.
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(2)
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Weighted-average common shares outstanding have been updated to reflect the impact of an error, which had no material impact to EPS information, basic or diluted, for any period presented.
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Consolidated Balance Sheets
($ in millions, except share data)
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2012
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2011
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||||||
As restated
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and amended
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ASSETS:
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Available-for-sale debt securities, at fair value (amortized cost of $11,718.0 and $11,267.0)
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$ | 12,656.0 | $ | 11,797.0 | ||||
Available-for-sale equity securities, at fair value (cost of $27.5 and $32.6)
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34.8 | 35.7 | ||||||
Limited partnerships and other investments
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577.3 | 565.3 | ||||||
Policy loans, at unpaid principal balances
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2,354.7 | 2,379.3 | ||||||
Derivative instruments
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157.4 | 162.2 | ||||||
Fair value investments
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201.5 | 184.0 | ||||||
Total investments
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$ | 15,981.7 | $ | 15,123.5 | ||||
Cash and cash equivalents
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246.4 | 168.2 | ||||||
Accrued investment income
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170.3 | 175.6 | ||||||
Receivables
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666.5 | 648.6 | ||||||
Deferred policy acquisition costs
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902.2 | 1,119.2 | ||||||
Deferred income taxes, net
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49.4 | 120.6 | ||||||
Other assets
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243.1 | 230.1 | ||||||
Discontinued operations assets
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53.7 | 85.3 | ||||||
Separate account assets
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3,316.5 | 3,816.9 | ||||||
Total assets
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$ | 21,629.8 | $ | 21,488.0 | ||||
LIABILITIES:
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Policy liabilities and accruals
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$ | 12,656.7 | $ | 12,631.4 | ||||
Policyholder deposit funds
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3,040.7 | 2,432.2 | ||||||
Dividend obligations
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1,003.6 | 752.5 | ||||||
Indebtedness
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378.8 | 426.9 | ||||||
Other liabilities
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674.6 | 658.0 | ||||||
Discontinued operations liabilities
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48.4 | 74.4 | ||||||
Separate account liabilities
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3,316.5 | 3,816.9 | ||||||
Total liabilities
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$ | 21,119.3 | $ | 20,792.3 | ||||
STOCKHOLDERS’ EQUITY:
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Common stock, $.01 par value: 5.7 million and 5.8 million shares outstanding(1)
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$ | 0.1 | $ | 1.3 | ||||
Additional paid-in capital
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2,633.1 | 2,630.5 | ||||||
Accumulated other comprehensive loss
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(249.3 | ) | (230.7 | ) | ||||
Accumulated deficit
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(1,697.2 | ) | (1,528.7 | ) | ||||
Treasury stock, at cost: 0.7 million and 0.6 million shares(1)
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(182.9 | ) | (179.5 | ) | ||||
Total The Phoenix Companies, Inc. stockholders’ equity
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503.8 | 692.9 | ||||||
Noncontrolling interests
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6.7 | 2.8 | ||||||
Total stockholders’ equity
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510.5 | 695.7 | ||||||
Total liabilities and stockholders’ equity
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$ | 21,629.8 | $ | 21,488.0 |
(1)
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All share amounts for all periods reflect the 1-for-20 reverse stock split, which was effective August 10, 2012.
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