Genworth Financial Inc
) reported fourth-quarter 2012 operating income of 18 cents per
share. The result missed the Zacks Consensus Estimate of 26 cents
and was 28% below the year-ago level.
Including a favorable adjustment of $78 million associated with
the finalization of the new Government Guarantee framework in
Canada, net income came in at 34 cents, up 17% year over year.
The fourth-quarter results benefited from better performances at
Global Mortgage Insurance and U.S. Life Insurance.
Quarterly Operational Performance
Genworth's total revenues increased 3.3% year over year to $2.54
billion in the quarter. Top line improved primarily due to net
investment gains. It was almost in line with the Zacks Consensus
Premium revenue at Genworth declined 2.5% year over year to $1.3
billion in the quarter.
Net investment income improved 1.6% year over year to $840
Full Year highlights
Net income 2012 was 65 cents, much ahead of 10 cents earned in
Total revenues decreased 3.3% year over year to $2.54 billion in
Quarterly Review by Segment
In the beginning of the fourth quarter of 2012, the company
changed its financial presentation for divisions. Now, it
operates through three divisions: U.S. Life Insurance, Global
Mortgage Insurance and Corporate and Other.
U.S. Life Insurance
: Net operating income dipped 19.1% year over year to $76
Genworth closed its second life block transaction in the fourth
quarter of 2012. The transaction generated more than $175 million
in initial after-tax capital benefits for U.S. life insurance.
Global Mortgage Insurance
: The segment's net operating income of $131 million in the
quarter recovered from a loss of $13 million in the year-ago
quarter. A substantially lower loss at U.S. Mortgage Insurance
and higher income from International Mortgage Insurance aided the
Corporate and Run-Off
: Net operating loss was $40 million in the quarter under review,
compared with an operating income of $43 million in the
Genworth exited the 2012 with cash, cash equivalents and invested
assets of $78.7 billion, up nearly 2.3% from 2011-end.
Genworth's long-term borrowings stood at $4.8 billion at quarter
end, up 1.1% from 2011-end level.
Performance of few other Life Insurers
StanCorp Financial Group Inc
) reported fourth-quarter 2012 operating earnings of 89 cents per
share, which exceeded the Zacks Consensus Estimate of 83 cents
and 85 cents earned in the prior-year quarter.
Reinsurance Group of America Inc
) reported fourth-quarter 2012 operating earnings of $2.44 per
share, significantly ahead of the Zacks Consensus Estimate of
$1.80 per share. Earnings were also up by 48.8% on a
Genworth currently carries a Zacks Rank #3 (Hold).
Manulife Financial Corporation
), another life insurer with a Zacks Rank #2 (Buy), is scheduled
to release its fourth-quarter results on Feb 7.
GENWORTH FINL (GNW): Free Stock Analysis
MANULIFE FINL (MFC): Free Stock Analysis
REINSURANCE GRP (RGA): Free Stock Analysis
STANCORP FNL CP (SFG): Free Stock Analysis
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