Q4 2021 Investor Supplement
Table of Contents
Page |
|
Consolidated Financial Highlights |
|
Selected Financial Data - Five Year History |
|
Consolidated Statements of Operations |
|
Consolidated Balance Sheets |
6 |
Capital Metrics |
7 |
Property & Casualty Segment |
|
Statements of Operations |
8 |
Underwriting Results and Informational Data |
9 |
Supplemental Segment and Informational Data |
10 |
Retirement Segment |
|
Statements of Operations and Informational Data |
11 |
Account Value Rollforward |
12 |
Life Segment |
|
Statements of Operations and Informational Data |
13 |
Corporate & Other Segment |
|
Statements of Operations |
14 |
Investment Earnings Before Taxes Consolidated |
15 |
Composition of Invested Assets Consolidated |
16 |
Appendix: Reconciliations of GAAP Measures to Non-GAAP Measures |
17 |
Reconciliation of Net Income to Core Earnings |
18 |
Reconciliation of Retuon Equity |
19 |
Reconciliation of Book Value per Common Share to Book Value per Common Share, Excluding Net Unrealized Gains on |
20 |
Reconciliation of Debt to Total Capitalization to Debt to Total Capitalization, Excluding Net Unrealized Gains on |
|
Reconciliation of Investment Yield on Fixed Income Portfolio |
21 |
Operating Ratios - Property & Casualty |
22 |
Ratings and Contact Information |
24 |
Note: The information contained in this document includes measures which are based on methodologies other than accounting principles generally accepted in
Horace Mann Educators Corporation I Fourth-Quarter 2021 Investor Supplement
Consolidated Financial Highlights
($ in millions, except per share data) |
Three Months Ended |
Year Ended |
||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||
2021 |
2021 |
2021 |
2021 |
2020 |
2021 |
2020 |
||||||||||||||
Premiums and contract charges earned |
$ |
210.8 |
$ |
225.4 |
$ |
225.8 |
$ |
227.6 |
$ |
233.7 |
$ |
889.6 |
$ |
930.7 |
||||||
Net investment income |
114.1 |
103.7 |
109.2 |
95.5 |
101.2 |
422.5 |
357.6 |
|||||||||||||
Net investment (losses) gains |
(0.4) |
(6.5) |
4.9 |
(9.0) |
10.5 |
(11.0) |
(2.3) |
|||||||||||||
Other income |
6.9 |
7.0 |
7.2 |
7.9 |
6.9 |
29.0 |
24.4 |
|||||||||||||
Total revenues |
$ |
331.4 |
$ |
329.6 |
$ |
347.1 |
$ |
322.0 |
$ |
352.3 |
$ |
1,330.1 |
$ |
1,310.4 |
||||||
Net income |
$ |
40.5 |
$ |
16.3 |
$ |
46.7 |
$ |
39.3 |
$ |
47.8 |
$ |
142.8 |
$ |
133.3 |
||||||
Core earnings* |
40.8 |
21.4 |
42.8 |
46.4 |
47.5 |
151.4 |
143.1 |
|||||||||||||
At Period End |
||||||||||||||||||||
Total assets |
$ |
