Cno Financial Group, Inc. · NYSE:CNO
Cno Financial — J.P. Morgan 2013 Insurance Conference
25 slides from Cno Financial's conference presentation, Mar 21, 2013
Slide 1: J.P. Morgan 2013 Insurance Conference
J.P. Morgan 2013 Insurance Conference March 21, 2013 Exhibit 99.1
Slide 2: Conference | March 21, 2013
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 2
Slide 3: Forward-Looking Statements
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 3 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 fu
Slide 4: Non-GAAP Measures
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 4 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 compa
Slide 5: CNO Fundamentals
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 5 Well positioned in the growing and underserved senior and middle income market Track record of strong execution Building core value drivers Strong risk management Well capitalized and generating significant excess ca
Slide 6: What Differentiates CNO?
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 6 What Differentiates CNO? Focus on serving the needs of our middle-income target market, a market that is fast growing and underserved Exclusive distribution ‒ Consistent with market focus ‒ We have “pricing” influence ‒
Slide 7: Track Record of Execution
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 7 88% 16% 26% CNO Peer Group S&P Insurance Track Record of Execution Total Return Since YE2009* *As of market close on 12/31/12 Reset Business Mix Financial Foundation Return Value To Shareholders Invest in Growth Peers - A
Slide 8: Investment in the Business
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 8 Investment in the Business CNO Investing in productivity and growth of the agent force Expanding presence by adding new locations and geographies Developing and launching new products to meet the needs of our target
Slide 9: Growth in the CNO Franchise
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 9 $12,106.9 $12,765.2 $13,329.2 $2,676.8 $2,637.6 $2,618.8 $698.0 $704.0 $714.8 BLC WN CP OCB ($ millions) $16,662.8 $15,481.7 $16,106.8 2010 2011 2012 $5,511.5 Growth in the CNO Franchise $5,286.1 $5,005.1 Investing in o
Slide 10: Segment Earnings Trend - Stable & Growing
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 10 ($ millions) * A non-GAAP measure. See the Appendix for a reconciliation to the corresponding GAAP measure. Segment Earnings Trend - Stable & Growing 2012 Headwinds Segment EBIT Excluding Significant Items* Favorable h
Slide 11: Loss Recognition & Cash Flow Testing
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 11 Loss Recognition & Cash Flow Testing 2012 Statutory Cash Flow Testing 2012 GAAP Loss Recognition Testing Aggregate testing margins remain strong Testing margin Increased in 2012 ↑ - ASU 2010-26 ↑ - Net Growth from Ne
Slide 12: Expanded New Money Rate Stress Test
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 12 • Moderate Stress: 4.75% NMR held flat for 5 years then recovering • Severe Stress: 50 basis point drop in NMR to 4.25% held flat indefinitely • 3Q assumption change: OCB interest sensitive life reserve charge - $28mm (a
Slide 13: Capital Strategy
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 13 $175 $294 $347 $423 $146 $161 $203 $294 309% 332% 358% 367% 2009 2010 2011 2012 Capital to Holding Company from Insurance Subs Holding Company Liquidity RBC Debt to Cap xAOCI* 23.8% 21.9% 18.3% 20.7% ($ millions) Capital
Slide 14: 2012 Capital Generation - Free Cash Flow
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 14 Debt Payments $111.8 Stock Buybacks $180.2 Financing Costs $23.1 Common Stock Dividends $13.9 2012 Capital Generation – Free Cash Flow Building ($ millions) 2013 Guidance: • $50-$75mm of capital retained to support growt
Slide 15: CNO: Near Term Goals Lead to Long Term Value
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 15 Grow sales, distribution and product portfolio Increase operational effectiveness Build economic value by growing EPS and ROE Achieve BB/BB debt rating Continue balanced approach to capital deployment Invest
Slide 16: Q&A
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 16 Q&A
Slide 17: Appendix
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 17 Appendix
Slide 18: The right products and channels for today's middle-market consumer
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 18 • Fixed and Fixed-Index Life and Annuity Products • Long-Term Care • Medicare Supplement • Whole and Universal life products • Final expense • Supplemental Health CNO can access consumers across multiple channels • With
Slide 19: Diversified product mix focused on protection needs
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 19 Retirement Security Medicare Annuities Supplemental Health Long-Term Care Life Insurance Basic products that fit with exclusive distribution and meet the basic insurance needs of the middle market Attractive and more
Slide 20: Information Related to Certain Non-GAAP Measures
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 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 ex
Slide 21: Non-GAAP Reconciliation: 2010 Net Operating Income
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 21 Information Related to Certain Non-GAAP Financial Measures The table below summarizes the financial impact of significant items on our 2010 net operating income. Management believes that identifying the impact of these i
Slide 22: Non-GAAP Reconciliation: 2011 Net Operating Income
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 22 Information Related to Certain Non-GAAP Financial Measures The table below summarizes the financial impact of significant items on our 2011 net operating income. Management believes that identifying the impact of these i
Slide 23: Non-GAAP Reconciliation: 2012 Net Operating Income
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 23 Information Related to Certain Non-GAAP Financial Measures The table below summarizes the financial impact of significant items on our 2012 net operating income. Management believes that identifying the impact of these i
Slide 24: Non-GAAP Reconciliation: EBIT
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 24 Information Related to Certain Non-GAAP Financial Measures Management believes that an analysis of earnings before net realized investment gains (losses), corporate interest, loss on extinguishment of debt, fair value ch
Slide 25: Debt to Capital Ratio Excluding AOCI
CNO Financial Group | J.P. Morgan 2013 Insurance Conference | March 21, 2013 25 Information Related to Certain Non-GAAP Financial Measures 4Q09 4Q10 4Q11 4Q12 Corporate notes payable 1,037.4$ 998.5$ 857.9$ 1,004.2$ Total shareholders' equity 3,038.6 3,811.6 4,613.8 5,049.3 Total capital 4,076.0$ 4,8
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