Net Income Falls At Lincoln, CNO Financial Group

Lincoln Financial Group reported third-quarter net income dropped 48 percent to $227 million from the year-ago period on revenue of $3.7 billion.

Operating income dropped 30 percent to $289 million compared with the year-ago quarter, the company also reported in a news release after the market close Wednesday.

Operating income per share diluted was $1.11, missing the average estimate of 10 analysts surveyed by Zacks Investment research by 41 cents per share, the company also reported.

The company reported third-quarter revenue of 3.72 billion, the company said, surpassing the estimate of three analysts surveyed by Zacks of $3.39 billion.

Third-quarter operating income from the annuities segment rose 6 percent to $259 million from the year-ago period, the company said.

Operating income in the third quarter from the company’s Retirement Plan Services segment rose by $2 million to $42 million compared with the year-ago quarter, the company also said.

Operating income from the life insurance segment in the third quarter was $36 million compared to $150 million in the year-ago period. This was due to $117 million related to deferred acquisition costs and reserve assumptions.

In the Group Protection segment, operating income rose to $17 million from $8 million in the year-ago period, the company also said. Sales dropped 35 percent to $61 million in the third quarter compared with the third quarter 2014 due to pricing changes.

CNO Financial

At CNO Financial Group, net income dropped 71 percent to $33.8 million, the company reported.

CNO Financial is a holding company for principally Bankers Life and Casualty Company, Colonial Penn Life Insurance Company and Washington National Insurance Company. These are all life insurance companies that target the middle market.

Third quarter net income per share diluted came to 18 cents compared to 54 cents in the year-ago period, the company said.

Adjusted for nonrecurring costs, net income was 30 cents per share diluted. This missed the average estimate of three analysts surveyed by Zacks Investment Research, who called for the company to deliver 34 cents per share.

Revenues came to $904 million, a drop of 6.5 percent from $967 million in the year-ago period, the company also said.

New annualized premium rose 1 percent to $104.6 million. Meanwhile, the number of third-party policies sold by Bankers Life agents but not included in new annualized premium rose 10 percent from the year-ago period.

Premium collected from the company’s operating segments was $880.9 million, an increase of 7 percent over the year-ago quarter, CNO said.

"Sales increases and solid customer retention delivered third quarter premium growth and expanded market reach," said Ed Bonach, CEO of CNO.

"Continued strong capital and liquidity levels provide us with numerous opportunities to focus on additional initiatives aimed at growing and advancing our businesses, and make steady progress on CNO's strategy to serve the U.S. middle-income market."

InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at cyril.tuohy@innfeedback.com.

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Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at cyril.tuohy@innfeedback.com.