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林肯金融报告2024年第三季度业绩
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宾夕法尼亚州， 2024年10月31日: 林肯金融（纽交所：LNC）今日公布了截至2024年9月30日的第三季度财务业绩。
•普通股东可获得的净利润(亏损)为5.62亿美元，每股摊薄分额为3.29美元。
•调整后的可供普通股股东的营业收入（亏损）为35800万美元，每股稀释后2.06美元。
•净利润（亏损）和调整后营业利润（亏损）之间的主要区别主要源于以下因素：
◦控制支出，同时继续在我们认为对长期成功至关重要的领域进行投资。4.46亿美元的税前净损失，每股稀释盈亏为$(2.61)，主要是由于与Fortitude Re再保险交易相关的嵌入式衍生工具公允价值变动造成的，其在其他全面收益中有直接对冲。
◦控制支出，同时继续在我们认为对长期成功至关重要的领域进行投资。$(3.81亿)美元的税前净损失，每股摊薄亏损$(2.23)，主要是由于利率期货下降导致市场风险利益变化，产生了非经济影响。
•年度假设审核结果对本季度的净利润（亏损）和调整后营业收入（亏损）均产生了积极影响。
•林肯在季末估计的RBC比率超过420%。
林肯金融董事长、总裁兼CEO Ellen Cooper 表示：“我们第三季度的业绩超出了预期，重新确立了我们坚定的战略执行力，得益于每个业务领域的势头和强劲的基本面。集团保护业务交出了创纪录的第三季度业绩，收益同比翻一番。年金业务收益增长了15%，销售额增长近25%。养老计划服务业务连续交出了业绩增长的季度，并且首年销售额环比增长了近80%。人寿保险连续两个季度实现了销售增长。(1)
我们正在利用我们的竞争优势实现增长，提高运营效率，构建资本灵活性，继续为实现可持续增长和增长的长期价值创造重新定位林肯。
(1) 报价中的运营利润指标不包括年度假设审查的影响。
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业务亮点
我们的业务取得了强劲的营运收入，这反映了持续执行各自战略计划。以下项目的业务运营结果中不包括年度假设审查的影响。请参阅后续的区域讨论以获取更多信息。
•年金业务 营业收入达到30000万美元，同比增长15%，反映了持续增长的账户余额、强劲的市场和更高的利差收入。总销售额为34亿美元，同比增长24%，我们的三大主要产品类别中每类销售额超过10亿美元，反映了我们多元化产品组合的优势。按利差计算的产品占本季度年金销售额的66%。
•集团保护 交付的营业利润为11000万美元，较2023财年第三季度的营业收入翻了一番，这归功于战略执行和持续支持性业务趋势。 第三季度毛利扩大至8.5%，增长了500个基点，原因是长期残疾的有利结果、改善的死亡率趋势和强劲的运营执行。 保费同比增长3%，反映了在新销售上持续实施定价纪律，同时符合我们的预期的续存率。
•人寿保险 上一年同期营业收入为2300万美元，本季度营业收入为1400万美元，不考虑上一年同期的重大事项影响。人寿保险经营收入符合预期，轻微不利的死亡率部分抵消了高于预期的另类投资收入。总销售额按顺序增长16％，导致连续第二个季度的顺序增长，由于我们的分销和产品重新定位进一步获得动力。
•退休计划服务 报告的营业收入为4400万美元，同比增长2%，环比增长10%，这是由账户余额增加、较高的股市以及持续控制费用所推动的。本季度首年销售额为17亿美元，反映了本年早些时候沟通的强劲项目储备。因此，养老服务提供商经历了阳性净流入65100万美元。
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收益总结
| （单位：百万美元，除每股数据外） | 截至或三个月结束时 | 截至或为期九个月结束时 | ||||||||||||
9/30/23(1) | 9/30/24 | 9/30/23(1) | 9/30/24 | |||||||||||
| $ | 853 | $ | (528) | $ | 483 | $ | 1,588 | |||||||
| 净利润(可供普通股股东使用) | 819 | (562) | 410 | 1,511 | ||||||||||
每股稀释盈利（损失）可供普通股东分配的净收入(2) | $ | 4.79 | $ | (3.29) | $ | 2.40 | $ | 8.75 | ||||||
| 调整后的营业收入（亏损） | 84 | 392 | 728 | 971 | ||||||||||
| 调整后的营业收入（亏损）可供普通股东分配 | 50 | 358 | 657 | 891 | ||||||||||
| Adjusted income (loss) from operations per diluted share available to common stockholders | $ | 0.29 | $ | 2.06 | $ | 3.85 | $ | 5.16 | ||||||
(1) 过往期间影响已经重新调整以符合当前期间的报告格式。
(2) 在呈现净亏损的期间，基本股份用于摊薄后每股收益和调整摊薄后每股收益的计算，因为使用摊薄后股份将导致每股亏损更低。
净利润与调整运营收入的对账(1)
| （单位：百万） | 在已结束的三个月中 | 在结束的九个月里 | |||||||||||||||
9/30/23(1) | 9/30/24 | 9/30/23(1) | 9/30/24 | ||||||||||||||
| 普通股股东可获得的净收益（亏损）——摊薄后 | $ | 819 | $ | (562) | $ | 410 | $ | 1,511 | |||||||||
| 更少： | |||||||||||||||||
| 已宣布的优先股分红 | (34) | (34) | (71) | (80) | |||||||||||||
| 根据我们的递延薪酬计划中LNC股票的递延单位进行了调整 | — | — | (2) | 3 | |||||||||||||
| 净收益（亏损） | 853 | (528) | 483 | 1,588 | |||||||||||||
| 更少： | |||||||||||||||||
| 净年金产品特征，税前 | 1,322 | (381) | 1,076 | 1,319 | |||||||||||||
| 净人寿保险产品特征，税前 | 108 | (125) | (168) | (253) | |||||||||||||
| 税前信用损失相关调整 | (27) | (88) | (53) | (124) | |||||||||||||
税前投资收益（亏损）(2) | (400) | (105) | (1,126) | (416) | |||||||||||||
| 再保险相关嵌入式衍生品公允价值的变化， | |||||||||||||||||
交易证券和某些抵押贷款，税前(2) | (29) | (446) | (27) | (51) | |||||||||||||
| 其他非金融资产的收益（亏损）——出售 | |||||||||||||||||
子公司/企业，税前(2) | — | (2) | — | 582 | |||||||||||||
其他税前项目(2) | (12) | (19) | (23) | (238) | |||||||||||||
| 与上述税前项目相关的所得税优惠（支出） | (193) | 246 | 76 | (202) | |||||||||||||
| 调整后的运营收入（亏损） | $ | 84 | $ | 392 | $ | 728 | $ | 971 | |||||||||
| 普通股股东可获得的业务调整后收益（亏损） | $ | 50 | $ | 358 | $ | 657 | $ | 891 | |||||||||