14,383.9 |
$ |
14,266.0 |
$ |
14,190.1 |
$ |
13,745.5 |
$ |
13,471.8 |
$ |
14,383.9 |
$ |
13,471.8 |
||||||
Total policy liabilities |
7,258.8 |
7,270.5 |
7,211.7 |
7,182.8 |
7,148.6 |
7,258.8 |
7,148.6 |
|||||||||||||
Debt |
502.6 |
388.6 |
413.5 |
437.4 |
437.3 |
502.6 |
437.3 |
|||||||||||||
Shareholders' equity |
1,807.4 |
1,796.4 |
1,816.6 |
1,692.9 |
1,790.1 |
1,807.4 |
1,790.1 |
|||||||||||||
Per Share and Shares Data (in millions) |
||||||||||||||||||||
Net income per share (basic) |
$ |
0.96 |
$ |
0.39 |
$ |
1.11 |
$ |
0.94 |
$ |
1.14 |
$ |
3.40 |
$ |
3.18 |
||||||
Core earnings per share (basic)* |
0.97 |
0.51 |
1.02 |
1.11 |
1.13 |
3.61 |
3.41 |
|||||||||||||
Net income per share (diluted) |
0.96 |
0.39 |
1.11 |
0.93 |
1.13 |
3.39 |
3.17 |
|||||||||||||
Core earnings per share (diluted)* |
0.97 |
0.50 |
1.02 |
1.10 |
1.13 |
3.59 |
3.40 |
|||||||||||||
Weighted average shares (basic) |
42.0 |
42.0 |
42.0 |
41.9 |
42.0 |
42.0 |
41.9 |
|||||||||||||
Dilutive effect of share equivalents |
0.2 |
0.2 |
0.1 |
0.2 |
0.2 |
0.2 |
0.1 |
|||||||||||||
Weighted average shares (diluted) |
42.2 |
42.2 |
42.1 |
42.1 |
42.2 |
42.2 |
42.0 |
|||||||||||||
Book value per share |
$ |
43.66 |
$ |
43.30 |
$ |
43.78 |
$ |
40.83 |
$ |
43.22 |
$ |
43.66 |
$ |
43.22 |
||||||
Per share impact of net unrealized investment gains on fixed maturity securities |
7.02 |
7.40 |
8.00 |
5.88 |
8.84 |
7.02 |
8.84 |
|||||||||||||
Book value per share excluding net unrealized investment gains on fixed maturity securities* |
$ |
36.64 |
$ |
35.90 |
$ |
35.78 |
$ |
34.95 |
$ |
34.38 |
$ |
36.64 |
$ |
34.38 |
||||||
Dividends paid per share |
$ |
0.31 |
$ |
0.31 |
$ |
0.31 |
$ |
0.31 |
$ |
0.30 |
$ |
1.24 |
$ |
1.20 |
||||||
Financial Ratios |
||||||||||||||||||||
Net Income ROE - LTM(1) |
8.0 % |
8.5 % |
9.8 % |
9.3 % |
8.1 % |
8.0 % |
8.1 % |
|||||||||||||
Net Income ROE - Annualized |
9.0 % |
3.6 % |
10.6 % |
9.0 % |
10.9 % |
7.9 % |
7.9 % |
|||||||||||||
Core ROE - LTM* |
10.3 % |
10.9 % |
12.1 % |
11.2 % |
10.5 % |
10.3 % |
10.5 % |
|||||||||||||
Core ROE - Annualized* |
10.9 % |
5.8 % |
11.7 % |
12.9 % |
13.5 % |
10.3 % |
10.4 % |
|||||||||||||
Debt to total capitalization excluding net unrealized investment gains on fixed maturity securities* |
24.9 % |
20.7 % |
21.8 % |
23.2 % |
23.5 % |
24.9 % |
23.5 % |
|||||||||||||
Investment yield on fixed income portfolio, pretax - annualized* |
4.27 % |
4.30 % |
4.25 % |
4.16 % |
4.20 % |
4.25 % |
4.23 % |
|||||||||||||
- LTM = Last twelve months.
Horace Mann Educators Corporation I Fourth-Quarter 2021 Investor Supplement |
Page 3 |
Selected Financial Data - Five Year History
($ in millions, except per share data) |
Year Ended |
|||||||||||||
2021 |
2020 |
2019(1) |
2018 |
2017 |
||||||||||
Consolidated Statement of Operations Data |
||||||||||||||
Premiums and contract charges earned |
$ |
889.6 |
$ |
930.7 |
$ |
898.0 |
$ |
817.3 |
$ |
794.7 |
||||
Net investment income |
422.5 |
357.6 |
365.1 |
376.5 |
373.6 |
|||||||||
Net income |
142.8 |
133.3 |
184.4 |
18.3 |
169.4 |
|||||||||
Core earnings* |
151.4 |
143.1 |
92.2 |
28.4 |
72.1 |
|||||||||
Net income ROE - Annualized |
7.9 % |
7.9 % |
12.9 % |
1.3 % |
12.1 % |
|||||||||
Core ROE - Annualized* |
10.3 % |
10.4 % |
7.3 % |
2.4 % |
6.2 % |
|||||||||
At Period End |
||||||||||||||
Total assets |
$ |
14,383.9 |
$ |
13,471.8 |
$ |
12,478.7 |
$ |
11,031.9 |
$ |
11,198.3 |
||||
Total policy liabilities |
7,258.8 |
7,148.6 |
6,956.5 |
6,384.1 |
6,182.0 |
|||||||||
Debt |
502.6 |
437.3 |
433.0 |
297.7 |
297.5 |
|||||||||
Shareholders' equity |
1,807.4 |
1,790.1 |
1,567.3 |
1,290.6 |
1,501.6 |
|||||||||
Per Share and Shares Data (in millions) |
||||||||||||||
Net income per share (basic) |
$ |
3.40 |
$ |
3.18 |
$ |
4.42 |
$ |
0.44 |
$ |
4.10 |
||||
Core earnings per share (basic)* |
3.61 |
3.41 |
2.21 |
0.68 |
1.75 |
|||||||||
Net income per share (diluted) |
3.39 |
3.17 |
4.40 |
0.44 |
4.08 |
|||||||||
Core earnings per share (diluted)* |
3.59 |
3.40 |
2.20 |
0.68 |
1.74 |
|||||||||
Weighted average shares (basic) |
42.0 |
41.9 |
41.7 |
41.6 |
41.4 |
|||||||||
Weighted average shares (diluted) |
42.2 |
42.0 |
41.9 |
41.9 |
41.6 |
|||||||||
Book value per share |
$ |
43.66 |
$ |
43.22 |
$ |
38.01 |
$ |
31.50 |
$ |
36.88 |
||||
Book value per share excluding net unrealized investment gains on fixed maturity securities* |
36.64 |
34.38 |
32.42 |
29.13 |
29.51 |
|||||||||
Dividends paid per share |
$ |
1.24 |
$ |
1.20 |
$ |
1.15 |
$ |
1.14 |
$ |
1.10 |
||||
Segment Information |
||||||||||||||
Insurance premiums written and contract deposits |
||||||||||||||
Property & Casualty |
$ |
607.8 |
$ |
635.5 |
$ |
683.1 |
$ |
681.5 |
$ |
662.8 |
||||
Supplemental |
125.3 |
130.3 |
65.7 |
- |
- |
|||||||||
Retirement |
448.8 |
429.1 |
419.4 |
439.1 |
453.1 |
|||||||||
Life |
116.9 |
110.1 |
113.2 |
114.4 |
111.2 |
|||||||||
Total |
$ |
1,298.8 |
$ |
1,305.0 |
$ |
1,281.4 |
$ |
1,235.0 |
$ |
1,227.1 |
||||
Core earnings (loss) |
||||||||||||||
Property & Casualty |
$ |
57.0 |
$ |
76.5 |
$ |
54.3 |
$ |
(14.3) |
$ |
17.2 |
||||
Supplemental |
46.3 |
43.1 |
18.0 |
- |
- |
|||||||||
Retirement |
52.0 |
28.2 |
23.2 |
41.7 |
48.9 |
|||||||||
Life |
16.1 |
10.4 |
17.6 |
18.8 |
17.3 |
|||||||||
Corporate & Other |
(20.0) |
(15.1) |
(20.9) |
(17.8) |
(11.3) |
|||||||||
Total |
$ |
151.4 |
$ |
143.1 |
$ |
92.2 |
$ |
28.4 |
$ |
72.1 |
||||
- The acquisition of NTA (Supplemental segment) closed on
July 1, 2019 .
