Metlife, Inc. · NYSE:MET
Metlife — Q3 2020 Earnings Presentation
22 slides from Metlife's earnings presentation, Nov 4, 2020
Slide 1: 3Q20 Supplemental Slides
Exhibit 99.3 3Q20 Supplemental Slides1 John McCallion Chief Financial Officer 1 These slides highlight information in MetLife, Inc.'s earnings release, quarterly financial supplement and other prior public disclosures.
Slide 2: Table of contents
Table of contents Topic Page No. Net Income (Loss) to Adjusted Earnings 3 Actuarial Assumption Review 4 Adjusted Earnings ex. Total Notable Items by Segment 6 Variable Investment Income (VII) 7 Direct Expense Ratio 9 Cash & Capital 10 Appendix 11 2
Slide 3: Net income (loss) to adjusted earnings
Net income (loss) to adjusted earnings 3Q20 1 (post-tax) $ in millions $ Per Share Net Income (Loss) $633 $0.69 Less: Net Investment Gains (Losses) (16) (0.02) Net Derivative Gains (Losses)2 (459) (0.50) Investment Hedge Adjustments (181) (0.20) Actuarial Assumption Review2 (98) (0.11) Other2 (191)
Slide 4: Assumption review reflects low interest rates for longer
Assumption review reflects low interest rates for longer 3Q20 Actuarial Assumption Review Highlights $ in $ Per • Lowered U.S. mean reversion interest (post-tax) 1 millions Share rate from 3.75% to 2.75% Adjusted Earnings $(203) $(0.22) • Extended U.S. mean reversion Non-Adjusted Earnings (98) (0.11
Slide 5: Actuarial assumption review by segment
Actuarial assumption review by segment Adjusted Non-Adjusted ($ in millions - post-tax) Earnings Earnings Net Income Highlights Lowered long-term returns and raised lapse Asia ($28) $10 ($18) assumptions in Korea Raised expense assumption in Chile ProVida, Latin America (9) — (9) increased premium p
Slide 6: Adjusted earnings ex. total notable items by segment
Adjusted earnings ex. total notable items by segment % % Change 1 ($ in millions - post-tax) 3Q20 3Q19 Change (Constant Rate) Highlights Group Benefits $392 $366 7% + Volume Growth + Investment Margins; + Underwriting Margins; Retirement and Income Solutions 490 284 73% + Volume Growth Property & Ca
Slide 7: 3Q20 VII driven by strong rebound in private equities
3Q20 VII driven by strong rebound in private equities ($ in millions - pre-tax) $652 $326 $327 $351 $0 ($555) 3Q19 4Q19 1Q20 2Q20 3Q20 Private Equity Other 7
Slide 8: 3Q20 VII by segment
3Q20 VII by segment ($ in millions - post-tax) 2Q20 3Q20 Group Benefits $3 $6 Retirement and Income Solutions (122) 164 Property & Casualty (9) 16 U.S. (128) 186 Asia (77) 148 Latin America (7) (3) EMEA — — MetLife Holdings (161) 172 Corporate & Other (65) 12 Total Variable Investment Income ($438)
Slide 9: Managing to ~12.3% direct expense ratio; 3Q20 ratio includes favorable items
Managing to ~12.3% direct expense ratio; 3Q20 ratio includes favorable items Direct Expense Ratio1 14.3% -170bps 13.3% 13.3% 12.9% 12.6% 12.4% 12.0% 11.4% 2015 2016 2017 2018 2019 1Q20 2Q20 3Q20 1 Direct expense ratio, excluding total notable items related to direct expenses and pension risk transfe
Slide 10: Cash & capital
Cash & capital Holding Company Cash1 Capital $7.8B • Higher 3Q20 holding company cash driven by preferred stock issuance of $1 billion $6.6B • Share repurchases of $80 million in 3Q20 $5.3B • Expected total U.S. Statutory Adjusted Capital2 $4.2B $3.5B of ~$21 billion at Sept. 30, 2020, up 12% from y
Slide 11: Appendix
Appendix Ii! MetLife
Slide 12: Cautionary Statement on Forward-Looking Statements
