Jackson Announces Fourth Quarter and Full Year 2023 Results
Fourth Quarter Highlights
-
Net income (loss) attributable to
Jackson Financial Inc. common shareholders of$(1.6) billion , or$(19.64) per diluted share in the fourth quarter of 2023, compared to$(1.2) billion , or$(13.74) per diluted share in the fourth quarter of 2022 -
Adjusted operating earnings1 of
$204 million , or$2.53 per diluted share in the fourth quarter of 2023, compared to$294 million , or$3.39 per diluted share in the fourth quarter of 2022. The current quarter’s adjusted operating earnings per diluted share included the$(0.79) unfavorable impact of the annual actuarial assumptions update, and$(0.37) from returns on private equity and other limited partnership assets below our 10% annualized return assumption. -
Returned
$117 million to common shareholders in the fourth quarter of 2023 through$67 million of share repurchases and$50 million in dividends -
Fourth quarter 2023 registered index-linked annuity (RILA) sales of
$1.0 billion , up from$560 million in the fourth quarter of 2022 -
Total annuity account value of
$235 billion as of the fourth quarter of 2023, up 12% from the fourth quarter of 2022, driven largely by higher equity markets over the 12-month period
Full Year 2023 Highlights
-
Net income attributable to
Jackson Financial Inc. common shareholders of$899 million , or$10.76 per diluted share in 2023, compared to$6.2 billion , or$69.75 per diluted share in 2022 -
Adjusted operating earnings of
$1.1 billion , or$12.84 per diluted share in 2023, compared to$1.5 billion , or$16.39 per diluted share in 2022 -
Achieved full year 2023 capital return target to common shareholders with
$464 million in dividends and share repurchases -
Full year 2023 RILA sales of
$2.9 billion , up from$1.8 billion in 2022 -
Robust capital position at the operating company level, with an estimated risk-based capital (RBC) ratio at
Jackson National Life Insurance Company (JNLIC) of 624% as of year-end 2023 -
Cash and highly liquid securities at the holding company of approximately
$600 million as of year-end 2023, which was above Jackson’s targeted minimum liquidity buffer
2024 Announcements
-
In January, established and funded
Brooke Life Reinsurance Company (Brooke Re), our wholly ownedMichigan based captive reinsurer -
Increased first quarter 2024 common dividend by nearly 13% to
$0.70 per share -
Established a 2024 capital return to common shareholders target of
$550-650 million
Consolidated Fourth Quarter and Full Year 2023 Results
Fourth Quarter 2023
The Company reported net income/(loss) attributable to
Adjusted operating earnings for the three months ended
Full Year 2023
The company reported net income attributable to
Full-year 2023 adjusted operating earnings were
Total common shareholders’ equity was
Segment Results – Pretax Adjusted Operating Earnings 2 |
|||||||||||||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||
(in millions) |
|
|
|
|
|
||||||||
Retail Annuities |
$ |
326 |
|
$ |
327 |
|
|
$ |
1,364 |
|
$ |
1,507 |
|
Institutional Products |
|
22 |
|
|
17 |
|
|
|
69 |
|
|
79 |
|
Closed Life and Annuity Blocks |
|
(88 |
) |
|
38 |
|
|
|
(95 |
) |
|
117 |
|
Corporate and Other |
|
(57 |
) |
|
(62 |
) |
|
|
(173 |
) |
|
(60 |
) |
Total3 |
$ |
203 |
|
$ |
320 |
|
|
$ |
1,165 |
|
$ |
1,643 |
|
Retail Annuities
Retail Annuities reported pretax adjusted operating earnings of
Full year 2023 pretax adjusted operating earnings for the segment were
Total annuity sales of
For the full year 2023, annuity sales of
Institutional Products
Institutional Products reported pretax adjusted operating earnings of
For the full year 2023, pretax adjusted operating earnings were
Closed Life and Annuity Blocks
Closed Life and Annuity Blocks reported a pretax adjusted operating loss of
For the full year 2023, the segment reported a pretax adjusted operating loss of
Corporate and Other
Corporate and Other reported a pretax adjusted operating loss of
For the full year 2023, the pretax adjusted operating loss was
Capitalization and Liquidity |
||||||
(Unaudited, in billions) |
|
|
|
|||
|
$ |
5.2 |
$ |
4.5 |
$ |
7.0 |
JNLIC’s estimated RBC ratio as of the fourth quarter of 2023 was 624%, up from the third quarter of 2023.
