Brighthouse Financial Announces Second Quarter 2024 Results
Brighthouse Financial (Nasdaq: BHF) reported mixed results for Q2 2024. Net income was $9 million ($0.12 per share), compared to a net loss of $200 million in Q2 2023. Adjusted earnings were $346 million ($5.57 per share), up from $271 million in Q2 2023. The company's estimated combined RBC ratio was between 380% and 400%, with holding company liquid assets of $1.2 billion.
Annuity sales were flat in H1 2024 compared to H1 2023, while life sales increased 19%. The company repurchased approximately $151 million of its common stock year-to-date through August 2, 2024. Corporate expenses decreased to $200 million in Q2 2024 from $221 million in Q2 2023.
Brighthouse Financial (Nasdaq: BHF) ha riportato risultati misti per il secondo trimestre del 2024. L'utile netto è stato di 9 milioni di dollari (0,12 dollari per azione), rispetto a una perdita netta di 200 milioni di dollari nel secondo trimestre del 2023. Gli utili rettificati ammontano a 346 milioni di dollari (5,57 dollari per azione), in aumento rispetto ai 271 milioni di dollari nel secondo trimestre del 2023. Il rapporto RBC combinato stimato dell'azienda si attestava tra il 380% e il 400%, con attività liquide della holding pari a 1,2 miliardi di dollari.
Le vendite di rendite sono rimaste stabili nella prima metà del 2024 rispetto alla prima metà del 2023, mentre le vendite di polizze vita sono aumentate del 19%. L'azienda ha riacquistato circa 151 milioni di dollari delle sue azioni ordinarie dall'inizio dell'anno fino al 2 agosto 2024. Le spese aziendali sono diminuite a 200 milioni di dollari nel secondo trimestre del 2024, rispetto ai 221 milioni di dollari nel secondo trimestre del 2023.
Brighthouse Financial (Nasdaq: BHF) reportó resultados mixtos para el segundo trimestre de 2024. La ingresos netos fueron de 9 millones de dólares (0,12 dólares por acción), en comparación con una pérdida neta de 200 millones de dólares en el segundo trimestre de 2023. Las ganancias ajustadas fueron de 346 millones de dólares (5,57 dólares por acción), un aumento respecto a los 271 millones de dólares en el segundo trimestre de 2023. Se estimó que el índice RBC combinado de la compañía estuvo entre el 380% y el 400%, con activos líquidos de la empresa matriz de 1,2 mil millones de dólares.
Las ventas de anualidades se mantuvieron estables en la primera mitad de 2024 en comparación con la primera mitad de 2023, mientras que las ventas de seguros de vida aumentaron un 19%. La empresa ha recomprado aproximadamente 151 millones de dólares de sus acciones comunes hasta la fecha, hasta el 2 de agosto de 2024. Los gastos corporativos disminuyeron a 200 millones de dólares en el segundo trimestre de 2024, frente a 221 millones de dólares en el segundo trimestre de 2023.
브라이트하우스 파이낸셜(Nasdaq: BHF)은 2024년 2분기 혼합 실적을 발표했습니다. 순이익은 9백만 달러(주당 0.12달러)로, 2023년 2분기의 2억 달러 순손실에 비해 증가했습니다. 조정된 수익은 3억 4천6백만 달러(주당 5.57달러)로, 2023년 2분기의 2억 7천1백만 달러에서 증가했습니다. 이 회사의 추정 결합 RBC 비율은 380%에서 400% 사이였으며, 지주회사 유동 자산은 12억 달러였습니다.
연금 판매는 2024년 상반기와 2023년 상반기 비교에서 동일했으나, 생명 보험 판매는 19% 증가했습니다. 이 회사는 2024년 8월 2일까지 올해 들어 약 1억 5천1백만 달러의 자사주를 재매입했습니다. 기업 비용은 2023년 2분기의 2억 2천1백만 달러에서 2024년 2분기 2억 달러로 감소했습니다.
Brighthouse Financial (Nasdaq: BHF) a présenté des résultats mitigés pour le deuxième trimestre 2024. Le revenu net était de 9 millions de dollars (0,12 dollar par action), contre une perte nette de 200 millions de dollars au deuxième trimestre 2023. Les bénéfices ajustés étaient de 346 millions de dollars (5,57 dollars par action), en hausse par rapport à 271 millions de dollars au deuxième trimestre 2023. Le ratio RBC combiné estimé de l'entreprise se situait entre 380 % et 400 %, avec des actifs liquides de la société holding s'élevant à 1,2 milliard de dollars.
