-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MV0/n3tC+thn08TsGhTmKOW2jNF19R8YaBQwV12Y/vhYxFmoxOhMQNxIZU4zriU2 QyCDek0MJlsREtbz2uIIAQ== 0001068800-05-000051.txt : 20050127 0001068800-05-000051.hdr.sgml : 20050127 20050127171302 ACCESSION NUMBER: 0001068800-05-000051 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050127 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050127 DATE AS OF CHANGE: 20050127 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REINSURANCE GROUP OF AMERICA INC CENTRAL INDEX KEY: 0000898174 STANDARD INDUSTRIAL CLASSIFICATION: ACCIDENT & HEALTH INSURANCE [6321] IRS NUMBER: 431627032 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11848 FILM NUMBER: 05554679 BUSINESS ADDRESS: STREET 1: 1370 TIMBERLAKE MANOR PARKWAY CITY: CHESTERFIELD STATE: MO ZIP: 63017-6039 BUSINESS PHONE: 6367367000 MAIL ADDRESS: STREET 1: 1370 TIMBERLAKE MANOR PARKWAY CITY: CHESTERFIELD STATE: MO ZIP: 63017-6039 8-K 1 rga8k.txt ============================================================================== SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of Earliest Event Reported): January 27, 2005 REINSURANCE GROUP OF AMERICA, INCORPORATED (Exact Name of Registrant as Specified in its Charter) MISSOURI 1-11848 43-1627032 (State or other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification Number) 1370 TIMBERLAKE MANOR PARKWAY CHESTERFIELD, MISSOURI 63017 (Address of Principal Executive Office) (636) 736-7000 (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ============================================================================== ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On January 27, 2005, RGA issued a press release announcing its earnings for the three-month period ended December 31, 2004 and providing certain additional information. In addition, RGA announced in the press release that a conference call would be held on January 28, 2005 to discuss its financial and operating results for the three-month period ended December 31, 2004. A copy of the press release is furnished with this report as Exhibit 99.1 and incorporated by reference herein. The information in Item 2.02 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act"), or otherwise subject to the liabilities of such section, nor shall such information or exhibit be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. ITEM 7.01 REGULATION FD DISCLOSURE On January 27, 2005, RGA issued a press release announcing its earnings for the three-month period ended December 31, 2004 and providing certain additional information. In addition, RGA announced in the press release that a conference call would be held on January 28, 2005 to discuss its financial and operating results for the three-month period ended December 31, 2004. A copy of the press release is furnished with this report as Exhibit 99.1 and incorporated by reference herein. The information in Item 7.01 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto shall not be deemed to be "filed" for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of such section, nor shall such information or exhibit be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits. 99.1 Press Release of Reinsurance Group of America, Incorporated dated January 27, 2005. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Reinsurance Group Of America, Incorporated Date: January 27, 2005 By: /s/ Jack B. Lay -------------------------------------- Name: Jack B. Lay Title: Executive Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 99.1 Press Release of Reinsurance Group of America, Incorporated dated January 27, 2005. EX-99.1 2 ex99p1.txt Exhibit 99.1 [RGA logo] For further information, contact Jack B. Lay Executive Vice President and Chief Financial Officer (636) 736-7439 FOR IMMEDIATE RELEASE - --------------------- REINSURANCE GROUP OF AMERICA REPORTS FOURTH-QUARTER RESULTS; ------------------------------------------------------------ PROVIDES EARNINGS GUIDANCE FOR 2005 ----------------------------------- ST. LOUIS, January 27, 2005 - Reinsurance Group of America, Incorporated (NYSE:RGA), a leading global provider of life reinsurance, reported net income for the fourth quarter of $55.4 million, or $0.87 per diluted share, compared to net income of $56.1 million, or $0.99 per diluted share in the prior-year quarter. RGA uses a non-GAAP financial measure called operating income as a basis for analyzing financial results. The definition of operating income and reconciliations to GAAP net income are provided in the following tables. Operating income increased 15 percent to $55.5 million from $48.2 million, while diluted earnings per share rose 2 percent to $0.87 from $0.85 in the year-ago quarter. Fourth-quarter net income and operating income were both adversely affected by $7.5 million in pre-tax claims and reserves associated with the Indian Ocean tsunami, or approximately $0.08 per diluted share, after tax. Additionally, both net income and operating income in the current quarter include the negative effect of a $10.0 million pre-tax, or approximately $0.10 per diluted share after