Statutory TAC at JNLIC was
Effective
Cash and highly liquid securities at the holding company totaled approximately
Earnings Conference Call
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To register for the webcast, click here.
FORWARD-LOOKING STATEMENTS
The information in this press release contains forward-looking statements about future events and circumstances and their effects upon revenues, expenses and business opportunities. Generally speaking, any statement in this release not based upon historical fact is a forward-looking statement. Forward-looking statements can also be identified by the use of forward-looking or conditional words, such as “could,” “should,” “can,” “continue,” “estimate,” “forecast,” “intend,” “look,” “may,” “will,” “expect,” “believe,” “anticipate,” “plan,” “remain,” “confident” and “commit” or similar expressions. In particular, statements regarding plans, strategies, prospects, targets and expectations regarding the business and industry are forward-looking statements. They reflect expectations, are not guarantees of performance and speak only as of the dates the statements are made. We caution investors that these forward-looking statements are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from those projected, expressed or implied. Factors that could cause actual results to differ materially from those in the forward-looking statements include those reflected in Part I, Item 1A. Risk Factors and Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended
Certain financial data included in this release consists of non-GAAP (Generally Accepted Accounting Principles) financial measures. These non-GAAP financial measures may not be comparable to similarly titled measures presented by other entities, nor should they be construed as an alternative to other financial measures determined in accordance with
Certain financial data included in this release consists of statutory accounting principles (“statutory”) financial measures, including “total adjusted capital.” These statutory financial measures are included in or derived from the
ABOUT JACKSON
Jackson® (NYSE: JXN) is committed to helping clarify the complexity of retirement planning—for financial professionals and their clients. Through our range of annuity products, financial know-how, history of award-winning service* and streamlined experiences, we strive to reduce the confusion that complicates retirement planning. We take a balanced, long-term approach to responsibly serving all our stakeholders, including customers, shareholders, distribution partners, employees, regulators and community partners. We believe by providing clarity for all today, we can help drive better outcomes for tomorrow. For more information, visit www.jackson.com.
Visit investors.jackson.com to view information regarding
*SQM (
Jackson® is the marketing name for
APPENDIX
Non-GAAP Financial Measures
In addition to presenting our results of operations and financial condition in accordance with
Adjusted Operating Earnings
Adjusted Operating Earnings is an after-tax non-GAAP financial measure, which we believe should be used to evaluate our financial performance on a consolidated basis by excluding certain items that may be highly variable from period to period due to accounting treatment under
For additional detail on the excluded items, please refer to the supplement regarding the fourth quarter ended