Les ventes d'annuités sont restées stables au premier semestre 2024 par rapport au premier semestre 2023, tandis que les ventes d'assurances vie ont augmenté de 19 %. L'entreprise a racheté environ 151 millions de dollars de ses actions ordinaires depuis le début de l'année jusqu'au 2 août 2024. Les dépenses d'entreprise ont diminué à 200 millions de dollars au deuxième trimestre 2024, contre 221 millions de dollars au deuxième trimestre 2023.
Brighthouse Financial (Nasdaq: BHF) berichtete über gemischte Ergebnisse für das zweite Quartal 2024. Der Nettoertrag betrug 9 Millionen Dollar (0,12 Dollar pro Aktie), verglichen mit einem Nettoverlust von 200 Millionen Dollar im zweiten Quartal 2023. Die bereinigten Erträge beliefen sich auf 346 Millionen Dollar (5,57 Dollar pro Aktie), ein Anstieg gegenüber 271 Millionen Dollar im zweiten Quartal 2023. Das geschätzte kombinierte RBC-Verhältnis des Unternehmens lag zwischen 380% und 400%, mit liquiden Mitteln des Holdingunternehmens in Höhe von 1,2 Milliarden Dollar.
Die Annuitätenverkäufe blieben im ersten Halbjahr 2024 im Vergleich zum ersten Halbjahr 2023 stabil, während die Lebensversicherungverkäufe um 19% zunahmen. Das Unternehmen hat bis zum 2. August 2024 etwa 151 Millionen Dollar seiner Stammaktien zurückgekauft. Die Unternehmensausgaben sank im zweiten Quartal 2024 auf 200 Millionen Dollar, verglichen mit 221 Millionen Dollar im zweiten Quartal 2023.
- Adjusted earnings increased to $346 million ($5.57 per share) from $271 million in Q2 2023
- Life sales increased 19% in H1 2024 compared to H1 2023
- Record Shield Level Annuity sales exceeding $2 billion in Q2 and $3.9 billion in H1 2024
- Corporate expenses decreased to $200 million from $221 million in Q2 2023
- Repurchased $151 million of common stock year-to-date through August 2, 2024
- Estimated combined RBC ratio at or modestly below the low end of target range
- Net income of $9 million ($0.12 per share) significantly lower than adjusted earnings
- Annuity sales decreased 3% quarter-over-quarter and 16% sequentially
- Book value decreased to $39.87 per share from $48.64 in Q2 2023
Insights
Brighthouse Financial's Q2 2024 results present a mixed picture. The company reported
The estimated combined RBC ratio between
On a positive note, the company's Shield Level Annuity sales reached record levels, exceeding
Brighthouse Financial's performance in Q2 2024 reflects broader market trends in the insurance and annuity sectors. The flat annuity sales year-over-year indicate a stable demand for retirement products, despite economic uncertainties. However, the shift towards Shield Level Annuities suggests a growing consumer preference for products offering downside protection with upside potential.
The
The decrease in corporate expenses from
Brighthouse Financial's Q2 2024 results present both opportunities and challenges for investors. The company's ability to generate record Shield Level Annuity sales and grow life insurance sales demonstrates product strength and market adaptability. However, the pressure on the RBC ratio is a concern that warrants close monitoring.
The company's ongoing share repurchase program, with
The adjusted net investment income yield of
-
Estimated combined risk-based capital ("RBC") ratio between
380% and400% ; holding company liquid assets of$1.2 billion -
The company repurchased approximately
$151 million - Total annuity sales in the first half of 2024 were consistent with the same period in 2023
-
Total life sales increased
19% in the first half of 2024 compared with the same period in 2023 -
Second quarter 2024 net income available to shareholders of
$9 million $0.12 -
Second quarter 2024 adjusted earnings* of
$346 million $5.57
Second Quarter 2024 Results
The company reported net income available to shareholders of
The company ended the second quarter of 2024 with common stockholders' equity ("book value") of
_________ |
* Information regarding the non-GAAP and other financial measures included in this news release and a reconciliation of such non-GAAP financial measures to the most directly comparable GAAP measures are provided in the Non-GAAP and Other Financial Disclosures discussion below, as well as in the tables that accompany this news release and/or the Second Quarter 2024 Brighthouse Financial, Inc. Financial Supplement and/or the Second Quarter 2024 Brighthouse Financial, Inc. Earnings Call Presentation (which are available on the Brighthouse Financial Investor Relations webpage at http://investor.brighthousefinancial.com). Additional information regarding notable items can be found on the last page of this news release. |
For the second quarter of 2024, the company reported adjusted earnings* of
Corporate expenses in the second quarter of 2024 were
The company's annuity sales were flat in the first half of 2024 compared with the same period in 2023 and decreased
During the second quarter of 2024, the company repurchased approximately
“Brighthouse Financial delivered mixed results in the quarter. We reported strong sales results, including record sales of our Shield Level Annuities, continued to efficiently manage our expenses and repurchased more of our common stock. Further, we are pleased that, in the quarter, we received our first deposits from BlackRock’s LifePath Paycheck solution,” said Eric Steigerwalt, president and CEO, Brighthouse Financial.