tax, increase in reserves associated with the reinsurance of Argentine pension obligations currently in run-off. Fourth-quarter net premiums totaled $916.8 million compared to $942.4 million a year ago, reflecting the inclusion in the 2003 quarter of six months of results from the company's transaction with Allianz Life Insurance Company of North America (Allianz). Net investment income totaled $168.2 million versus $120.3 million the year before. Approximately $14.6 million of that increase was offset by additional amortization of deferred acquisition costs, a result of the conversion of a large annuity treaty from a funds-withheld structure to a coinsurance structure. - more - Add One A. Greig Woodring, president and chief executive officer, commented, "We are pleased with the fourth-quarter results, particularly when you consider that they included our estimate of the impact of the devastating tsunami and the Argentine pension reserve strengthening. The U.S. segment reported good results for the quarter and year. Pre-tax net income totaled $71.8 million for the quarter compared with $72.4 million in the prior-year quarter. Pre-tax operating income totaled $77.5 million for the quarter compared with $58.0 million in the prior-year quarter, a 34 percent increase. Mortality experience for the quarter and the year as a whole was within our range of expectations. Pre-tax operating income in the U.S. Asset Intensive sub-segment benefited by approximately $3.2 million, pre-tax, from the aforementioned conversion of a large annuity treaty from a funds-withheld structure to a coinsurance structure. For the year, the U.S. reported more than $2.2 billion in net premiums, a 23 percent increase over the prior year, attributable in part to an entire year of premium production from the Allianz block of business. Pre-tax operating income for the year totaled $289.5 million, up from $210.6 million in 2003. "For the quarter, our Canada operations reported pre-tax net income of $20.5 million compared to $16.0 million a year ago. Pre-tax operating income was up 17 percent to $17.2 million from $14.7 million. The 2004 quarter includes a $1.6 million, pre-tax, provision for tsunami claims. Mortality experience continues to be favorable. Net premiums increased $11.6 million, or 19 percent for the quarter, and totaled $72.6 million. Approximately $5.2 million of the increase in net premiums and approximately $1.3 million of the increase in pre-tax operating income were the result of a favorable currency exchange rate. For the year, pre-tax operating income totaled $62.0 million, up 34 percent from $46.1 million in 2003. "Other International operations, which include our Asia Pacific and Europe and South Africa segments, reported 18 percent growth in net premiums, increasing to $233.7 million from $197.5 million. Stronger foreign currencies contributed approximately $12.7 million to the premium growth. However, pre-tax net income and pre-tax operating income decreased from the prior year. Pre-tax net income totaled $6.5 million compared to $17.7 million in the prior-year quarter, which benefited from unusually high premium flows and favorable mortality results. Pre-tax operating income for the quarter totaled $5.9 million, a decline from $15.7 million in the prior-year period. Bottom-line results were adversely affected by $5.3 million, pre-tax, due to the tsunami in Southeast Asia. Additionally, adverse mortality in the UK and parts of Asia Pacific and various adjustments related to enhancements of our business administration process in - more - Add Two Australia totaled approximately $4.0 million, pre-tax. The enhancements to our business administration process were a reaction to the increasing levels of business within that segment and our desire to improve the reliability of that administration function. Foreign currency appreciation contributed approximately $0.5 million to current quarter pre-tax operating income. As previously indicated, quarterly results in these newer operations may be more volatile than our North American operations due to the smaller size and relative aging of this business. For the year, our international operations reported pre-tax operating income of $38.5 million, up from $36.3 million in 2003. "The Corporate segment reported a pre-tax net operating loss of $18.9 million. That amount includes the impact of the $10.0 million in additional reserves for the Argentine pension business. We thought it was appropriate to add to our Argentine pension reserves given the pattern of claims development to date. This business will likely be in a run-off status for another two years or so." Fourth-quarter results benefited from a lower effective tax rate as a result of reduced federal income taxes associated with the favorable resolution of a tax position taken by the company. The related reduction in tax liabilities amounted to $1.9 million, or $0.03 per diluted share. For the year, consolidated net income totaled $221.9 million, or $3.52 per diluted share, compared to $173.1 million, or $3.36 per diluted share, in the year-ago