(1) 请查看本新闻稿背后的经营调整后收入的定义，以了解对2024年第三季度定义的修订以及调解行项目的进一步解释。之前的影响已经重新整理以符合当前期间的展示。
(2) 请查阅本公告背面的完整调节表以了解脚注。
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变量投资收益
其他投资收入，税后(1) | 截至三个月的时间 | 截至九个月的营业收入 | ||||||||||||||||||||||||
| （单位百万） | 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | 9/30/23 | 9/30/24 | |||||||||||||||||||
| 年金业务 | $ | 3 | $ | 3 | $ | 2 | $ | 1 | $ | 3 | $ | 10 | $ | 6 | ||||||||||||
| 人寿保险 | 34 | 39 | 58 | 26 | 73 | 125 | 157 | |||||||||||||||||||
| 集团保护 | 2 | 2 | 1 | 1 | 1 | 5 | 3 | |||||||||||||||||||
| 退休计划服务 | 2 | 2 | 1 | — | 2 | 6 | 3 | |||||||||||||||||||
| 其他经营 | — | — | — | — | — | — | — | |||||||||||||||||||
| 合并后的 | $ | 41 | $ | 46 | $ | 62 | $ | 28 | $ | 79 | $ | 146 | $ | 169 | ||||||||||||
(1) 在我们受限于对这些投资的经济利益的修改分保和暂扣基金再保协议中，排除用于支持我们所有基金类型的替代投资收入。
税后预付收入 | 截至三个月的时间 | 截至九个月的营业收入 | ||||||||||||||||||||||||
（单位百万） | 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | 9/30/23 | 9/30/24 | |||||||||||||||||||
年金业务 | $ | 1 | $ | 1 | $ | 1 | $ | — | $ | — | $ | 1 | $ | 1 | ||||||||||||
人寿保险 | — | 2 | — | 2 | 3 | 2 | 5 | |||||||||||||||||||
集团保护 | — | — | — | — | 1 | 1 | — | |||||||||||||||||||
退休计划服务 | — | — | 1 | — | — | 1 | 1 | |||||||||||||||||||
其他经营 | — | — | — | — | — | — | — | |||||||||||||||||||
合并后的 | $ | 1 | $ | 3 | $ | 2 | $ | 2 | $ | 4 | $ | 5 | $ | 7 | ||||||||||||
影响部门和其他操作结果的项目
截至2024年9月30日三个月的财务报告 | |||||||||||||||||
（单位百万） | 年金业务 | 人寿保险 | 集团保护 | 退休计划服务 | 其他经营 | ||||||||||||
税后影响： | |||||||||||||||||
替代投资收入与回报目标相比(1) | $ | 1 | $ | 6 | $ | — | $ | — | $ | — | |||||||
提前偿还收入(2) | — | 3 | 1 | — | — | ||||||||||||
年度假设审查 | 1 | 8 | (1) | — | — | ||||||||||||
| 税务事项 | — | — | — | — | — | ||||||||||||
| 其他 | — | — | — | — | — | ||||||||||||
总影响 | $ | 2 | $ | 17 | $ | — | $ | — | $ | — | |||||||
(1) 与目标回报比较的替代投资收入假设替代投资组合年回报率为10%。
(2) 预付款收入是在该季度报告的实际收入。
4
Capital and Liquidity
| For the Three Months Ended | |||||||||||||||||
| (in millions, except percent and per share data) | 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | ||||||||||||
Holding company available liquidity(1) | $ | 455 | $ | 458 | $ | 466 | $ | 463 | $ | 459 | |||||||
RBC ratio(2) | 375-385% | 407 | % | 400-410% | >420% | >420% | |||||||||||
| Book value per share (BVPS), including AOCI | $ | 13.04 | $ | 34.81 | $ | 38.46 | $ | 40.78 | $ | 46.97 | |||||||
Book value per share, excluding AOCI(3) | $ | 63.03 | $ | 55.30 | $ | 61.63 | $ | 66.37 | $ | 62.67 | |||||||
Adjusted book value per share(3),(4) | $ | 63.53 | $ | 64.97 | $ | 65.01 | $ | 68.51 | $ | 70.04 | |||||||
(1) Holding company available liquidity presented as of 3/31/2024, 6/30/2024 and 9/30/2024 does not include the $300 million prefunding of a 2025 maturity.
(2) The RBC ratio is calculated as of December 31 annually, but is reported in the March statutory reporting, and as such, the quarterly ratios presented for 9/30/2023, 3/31/2024, 6/30/2024, and 9/30/2024 are considered estimates based on information known at the time of reporting.
(3) Refer to the reconciliation to book value per share, including AOCI, at the back of this release.
(4) This measure has been updated, effective beginning with the fourth quarter of 2023, to exclude reinsurance-related embedded derivatives and the underlying portfolio gains (losses), given the size of the impact of the fourth quarter 2023 reinsurance transaction. Such amounts in the prior periods presented, and the impact of this change to such prior periods, was not meaningful.