“Despite those positives, our statutory results caused our estimated combined RBC ratio to end the quarter at or modestly below the low end of our target range, driven by our variable annuity and Shield business," Steigerwalt continued. "We have a number of specific initiatives underway designed to improve capital efficiency, unlock capital and return to our target RBC ratio range in the next six to 12 months. We continue to be strongly capitalized, with a solid RBC ratio and a significant amount of holding company liquid assets.”
Key Metrics (Unaudited, dollars in millions except share and per share amounts)
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As of or For the Three Months Ended |
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June 30, 2024 |
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June 30, 2023 |
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Total |
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Per share |
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Total |
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Per share |
Net income (loss) available to shareholders (1) |
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Adjusted earnings (loss) (1) |
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Weighted average common shares outstanding - diluted (1) |
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62,255,330 |
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N/A |
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66,967,185 |
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N/A |
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Book value |
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Book value, excluding AOCI |
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Ending common shares outstanding |
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61,243,957 |
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N/A |
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65,956,660 |
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N/A |
(1) |
Per share amounts are on a diluted basis and may not recalculate due to rounding. For loss periods, dilutive shares were not included in the calculation as inclusion of such shares would have an anti-dilutive effect. See Non-GAAP and Other Financial Disclosures discussion in this news release. |
Results by Segment and Corporate & Other (Unaudited, in millions)
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For the Three Months Ended |
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ADJUSTED EARNINGS (LOSS) |
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June 30,
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March 31,
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June 30,
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Annuities |
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Life (1) |
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Run-off (1) |
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Corporate & Other (1) |
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(1) |
The company uses the term “adjusted loss” throughout this news release to refer to negative adjusted earnings values. |
Sales (Unaudited, in millions)
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For the Three Months Ended |
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June 30,
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March 31,
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June 30,
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Annuities (1) |
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Life |
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(1) |
Annuities sales include sales of a fixed index annuity product, which represents |
Annuities
Adjusted earnings in the Annuities segment were
There were no notable items in the current quarter or the comparison quarters.
On a quarter-over-quarter basis, adjusted earnings reflect higher fees, lower expenses, a higher underwriting margin and higher net investment income. On a sequential basis, adjusted earnings reflect a higher underwriting margin, higher fees and lower expenses.
As mentioned above, annuity sales were flat in the first half of 2024 compared with the same period in 2023 and decreased
Life
Adjusted earnings in the Life segment were
There were no notable items in the current quarter or the second quarter of 2023. The first quarter of 2024 included a
On a quarter-over-quarter basis, adjusted earnings reflect a higher underwriting margin and lower expenses. On a sequential basis, adjusted earnings, less notable items, reflect higher net investment income, partially offset by a lower underwriting margin.
As mentioned above, life sales were at a record level in the first half of 2024 and increased
Run-off
The Run-off segment had an adjusted loss of
There were no notable items in the current quarter or the second quarter of 2023. The first quarter of 2024 included a
On a quarter-over-quarter basis, the adjusted loss reflects a lower underwriting margin, partially offset by lower expenses. On a sequential basis, the adjusted loss, less notable items, reflects a higher underwriting margin.
Corporate & Other
Adjusted earnings in the Corporate & Other segment were
There were no notable items in the current quarter or the comparison quarters.
Both on a quarter-over-quarter and sequential basis, adjusted earnings reflect higher net investment income and a higher tax benefit.