period. Operating income increased to $224.6 million, or $3.57 per diluted share, from $166.2 million, or $3.22 per diluted share the year before, an 11 percent increase on a per-share basis. Operating income in 2004 benefited from stronger foreign currencies by approximately $4.6 million, after tax, compared to the prior year, or approximately $0.07 per diluted share. Consolidated net premiums were up 27 percent, to $3,347.4 million from $2,643.2 million. Woodring concluded, "We have completed what we consider to be a very successful year. The $3.57 per diluted share in operating earnings exceeds the midpoint of the guidance range that we provided last January, and we had a strong year in terms of premium growth. Our success in 2004 is a continuation of the good results that we have seen for several years, and we head into 2005 on solid footing in terms of our market position and financial strength. Specifically, for 2005, we expect consolidated operating earnings per diluted share to be within a range of $3.85 to $4.15 and consolidated net premium growth of 15 percent to 20 percent." - more - Add Three The company also announced that its board of directors declared a regular quarterly dividend of $0.09, payable February 28 to shareholders of record as of February 7. A conference call to discuss the company's fourth-quarter results will begin at 9 a.m. Eastern Time on Friday, January 28. Interested parties may access the call by dialing 800-231-9012 (domestic) or 719-457-2617 (international). The access code is 292650. A live audio webcast of the conference call will be available on the company's investor relations web page at www.rgare.com. A replay of the conference call will be available at the same address for three months following the conference call. A replay of the conference call will also be available via telephone through February 4 at 888-203-1112 (domestic) or 719-457-0820, access code 292650. Reinsurance Group of America, Incorporated, through its subsidiaries, RGA Reinsurance Company and RGA Life Reinsurance Company of Canada, is among the largest global providers of life reinsurance. In addition to its U.S. and Canadian operations, Reinsurance Group of America, Incorporated has subsidiary companies or offices in Australia, Barbados, Hong Kong, India, Ireland, Japan, Mexico, South Africa, South Korea, Spain, Taiwan, and the United Kingdom. Worldwide, the company has approximately $1.5 trillion of life reinsurance in force, and assets of $14.0 billion. MetLife, Inc. is the beneficial owner of approximately 52 percent of RGA's outstanding shares. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS - --------------------------------------------------------- This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements relating to projections of the earnings, revenues, income or loss, future financial performance and growth potential of Reinsurance Group of America, Incorporated and its subsidiaries (which we refer to in the following paragraphs as "we," "us" or "our"). The words "intend," "expect," "project," "estimate," "predict," "anticipate," "should," "believe," and other similar expressions also are intended to identify forward-looking statements. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results, performance and achievements could differ materially from those set forth in, contemplated by or underlying the forward-looking statements. - more - Add Four Numerous important factors could cause actual results and events to differ materially from those expressed or implied by forward-looking statements including, without limitation, (1) adverse changes in mortality, morbidity or claims experience, (2) changes in our financial strength and credit ratings or those of MetLife, Inc. ("MetLife"), the beneficial owner of a majority of our common shares, or its subsidiaries, and the effect of such changes on our future results of operations and financial condition, (3) general economic conditions affecting the demand for insurance and reinsurance in our current and planned markets, (4) market or economic conditions that adversely affect our ability to make timely sales of investment securities, (5) risks inherent in our risk management and investment strategy, including changes in investment portfolio yields due to interest rate or credit quality changes, (6) fluctuations in U.S. or foreign currency exchange rates, interest rates, or securities and real estate markets, (7) adverse litigation or arbitration results, (8) the adequacy of reserves relating to settlements, awards and terminated and discontinued lines of business, (9) the stability of governments and economies in the markets in which we operate, (10) competitive factors and competitors' responses to our initiatives, (11) the success of our clients, (12) successful execution of our entry into new markets, (13) successful development and introduction of new products, (14) our ability to successfully integrate and operate reinsurance business that we acquire, including without limitation, the traditional life reinsurance business of Allianz