Annuities
| (in millions, except ROA data) | As of or For the Three Months Ended | As of or For the Nine Months Ended | ||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23(1) | 3/31/24 | 6/30/24 | 9/30/24 | Change | 9/30/23 | 9/30/24 | Change | ||||||||||||||||||||||||
| Total operating revenues | $ | 1,197 | $ | (525) | $ | 1,269 | $ | 1,209 | $ | 1,195 | (0.2) | % | $ | 3,528 | $ | 3,673 | 4.1 | % | ||||||||||||||
| Total operating expenses | 915 | (846) | 952 | 858 | 836 | (8.6) | % | 2,636 | 2,645 | 0.3 | % | |||||||||||||||||||||
| Income (loss) from operations before taxes | 282 | 321 | 317 | 351 | 359 | 27.3 | % | 892 | 1,028 | 15.2 | % | |||||||||||||||||||||
| Federal income tax expense (benefit) | 34 | 42 | 58 | 54 | 58 | 70.6 | % | 98 | 171 | 74.5 | % | |||||||||||||||||||||
| Income (loss) from operations | $ | 248 | $ | 279 | $ | 259 | $ | 297 | $ | 301 | 21.4 | % | $ | 794 | $ | 857 | 7.9 | % | ||||||||||||||
| Income (loss) from operations, excluding impact of annual assumption review | $ | 260 | $ | 265 | $ | 259 | $ | 297 | $ | 300 | 15.3 | % | $ | 806 | $ | 856 | 6.2 | % | ||||||||||||||
| Total sales | $ | 2,728 | $ | 4,365 | $ | 2,847 | $ | 3,817 | $ | 3,375 | 23.7 | % | $ | 8,475 | $ | 10,038 | 18.4 | % | ||||||||||||||
| Net flows | $ | (874) | $ | 285 | $ | (1,993) | $ | (954) | $ | (1,637) | (87.3) | % | $ | (2,312) | $ | (4,584) | (98.3) | % | ||||||||||||||
| Average account balances, net of reinsurance | $ | 151,312 | $ | 147,419 | $ | 155,291 | $ | 158,370 | $ | 161,680 | 6.9 | % | $ | 148,613 | $ | 158,245 | 6.5 | % | ||||||||||||||
| Return on average account balances (bps) | 66 | 76 | 67 | 75 | 74 | 71 | 72 | |||||||||||||||||||||||||
(1) Day one impacts related to the reinsurance transaction with Fortitude Re caused line-item volatility in the fourth quarter 2023.
•Income from operations was $301 million for the third quarter, up 21% over the prior year. The year-over-year increase was primarily driven by account balance growth due to favorable equity markets.
•Total sales were $3.4 billion, an increase of 24% year over year driven by strong growth within spread-based products.
•RILA sales increased 13% year over year and 10% sequentially, following the successful launch of our second-generation RILA product.
5
•Net outflows were approximately $1.6 billion in the quarter, compared to net outflows of $874 million in the prior-year quarter, primarily the result of higher account balances.
•Average account balances, net of reinsurance, for the quarter were $162 billion, up 7%, compared to $151 billion in the prior-year quarter, primarily driven by growth in variable annuities and RILA. RILA represented 20% of total annuity ending account balances, net of reinsurance, an increase of 3 percentage points compared to the prior-year quarter.
Life Insurance
| (in millions) | As for or For the Three Months Ended | As of or For the Nine Months Ended | ||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | Change | 9/30/23 | 9/30/24 | Change | ||||||||||||||||||||||||
| Total operating revenues | $ | 1,723 | $ | 1,667 | $ | 1,541 | $ | 1,511 | $ | 1,589 | (7.8) | % | $ | 5,241 | $ | 4,640 | (11.5) | % | ||||||||||||||
| Total operating expenses | 1,952 | 1,681 | 1,591 | 1,562 | 1,568 | (19.7) | % | 5,458 | 4,719 | (13.5) | % | |||||||||||||||||||||
| Income (loss) from operations before taxes | (229) | (14) | (50) | (51) | 21 | 109.2 | % | (217) | (79) | 63.6 | % | |||||||||||||||||||||
| Federal income tax expense (benefit) | (56) | (8) | (15) | (16) | (1) | 98.2 | % | (64) | (31) | 51.6 | % | |||||||||||||||||||||
| Income (loss) from operations | $ | (173) | $ | (6) | $ | (35) | $ | (35) | $ | 22 | 112.7 | % | $ | (153) | $ | (48) | 68.6 | % | ||||||||||||||
| Income (loss) from operations, excluding the impact of annual assumption review | $ | (17) | $ | (6) | $ | (35) | $ | (35) | $ | 14 | NM | $ | 3 | $ | (56) | NM | ||||||||||||||||
| Average account balances, net of reinsurance | $ | 50,130 | $ | 45,608 | $ | 42,280 | $ | 43,230 | $ | 44,055 | (12.1) | % | $ | 49,760 | $ | 43,188 | (13.2) | % | ||||||||||||||
| Total sales | $ | 144 | $ | 144 | $ | 91 | $ | 105 | $ | 122 | (15.3) | % | $ | 397 | $ | 319 | (19.6) | % | ||||||||||||||
•Income from operations was $22 million for the quarter, compared to an operating loss of $173 million in the prior-year quarter. The third quarter 2024 annual assumption review had an $8 million favorable impact, compared to an unfavorable impact of $156 million in the prior-year quarter. The operating loss in the third quarter of 2023 also included $40 million of unfavorable significant items, including $25 million in unclaimed property expense and $15 million related to a surrender benefit program.
•Not including the impact of the annual assumption review and prior-year quarter significant items, operating income in the third quarter of 2024 was $14 million compared to operating income of $23 million in the prior-year quarter, reflecting a lower run-rate post the Fortitude Re transaction.
•Total sales grew 16% sequentially, achieving a second consecutive quarter of sequential growth, as our distribution and product repositioning gained further traction.
•Average account balances, net of reinsurance, were $44 billion, down 12% compared to the prior-year quarter, driven by the impact of the Fortitude Re transaction.
