Cno Financial Group, Inc. · NYSE:CNO
Cno Financial — Investor Presentation (December 2013)
27 slides from Cno Financial's investor presentation, Dec 18, 2013
Slide 1: 2014 Outlook Call
2014 Outlook Call December 18, 2013 Exhibit 99.2
Slide 2: Forward-Looking Statements
CNO Financial Group | Outlook Call | December 18, 2013 2 Forward-Looking Statements Certain statements made in this presentation should be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These include statements about future results of operat
Slide 3: Non-GAAP Measures
CNO Financial Group | Outlook Call | December 18, 2013 3 Non-GAAP Measures This presentation contains financial measures that differ from the comparable measures under Generally Accepted Accounting Principles (GAAP). Reconciliations between those non-GAAP measures and the comparable GAAP measures ar
Slide 4: 18, 2013
CNO Financial Group | Outlook Call | December 18, 2013 4
Slide 5: CNO Strategy
CNO Financial Group | Outlook Call | December 18, 2013 5 CNO Strategy Continue to Build Long Term Shareholder Value Build on investment in the business Focus on sustainable profitable growth Increase operating effectiveness Enhance the Customer Experience Tactical deployment of excess capi
Slide 6: Trends and Market Observations
CNO Financial Group | Outlook Call | December 18, 2013 6 Continued growth in the underserved middle-income population The middle-income population is unprepared for retirement $21 trillion of retirement assets in motion The Affordable Care Act and insurance marketplaces have expanded opportu
Slide 7: Key Initiatives
CNO Financial Group | Outlook Call | December 18, 2013 7 Agent productivity Branch and geographic expansion New product development Worksite platform Operating efficiencies Customer Experience Key Initiatives Leveraging Middle Market Focus & Business Model Investment Breakdown Plan to In
Slide 8: Bankers Life 2014 Outlook
CNO Financial Group | Outlook Call | December 18, 2013 8 Bankers Life 2014 Outlook Sales force automation and new CRM tools Advanced life sales training Satellite expansion Revised branding and digital marketing Grow Financial Advisor program YTD 3Q2013 2014 Net new locations 19 15 Growth
Slide 9: Washington National 2014 Outlook
CNO Financial Group | Outlook Call | December 18, 2013 9 Washington National 2014 Outlook Worksite distribution expansion – Private exchange platform – Group underwritten products Individual distribution expansion – Experienced agent recruiting – Geographic expansion Grow owned agency distribu
Slide 10: Colonial Penn 2014 Outlook
CNO Financial Group | Outlook Call | December 18, 2013 10 Colonial Penn 2014 Outlook Patriot program growth Lead generation diversification Web/digital strategy Hispanic market expansion Telesales productivity improvements YTD 3Q2013 2014 Growth in sales Flat 6% - 9% Growth in collected pr
Slide 11: Tracking 4Q Expectations
CNO Financial Group | Outlook Call | December 18, 2013 11 Tracking 4Q Expectations CNO Core Earnings: - Health benefit ratios and annuity spreads consistent with 3rd quarter results - Colonial Penn 4Q EBIT will reflect a $5 million incremental increase in ad spend - Strategic investments drive seq
Slide 12: Financial Plan Underpinnings
CNO Financial Group | Outlook Call | December 18, 2013 12 • Stepped-up investment in growth and platform initiatives with an incremental impact on expenses in 2014 of ~$10 million Investing to Drive Long-Term Growth • Value of new business governs the run-on of profitable business while seeking to a
Slide 13: Key Earnings Drivers – Health and Annuity
CNO Financial Group | Outlook Call | December 18, 2013 13 v v v v v $10.3 $10.3 $10.2 2.61% 2.65% 2.70% 2012 2013 2014P Account Value Spread * Interest-adjusted benefit ratio - non-GAAP measure. Refer to the Appendix for the corresponding GAAP measure. Key Earnings Drivers – Health and Annuity CNO I
Slide 14: Capital Targets & Excess Capital Deployment
CNO Financial Group | Outlook Call | December 18, 2013 14 Capital Targets & Excess Capital Deployment CNO 3Q 2013 2014 Outlook RBC 392% ~ 400% range Liquidity $292mm ~ $300mm range Leverage 17.3%* ~16% range 2014 Capital Generation ~ $500mm Dialing in metrics that support investment- grade ratings w
Slide 15: Leveraging Considerable Tax Assets
CNO Financial Group | Outlook Call | December 18, 2013 15 Leveraging Considerable Tax Assets CNO ($ millions) Capital $278 Non-Life $974 Life $271 Loss Carryforwards Valuation Allowance 3Q 2013 Loss Carryforwards GAAP Expectations $1,523 $534 Non-Life & Capital v Expect modest future valuation allow
Slide 16: Driving CNO's Valuation
CNO Financial Group | Outlook Call | December 18, 2013 16 Driving CNO’s Valuation CNO Price to Book (Ex AOCI) ROE / Cost of Equity Regression Line Industry Value Map Quality Operating ROE growth while building book value per share and lowering our cost of capital...... Quality Operating ROE* v BVPS*
Slide 17: Closing Remarks
CNO Financial Group | Outlook Call | December 18, 2013 17 Closing Remarks CNO Building long term value… Investments in the business leading to above industry growth rates in combination with proactive approach to decreasing “Beta” to drive shareholder value Consolidated sales growth of 6%-8% in 20
Slide 18: Questions and Answers
CNO Financial Group | Outlook Call | December 18, 2013 18 Questions and Answers
Slide 19: Appendix
CNO Financial Group | Outlook Call | December 18, 2013 19 Appendix
Slide 20: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 20 The following provides additional information regarding certain non-GAAP measures used in this presentation. A non-GAAP measure is a numerical measure of a company’s performance, financial position, or cash flows that excludes or includes amo
Slide 21: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 21 Information Related to Certain Non-GAAP Financial Measures The interest-adjusted benefit ratio (a non-GAAP measure) is calculated by dividing the product's insurance policy benefits less imputed interest income on the accumulated assets backi
Slide 22: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 22 Information Related to Certain Non-GAAP Financial Measures Operating return measures Management believes that an analysis of return before loss on extinguishment of debt, net realized gains or losses, fair value changes due to fluctuations in
Slide 23: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 23 Information Related to Certain Non-GAAP Financial Measures The calculations of: (i) operating return on equity, excluding accumulated other comprehensive income (loss) and net operating loss carryforwards (a non-GAAP financial measure); (ii)
Slide 24: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 24 Information Related to Certain Non-GAAP Financial Measures A reconciliation of pretax operating earnings (a non-GAAP financial measure) to net income is as follows (dollars in millions): Twelve months ended 3Q13 Pretax operating earnings (a n
Slide 25: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 25 Information Related to Certain Non-GAAP Financial Measures A reconciliation of consolidated capital, excluding accumulated other comprehensive income (loss) and net operating loss carryforwards (a non-GAAP financial measure) to common shareho
Slide 26: EBIT Non-GAAP Measure
CNO Financial Group | Outlook Call | December 18, 2013 26 Management believes that an analysis of earnings before net realized investment gains (losses), fair value changes in embedded derivative liabilities, equity in earnings of certain non-strategic investments and earnings attributable to non-co
Slide 27: Information Related to Certain Non-GAAP Financial Measures
CNO Financial Group | Outlook Call | December 18, 2013 27 Information Related to Certain Non-GAAP Financial Measures 3Q13 Corporate notes payable 868.6$ Total shareholders' equity 4,786.6 Total capital 5,655.2$ Corporate debt to capital 15.4% Corporate notes payable 868.6$ Total shareholders' equity
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