The following is a reconciliation of Adjusted Operating Earnings to net income (loss) attributable to
GAAP Net Income (Loss) to Adjusted Operating Earnings |
|||||||||||||
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||
(in millions, except share and per share data) |
|
|
|
|
|
||||||||
Net income (loss) attributable to |
$ |
(1,570 |
) |
$ |
(1,150 |
) |
|
$ |
899 |
|
$ |
6,186 |
|
Add: dividends on preferred stock |
|
11 |
|
|
— |
|
|
|
35 |
|
|
— |
|
Add: income tax expense (benefit) |
|
(395 |
) |
|
(385 |
) |
|
|
4 |
|
|
1,505 |
|
Pretax income (loss) attributable to |
|
(1,954 |
) |
|
(1,535 |
) |
|
|
938 |
|
|
7,691 |
|
Non-operating adjustments – (income) loss: |
|
|
|
|
|
||||||||
Guaranteed benefits and hedging results: |
|
|
|
|
|
||||||||
Fees attributed to guaranteed benefit reserves |
|
(780 |
) |
|
(777 |
) |
|
|
(3,125 |
) |
|
(3,077 |
) |
Net movement in freestanding derivatives |
|
(43 |
) |
|
3,862 |
|
|
|
4,651 |
|
|
2,744 |
|
Market risk benefits (gains) losses, net |
|
1,223 |
|
|
(1,900 |
) |
|
|
(3,897 |
) |
|
(3,536 |
) |
Net reserve and embedded derivative movements |
|
449 |
|
|
175 |
|
|
|
787 |
|
|
222 |
|
Amortization of DAC associated with non-operating items at date of transition to LDTI* |
|
141 |
|
|
157 |
|
|
|
591 |
|
|
658 |
|
Total guaranteed benefits and hedging results |
|
990 |
|
|
1,517 |
|
|
|
(993 |
) |
|
(2,989 |
) |
Net realized investment (gains) losses |
|
319 |
|
|
228 |
|
|
|
554 |
|
|
359 |
|
Net realized investment (gains) losses on funds withheld assets |
|
1,153 |
|
|
474 |
|
|
|
1,801 |
|
|
(2,186 |
) |
Net investment income on funds withheld assets |
|
(312 |
) |
|
(317 |
) |
|
|
(1,174 |
) |
|
(1,254 |
) |
Other items |
|
7 |
|
|
(47 |
) |
|
|
39 |
|
|
22 |
|
Total non-operating adjustments |
|
2,157 |
|
|
1,855 |
|
|
|
227 |
|
|
(6,048 |
) |
Pretax adjusted operating earnings |
|
203 |
|
|
320 |
|
|
|
1,165 |
|
|
1,643 |
|
Less: operating income tax expense (benefit) |
|
(12 |
) |
|
26 |
|
|
|
57 |
|
|
189 |
|
Adjusted operating earnings before dividends on preferred stock |
|
215 |
|
|
294 |
|
|
|
1,108 |
|
|
1,454 |
|
Less: dividends on preferred stock |
|
11 |
|
|
— |
|
|
|
35 |
|
|
— |
|
Adjusted operating earnings |
$ |
204 |
|
$ |
294 |
|
|
$ |
1,073 |
|
$ |
1,454 |
|
|
|
|
|
|
|
||||||||
Weighted Average diluted shares outstanding |
|
80,716,770 |
|
|
86,807,053 |
|
|
|
83,577,226 |
|
|
88,690,700 |
|
Net income (loss) per diluted share |
$ |
(19.64 |
) |
$ |
(13.74 |
) |
|
$ |
10.76 |
|
$ |
69.75 |
|
Adjusted Operating Earnings per diluted share |
$ |
2.53 |
|
$ |
3.39 |
|
|
$ |
12.84 |
|
$ |
16.39 |
|
*LDTI - Adoption of FASB issued ASU 2018-12 “Targeted Improvements to the Accounting for Long Duration Contracts”. |
|||||||||||||
Adjusted Book Value Attributable to Common Shareholders
Adjusted Book Value Attributable to Common Shareholders excludes Preferred Stock and Accumulated Other Comprehensive Income (Loss) ("AOCI") attributable to
(in millions) |
|
|
||
Total shareholders’ equity |
$ |
10,170 |
$ |
8,646 |
Less: Preferred equity |
|
533 |
|
— |
Total common shareholders’ equity |
|
9,637 |
|
8,646 |
Adjustments to total common shareholders’ equity: |
|
|
||
Exclude Accumulated Other Comprehensive (Income) Loss attributable to |
|
1,196 |
|
1,272 |
Adjusted Book Value Attributable to Common Shareholders |
$ |
10,833 |
$ |
9,918 |
Consolidated Balance Sheets |