Net Investment Income and Adjusted Net Investment Income (Unaudited, in millions)
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For the Three Months Ended |
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June 30,
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March 31,
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June 30,
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Net investment income |
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Adjusted net investment income |
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Net Investment Income
Net investment income was
Adjusted net investment income increased
The adjusted net investment income yield* was
Statutory Capital and Liquidity (Unaudited, in billions)
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As of |
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June 30,
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March 31,
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June 30,
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Statutory combined total adjusted capital |
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(1) |
Reflects preliminary statutory results as of June 30, 2024. |
Capitalization
As of June 30, 2024:
-
Statutory combined total adjusted capital ("TAC")(1) was approximately
$5.4 billion
-
Estimated combined RBC ratio(1) was between
380% and400%
-
Holding company liquid assets were
$1.2 billion
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(1) |
Reflects preliminary statutory results as of June 30, 2024. |
Earnings Conference Call
Brighthouse Financial will hold a conference call and audio webcast to discuss its financial results for the second quarter of 2024 at 8:00 a.m. Eastern Time on Thursday, August 8, 2024. In connection with this call, the company has prepared a presentation for use with investors and other members of the investment community. This presentation is available on the Brighthouse Financial Investor Relations webpage at http://investor.brighthousefinancial.com.
To listen to the audio webcast via the internet and to access the related presentation, please visit the Brighthouse Financial Investor Relations webpage at http://investor.brighthousefinancial.com. To join the conference call via telephone as a participant, please register in advance at https://register.vevent.com/register/BIf08d57272ce0428682df2ccbc214dc4b.
A replay of the conference call will be made available until Friday, August 23, 2024, on the Brighthouse Financial Investor Relations webpage at http://investor.brighthousefinancial.com.
About Brighthouse Financial, Inc.
Brighthouse Financial, Inc. (Brighthouse Financial) (Nasdaq: BHF) is on a mission to help people achieve financial security. As one of the largest providers of annuities and life insurance in the
(1) |
Ranked by 2023 admitted assets. Best's Review®: Top 200 U.S. Life/Health Insurers. AM Best, 2024. |
Note Regarding Forward-Looking Statements
This news release and other oral or written statements that we make from time to time may contain information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve substantial risks and uncertainties. We have tried, wherever possible, to identify such statements using words such as "anticipate," "estimate," "expect," "project," "may," "will," "could," "intend," "goal," "target," "guidance," "forecast," "preliminary," "objective," "continue," "aim," "plan," "believe" and other words and terms of similar meaning, or that are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include, without limitation, statements relating to future actions, prospective services or products, financial projections, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, as well as trends in operating and financial results.
Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial. These statements are based on current expectations and the current economic environment and involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others: differences between actual experience and actuarial assumptions and the effectiveness of our actuarial models; higher risk management costs and exposure to increased market risk due to guarantees within certain of our products; the effectiveness of our variable annuity exposure risk management strategy and the impacts of such strategy on volatility in our profitability measures and the negative effects on our statutory capital; material differences between actual outcomes and the sensitivities calculated under certain scenarios that we may utilize in connection with our variable annuity risk management strategies; the impact of interest rates on our future ULSG policyholder obligations and net income volatility; the potential material adverse effect of changes in accounting standards, practices or policies applicable to us, including changes in the accounting for long-duration contracts; loss of business and other negative impacts resulting from a downgrade or a potential downgrade in our financial strength or credit ratings; the availability of reinsurance and the ability of the counterparties to our reinsurance or indemnification arrangements to perform their obligations thereunder; heightened competition, including with respect to service, product features, scale, price, actual or perceived financial strength, claims-paying ratings, credit ratings, e-business capabilities and name recognition; our ability to market and distribute our products through distribution channels; any failure of third parties to provide services we need, any failure of the practices and procedures of such third parties and any inability to obtain information or assistance we need from third parties; the ability of our subsidiaries to pay dividends to us, and our ability to pay dividends to our shareholders and repurchase our common stock; the risks associated with climate change; the adverse impact of public health crises, extreme mortality events or similar occurrences on our business and the economy in general; the impact of adverse capital and credit market conditions, including with respect to our ability to meet liquidity needs and access capital; the impact of economic conditions in the capital markets and the
For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements included and the risks, uncertainties and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2023, particularly in the sections entitled "Risk Factors" and "Quantitative and Qualitative Disclosures About Market Risk," as well as in our other subsequent filings with the SEC. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.
Non-GAAP and Other Financial Disclosures
Our definitions of non-GAAP and other financial measures may differ from those used by other companies.