6
Group Protection
| (in millions, except margin data) | As of or For the Three Months Ended | As of or For the Nine Months Ended | ||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | Change | 9/30/23 | 9/30/24 | Change | ||||||||||||||||||||||||
| Total operating revenues | $ | 1,388 | $ | 1,387 | $ | 1,425 | $ | 1,441 | $ | 1,432 | 3.2 | % | $ | 4,176 | $ | 4,299 | 2.9 | % | ||||||||||||||
| Total operating expenses | 1,302 | 1,322 | 1,324 | 1,276 | 1,295 | (0.5) | % | 3,863 | 3,896 | 0.9 | % | |||||||||||||||||||||
| Income (loss) from operations before taxes | 86 | 65 | 101 | 165 | 137 | 59.3 | % | 313 | 403 | 28.8 | % | |||||||||||||||||||||
| Federal income tax expense (benefit) | 18 | 13 | 21 | 35 | 28 | 55.6 | % | 66 | 85 | 28.8 | % | |||||||||||||||||||||
| Income (loss) from operations | $ | 68 | $ | 52 | $ | 80 | $ | 130 | $ | 109 | 60.3 | % | $ | 247 | $ | 318 | 28.7 | % | ||||||||||||||
| Income (loss) from operations, excluding the impact of annual assumption review | $ | 44 | $ | 52 | $ | 80 | $ | 130 | $ | 110 | NM | $ | 223 | $ | 319 | 43.0 | % | |||||||||||||||
| Insurance premiums | $ | 1,251 | $ | 1,250 | $ | 1,285 | $ | 1,298 | $ | 1,288 | 3.0 | % | $ | 3,765 | $ | 3,871 | 2.8 | % | ||||||||||||||
| Total sales | $ | 71 | $ | 398 | $ | 144 | $ | 161 | $ | 84 | 18.3 | % | $ | 295 | $ | 389 | 31.9 | % | ||||||||||||||
| Total loss ratio | 75.2 | % | 76.6 | % | 75.0 | % | 70.1 | % | 71.4 | % | 73.8 | % | 72.2 | % | ||||||||||||||||||
Operating margin(1) | 5.4 | % | 4.1 | % | 6.2 | % | 10.0 | % | 8.4 | % | 6.6 | % | 8.2 | % | ||||||||||||||||||
| Operating margin, excluding the impact of annual assumption review | 3.5 | % | 4.1 | % | 6.2 | % | 10.0 | % | 8.5 | % | 5.9 | % | 8.2 | % | ||||||||||||||||||
(1) Operating margin is calculated by dividing income (loss) from operations by insurance premiums.
•Income from operations was $109 million in the quarter, compared to earnings of $68 million in the prior-year quarter. The annual assumption review had a $1 million unfavorable impact in the current quarter and a $24 million favorable impact in the third quarter of 2023.
•Not including the impact of the annual assumption review, operating income was up $66 million year over year due to the benefits from strategic and operational actions.
•Operating margin was 8.4%, 300 basis points higher than the third quarter of 2023.
•The total loss ratio was 71.4% in the quarter, 380 basis points lower than the prior-year quarter.
•Insurance premiums were $1.3 billion in the quarter, up 3% compared to the prior-year quarter.
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Retirement Plan Services
| (in millions, except ROA data) | As of or For the Three Months Ended | As of or For the Nine Months Ended | ||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | Change | 9/30/23 | 9/30/24 | Change | ||||||||||||||||||||||||
| Total operating revenues | $ | 327 | $ | 322 | $ | 322 | $ | 327 | $ | 335 | 2.4 | % | $ | 988 | $ | 984 | (0.4) | % | ||||||||||||||
| Total operating expenses | 277 | 278 | 281 | 281 | 286 | 3.2 | % | 831 | 847 | 1.9 | % | |||||||||||||||||||||
| Income (loss) from operations before taxes | 50 | 44 | 41 | 46 | 49 | (2.0) | % | 157 | 137 | (12.7) | % | |||||||||||||||||||||
| Federal income tax expense (benefit) | 7 | 6 | 5 | 6 | 5 | (28.6) | % | 24 | 17 | (29.2) | % | |||||||||||||||||||||
| Income (loss) from operations | $ | 43 | $ | 38 | $ | 36 | $ | 40 | $ | 44 | 2.3 | % | $ | 133 | $ | 120 | (9.8) | % | ||||||||||||||
| Deposits | $ | 2,700 | $ | 2,972 | $ | 3,802 | $ | 3,282 | $ | 4,180 | 54.8 | % | $ | 8,806 | $ | 11,265 | 27.9 | % | ||||||||||||||
| Net flows | $ | (272) | $ | (332) | $ | 391 | $ | (197) | $ | 651 | NM | $ | 464 | $ | 845 | 82.1 | % | |||||||||||||||
| Average account balances | $ | 96,473 | $ | 96,045 | $ | 103,240 | $ | 106,374 | $ | 110,550 | 14.6 | % | $ | 93,897 | $ | 106,595 | 13.5 | % | ||||||||||||||
| Return on average account balances (bps) | 18 | 16 | 14 | 15 | 16 | 19 | 15 | |||||||||||||||||||||||||
•Income from operations was $44 million in the quarter, a 2% improvement compared to the prior-year quarter, primarily driven by higher account balances. Sequentially, income from operations was up 10%, driven by higher account balances.
•Total deposits for the quarter were $4.2 billion, an increase of 55% over the prior-year quarter driven by increased first-year sales in full-service segments.
•Net inflows totaled $651 million for the quarter driven by first-year sales growth.
•Average account balances for the quarter were $111 billion, increasing 15% from the prior-year quarter.
Other Operations
| (in millions) | As of or For the Three Months Ended | As of or For the Nine Months Ended | ||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23(1) | 3/31/24 | 6/30/24 | 9/30/24 | Change | 9/30/23 | 9/30/24 | Change | ||||||||||||||||||||||||
| Total operating revenues | $ | 38 | $ | (884) | $ | 27 | $ | 39 | $ | 52 | 36.8 | % | $ | 127 | $ | 118 | (7.1) | % | ||||||||||||||
Total operating expenses (2) | 170 | (751) | 146 | 161 | 157 | (7.6) | % | 499 | 466 | (6.6) | % | |||||||||||||||||||||
Income (loss) from operations before taxes (2) | (132) | (133) | (119) | (122) | (105) | 20.5 | % | (372) | (348) | 6.5 | % | |||||||||||||||||||||
Federal income tax expense (benefit) (2) | (30) | (33) | (23) | (25) | (21) | 30.0 | % | (79) | (72) | 8.9 | % | |||||||||||||||||||||
Income (loss) from operations(2),(3) | $ | (102) | $ | (100) | $ | (96) | $ | (97) | $ | (84) | 17.6 | % | $ | (293) | $ | (276) | 5.8 | % | ||||||||||||||
(1) Day one impacts related to the reinsurance transaction with Fortitude Re caused line-item volatility in the fourth quarter of 2023.
(2) The prior period presentation has been recast to conform to the revised definition of income (loss) from operations. See Definitions of Non-GAAP Measures at the back of this press release.
(3) Income (loss) from operations does not include preferred dividends.
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Unrealized Gains and Losses
The Company reported a net unrealized loss of $7.0 billion (pre-tax) on its available-for-sale securities as of September 30, 2024. This compared to a net unrealized loss of $14.2 billion (pre-tax) as of September 30, 2023, with the year-over-year increase primarily due to lower treasury rates.