Life, (15) regulatory action that may be taken by state Departments of Insurance with respect to us, MetLife, or its subsidiaries, (16) our dependence on third parties, including those insurance companies and reinsurers to which we cede some reinsurance, third-party investment managers and others, (17) changes in laws, regulations, and accounting standards applicable to us, our subsidiaries, or our business, and (18) other risks and uncertainties described in this document and in our other filings with the Securities and Exchange Commission. Forward-looking statements should be evaluated together with the many risks and uncertainties that affect our business, including those mentioned in this document and described in the periodic reports we file with the Securities and Exchange Commission. These forward-looking statements speak only as of the date on which they are made. We do not undertake any obligations to update these forward-looking statements, even though our situation may change in the future. We qualify all of our forward-looking statements by these cautionary statements. - more - Add Five Operating Income RGA uses a non-GAAP financial measure called operating income as a basis for analyzing financial results. This measure also serves as a basis for establishing target levels and awards under RGA's management incentive programs. Management believes that operating income, on a pre-tax and after-tax basis, better measures the ongoing profitability and underlying trends of the company's continuing operations, primarily because that measure excludes the effect of net realized capital gains and losses, as well as changes in the fair value of embedded derivatives and related deferred acquisition costs. These items tend to be highly variable, primarily due to the credit market and interest rate environment and are not necessarily indicative of the performance of the company's underlying businesses. Additionally, operating income excludes any net gain or loss from discontinued operations and the cumulative effect of any accounting changes, which management believes are not indicative of the company's ongoing operations. The definition of operating income can vary by company and is not considered a substitute for GAAP net income. REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Net Income From Continuing Operations to Operating Income (Dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended December 31, December 31, ------------------ ------------------- (Unaudited) 2004 2003 2004 2003 ---- ---- ---- ---- GAAP net income-continuing operations $55,917 $59,349 $245,300 $178,319 Realized investment (gains)/losses (36) (2,930) (22,044) (3,786) Change in value of embedded derivatives 146 (28,337) (104) (28,337) DAC offsets for embedded derivatives and realized investment (gains) / losses, net (509) 20,084 1,472 19,997 ------------------------------------- Operating income $55,518 $48,166 $224,624 $166,193
- more - Add Six REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Pre-tax Net Income From Continuing Operations to Pre-tax Operating Income (Dollars in thousands)
(Unaudited) Three Months Ended December 31, 2004 Realized Change in Pre-tax investment value of Pre-tax net (gains)/ embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $ 63,927 $ 642 $ -- $ 64,569 Asset Intensive 4,599 6,972 (1) (1,979)(2) 9,592 Financial Reinsurance 3,310 -- -- 3,310 --------------------------------------------- Total U.S. 71,836 7,614 (1,979) 77,471 Canada Operations 20,519 (3,349) -- 17,170 Asia Pacific Operations 2,520 (228) -- 2,292 Europe & South Africa 4,016 (437) -- 3,579 --------------------------------------------- Other Intl Operations 6,536 (665) -- 5,871 Corporate & Other (19,012) 117 -- (18,895) --------------------------------------------- Consolidated $ 79,879 $ 3,717 $ (1,979) $ 81,617 ============================================= (1) Asset Intensive is net of $1,419 DAC offset. (2) Asset Intensive is net of DAC offsets of $18,612 included in change in deferred acquisition cost associated with change in value of embedded derivative, ($20,782) DAC offset included in policy acquisition costs and other insurance expenses, and $25,911 investment income offset. Three Months Ended December 31, 2003 Realized Change in Pre-tax investment value of Pre-tax net (gains)/ embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $ 54,324 $ (1,302) $ -- $ 53,022 Asset Intensive 14,631 (173)(1) (12,931)(2) 1,527 Financial Reinsurance 3,431 -- -- 3,431 --------------------------------------------- Total U.S. 72,386 (1,475) (12,931) 57,980 Canada Operations 15,979 (1,265) -- 14,714 Asia Pacific Operations 6,838 139 -- 6,977 Europe & South Africa 10,863 (2,111) -- 8,752 --------------------------------------------- Other Intl Operations 17,701 (1,972) -- 15,729 Corporate & Other (14,325) 361 -- (13,964) --------------------------------------------- Consolidated $ 91,741 $ (4,351) $ (12,931) $ 74,459 ============================================= (1) Asset Intensive is net of $233 DAC offset. (2) Asset Intensive is net of $30,665 DAC offset.
- more - Add Seven REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Reconciliation of Pre-tax Net Income From Continuing Operations to Pre-tax Operating Income (Dollars in thousands)
(Unaudited) Twelve Months Ended December 31, 2004 Realized Change in Pre-tax investment value of Pre-tax net (gains)/ embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $260,067 $ (9,738) $ -- $250,329 Asset Intensive 17,254 7,346 (1) 1,954(2) 26,554 Financial Reinsurance 12,603 -- -- 12,603 --------------------------------------------- Total U.S. 289,924 (2,392) 1,954 289,486 Canada Operations 73,485 (11,508) -- 61,977 Asia Pacific Operations 12,605 (670) -- 11,935 Europe & South Africa 31,682 (5,080) -- 26,602 ------------------------------------------- Other Intl Operations 44,287 (5,750) -- 38,537 Corporate & Other (38,503) (9,673) -- (48,176) --------------------------------------------- Consolidated $369,193 $(29,323) $ 1,954 $341,824 ============================================= (1) Asset Intensive is net of $150 DAC offset. (2) Asset Intensive is net of DAC offsets of $22,896 included in change in deferred acquisition cost associated with change in value of embedded derivative, ($20,782) DAC offset included in policy acquisition costs and other insurance expenses, and $25,944 investment income offset. Twelve Months Ended December 31, 2003 Realized Change in Pre-tax investment value of Pre-tax net (gains)/ embedded operating income losses, derivatives, income (loss) net net (loss) ------- ---------- ------------ -------- U.S. Operations: Traditional $178,314 $ 5,715 $ -- $184,029 Asset Intensive 25,395 1,774(1) (12,931)(2) 14,238 Financial Reinsurance 12,379 -- -- 12,379 --------------------------------------------- Total U.S. 216,088 7,489 (12,931) 210,646 Canada Operations 59,564 (13,423) -- 46,141 Asia Pacific Operations 19,262 761 -- 20,023 Europe & South Africa 20,272 (3,999) -- 16,273 --------------------------------------------- Other Intl Operations 39,534 (3,238) -- 36,296 Corporate & Other (43,576) 3,912 -- (39,664) --------------------------------------------- Consolidated $271,610 $ (5,260) $(12,931) $253,419 ============================================= (1) Asset Intensive is net of $100 DAC offset. (2) Asset Intensive is net of $30,665 DAC offset.
- more - Add Eight REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Statements of Income (Dollars in thousands)
Three Months Ended Twelve Months Ended ------------------------------------------- (Unaudited) December 31, December 31, - -------------------------------------------------------------------- 2004 2003 2004 2003 ---- ---- ---- ---- Revenues: Net premiums $ 916,812 $ 942,417 $3,347,448 $2,643,163 Investment income, net of related expenses 168,201 120,345 580,528 465,579 Realized investment gains (losses), net (2,298) 4,584 29,473 5,360 Change in value of embedded derivatives 25,720 43,596 26,104 43,596 Other revenues 15,383 13,630 55,366 47,300 ------------------------------------------- Total revenues 1,123,818 1,124,572 4,038,919 3,204,998 Benefits and expenses: Claims and other policy benefits 755,063 774,350 2,678,537 2,108,431 Interest credited 60,245 48,788 198,931 179,702 Policy acquisition costs and other insurance expenses 165,714 127,262 591,029 458,165 Change in deferred acquisition cost associated with change in value of embedded derivatives 18,612 30,665 22,896 30,665 Other operating expenses 34,603 42,361 139,896 119,636 Interest expense 9,702 9,405 38,437 36,789 ------------------------------------------- Total benefits and expenses 1,043,939 1,032,831 3,669,726 2,933,388 Income from continuing operations before income taxes 79,879 91,741 369,193 271,610 Provision for income taxes 23,962 32,392 123,893 93,291 ------------------------------------------- Income from continuing operations 55,917 59,349 245,300 178,319 Discontinued operations: Loss from discontinued accident and health operations, net of income taxes (497) (3,805) (23,048) (5,723) Cumulative effect of change in accounting principle -- 545 (361) 545 ------------------------------------------- Net income $ 55,420 $ 56,089 $ 221,891 $ 173,141 ===========================================