Non-GAAP Financial Disclosures
We present certain measures of our performance that are not calculated in accordance with accounting principles generally accepted in
The following non-GAAP financial measures should not be viewed as substitutes for the most directly comparable financial measures calculated in accordance with GAAP:
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Non-GAAP financial measures: |
Most directly comparable GAAP financial measures: |
adjusted earnings |
net income (loss) available to shareholders (1) |
adjusted earnings, less notable items |
net income (loss) available to shareholders (1) |
adjusted revenues |
revenues |
adjusted expenses |
expenses |
adjusted earnings per common share |
earnings per common share, diluted (1) |
adjusted earnings per common share, less notable items |
earnings per common share, diluted (1) |
adjusted return on common equity |
return on common equity (2) |
adjusted return on common equity, less notable items |
return on common equity (2) |
adjusted net investment income |
net investment income |
adjusted net investment income yield |
net investment income yield |
__________________ |
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(1) |
Brighthouse uses net income (loss) available to shareholders to refer to net income (loss) available to Brighthouse Financial, Inc.'s common shareholders, and earnings per common share, diluted to refer to net income (loss) available to shareholders per common share. |
(2) |
Brighthouse uses return on common equity to refer to return on Brighthouse Financial, Inc.'s common stockholders' equity. |
Reconciliations to the most directly comparable historical GAAP measures are included for those measures which are presented herein. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are not accessible on a forward-looking basis because we believe it is not possible without unreasonable efforts to provide other than a range of net investment gains and losses and net derivative gains and losses, which can fluctuate significantly within or outside the range and from period to period and may have a material impact on net income (loss) available to shareholders.
Adjusted Earnings, Adjusted Revenues and Adjusted Expenses
Adjusted earnings is a financial measure used by management to evaluate performance and facilitate comparisons to industry results. This financial measure, which may be positive or negative, focuses on our primary businesses by excluding the impact of market volatility, which could distort trends. The company uses the term “adjusted loss” throughout this news release to refer to negative adjusted earnings values.
Adjusted earnings reflect adjusted revenues less (i) adjusted expenses, (ii) provision for income tax expense (benefit), (iii) net income (loss) attributable to noncontrolling interests and (iv) preferred stock dividends. Provided below are the adjustments to GAAP revenues and GAAP expenses used to calculate adjusted revenues and adjusted expenses, respectively.
The following are significant items excluded from total revenues in calculating the adjusted revenues component of adjusted earnings:
- Net investment gains (losses); and
- Net derivative gains (losses) ("NDGL"), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment ("Investment Hedge Adjustments").
The following are significant items excluded from total expenses in calculating the adjusted expenses component of adjusted earnings:
- Change in market risk benefits; and
- Change in fair value of the crediting rate on experience-rated contracts ("Market Value Adjustments").
The provision for income tax related to adjusted earnings is calculated using the statutory tax rate of
Consistent with GAAP guidance for segment reporting, adjusted earnings is also our GAAP measure of segment performance.
Adjusted Earnings per Common Share and Adjusted Return on Common Equity
Adjusted earnings per common share and adjusted return on common equity are measures used by management to evaluate the execution of our business strategy and align such strategy with our shareholders' interests.
Adjusted earnings per common share is defined as adjusted earnings for the period divided by the weighted average number of fully diluted shares of common stock outstanding for the period. The weighted average common shares outstanding used to calculate adjusted earnings per share will differ from such shares used to calculate diluted net income (loss) available to shareholders per common share when the inclusion of dilutive shares has an anti-dilutive effect for one calculation but not for the other.
Adjusted return on common equity is defined as total annual adjusted earnings on a four quarter trailing basis, divided by the simple average of the most recent five quarters of total Brighthouse Financial, Inc.'s common stockholders' equity, excluding AOCI.
Adjusted Net Investment Income
We present adjusted net investment income to measure our performance for management purposes, and we believe it enhances the understanding of our investment portfolio results. Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments.
Adjusted Net Investment Income Yield
Similar to adjusted net investment income, we present adjusted net investment income yield as a performance measure we believe enhances the understanding of our investment portfolio results. Adjusted net investment income yield represents adjusted net investment income as a percentage of average quarterly asset carrying values. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. Investment fee and expense yields are calculated as a percentage of average quarterly asset estimated fair values. Asset estimated fair values exclude collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties.
Other Financial Disclosures
Corporate Expenses
Corporate expenses includes functional department expenses, public company expenses, certain investment expenses, retirement funding and incentive compensation.
Notable Items
Certain of the non-GAAP measures described above may be presented further adjusted to exclude notable items. Notable items reflect the unfavorable (favorable) after-tax impact on our results of certain unanticipated items and events, as well as certain items and events that were anticipated. The presentation of notable items and non-GAAP measures, less notable items is intended to help investors better understand our results and to evaluate and forecast those results.