The tables attached to this release define and reconcile the non-GAAP measures adjusted income (loss) from operations, adjusted income (loss) from operations available to common stockholders, book value per share, excluding AOCI, and adjusted book value per share to net income (loss), net income (loss) available to common stockholders, and book value per share, including AOCI, calculated in accordance with GAAP.
This press release contains statements that are forward-looking, and actual results may differ materially. Please see the Forward-looking Statements – Cautionary Language at the end of this release for factors that may cause actual results to differ materially from the company’s current expectations.
For other financial information, please refer to the company’s third quarter 2024 statistical supplement and third quarter 2024 earnings supplement, which are available in the investor relations section of its website http://www.lincolnfinancial.com/investor.
Conference Call Information
Lincoln Financial will discuss the company’s third-quarter 2024 results with the investment community in a conference call beginning at 8:00 a.m. Eastern Time on Thursday, October 31, 2024.
The conference call will be broadcast live through the company’s website at www.lincolnfinancial.com/webcast. Please log on to the webcast at least 15 minutes prior to the start of the conference call to download and install any necessary streaming media software. A replay of the call will be available by 10:30 a.m. Eastern Time on October 31, 2024, at www.lincolnfinancial.com/webcast.
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About Lincoln Financial
Lincoln Financial helps people to plan, protect and retire with confidence. As of December 31, 2023, approximately 17 million customers trust our guidance and solutions across four core businesses – annuities, life insurance, group protection, and retirement plan services. As of September 30, 2024, the company had $324 billion in end-of-period account balances, net of reinsurance. Headquartered in Radnor, Pa., Lincoln Financial is the marketing name for Lincoln National Corporation (NYSE: LNC) and its affiliates. Learn more at LincolnFinancial.com.
| Contacts: | ||||||||||||||
| Tina Madon | Sarah Boxler | |||||||||||||
| 445-280-0488 | 215-495-8439 | |||||||||||||
| Investor Relations | Media Relations | |||||||||||||
| Tina.Madon@LFG.com | Sarah.Boxler@LFG.com | |||||||||||||
Non-GAAP Measures
Management believes that adjusted income (loss) from operations (or adjusted operating income), adjusted income (loss) from operations available to common stockholders, and adjusted income (loss) from operations per diluted share available to common stockholders better explain the results of the company’s ongoing businesses in a manner that allows for a better understanding of the underlying trends in the company’s current business as the excluded items are unpredictable and not necessarily indicative of current operating fundamentals or future performance of the business segments, and, in most instances, decisions regarding these items do not necessarily relate to the operations of the individual segments. Management also believes that using book value, excluding accumulated other comprehensive income (“AOCI”), and adjusted book value per share enables investors to analyze the amount of our net worth that is primarily attributable to our business operations. Book value per share, excluding AOCI is useful to investors because it eliminates the effect of items that are unpredictable and can fluctuate significantly from period to period, primarily based on changes in interest rates. Adjusted book value per share is useful to investors because it eliminates the effect of items that are unpredictable and can fluctuate significantly from period to period, primarily based on changes in equity markets and interest rates.
For the historical periods, reconciliations of non-GAAP measures used in this press release to the most directly comparable GAAP measure may be included in this Appendix to the press release and/or are included in the Statistical Supplements for the corresponding periods contained in the Earnings section of the Investor Relations page on our website: http://www.lincolnfinancial.com/investor.
Definitions of Non-GAAP Measures Used in this Press Release
Adjusted income (loss) from operations, adjusted income (loss) from operations available to common stockholders, book value per share, excluding AOCI, and adjusted book value per share are financial measures we use to evaluate and assess our results. Adjusted income (loss) from operations, adjusted income (loss) from operations available to common
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stockholders, book value per share, excluding AOCI, and adjusted book value per share, as used in the press release, are non-GAAP financial measures and do not replace GAAP net income (loss), net income (loss) available to common stockholders, and book value per share, including AOCI, the most directly comparable GAAP measures.
Adjusted Income (Loss) from Operations
In the third quarter of 2024, we revised our definition of adjusted income (loss) from operations to exclude the impact of certain items that are not indicative of the ongoing operations of the business and may obscure trends in the underlying performance of the Company. The revised definition now excludes, as applicable, certain legal accruals, severance expense related to initiatives that realign the workforce, mark-to-market adjustment related to the LNC stock component of our deferred compensation plans, impacts from the settlement or curtailment of defined benefit obligations and the effect of tax adjustments such as changes to deferred tax valuation allowances from the definition of adjusted income (loss) from operations. The presentation of prior period adjusted income (loss) from operations has been recast to conform to the current period presentation.
Adjusted income (loss) from operations is GAAP net income excluding the following items, as applicable:
•Items related to annuity product features, which include changes in MRBs, including gains and losses and benefit payments, changes in the fair value of the derivative instruments we hold to hedge GLB and GDB riders, net of fee income allocated to support the cost of hedging them, and changes in the fair value of the embedded derivative liabilities of our indexed annuity contracts and the associated index options we hold to hedge them, including collateral expense associated with the hedge program (collectively, “net annuity product features”);
•Items related to life insurance product features, which include changes in the fair value of derivatives we hold as part of VUL hedging, changes in reserves resulting from benefit ratio unlocking associated with the impact of capital markets, and changes in the fair value of the embedded derivative liabilities of our IUL contracts and the associated index options we hold to hedge them (collectively, “net life insurance product features”);
•Credit loss-related adjustments on fixed maturity AFS securities, mortgage loans on real estate and reinsurance-related assets (“credit loss-related adjustments”);
•Changes in the fair value of equity securities, certain derivatives, certain other investments and realized gains (losses) on sales, disposals and impairments of financial assets (collectively, “investment gains (losses)”);
•Changes in the fair value of reinsurance-related embedded derivatives, trading securities and mortgage loans on real estate electing the fair value option (“changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans”);
•Income (loss) from the initial adoption of new accounting standards, accounting policy changes and new regulations, including changes in tax law;
•Income (loss) from reserve changes, net of related amortization, on business sold through reinsurance;
•Losses from the impairment of intangible assets and gains (losses) on other non-financial assets;
•Income (loss) from discontinued operations;
•Other items, which include the following: certain legal accruals; severance expense related to initiatives that realign the workforce; transaction and integration costs related to mergers and acquisitions including the acquisition or divestiture, through reinsurance or other means, of businesses or blocks of business; mark-to-market adjustment related to the LNC stock component of our deferred compensation plans (“deferred compensation mark-to-market adjustment”); gains (losses) on modification or early extinguishment of debt; and impacts from settlement or curtailment of defined benefit obligations; and
•Income tax benefit (expense) related to the above pre-tax items, including the effect of tax adjustments such as changes to deferred tax valuation allowances.