||||||
|
|
|
|
|
||
|
|
2023 |
|
2022 |
||
(in millions, except share and per share data) |
|
|
|
|
||
Assets |
|
|
|
|
||
Investments: |
|
|
|
|
||
|
|
$ |
40,422 |
|
$ |
42,489 |
|
|
|
2,153 |
|
|
2,173 |
|
|
|
68 |
|
|
100 |
Equity securities, at fair value |
|
|
394 |
|
|
393 |
Mortgage loans, net of allowance for credit losses of |
|
|
10,082 |
|
|
10,967 |
Mortgage loans, at fair value under fair value option |
|
|
481 |
|
|
582 |
Policy loans (including |
|
|
4,399 |
|
|
4,377 |
Freestanding derivative instruments |
|
|
390 |
|
|
1,270 |
Other invested assets |
|
|
2,466 |
|
|
3,595 |
Total investments |
|
|
60,855 |
|
|
65,946 |
Cash and cash equivalents |
|
|
2,688 |
|
|
4,298 |
Accrued investment income |
|
|
512 |
|
|
514 |
Deferred acquisition costs |
|
|
12,302 |
|
|
12,923 |
Reinsurance recoverable, net of allowance for credit losses of |
|
|
25,422 |
|
|
29,046 |
Reinsurance recoverable on market risk benefits, at fair value |
|
|
149 |
|
|
221 |
Market risk benefit assets, at fair value |
|
|
6,737 |
|
|
4,865 |
Deferred income taxes, net |
|
|
640 |
|
|
320 |
Other assets |
|
|
1,294 |
|
|
944 |
Separate account assets |
|
|
219,656 |
|
|
195,906 |
Total assets |
|
$ |
330,255 |
|
$ |
314,983 |
Consolidated Balance Sheets |
||||||||
|
|
|
|
|
||||
|
|
2023 |
|
2022 |
||||
(in millions, except share and per share data) |
|
|
|
|
||||
Liabilities and Equity |
|
|
|
|
||||
Liabilities |
|
|
|
|
||||
Reserves for future policy benefits and claims payable |
|
$ |
11,898 |
|
|
$ |
12,318 |
|
Other contract holder funds |
|
|
55,319 |
|
|
|
58,190 |
|
Market risk benefit liabilities, at fair value |
|
|
4,785 |
|
|
|
5,662 |
|
Funds withheld payable under reinsurance treaties (including |
|
|
19,952 |
|
|
|
22,957 |
|
Long-term debt |
|
|
2,037 |
|
|
|
2,635 |
|
Repurchase agreements and securities lending payable |
|
|
19 |
|
|
|
1,048 |
|
Collateral payable for derivative instruments |
|
|
780 |
|
|
|
689 |
|
Freestanding derivative instruments |
|
|
1,210 |
|
|
|
2,065 |
|
Notes issued by consolidated variable interest entities, at fair value under fair value option |
|
|
1,988 |
|
|
|
1,732 |
|
Other liabilities |
|
|
2,277 |
|
|
|
2,403 |
|
Separate account liabilities |
|
|
219,656 |
|
|
|
195,906 |
|
Total liabilities |
|
|
319,921 |
|
|
|
305,605 |
|
|
|
|
|
|
||||
Equity |
|
|
|
|
||||
Series A non-cumulative preferred stock and additional paid in capital, |
|
|
533 |
|
|
|
— |
|
Common stock; 1,000,000,000 shares authorized, |
|
|
1 |
|
|
|
1 |
|
Additional paid-in capital |
|
|
6,005 |
|
|
|
6,063 |
|
|
|
|
(599 |
) |
|
|
(443 |
) |
Accumulated other comprehensive income (loss), net of tax expense (benefit) of |
|
|
(2,808 |
) |
|
|
(3,378 |
) |
Retained earnings |
|
|
7,038 |
|
|
|
6,403 |
|
Total shareholders' equity |
|
|
10,170 |
|
|
|
8,646 |
|
Noncontrolling interests |
|
|
164 |
|
|
|
732 |
|
Total equity |
|
|
10,334 |
|
|
|
9,378 |
|
Total liabilities and equity |
|
|
330,255 |
|
|
|
314,983 |
|
Consolidated Income Statements |
||||||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
(in millions, except per share data) |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Revenues |
|
|
|
|
|
|
|
|
||||||||
Fee income |
|
$ |
1,929 |
|
|
$ |
1,868 |
|
|
$ |
7,680 |
|
|
$ |
7,722 |
|
Premiums |
|
|
38 |
|
|
|
27 |
|
|
|
147 |
|
|
|
132 |
|
Net investment income: |
|
|
|
|
|
|
|
|
||||||||