Book Value per Common Share and Book Value per Common Share, excluding AOCI
Brighthouse uses the term "book value" to refer to "Brighthouse Financial, Inc.'s common stockholders' equity, including AOCI." Book value per common share is defined as ending Brighthouse Financial, Inc.'s common stockholders' equity, including AOCI, divided by ending common shares outstanding. Book value per common share, excluding AOCI, is defined as ending Brighthouse Financial, Inc.'s common stockholders' equity, excluding AOCI, divided by ending common shares outstanding.
CTE70
CTE70 is defined as the amount of assets required to satisfy contract holder obligations across market environments in the average of the worst thirty percent of a set of capital market scenarios over the life of the contracts.
CTE98
CTE98 is defined as the amount of assets required to satisfy contract holder obligations across market environments in the average of the worst two percent of a set of capital market scenarios over the life of the contracts.
Holding Company
Holding company means, collectively, Brighthouse Financial, Inc., Brighthouse Holdings, LLC, and Brighthouse Services, LLC.
Holding Company Liquid Assets
Holding company liquid assets include liquid assets in Brighthouse Financial, Inc., Brighthouse Holdings, LLC, and Brighthouse Services, LLC. Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include assets held in trust.
Total Adjusted Capital
Total adjusted capital primarily consists of statutory capital and surplus, as well as the statutory asset valuation reserve. When referred to as “combined,” represents that of our insurance subsidiaries as a whole.
Sales
Life insurance sales consist of 100 percent of annualized new premium for term life, first-year paid premium for whole life, universal life, and variable universal life, and total paid premium for indexed universal life. We exclude company-sponsored internal exchanges, corporate-owned life insurance, bank-owned life insurance, and private placement variable universal life.
Annuity sales consist of 100 percent of direct statutory premiums, except for fixed index annuity sales, which represents 100 percent of gross sales on directly written business and the proportion of assumed gross sales under reinsurance agreements. Annuity sales exclude certain internal exchanges. These sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity.
Normalized Statutory Earnings (Loss)
Normalized statutory earnings (loss) is used by management to measure our insurance companies’ ability to pay future distributions and is reflective of whether our hedging program functions as intended. Normalized statutory earnings (loss) is calculated as statutory pre-tax net gain (loss) from operations adjusted for the favorable or unfavorable impacts of (i) net realized capital gains (losses) before capital gains tax (excluding gains (losses) and taxes transferred to the interest maintenance reserve), (ii) the change in total asset requirement at CTE98, net of the change in our variable annuity reserves, and (iii) pre-tax unrealized gains (losses) associated with our variable annuities and Shield hedging programs and other equity risk management strategies. Normalized statutory earnings (loss) may be further adjusted for certain unanticipated items that impact our results in order to help management and investors better understand, evaluate and forecast those results.
Risk-Based Capital Ratio
The risk-based capital ratio is a method of measuring an insurance company’s capital, taking into consideration its relative size and risk profile, in order to ensure compliance with minimum regulatory capital requirements set by the National Association of Insurance Commissioners. When referred to as “combined,” represents that of our insurance subsidiaries as a whole. The reporting of our combined risk-based capital ratio is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities.
Condensed Statements of Operations (Unaudited, in millions)
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For the Three Months Ended |