- more - Add Nine REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Statements of Income (Dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended --------------------------------------- (Unaudited) December 31, December 31, - -------------------------------------------------------------------------- 2004 2003 2004 2003 ---- ---- ---- ---- Earnings per share from continuing operations: Basic earnings per share $ 0.90 $ 1.06 $ 3.94 $ 3.47 Diluted earnings per share $ 0.88 $ 1.05 $ 3.90 $ 3.46 Diluted earnings before realized investment gains/ (losses), change in value of embedded derivatives, and related deferred acquisition costs $ 0.87 $ 0.85 $ 3.57 $ 3.22 Earnings per share from net income: Basic earnings per share $ 0.89 $ 1.00 $ 3.56 $ 3.37 Diluted earnings per share $ 0.87 $ 0.99 $ 3.52 $ 3.36 Weighted average number of common and common equivalent shares outstanding (in thousands) 63,632 56,516 62,964 51,598
- more - Add Ten REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Condensed Consolidated Business Summary
At or For the Twelve Months Ended (Unaudited) December 31, - --------------------------------------------------------------------- 2004 2003 ---- ---- Gross life reinsurance in force (in billions) North American business $1,095.7 $ 976.1 International business 363.2 276.1 Gross life reinsurance written (in billions) North American business 188.1 434.3 International business 91.0 110.1 Consolidated cash and invested assets (in millions) 10,716.3 8,968.0 Invested asset book yield - trailing three months excluding funds withheld 5.93% 6.06% Investment portfolio mix Cash and short-term investments 1.72% 1.27% Fixed maturity securities 56.21% 51.02% Mortgage loans 5.69% 5.34% Policy loans 8.93% 10.07% Funds withheld at interest 25.52% 30.30% Other invested assets 1.93% 2.00% Book value per share outstanding $ 36.50 $ 31.33 Book value per share outstanding, before impact of FAS 115* $ 32.58 $ 28.59 Treasury stock 683,245 967,927 * Book value per share outstanding, before impact of FAS 115, is a non-GAAP financial measure that management believes is important in evaluating the balance sheet ignoring the effect of mark-to-market adjustments that primarily relate to changes in interest rates and credit spreads on investment securities since they were acquired.
- more - Add Eleven REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES U.S. OPERATIONS (Unaudited) (Dollars in thousands)
Three Months Ended December 31, 2004 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $607,953 $ 1,234 $ -- $609,187 Investment income, net of related expenses 58,748 69,766 44 128,558 Realized investment losses, net (642) (5,553) -- (6,195) Change in value of embedded derivatives -- 25,720 -- 25,720 Other revenues 964 3,514 7,185 11,663 -------------------------------------------- Total revenues 667,023 94,681 7,229 768,933 Benefits and expenses: Claims and other policy benefits 486,117 (305) -- 485,812 Interest credited 14,022 45,630 -- 59,652 Policy acquisition costs and other insurance expenses 93,740 24,913 2,598 121,251 Change in deferred ac- quisition cost asso- ciated with change in value of embedded derivatives -- 18,612 -- 18,612 Other operating expenses 9,217 1,232 1,321 11,770 -------------------------------------------- Total benefits and expenses 603,096 90,082 3,919 697,097 Income before income taxes $ 63,927 $ 4,599 $ 3,310 $ 71,836 ======== ======== ======== ======== Three Months Ended December 31, 2003 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $682,118 $ 1,118 $ -- $683,236 Investment income, net of related expenses 46,651 41,204 8 87,863 Realized investment gains, net 1,302 406 -- 1,708 Change in value of embedded derivatives -- 43,596 -- 43,596 Other revenues 734 1,489 7,123 9,346 -------------------------------------------- Total revenues 730,805 87,813 7,131 825,749 Benefits and expenses: Claims and other policy benefits 568,981 (1,190) -- 567,791 Interest credited 13,148 35,197 -- 48,345 Policy acquisition costs and other insurance expenses 77,620 7,530 2,453 87,603 Change in deferred ac- quisition cost asso- ciated with change in value of embedded derivatives -- 30,665 -- 30,665 Other operating expenses 16,732 980 1,247 18,959 -------------------------------------------- Total benefits and expenses 676,481 73,182 3,700 753,363 Income before income taxes $ 54,324 $ 14,631 $ 3,431 $ 72,386 ======== ======== ======== ========