Adjusted Income (Loss) from Operations Available to Common Stockholders
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Adjusted income (loss) from operations available to common stockholders is defined as after-tax adjusted income (loss) from operations less preferred stock dividends.
Book Value Per Share, Excluding AOCI
Book value per share, excluding AOCI, is calculated based upon a non-GAAP financial measure.
•It is calculated by dividing (a) stockholders’ equity, excluding AOCI and preferred stock, by (b) common shares outstanding.
•We provide book value per share, excluding AOCI, to enable investors to analyze the amount of our net worth that is attributable primarily to our business operations.
•Management believes book value per share, excluding AOCI, is useful to investors because it eliminates the effect of items that are unpredictable and can fluctuate significantly from period to period, primarily based on changes in interest rates.
•Book value per share is the most directly comparable GAAP measure.
Adjusted Book Value Per Share
Adjusted book value per share is calculated based upon a non-GAAP financial measure.
•It is calculated by dividing (a) stockholders’ equity, excluding AOCI, preferred stock, MRB-related impacts, GLB and GLB hedge instrument gains (losses), and the difference between amounts recognized in net income (loss) on reinsurance-related embedded derivatives and the underlying asset portfolios (“reinsurance-related embedded derivatives and portfolio gains (losses)”) by (b) common shares outstanding.
•We provide adjusted book value per share to enable investors to analyze the amount of our net worth that is primarily attributable to our business operations.
•Management believes adjusted book value per share is useful to investors because it eliminates the effect of market movements that are unpredictable that can fluctuate significantly from period to period, primarily based on changes in equity markets and interest rates.
•Book value per share is the most directly comparable GAAP measure.
Other Definitions
Holding Company Available Liquidity
Holding company available liquidity consists of cash and invested cash, excluding cash held as collateral, and certain short-term investments that can be readily converted into cash, net of commercial paper outstanding.
Sales
Sales as reported consist of the following:
•Annuities and Retirement Plan Services – deposits from new and existing customers;
•Universal life insurance (“UL”), indexed universal life insurance (“IUL”), variable universal life insurance (“VUL”) – first-year commissionable premiums plus 5% of excess premiums received;
•MoneyGuard® linked-benefit products – MoneyGuard® (UL), 15% of total expected premium deposits, and MoneyGuard Market AdvantageSM (VUL), 150% of commissionable premiums;
•Executive Benefits – insurance and corporate-owned UL and VUL, first-year commissionable premiums plus 5% of excess premium received, and single premium bank-owned UL and VUL, 15% of single premium deposits;
•Term – 100% of annualized first-year premiums; and
•Group Protection – annualized first-year premiums from new policies.
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Lincoln National Corporation
Reconciliation of Net Income to Adjusted Income from Operations and
Average Stockholders' Equity to Adjusted Average Stockholders' Equity
| For the | For the | ||||||||||||||||||||||
| (in millions, except per share data) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| 2024 | 2023 (1) | 2024 | 2023 (1) | ||||||||||||||||||||
| Net Income (Loss) Available to Common | |||||||||||||||||||||||
| Stockholders – Diluted | $ | (562) | $ | 819 | $ | 1,511 | $ | 410 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Preferred stock dividends declared | (34) | (34) | (80) | (71) | |||||||||||||||||||
| Adjustment for deferred units of LNC stock in our | |||||||||||||||||||||||
| deferred compensation plans | — | — | 3 | (2) | |||||||||||||||||||
| Net Income (Loss) | (528) | 853 | 1,588 | 483 | |||||||||||||||||||
| Less: | |||||||||||||||||||||||
| Net annuity product features, pre-tax | (381) | 1,322 | 1,319 | 1,076 | |||||||||||||||||||
| Net life insurance product features, pre-tax | (125) | 108 | (253) | (168) | |||||||||||||||||||
| Credit loss-related adjustments, pre-tax | (88) | (27) | (124) | (53) | |||||||||||||||||||
Investment gains (losses), pre-tax (2) | (105) | (400) | (416) | (1,126) | |||||||||||||||||||
| Changes in the fair value of reinsurance-related | |||||||||||||||||||||||
| embedded derivatives, trading securities and certain | |||||||||||||||||||||||
mortgage loans, pre-tax (3) | (446) | (29) | (51) | (27) | |||||||||||||||||||
| Gains (losses) on other non-financial assets – sale of | |||||||||||||||||||||||
subsidiaries/businesses, pre-tax (4) | (2) | — | 582 | — | |||||||||||||||||||
Other items, pre-tax (5)(6)(7)(8) | (19) | (12) | (238) | (23) | |||||||||||||||||||
| Income tax benefit (expense) related | |||||||||||||||||||||||
| to the above pre-tax items | 246 | (193) | (202) | 76 | |||||||||||||||||||
| Total adjustments | (920) | 769 | 617 | (245) | |||||||||||||||||||
| Adjusted Income (Loss) from Operations | $ | 392 | $ | 84 | $ | 971 | $ | 728 | |||||||||||||||
| Add: | |||||||||||||||||||||||
| Preferred stock dividends declared | (34) | (34) | (80) | (71) | |||||||||||||||||||
| Adjusted Income (Loss) from Operations Available to Common Stockholders | $ | 358 | $ | 50 | $ | 891 | $ | 657 | |||||||||||||||
Earnings (Loss) Per Common Share – Diluted (9) | |||||||||||||||||||||||
| Net income (loss) | $ | (3.29) | $ | 4.79 | $ | 8.75 | $ | 2.40 | |||||||||||||||
| Adjusted income (loss) from operations | 2.06 | 0.29 | 5.16 | 3.85 | |||||||||||||||||||
| Stockholders’ Equity, Average | |||||||||||||||||||||||
| Stockholders' equity | $ | 8,481 | $ | 4,509 | $ | 7,816 | $ | 5,567 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Preferred stock | 986 | 986 | 986 | 986 | |||||||||||||||||||
| AOCI | (3,526) | (6,792) | (3,800) | (5,425) | |||||||||||||||||||
| Stockholders’ equity, excluding AOCI and preferred stock | 11,021 | 10,315 | 10,630 | 10,006 | |||||||||||||||||||
| MRB-related impacts | 2,410 | 986 | 2,288 | (95) | |||||||||||||||||||
| GLB and GDB hedge instruments gains (losses) | (2,767) | (1,519) | (2,623) | (921) | |||||||||||||||||||
Reinsurance-related embedded derivatives and portfolio gains (losses)(10) | (455) | NM | (462) | NM | |||||||||||||||||||
Adjusted average stockholders' equity(10) | $ | 11,833 | $ | 10,848 | $ | 11,427 | $ | 11,022 | |||||||||||||||
(1)Prior period impacts have been recast to conform to the current period presentation. See definitions of Non-GAAP measures earlier in this release.