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Revenues |
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June 30,
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March 31,
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June 30,
|
Premiums |
|
|
|
|
|
|
Universal life and investment-type product policy fees |
|
580 |
|
436 |
|
601 |
Net investment income |
|
1,307 |
|
1,254 |
|
1,196 |
Other revenues |
|
141 |
|
145 |
|
130 |
Revenues before NIGL and NDGL |
|
2,209 |
|
2,037 |
|
2,138 |
Net investment gains (losses) |
|
(120) |
|
(42) |
|
(64) |
Net derivative gains (losses) |
|
(662) |
|
(1,921) |
|
(1,811) |
Total revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
Policyholder benefits and claims |
|
|
|
|
|
|
Interest credited to policyholder account balances |
|
509 |
|
502 |
|
452 |
Amortization of DAC and VOBA |
|
150 |
|
151 |
|
157 |
Change in market risk benefits |
|
(356) |
|
(1,440) |
|
(1,300) |
Interest expense on debt |
|
38 |
|
38 |
|
38 |
Other expenses |
|
430 |
|
469 |
|
464 |
Total expenses |
|
1,413 |
|
688 |
|
500 |
Income (loss) before provision for income tax |
|
14 |
|
(614) |
|
(237) |
Provision for income tax expense (benefit) |
|
(20) |
|
(123) |
|
(62) |
Net income (loss) |
|
34 |
|
(491) |
|
(175) |
Less: Net income (loss) attributable to noncontrolling interests |
|
— |
|
2 |
|
— |
Net income (loss) attributable to Brighthouse Financial, Inc. |
|
34 |
|
(493) |
|
(175) |
Less: Preferred stock dividends |
|
25 |
|
26 |
|
25 |
Net income (loss) available to Brighthouse Financial, Inc.’s common shareholders |
|
|
|
|
|
|
Condensed Balance Sheets (Unaudited, in millions)
|
|
As of |
||||
ASSETS |
|
June 30,
|
|
March 31,
|
|
June 30,
|
Investments: |
|
|
|
|
|
|
Fixed maturity securities available-for-sale |
|
|
|
|
|
|
Equity securities |
|
85 |
|
86 |
|
91 |
Mortgage loans |
|
22,641 |
|
22,670 |
|
22,614 |
Policy loans |
|
1,470 |
|
1,651 |
|
1,288 |
Limited partnerships and limited liability companies |
|
4,938 |
|
4,920 |
|
4,914 |
Short-term investments |
|
1,390 |
|
1,347 |
|
1,125 |
Other invested assets |
|
4,194 |
|
4,746 |
|
3,677 |
Total investments |
|
115,299 |
|
115,894 |
|
111,286 |
Cash and cash equivalents |
|
4,441 |
|
3,823 |
|
3,737 |
Accrued investment income |
|
1,169 |
|
1,297 |
|
1,027 |
Reinsurance recoverables |
|
19,369 |
|
19,570 |
|
18,650 |
Premiums and other receivables |
|
674 |
|
664 |
|
573 |
DAC and VOBA |
|
4,791 |
|
4,829 |
|
4,968 |
Current income tax recoverable |
|
28 |
|
28 |
|
31 |
Deferred income tax asset |
|
2,087 |
|
2,063 |
|
1,897 |
Market risk benefit assets |
|
916 |
|
839 |
|
602 |
Other assets |
|
404 |
|
349 |
|
382 |
Separate account assets |
|
88,260 |
|
90,332 |
|
88,392 |
Total assets |
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Future policy benefits |
|
|
|
|
|
|
Policyholder account balances |
|
85,865 |
|
84,159 |
|
78,643 |
Market risk benefit liabilities |
|
8,708 |
|
8,964 |
|
9,783 |
Other policy-related balances |
|
3,796 |
|
3,798 |
|
3,784 |
Payables for collateral under securities loaned and other transactions |
|
3,906 |
|
3,653 |
|
4,133 |
Long-term debt |
|
3,155 |
|
3,155 |
|
3,156 |
Other liabilities |
|
7,656 |
|
9,122 |
|
6,783 |
Separate account liabilities |
|
88,260 |
|
90,332 |
|
88,392 |
Total liabilities |
|
233,232 |
|
235,428 |
|
226,573 |
Equity |
|
|
|
|
|
|
Preferred stock, at par value |
|
— |
|
— |
|
— |
Common stock, at par value |
|
1 |
|
1 |
|
1 |
Additional paid-in capital |
|
13,972 |
|
13,989 |
|
14,039 |
Retained earnings (deficit) |
|
(1,966) |
|
(2,000) |
|
(1,069) |
Treasury stock |
|
(2,447) |
|
(2,382) |
|
(2,183) |
Accumulated other comprehensive income (loss) |
|
(5,419) |
|
(5,413) |
|
(5,881) |
Total Brighthouse Financial, Inc.’s stockholders’ equity |
|
4,141 |
|
4,195 |
|
4,907 |
Noncontrolling interests |
|
65 |
|
65 |
|
65 |
Total equity |
|
4,206 |
|
4,260 |
|
4,972 |
Total liabilities and equity |
|
|
|
|
|
|
Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings (Loss) and Adjusted Earnings, Less Notable Items, and Reconciliation of Net Income (Loss) Available to Shareholders per Common Share to Adjusted Earnings (Loss) per Common Share and Adjusted Earnings, Less Notable Items per Common Share (Unaudited, in millions except per share data)
|
|
For the Three Months Ended |
||||
ADJUSTED EARNINGS, LESS NOTABLE ITEMS |
|
June 30,
|
|
March 31,
|
|
June 30,
|
Net income (loss) available to shareholders |
|
|
|
|
|
|
Less: Net investment gains (losses) |
|
(120) |
|
(42) |
|
(64) |
Less: Net derivative gains (losses), excluding investment hedge adjustments |
|
(671) |
|
(1,934) |
|
(1,834) |
Less: Change in market risk benefits |
|
356 |
|
1,440 |
|
1,300 |
Less: Market value adjustments |
|
6 |
|
4 |
|
2 |
Less: Provision for income tax (expense) benefit on reconciling adjustments |
|
92 |
|
111 |
|
125 |
Adjusted earnings (loss) |
|
346 |
|
(98) |
|
271 |
Less: Notable items |
|
— |
|
(366) |
|
— |
Adjusted earnings, less notable items |
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EARNINGS, LESS NOTABLE ITEMS PER COMMON SHARE (1) |
|
|
|
|
|
|
Net income (loss) available to shareholders per common share |
|
|
|
|
|
|
Less: Net investment gains (losses) |
|
(1.93) |
|
(0.67) |
|
(0.96) |
Less: Net derivative gains (losses), excluding investment hedge adjustments |
|
(10.78) |
|
(30.68) |
|
(27.49) |
Less: Change in market risk benefits |
|
5.72 |
|
22.84 |
|
19.48 |
Less: Market value adjustments |
|
0.10 |
|
0.06 |
|
0.03 |
Less: Provision for income tax (expense) benefit on reconciling adjustments |
|
1.48 |
|
1.76 |
|
1.87 |
Less: Impact of inclusion of dilutive shares |
|
— |
|
— |
|
0.01 |
Adjusted earnings (loss) per common share |
|
5.57 |
|
(1.56) |
|
4.04 |
Less: Notable items |
|
— |
|
(5.81) |
|
— |
Adjusted earnings, less notable items per common share |
|
|
|
|
|
|
(1) |
Per share calculations are on a diluted basis and may not recalculate or foot due to rounding. For loss periods, dilutive shares were not included in the calculation as inclusion of such shares would have an anti-dilutive effect. See Non-GAAP and Other Financial Disclosures discussion in this news release. |
Reconciliation of Net Investment Income to Adjusted Net Investment Income (Unaudited, in millions)
|
|
For the Three Months Ended |
||||
ADJUSTED NET INVESTMENT INCOME (1) |
|
June 30,
|
|
March 31,
|
|
June 30,
|
Net investment income |
|
|
|
|
|
|
Less: Investment hedge adjustments |
|
(9) |
|
(13) |
|
(23) |
Adjusted net investment income |
|
|
|
|
|
|
Reconciliation of Investment Income Yield to Adjusted Net Investment Income Yield
|
|
For the Three Months Ended |
||||
ADJUSTED NET INVESTMENT INCOME YIELD (1) |
|
June 30,
|
|
March 31,
|
|
June 30,
|
Investment income yield |
|
|
|
|
|
|
Investment fees and expenses |
|
(0.13)% |
|
(0.14)% |
|
(0.14)% |
Adjusted net investment income yield |
|
|
|
|
|
|
Notable Items (Unaudited, in millions)
|
|
For the Three Months Ended |
||||
NOTABLE ITEMS IMPACTING ADJUSTED EARNINGS |
|
June 30,
|
|
March 31,
|
|
June 30,
|
Actuarial items and other insurance adjustments |
|
$— |
|
|
|
$— |
Legal matters |
|
— |
|
— |
|
— |
Total notable items (1) |
|
$— |
|
|
|
$— |
|
|
|
|
|
|
|
NOTABLE ITEMS BY SEGMENT AND CORPORATE & OTHER |
|
|
|
|
|
|
Annuities |
|
$— |
|
$— |
|
$— |
Life |
|
— |
|
73 |
|
— |
Run-off |
|
— |
|
293 |
|
— |
Corporate & Other |
|
— |
|
— |
|
— |
Total notable items (1) |
|
$— |
|
|
|
$— |
(1) |
See Non-GAAP and Other Financial Disclosures discussion in this news release. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240807112536/en/
FOR INVESTORS
Dana Amante
(980) 949-3073
damante@brighthousefinancial.com
FOR MEDIA
Deon Roberts
(980) 949-3071
deon.roberts@brighthousefinancial.com
Source: Brighthouse Financial, Inc.
FAQ
What was Brighthouse Financial's (BHF) net income for Q2 2024?
How did Brighthouse Financial's (BHF) adjusted earnings change in Q2 2024 compared to Q2 2023?
What was Brighthouse Financial's (BHF) estimated combined RBC ratio as of June 30, 2024?
How much common stock did Brighthouse Financial (BHF) repurchase in 2024?
What was the performance of Brighthouse Financial's (BHF) life sales in the first half of 2024?