- more - Add Twelve REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES U.S. OPERATIONS (Unaudited) (Dollars in thousands)
Twelve Months Ended December 31, 2004 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $2,207,817 $ 4,833 $ -- $2,212,650 Investment income, net of related expenses 220,080 215,862 173 436,115 Realized investment gain/(losses), net 9,738 (7,196) -- 2,542 Change in value of embedded derivatives -- 26,104 -- 26,104 Other revenues 4,157 9,735 27,419 41,311 ---------------------------------------------- Total revenues 2,441,792 249,338 27,592 2,718,722 Benefits and expenses: Claims and other policy benefits 1,758,452 9,751 2 1,768,205 Interest credited 50,290 146,480 -- 196,770 Policy acquisition costs and other insurance expenses 329,006 48,243 9,521 386,770 Change in deferred ac- quisition costs asso- ciated with change in value of embedded derivatives -- 22,896 -- 22,896 Other operating expenses 43,977 4,714 5,466 54,157 ---------------------------------------------- Total benefits and expenses 2,181,725 232,084 14,989 2,428,798 Income before income taxes $ 260,067 $ 17,254 $ 12,603 $ 289,924 ========== ========= ======== ========== Twelve Months Ended December 31, 2003 Asset- Financial Total Revenues: Traditional Intensive Reinsurance U.S. ----------- --------- ----------- ------ Net premiums $1,797,478 $ 4,315 $ -- $1,801,793 Investment income, net of related expenses 181,897 164,127 105 346,129 Realized investment losses, net (5,715) (1,674) -- (7,389) Change in value of embedded derivatives -- 43,596 -- 43,596 Other revenues 3,920 6,524 27,302 37,746 ---------------------------------------------- Total revenues 1,977,580 216,888 27,407 2,221,875 Benefits and expenses: Claims and other policy benefits 1,457,886 2,976 -- 1,460,862 Interest credited 58,317 119,621 -- 177,938 Policy acquisition costs and other insurance expenses 241,877 34,422 9,900 286,199 Change in deferred ac- quisition costs asso- ciated with change in value of embedded derivatives -- 30,665 -- 30,665 Other operating expenses 41,186 3,809 5,128 50,123 ---------------------------------------------- Total benefits and expenses 1,799,266 191,493 15,028 2,005,787 Income before income taxes $ 178,314 $ 25,395 $ 12,379 $ 216,088 ========== ========= ======== ==========
- more - Add Thirteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES CANADIAN OPERATIONS (Unaudited) (Dollars in thousands)
Three Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $ 72,643 $ 60,991 Investment income, net of related expenses 27,582 23,693 Realized investment gains, net 3,349 1,265 Other revenues (6) (21) --------------------- Total revenues 103,568 85,928 Benefits and expenses: Claims and other policy benefits 72,109 61,964 Interest credited 515 399 Policy acquisition costs and other insurance expenses 7,472 4,579 Other operating expenses 2,953 3,007 -------------------- Total benefits and expenses 83,049 69,949 Income before income taxes $ 20,519 $ 15,979 ======== ======== Twelve Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $253,852 $214,738 Investment income, net of related expenses 100,141 87,212 Realized investment gains, net 11,508 13,423 Other revenues 32 (212) --------------------- Total revenues 365,533 315,161 Benefits and expenses: Claims and other policy benefits 250,542 223,375 Interest credited 1,840 1,488 Policy acquisition costs and other insurance expenses 28,505 20,293 Other operating expenses 11,161 10,441 -------------------- Total benefits and expenses 292,048 255,597 Income before income taxes $ 73,485 $ 59,564 ======== ========