(2)The three and nine months ended September 30, 2023, include impairments of certain fixed maturity AFS securities in an unrealized loss position, resulting from the Company’s intent to sell these securities as part of the fourth quarter 2023 reinsurance transaction.
(3)Includes primarily changes in the fair value of the embedded derivative related to the fourth quarter 2023 reinsurance transaction.
(4)Relates to the sale of our wealth management business, which provided approximately $650 million of statutory capital benefit.
(5)Includes certain legal accruals of $(12) million in the third quarter of 2023 and $(114) million primarily related to the settlement of cost of insurance litigation in the first quarter of 2024.
(6)Includes severance expense related to initiatives that realign the workforce of $(3) million, $(3) million, $(49) million, $(7) million and $(16) million in the first quarter of 2023, second quarter of 2023, first quarter of 2024, second quarter of 2024 and third quarter of 2024, respectively.
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(7)Includes transaction and integration costs related to mergers, acquisitions and divestitures of $(9) million, $(1) million, $(10) million, $(27) million and $(2) million for the second quarter of 2023, third quarter of 2023, first quarter of 2024, second quarter of 2024 and third quarter of 2024, respectively.
(8)Includes deferred compensation mark-to-market adjustment of $12 million, $(8) million, $1 million, $(13) million, $1 million and $(1) million in the first quarter of 2023, second quarter of 2023, third quarter of 2023, first quarter of 2024, second quarter of 2024 and third quarter of 2024, respectively.
(9)In periods where a net loss or adjusted loss from operations is presented, basic shares are used in the diluted EPS and adjusted diluted EPS calculations, as the use of diluted shares would result in a lower loss per share.
(10)This measure has been updated, effective beginning with the fourth quarter of 2023, to exclude reinsurance-related embedded derivatives and the underlying portfolio gains (losses), given the size of the impact of the fourth quarter 2023 reinsurance transaction. Such amounts in the prior periods presented, and the impact of this change to such prior periods, was not meaningful.
Lincoln National Corporation
Reconciliation of Book Value per Share
| As of the Three Months Ended | ||||||||||||||||||||||||||||||||
| 9/30/23 | 12/31/23 | 3/31/24 | 6/30/24 | 9/30/24 | ||||||||||||||||||||||||||||
| Book Value Per Common Share | ||||||||||||||||||||||||||||||||
| Book value per share | $ | 13.04 | $ | 34.81 | $ | 38.46 | $ | 40.78 | $ | 46.97 | ||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||
| AOCI | (49.99) | (20.49) | (23.17) | (25.59) | (15.70) | |||||||||||||||||||||||||||
| Book value per share, excluding AOCI | 63.03 | 55.30 | 61.63 | 66.37 | 62.67 | |||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||
| MRB-related gains (losses) | 9.11 | 6.38 | 15.10 | 15.66 | 12.56 | |||||||||||||||||||||||||||
| GLB and GDB hedge instruments gains (losses) | (9.61) | (12.29) | (15.69) | (16.22) | (16.17) | |||||||||||||||||||||||||||
Reinsurance-related embedded derivatives and portfolio gains (losses)(1) | NM | (3.76) | (2.79) | (1.58) | (3.76) | |||||||||||||||||||||||||||
Adjusted book value per share(1) | $ | 63.53 | $ | 64.97 | $ | 65.01 | $ | 68.51 | $ | 70.04 | ||||||||||||||||||||||
(1) This measure has been updated, effective beginning with the fourth quarter of 2023, to exclude reinsurance-related embedded derivatives and the underlying portfolio gains (losses), given the size of the impact of the fourth quarter 2023 reinsurance transaction. Such amounts in the prior periods presented, and the impact of this change to such prior periods, were not meaningful (NM).
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Lincoln National Corporation
Digest of Earnings
| For the | |||||||||||
| (in millions, except per share data) | Three Months Ended | ||||||||||
| September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Revenues | $ | 4,111 | $ | 4,203 | |||||||
| Net Income (Loss) | $ | (528) | $ | 853 | |||||||
| Preferred stock dividends declared | (34) | (34) | |||||||||
| Net Income (Loss) Available to Common | |||||||||||
| Stockholders – Diluted | $ | (562) | $ | 819 | |||||||
| Net Income (Loss) Per Common Share – Basic | $ | (3.29) | $ | 4.82 | |||||||
Net Income (Loss) Per Common Share – Diluted (2) | $ | (3.29) | $ | 4.79 | |||||||
| Average Shares – Basic | 170,773,438 | 169,645,881 | |||||||||
| Average Shares – Diluted | 172,848,870 | 170,890,502 | |||||||||
| For the | |||||||||||
| Nine Months Ended | |||||||||||
| September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Revenues | $ | 13,380 | $ | 10,946 | |||||||
| Net Income (Loss) | $ | 1,588 | $ | 483 | |||||||
| Preferred stock dividends declared | (80) | (71) | |||||||||
| Adjustment for deferred units of LNC stock in our | |||||||||||
deferred compensation plans (1) | 3 | (2) | |||||||||
| Net Income (Loss) Available to Common | |||||||||||
| Stockholders – Diluted | $ | 1,511 | $ | 410 | |||||||
| Net Income (Loss) Per Common Share – Basic | $ | 8.85 | $ | 2.43 | |||||||
| Net Income (Loss) Per Common Share – Diluted | $ | 8.75 | $ | 2.40 | |||||||
| Average Shares – Basic | 170,482,264 | 169,529,509 | |||||||||
| Average Shares – Diluted | 172,767,554 | 170,625,444 | |||||||||
(1) We exclude deferred units of LNC stock that are antidilutive from our diluted earnings per share calculation.