Net investment income excluding funds withheld assets |
|
|
442 |
|
|
|
422 |
|
|
|
1,756 |
|
|
|
1,507 |
|
Net investment income on funds withheld assets |
|
|
312 |
|
|
|
317 |
|
|
|
1,174 |
|
|
|
1,254 |
|
Total net investment income |
|
|
754 |
|
|
|
739 |
|
|
|
2,930 |
|
|
|
2,761 |
|
Net gains (losses) on derivatives and investments: |
|
|
|
|
|
|
|
|
||||||||
Net gains (losses) on derivatives and investments |
|
|
(691 |
) |
|
|
(4,199 |
) |
|
|
(5,864 |
) |
|
|
(3,023 |
) |
Net gains (losses) on funds withheld reinsurance treaties |
|
|
(1,153 |
) |
|
|
(474 |
) |
|
|
(1,801 |
) |
|
|
2,186 |
|
Total net gains (losses) on derivatives and investments |
|
|
(1,844 |
) |
|
|
(4,673 |
) |
|
|
(7,665 |
) |
|
|
(837 |
) |
Other income |
|
|
15 |
|
|
|
25 |
|
|
|
67 |
|
|
|
85 |
|
Total revenues |
|
|
892 |
|
|
|
(2,014 |
) |
|
|
3,159 |
|
|
|
9,863 |
|
|
|
|
|
|
|
|||||||||||
Benefits and Expenses |
|
|
|
|
|
|
|
|
||||||||
Death, other policy benefits and change in policy reserves, net of deferrals |
|
|
264 |
|
|
|
251 |
|
|
|
965 |
|
|
|
1,062 |
|
(Gain) loss from updating future policy benefits cash flow assumptions, net |
|
|
79 |
|
|
|
(26 |
) |
|
|
102 |
|
|
|
(34 |
) |
Market risk benefits (gains) losses, net |
|
|
1,223 |
|
|
|
(1,900 |
) |
|
|
(3,897 |
) |
|
|
(3,536 |
) |
Interest credited on other contract holder funds, net of deferrals and amortization |
|
|
281 |
|
|
|
236 |
|
|
|
1,145 |
|
|
|
866 |
|
Interest expense |
|
|
35 |
|
|
|
40 |
|
|
|
185 |
|
|
|
113 |
|
Operating costs and other expenses, net of deferrals |
|
|
687 |
|
|
|
631 |
|
|
|
2,549 |
|
|
|
2,432 |
|
Amortization of deferred acquisition costs |
|
|
278 |
|
|
|
297 |
|
|
|
1,152 |
|
|
|
1,226 |
|
Total benefits and expenses |
|
|
2,847 |
|
|
|
(471 |
) |
|
|
2,201 |
|
|
|
2,129 |
|
Pretax income (loss) |
|
|
(1,955 |
) |
|
|
(1,543 |
) |
|
|
958 |
|
|
|
7,734 |
|
Income tax expense (benefit) |
|
|
(395 |
) |
|
|
(385 |
) |
|
|
4 |
|
|
|
1,505 |
|
Net income (loss) |
|
|
(1,560 |
) |
|
|
(1,158 |
) |
|
|
954 |
|
|
|
6,229 |
|
Less: Net income (loss) attributable to noncontrolling interests |
|
|
(1 |
) |
|
|
(8 |
) |
|
|
20 |
|
|
|
43 |
|
Net income (loss) attributable to |
|
|
(1,559 |
) |
|
|
(1,150 |
) |
|
|
934 |
|
|
|
6,186 |
|
Less: Dividends on preferred stock |
|
|
11 |
|
|
|
— |
|
|
|
35 |
|
|
|
— |
|
Net income (loss) attributable to |
|
$ |
(1,570 |
) |
|
$ |
(1,150 |
) |
|
$ |
899 |
|
|
$ |
6,186 |
|
|
|
|
|
|
|
|||||||||||
Earnings per share |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
(19.64 |
) |
|
$ |
(13.74 |
) |
|
$ |
10.99 |
|
|
$ |
72.34 |
|
Diluted (1) |
|
$ |
(19.64 |
) |
|
$ |
(13.74 |
) |
|
$ |
10.76 |
|
|
$ |
69.75 |
|
(1) In a quarter in which we reported a net loss attributable to |
||||||||||||||||
1 |
For the reconciliation of non-GAAP measures to the most comparable GAAP measure, please see the explanation of Non-GAAP Financial Measures in the Appendix to this release. |
2 |
For the reconciliation of non-GAAP measures to the most comparable GAAP measure, please see the explanation of Non-GAAP Financial Measures in the Appendix to this release. |
3 |
See reconciliation of Net Income to Total Pretax Adjusted Operating Earnings in the Appendix to this release. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240221973462/en/
Investor Relations Contacts:
elizabeth.werner@jackson.com
andrew.campbell@jackson.com
Media Contact:
patrick.rich@jackson.com
Source: