Lincoln National Corporation
) reported third-quarter 2013 operating earnings of $1.34 per
share. The results surpassed the Zacks Consensus Estimate of
$1.23 and breezed past the prior-year quarter's earnings of $1.27
The upside was driven by growth in sales, positive net flows
and a favorable equity market situation.
Further, Lincoln National's operating net income increased
1.4% year over year to $367 million. Meanwhile, reported net
income, including extraordinary items, stood at $337 million or
$1.23 per share as against $428 million or $1.51 per share in the
Lincoln National's total operating revenue climbed 6% over the
prior-year quarter to $3.1 billion, marginally exceeding the
Zacks Consensus Estimate of $3.0 billion. The year-over-year
improvement was driven by growth in deposits and sales across all
of its operating segments. Further, sales growth of re-priced
products as well as change in the business mix to higher return
products also aided the upside.
Consolidated account balances of Lincoln National increased
13% year over year to $197 billion, while net flow surged 76% to
$2.3 billion, both reflecting growth across segments.
Operating income from Lincoln National's
segment stood at $198 million, increasing 42% from $139 million
in the prior-year quarter, driven by higher variable annuity
deposit sales. Even account values, gross deposits and net flow
showcased improvement over the prior-year quarter.
Operating income from
Retirement Plan Services
was $33 million, up from $29 million in the prior-year period.
The upside was driven by growth in deposits, sales in the
Mid-Large market, retention and account balances.
Operating income from
was $140 million, down 7.9% year over year, although life
insurance sales improved 46% year over year to $163 million. Life
insurance in force improved 4% year over year to $608 billion,
while aggregate sales of higher return products, including
indexed universal life, variable universal life, flexible premium
MoneyGuard and term life insurance, increased 124% over the
Operating income from
Group Protection i
ncreased to $23 million from $16 million in the prior-year
period. Non-medical loss ratio dipped to 73.4% from 75.7% in the
prior quarter. Further, non-medical net earned premiums were $494
million, up 10% over the year-ago period, while Group Protection
sales of $107 million grew 10% year over year.
Operating loss in
operations were $27 million, compared to a gain of $26 million in
the prior-year quarter.
Lincoln National's net realized losses included a net loss
from account investments of $7 million compared with $3 million
net gain in the prior-year quarter. Additionally, net realized
losses included variable annuity net derivatives loss of $16
million during the reported quarter.
As of Sep 30, 2013, pre-tax net unrealized gain on Lincoln
National's available-for-sale securities was approximately $4.3
billion as compared with $9.4 billion in the year-ago period.
At the end of Sep 2013, Lincoln National's book value per
share came in at $50.62, down 8% year-over-year. Excluding
accumulated other comprehensive income (AOCI), book value climbed
11% year over year to $44.37 per share. Operating ROE stood at
12.7% at the end of Sep 2013, down from 13.4% at the end of the
Additionally, Lincoln National bought back 2.3 million shares
for $100 million during the reported quarter. This amounts to a
total of 10 million shares bought back for $350 million over the
first nine months of 2013.
On Aug 9, 2013, the board of Lincoln National declared its
regular quarterly dividend of 12 cents per share, to be paid on
Nov 1, 2013 to the shareholders of record as on Oct 10, 2013.
In Oct 2013, Lincoln National entered into a reinsurance
treaty to cover the new sales of its flagship variable annuity
guaranteed living benefit product. As per the deal, Lincoln
National will offer 50% coinsurance on new living benefit
guarantee sales up to $8 billion through Dec 31, 2014.
Genworth Financial Inc.
) reported third-quarter 2013 net operating income of 24 cents
per share. The results fell short of the Zacks Consensus Estimate
by 4 cents.
StanCorp Financial Group Inc.
) reported third-quarter 2013 operating net earnings of $1.45 per
share, which exceeded the Zacks Consensus Estimate of $1.04.
Reinsurance Group of America Inc.
) reported third quarter 2013 operating income of $2.14 per
share, significantly exceeding the Zacks Consensus Estimate of
$1.82 per share.
Lincoln National carries a Zacks Rank #2 (Buy).
GENWORTH FINL (GNW): Free Stock Analysis
LINCOLN NATL-IN (LNC): Free Stock Analysis
REINSURANCE GRP (RGA): Free Stock Analysis
STANCORP FNL CP (SFG): Free Stock Analysis
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