Cautionary Statement on Forward-Looking Statements The forward-looking statements in this presentation, such as “assumption,” "expect," "long-term," and “managing to" are based on assumptions and expectations that involve risks and uncertainties, including the “Risk Factors” MetLife, Inc. describes
Slide 13: Explanatory Note on Non-GAAP and Other Financial Information
Explanatory Note on Non-GAAP and Other Financial Information Any references in this presentation (except in this Explanatory Note on Non- GAAP Financial Information and Reconciliations) to: Should be read as, respectively: (i) net income (loss); (i) net income (loss) available to MetLife, Inc.’s com
Slide 14: Explanatory Note on Non-GAAP and Other Financial Information (Continued)
Explanatory Note on Non-GAAP and Other Financial Information (Continued) Any of these financial measures shown on a constant currency basis reflect the impact of changes in foreign currency exchange rates and are calculated using the average foreign currency exchange rates for the most recent period
Slide 15: Explanatory Note on Non-GAAP and Other Financial Information (Continued)
Explanatory Note on Non-GAAP and Other Financial Information (Continued) The following additional adjustments are made to revenues, in the line items indicated, in calculating adjusted revenues: • Universal life and investment-type product policy fees excludes the amortization of unearned revenue re
Slide 16: Explanatory Note on Non-GAAP and Other Financial Information (Continued)
Explanatory Note on Non-GAAP and Other Financial Information (Continued) Statistical sales information: • U.S.: ◦ Group Benefits: calculated using 10% of single premium deposits and 100% of annualized full-year premiums and fees from recurring premium policy sales of all products. ◦ Retirement and I
Slide 17: Reconciliation of Net Income (Loss) to Adjusted Earnings Available to Common Shareholders
Reconciliation of Net Income (Loss) Available to MetLife, Inc.'s Common Shareholders to Adjusted Earnings Available to Common Shareholders 3Q20 3Q19 Earnings Per Earnings Per Weighted Weighted Average Average Common Common Share Share Diluted1 Diluted1 (In millions, except per share data) Net Income
Slide 18: Reconciliation to Adjusted Earnings, Excluding Total Notable Items
Reconciliation to Adjusted Earnings Available to Common Shareholders, Excluding Total Notable Items 3Q20 Retirement and Group Income Property & Latin MetLife Corporate U.S.1 Benefits1 Solutions1 Casualty1 Asia America EMEA Holdings1 & Other1 (In millions) Adjusted earnings available to common shareh
Slide 19: Expense Detail and Ratios
Expense Detail and Ratios (In millions, except ratio data) 2015 2016 2017 2018 2019 Reconciliation of Capitalization of DAC to Adjusted Capitalization of DAC Capitalization of DAC $ (3,319) $ (3,152) $ (3,002) $ (3,254) $ (3,358) Less: Divested businesses and lag elimination1 120 (1) 34 (1) (20) Adj
Slide 20: Expense Detail and Ratios (Continued)
Expense Detail and Ratios (Continued) (In millions, except ratio data) 1Q20 2Q20 3Q20 Reconciliation of Capitalization of DAC to Adjusted Capitalization of DAC Capitalization of DAC $ (774) $ (671) $ (764) Less: Divested businesses (3) (2) — Adjusted capitalization of DAC $ (771) $ (669) $ (764) Rec
Slide 21: Premiums, Fees and Other Revenues
Premiums, Fees and Other Revenues (In millions) 2015 2016 2017 2018 2019 1Q20 2Q20 3Q20 Total Company - Premiums, Fees and Other Revenues Premiums, fees and other revenues $ 43,900 $ 44,370 $ 45,843 $ 51,222 $ 49,680 $ 11,336 $ 10,491 $ 11,887 Less: Unearned revenue adjustments 7 30 12 (7) 97 18 5 2
Slide 22: MetLife - Navigating life together
iy’ MetLife Navigating life together Ii! MetLife