Slide 1: Citizens Inc. Transforming and Clear Revenue Growth Opportunities
CITIZENS INC. TRANSFORMING AND CLEAR REVENUE GROWTH OPPORTUNITIES MARCH 2024 WWW.CITIZENSINC.COM
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Slide 3: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. All statements other than statements of historical facts contained in this presentation, including statements
Slide 4: Company Overview
Company Overview \CcITIZENS ©
Slide 5: Citizens Overview
CITIZENS OVERVIEW We specialize in offering traditional life insurance, endowment products and final expense insurance in niche markets where we believe we are able to achieve competitive advantages $1.7B Assets 232 Policyholders In more than 3,000+ Over $4.9 Billion Gross Insurance In-force employe
Slide 6: Company Premium Revenues Overview
COMPANY PREMIUM REVENUES OVERVIEW 2023 Premium Revenues (Segment) Life Home Life Insurance Segment Insurance Services Home Services Insurance Segment (73%)1 Segment Segment (27%)1 73% 27% International Market: Whole life insurance (funeral and burial costs) • Majority of premiums originate in Louisi
Slide 7: Uniquely Positioned for Growth Opportunities
UNIQUELY POSITIONED FOR GROWTH OPPORTUNITIES Persistent customer base expansion in large underserved niche markets globally Capital is invested in a more secure economic environment (the U.S.) U.S. Dollar Protection against devaluation of the policyowners' local currency Denominated Products Less pr
Slide 8: 2024 Milestones
2024 MILESTONES For 2024, Citizens has set the following milestones: • Increase first year life and A&H premium revenues at least 6% • Improve retention metrics at least 4% • Expand global network of producing agents at least 20% • Introduce 2 to 3 new products or major product enhancements. Citizen
Slide 9: Key Investment Highlights
KEY INVESTMENT HIGHLIGHTS TRANSFORMING AND CLEAR REVENUE GROWTH OPPORTUNITIES Unique Market Position Clear Growth Opportunities Executing on Goals • A Leader in USD-denominated whole • Large unmet need for specialized • Rapid expansion of sales force life products, internationally insurance products
Slide 10: Roadmap Execution
Roadmap Execution \CcITIZENS ©
Slide 11: Recent Accomplishments
ACCOMPLISHMENTS TRANSFORMING AND CLEAR REVENUE GROWTH OPPORTUNITIES INITIATIVES Rapid expansion of sales force Clear and defined runway for geographic expansion Disciplined expense and capital management Rapidly develop innovative products Advantages in growing niche markets globally ▪ Increased glo
Slide 12: Executing on Success
EXECUTING ON SUCCESS Amount of Insurance Issued ($ millions) $800 + 10% y/y $742 $675 New & Innovative Products $600 Successful Selling Campaigns $402 $392 $411 $400 $354 Growing Distributor Relationships Positive results $200 • FY 2023 insurance issued grew 10% y/y $0 2018 2019 2020 2021 2022 2023
Slide 13: Shareholder Returns
SHAREHOLDER RETURNS Book Value Per Share, Ex-AOCI $millions Shareholder Equity, Ex-AOCI $6.50 + 10% y/y $5.85 $400 $6.00 $5.50 $5.31 $5.00 $4.78 + 9% y/y $300 $290 $4.50 $265 $4.00 $239 $3.50 $118 $3.00 $200 $137 $139 $2.50 $2.00 $1.50 $100 $172 $1.00 $128 $100 $0.50 $0.00 $0 FY 21 FY 22 FY 23 FY 21
Slide 14: Process Improvements & Technology
PROCESS IMPROVEMENTS & TECHNOLOGY MAKING IT EASIER TO DO BUSINESS WITH CITIZENS Sales & Distribution Self-service Platform Developed digital sales and Enhanced policyholder and agent servicing platforms to improve self-services platform with new distribution capabilities capabilities to make it easi
Slide 15: Financial Overview
Financial Overview \CcITIZENS ©
Slide 16: Low Risk Profile and Financial Strength
LOW RISK PROFILE AND FINANCIAL STRENGTH • Low risk business model and conservative balance sheet management drive our financial fortitude Disciplined Conservative Approach to Investment • Strong balance sheet underpinned by a prudent Capital and Portfolio Liquidity approach to: o Investment portfoli
Slide 17: Investment Portfolio
INVESTMENT PORTFOLIO HIGH-QUALITY AND WELL-DIVERSIFIED Cash and Invested Assets (FY 2023) • Fixed income and cash securities represent 88% of the investment portfolio 6% Long-term • 99% of fixed income investments Investments rated investment grade 5% 86% $1.43B Policy Loans • Annualized investment
Slide 18: Capital Adequacy and Liquidity
CAPITAL ADEQUACY AND LIQUIDITY Risk Based Capital Ratio (%) Puerto Rico Capital Requirement (TAC/ACL RBC) 8.0 656% 7.0 Target Ratio 700% 650% of 7 600% 573% 560% 6.0 540% 5.1 or Lower 488% 5.0 500% 400% 4.0 300% 350% 3.0 Internal target 200% 2.0 100% 1.0 0% 0.0 2018 2019 2020 2021 2022 2023 2023 RBC
Slide 19: Financial Highlights for Q4 and Full Year 2023
FINANCIAL HIGHLIGHTS FOR Q4 AND FULL YEAR 2023 GAAP Financial Results As of and for the periods ended Three Months Ended December 31, Twelve Months Ended December 31, Performance Highlights (In thousands, except per share data) 2023 2022 2023 2022 Total Revenues $ 66,849 $ 67,257 $ 240,680 $ 232,524
Slide 20: SC Citizens
SC CITIZENS
Slide 21: Appendix
Appendix \CcITIZENS ©
Slide 22: Explanatory Notes on Use of Non-GAAP Measures
Explanatory Notes on Use of Non-GAAP Measures 1Adjusted Operating Income Adjusted Operating Income is a non-GAAP measure that is computed as pre-tax GAAP operating income, excluding net investment related gains (losses) and unusual one-time items. Management believes that this metric is meaningful,
Slide 23: Explanatory Notes on Use of Non-GAAP Measures, Continued
Explanatory Notes on Use of Non-GAAP Measures, Continued 2Adjusted Book Value Per Class A Common Share Adjusted book value per Class A common share is a non-GAAP measure that is calculated by dividing actual Class A common stockholders’ equity, excluding AOCI, by the number of Class A common shares
Slide 24: Company Timeline
COMPANY TIMELINE 2020 2021 Strategic Initiatives CEO, Gerald 1) Product and Geographic expansion Shields joins 2) Enhance marketing and sales efforts Citizens 1975 1995 3) Implement Process improvements Expanded Security Plan Life was operations incorporated to fund Internationally final expenses Be
Slide 25: Dedicated & Experienced Management Team
DEDICATED & EXPERIENCED MANAGEMENT TEAM INTERDISCIPLINARY TEAM WITH BROAD CAPABILITIES GERALD W. SHIELDS SHERYL KINLAW CEO Vice President, Chief Legal Officer and Secretary CEO Since 2020 CLO Since 2021 JON STENBERG ROBERT M. MAULDIN, III President Vice President, Chief Marketing Officer PRESIDENT C