Primerica, Inc. · NYSE:PRI
Primerica — Q4 2022 Earnings Presentation
13 slides from Primerica's earnings presentation, February 2023
Slide 1: Earnings Results
Earnings Results Quarter Ended December 31, 2022
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures Forward-Looking Statements This presentation may contain forward-looking statements. Information on factors that could cause results to differ materially from those projected in this presentation is available in our Form 10-K for the year en
Slide 3: Financial Highlights
Financial Highlights ● Adjusted operating revenues declined 5% as GAAP Financial Results volatility in equity markets pressured ISP results ($ in millions, except per-share amounts) Q4 2022 Q4 2021 % Change Revenues $686.9 $724.1 (5%) ● Adjusted net operating income of nearly $130 Net income $131.8
Slide 4: Distribution Highlights
Distribution Highlights Sales Force ● Life insurance licensed sales force ended the year at a record 135,208 reps Q4 2022 Q4 2021 % Change Distribution Recruits 77,025 73,572 5% ● Recruited more than 77,000 individuals New life licensed representatives 11,117 9,296 20% during the quarter, a 5% incre
Slide 5: Production Highlights: Term Life Insurance
Production Highlights Term Life Insurance Production ● Record life insurance face amount in-force of ($ in billions) Q4 2022 Q4 2021 % Change $917 billion at year end Issued life insurance policies 72,544 75,203 (4%) Term Life Face amount issued $25.3 $25.7 (1%) ● Transition to new term life product
Slide 6: Production Highlights: Investment and Savings Products
Production Highlights Investment and Savings Products ● Annual investment product sales exceeded Production $10 billion for the second consecutive year, ($ in billions) Q4 2022 Q4 2021 % Change although equity market volatility and Total product sales $2.09 $3.02 (31%) economic uncertainty pressured
Slide 7: Production Highlights: Senior Health
Production Highlights Senior Health ● Fourth quarter 2022 results reflected the deliberate slowing of growth and our progress in stabilizing the senior health business – Approved policies declined 35% year-over-year – LTV/CAC multiple of 1.2x ● During the 2022 AEP – We improved agent productivity by
Slide 8: Operating Results: Term Life Segment
Operating Results Term Life Segment ● Operating revenues increased 5%, driven by ($ in millions) Q4 2022 Q4 2021 % Change 6% growth in Adjusted Direct Premiums (ADP) Direct premiums $807.8 $789.3 2% ● Operating income growth outpaced revenues Premium ceded to IPO coinsurers (1) ($224.2) ($239.8) 7%
Slide 9: 2023 Outlook of Key Performance Metrics
2023 Outlook of Key Performance Metrics Provided under new accounting literature (LDTI basis) Impact of new accounting literature Guidance full year 2023 ● Adjusted direct premiums (ADP) – LDTI does not impact net premiums or ● ADP expected to grow ~6%, ADP assuming mid-single digit sales ● DAC rati
Slide 10: Operating Results: Investment & Savings Products Segment
Operating Results Investment & Savings Products Segment ($ in millions, except as noted) Q4 2022 Q4 2021 % Change ● Segment results adversely impacted by continued equity market volatility and Sales-based revenues $66.5 $103.5 (36%) economic headwinds Asset-based revenues $105.4 $118.0 (11%) Account
Slide 11: Operating Results: Senior Health Segment
Operating Results Senior Health Segment ($ in millions, except as noted) Q4 2022 Q4 2021 % Change ● Operating revenues were $28 million and operating income before taxes was $4.3 million Commissions and fees $22.2 $29.3 (24%) – Results reflected a $3.8 million revenue Operating revenues $27.9 $37.5
Slide 12: Insurance & Other Operating Expense Highlights
Insurance & Other Operating Expense Highlights ● Full year 2023 insurance and other operating expenses are expected to increase by around $22 to $28 million, or 4% to 5% — $14 million for employee-related costs — $12 million due to growth in the business — $9 million of technology-related costs — Be
Slide 13: Invested Assets Portfolio
Invested Assets Portfolio Key Portfolio Attributes ● Tailwinds from higher interest rates and growth (based on amortized cost (except for market value); in the size of portfolio Q4 2022 excludes cash, period end) — Average credit rating of A Fixed income / other mix 99%/1% Fixed income average book