Horace Mann Educators Corporation I Fourth-Quarter 2021 Investor Supplement |
Page 4 |
Consolidated Statements of Operations
($ in millions) |
Three Months Ended |
Year Ended |
||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||
2021 |
2021 |
2021 |
2021 |
2020 |
2021 |
2020 |
||||||||||||||
Revenues |
||||||||||||||||||||
Premiums and contract charges earned |
$ |
210.8 |
$ |
225.4 |
$ |
225.8 |
$ |
227.6 |
$ |
233.7 |
$ |
889.6 |
$ |
930.7 |
||||||
Net investment income |
114.1 |
103.7 |
109.2 |
95.5 |
101.2 |
422.5 |
357.6 |
|||||||||||||
Net investment (losses) gains |
(0.4) |
(6.5) |
4.9 |
(9.0) |
10.5 |
(11.0) |
(2.3) |
|||||||||||||
Other income |
6.9 |
7.0 |
7.2 |
7.9 |
6.9 |
29.0 |
24.4 |
|||||||||||||
Total revenues |
331.4 |
329.6 |
347.1 |
322.0 |
352.3 |
1,330.1 |
1,310.4 |
|||||||||||||
Benefits, losses and expenses |
||||||||||||||||||||
Benefits, claims and settlement expenses |
171.5 |
164.8 |
147.1 |
134.3 |
135.8 |
617.7 |
568.9 |
|||||||||||||
Interest credited |
10.7 |
51.9 |
51.2 |
50.6 |
51.3 |
164.4 |
204.6 |
|||||||||||||
Operating expenses |
68.7 |
64.3 |
60.5 |
58.0 |
64.7 |
251.5 |
237.8 |
|||||||||||||
DAC amortization expense, excluding DAC unlocking |
23.9 |
23.7 |
23.9 |
24.7 |
25.2 |
96.2 |
102.0 |
|||||||||||||
DAC unlocking |
0.3 |
(0.8) |
(0.4) |
(0.6) |
(0.3) |
(1.5) |
(2.1) |
|||||||||||||
Intangible asset amortization expense |
3.2 |
3.3 |
3.2 |
3.3 |
3.5 |
13.0 |
14.4 |
|||||||||||||
Interest expense |
3.5 |
3.4 |
3.5 |
3.5 |
3.5 |
13.9 |
15.2 |
|||||||||||||
Other expense - goodwill and intangible asset impairments |
- |
- |
- |
- |
10.0 |
- |
10.0 |
|||||||||||||
Total benefits, losses and expenses |
281.8 |
310.6 |
289.0 |
273.8 |
293.7 |
1,155.2 |
1,150.8 |
|||||||||||||
Income before income taxes |
49.6 |
19.0 |
58.1 |
48.2 |
58.6 |
174.9 |
159.6 |
|||||||||||||
Income tax expense |
9.1 |
2.7 |
11.4 |
8.9 |
10.8 |
32.1 |
26.3 |
|||||||||||||
Net income |
$ |
40.5 |
$ |
16.3 |
$ |
46.7 |
$ |
39.3 |
$ |
47.8 |
$ |
142.8 |
$ |
133.3 |
||||||
Other Statistics |
||||||||||||||||||||
Effective tax rate on net investment income |
20.6 % |
20.5 % |
20.5 % |
20.4 % |
20.5 % |
20.5 % |
20.4 % |
|||||||||||||
Net investment income, after tax |
$ |
90.6 |
$ |
82.4 |
$ |
86.8 |
$ |
75.9 |
$ |
80.5 |
$ |
335.7 |
$ |
284.6 |
||||||
Catastrophe losses, net of reinsurance, pretax |
11.1 |
38.6 |
17.5 |
11.0 |
6.1 |
78.2 |
84.4 |
|||||||||||||
Catastrophe losses, net of reinsurance, after tax |
8.8 |
30.5 |
13.8 |
8.7 |
4.8 |
61.8 |
66.7 |
|||||||||||||
Impairments on investments(1) |
(0.6) |
(6.6) |
- |
(3.2) |
- |
(10.4) |
(5.3) |
- Included in pretax net investment gains (losses).
Horace Mann Educators Corporation I Fourth-Quarter 2021 Investor Supplement |
Page 5 |
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