- more - Add Fourteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Europe and South Africa (Unaudited) (Dollars in thousands)
Three Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $125,617 $104,374 Investment income, net of related expenses 1,328 1,061 Realized investment gains, net 437 2,111 Other revenues (14) 1,049 -------------------- Total revenues 127,368 108,595 Benefits and expenses: Claims and other policy benefits 82,233 69,227 Policy acquisition costs and other insurance expenses 35,083 23,546 Other operating expenses 5,786 4,638 Interest expense 250 321 -------------------- Total benefits and expenses 123,352 97,732 Income before income taxes $ 4,016 $ 10,863 ======== ========= Twelve Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $478,580 $364,203 Investment income, net of related expenses 5,125 3,869 Realized investment gains, net 5,080 3,999 Other revenues 1,541 1,067 -------------------- Total revenues 490,326 373,138 Benefits and expenses: Claims and other policy benefits 314,128 230,895 Policy acquisition costs and other insurance expenses 121,708 105,062 Other operating expenses 21,472 15,866 Interest expense 1,336 1,043 -------------------- Total benefits and expenses 458,644 352,866 Income before income taxes $ 31,682 $ 20,272 ======== ========
- more - Add Fifteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES Asia Pacific (Unaudited) (Dollars in thousands)
Three Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $108,043 $ 93,174 Investment income, net of related expenses 4,951 2,494 Realized investment gains/(losses), net 228 (139) Other revenues 1,959 295 -------------------- Total revenues 115,181 95,824 Benefits and expenses: Claims and other policy benefits 103,308 69,803 Policy acquisition costs and other insurance expenses 1,378 14,112 Other operating expenses 7,470 4,817 Interest expense 505 254 -------------------- Total benefits and expenses 112,661 88,986 Income before income taxes $ 2,520 $ 6,838 ======== ======== Twelve Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $399,122 $259,010 Investment income, net of related expenses 16,113 10,692 Realized investment gains/(losses), net 670 (761) Other revenues 5,121 1,191 -------------------- Total revenues 421,026 270,132 Benefits and expenses: Claims and other policy benefits 330,144 185,358 Policy acquisition costs and other insurance expenses 52,300 47,513 Other operating expenses 24,363 16,903 Interest expense 1,614 1,096 -------------------- Total benefits and expenses 408,421 250,870 Income before income taxes $ 12,605 $ 19,262 ======== ========
- more - Add Sixteen REINSURANCE GROUP OF AMERICA, INCORPORATED AND SUBSIDIARIES CORPORATE AND OTHER (Dollars in thousands) (Unaudited)
Three Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $ 1,322 $ 642 Investment income, net of related expenses 5,782 5,234 Realized investment losses, net (117) (361) Other revenues 1,781 2,961 -------------------- Total revenues 8,768 8,476 Benefits and expenses: Claims and other policy benefits 11,601 5,565 Interest credited 78 44 Policy acquisition costs and other insurance expenses 530 (2,578) Other operating expenses 6,624 10,940 Interest expense 8,947 8,830 -------------------- Total benefits and expenses 27,780 22,801 Loss before income taxes $(19,012) $(14,325) ======== ======== Twelve Months Ended December 31, 2004 2003 ---- ---- Revenues: Net premiums $ 3,244 $ 3,419 Investment income, net of related expenses 23,034 17,677 Realized investment gains/(losses), net 9,673 (3,912) Other revenues 7,361 7,508 -------------------- Total revenues 43,312 24,692 Benefits and expenses: Claims and other policy benefits 15,518 7,941 Interest credited 321 276 Policy acquisition costs and other insurance expenses 1,746 (902) Other operating expenses 28,743 26,303 Interest expense 35,487 34,650 -------------------- Total benefits and expenses 81,815 68,268 Loss before income taxes $(38,503) $(43,576) ========= ========
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