(2) In periods where a net loss or adjusted loss from operations is presented, basic shares are used in the diluted EPS and adjusted diluted EPS calculations, as the use of diluted shares would result in a lower loss per share.
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FORWARD-LOOKING STATEMENTS – CAUTIONARY LANGUAGE
Certain statements made in this press release and in other written or oral statements made by Lincoln or on Lincoln’s behalf are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements. Forward-looking statements may contain words like: “anticipate,” “believe,” “estimate,” “expect,” “project,” “shall,” “will” and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, trends in Lincoln’s businesses, prospective services or products, future performance or financial results and the outcome of contingencies, such as legal proceedings. Lincoln claims the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA.
Forward-looking statements are subject to risks and uncertainties. Actual results could differ materially from those expressed in or implied by such forward-looking statements due to a variety of factors, including:
•Weak general economic and business conditions that may affect demand for our products, account balances, investment results, guaranteed benefit liabilities, premium levels and claims experience;
•Adverse global capital and credit market conditions that may affect our ability to raise capital, if necessary, and may cause us to realize impairments on investments and certain intangible assets, including goodwill and the valuation allowance against deferred tax assets, which may reduce future earnings and/or affect our financial condition and ability to raise additional capital or refinance existing debt as it matures;
•The inability of our subsidiaries to pay dividends to the holding company in sufficient amounts, which could harm the holding company’s ability to meet its obligations;
•Legislative, regulatory or tax changes, both domestic and foreign, that affect: the cost of, or demand for, our subsidiaries’ products; the required amount of reserves and/or surplus; our ability to conduct business and our captive reinsurance arrangements as well as restrictions on the payment of revenue sharing and 12b-1 distribution fees;
•Changes in tax law or the interpretation of or application of existing tax laws that could impact our tax costs and the products that we sell;
•The impact of regulations adopted by the Securities and Exchange Commission (“SEC”), the Department of Labor or other federal or state regulators or self-regulatory organizations that could adversely affect our distribution model and sales of our products and result in additional disclosure and other requirements related to the sale and delivery of our products;
•The impact of new and emerging rules, laws and regulations relating to privacy, cybersecurity and artificial intelligence that may lead to increased compliance costs, reputation risk and/or changes in business practices;
•Increasing scrutiny and evolving expectations and regulations regarding ESG matters that may adversely affect our reputation and our investment portfolio;
•Actions taken by reinsurers to raise rates on in-force business;
•Declines in or sustained low interest rates causing a reduction in investment income, the interest margins of our businesses and demand for our products;
•Rapidly increasing or sustained high interest rates that may negatively affect our profitability, value of our investment portfolio and capital position and may cause policyholders to surrender annuity and life insurance policies, thereby causing realized investment losses;
16
•The impact of the implementation of the provisions of the European Market Infrastructure Regulation relating to the regulation of derivatives transactions;
•The initiation of legal or regulatory proceedings against us, and the outcome of any legal or regulatory proceedings, such as: adverse actions related to present or past business practices common in businesses in which we compete; adverse decisions in significant actions including, but not limited to, actions brought by federal and state authorities and class action cases; new decisions that result in changes in law; and unexpected trial court rulings;
•A decline or continued volatility in the equity markets causing a reduction in the sales of our subsidiaries’ products; a reduction of asset-based fees that our subsidiaries charge on various investment and insurance products; and an increase in liabilities related to guaranteed benefit riders, which are accounted for as market risk benefits, of our subsidiaries’ variable annuity products;
•Ineffectiveness of our risk management policies and procedures, including our various hedging strategies;
•A deviation in actual experience regarding future policyholder behavior, mortality, morbidity, interest rates or equity market returns from the assumptions used in pricing our subsidiaries’ products and in establishing related insurance reserves, which may reduce future earnings;
•Changes in accounting principles that may affect our consolidated financial statements;
•Lowering of one or more of our debt ratings issued by nationally recognized statistical rating organizations and the adverse effect such action may have on our ability to raise capital and on our liquidity and financial condition;
•Lowering of one or more of the insurer financial strength ratings of our insurance subsidiaries and the adverse effect such action may have on the premium writings, policy retention, profitability of our insurance subsidiaries and liquidity;
•Significant credit, accounting, fraud, corporate governance or other issues that may adversely affect the value of certain financial assets, as well as counterparties to which we are exposed to credit risk, requiring that we realize losses on financial assets;
•Interruption in telecommunication, information technology or other operational systems or failure to safeguard the confidentiality or privacy of sensitive data on such systems, including from cyberattacks or other breaches of our data security systems;
•The effect of acquisitions and divestitures, including the inability to realize the anticipated benefits of acquisitions and dispositions of businesses and potential operating difficulties and unforeseen liabilities relating thereto, as well as the effect of restructurings, product withdrawals and other unusual items;
•The inability to realize or sustain the benefits we expect from, greater than expected investments in, and the potential impact of efforts related to, our strategic initiatives;
•The adequacy and collectability of reinsurance that we have obtained;
•Pandemics, acts of terrorism, war or other man-made and natural catastrophes that may adversely impact liabilities for policyholder claims, affect our businesses and increase the cost and availability of reinsurance;
•Competitive conditions, including pricing pressures, new product offerings and the emergence of new competitors, that may affect the level of premiums and fees that our subsidiaries can charge for their products;
•The unknown effect on our subsidiaries’ businesses resulting from evolving market preferences and the changing demographics of our client base; and
•The unanticipated loss of key management or wholesalers.
The risks and uncertainties included here are not exhaustive. Our most recent Form 10-K, as well as other reports that we file with the SEC, include additional factors that could affect our businesses and
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financial performance. Moreover, we operate in a rapidly changing and competitive environment. New risk factors emerge from time to time, and it is not possible for management to predict all such risk factors.
Further, it is not possible to assess the effect of all risk factors on our businesses or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. In addition, Lincoln disclaims any obligation to correct or update any forward-looking statements to reflect events or circumstances that occur after the date of this press release.
The reporting of Risk-Based Capital (“RBC”) measures is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities.
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