Jackson Financial Inc. · NYSE:JXN
Jackson Financial — Q2 2024 Earnings Presentation
31 slides from Jackson Financial's earnings presentation, Aug 8, 2024
Slide 1: Second Quarter 2024 Financial Results
Jackson Financial Inc. Second Quarter 2024 Financial Results August 8, 2024
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures The information in this document contains forward-looking statements about future events and circumstances and their effects upon revenues, expenses and business opportunities. Generally speaking, any statement in this document not based upon historic
Slide 3: 2Q 2024 Financial Results Key Highlights
2Q 2024 Financial Results Key Highlights $264M $3.43 $144M 550-570% GAAP earnings GAAP Earnings per Capital return Statutory capital position Net income attributable to share Common share dividends JNLIC estimated risk-based Jackson Financial Inc. Net income per common and repurchases capital (RBC)
Slide 4: Consistent Capital Delivery
Consistent Capital Delivery Cumulative capital return to common shareholders Capital return since becoming a standalone company Highlights 1,600,000,000 $1.5B • Jackson Financial Inc. (JFI) has returned $1.5 1,400,000,000 billion to common shareholders since becoming a standalone public company 1,20
Slide 5: On Track to Deliver on 2024 Financial Targets
On Track to Deliver on 2024 Financial Targets 2024 Progress Capital Return $550-$650 million capital In the first six months of 2024, returned $316 million of capital to common return to common shareholders shareholders Holdco Liquidity Approximately two years of Holding company cash and highly liqu
Slide 6: Consolidated Results
Consolidated Results Adjusted Operating Earnings1 Key Takeaways ($ millions) 410 334 Adjusted Operating Earnings 283 2Q24 vs. 2Q23 • 2Q24 benefited from improved spread income and increased fee income resulting from higher average variable annuity assets under management, and improved mortality, par
Slide 7: Notable Items
Notable Items Second Quarter 2024 2Q23 2Q24 After- EPS- After- EPS- ($ millions, except per share amounts) Pretax Pretax tax1 Diluted tax1,2 Diluted Adjusted Operating Earnings3 305 283 $3.34 473 410 $5.32 Notable Items Included in Adjusted Operating Earnings Out performance/(Under performance) from
Slide 8: Stable Non-Operating Results
Stable Non-Operating Results 2Q24 Pretax Adjusted Operating Earnings Reconciliation ($ millions) Highlights 473 • Stable guarantee fee stream supports hedging needs • Economic hedging better aligns with U.S. GAAP 71 311 accounting following the establishment and funding of Brooke Re, leading to a be
Slide 9: Continued Progress on Retail Sales Diversification
Continued Progress on Retail Sales Diversification1 Retail Sales Highlights ($ billions) 4.2 • 2Q24 retail annuity sales up 15% and 36% from 1Q24 and 3.7 3.1 2Q23, respectively, with an increasingly diversified product mix • More than half of retail annuity sales without lifetime 2Q23 1Q24 2Q24 bene
Slide 10: Segment Results
Segment Results ($ millions) Retail ($ millions) Institutional ($ millions) Closed Block ($ millions) Pre-tax adjusted operating earnings1 ($ millions) Pre-tax adjusted operating earnings1 ($ millions) Pre-tax adjusted operating earnings1 465 419 328 35 31 29 17 19 7 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 2Q
Slide 11: Strong Capital and Liquidity Position
Strong Capital and Liquidity Position Highlights • Jackson National Life Insurance Company (JNLIC) estimated RBC ratio of 550-570% as of 2Q24 • Statutory Total Adjusted Capital (TAC) at JNLIC ended 2Q24 at $4.7 billion • JNLIC generated $681 million of capital in the first six months of 20241 • Broo
Slide 12: Outlook for Continued Performance Against Targets Remains Positive
Outlook for Continued Performance Against Targets Remains Positive Demonstrated Maintained strong On track to deliver Well-positioned for strength of balance sheet and on 2024 key financial continued long- distribution robust levels of targets term value creation franchise and liquidity for sharehol
Slide 13: Investments
Investments @ JACKSON’
Slide 14: High Quality, Diversified Investment Portfolio
High Quality, Diversified Investment Portfolio Strategic, conservative Highly rated and Corporate portfolio is underwriting across our diversified commercial concentrated in portfolio mortgage loan office investment-grade portfolio, which is less securities than 2% of the general account portfolio 1
Slide 15: U.S. GAAP – Investment Portfolio
U.S. GAAP – Investment Portfolio June 30, 2024 Investment Portfolio Classification1 Key Highlights Other invested assets <1% Limited partnerships 4% • Market/book ratio of the fixed maturity portfolio is 0.92 U.S government securities 9% Derivatives <1% Policy loans 2% Other government securities 2%
Slide 16: Statutory – Investment Portfolio
Statutory1 – Investment Portfolio June 30, 2024 Investment Portfolio Classification Key Highlights Limited partnerships 3% Other invested assets <1% • Market/book ratio of the fixed maturity portfolio is 0.92 Derivative <1% U.S government securities 10% Policy loans 2% Other government securities 2%
Slide 17: Statutory – Fixed Maturity Rating Distribution
Statutory – Fixed Maturity Rating Distribution June 30, 2024 98% of portfolio is investment grade US Treasuries NAIC 1A-1D (AAA-AA-) 13% 17% NAIC 5/6 <0.1% NAIC 4A-4C (B) <1% NAIC 3A-3C (BB) 1% $32b NAIC 1E-1G (A) 33% NAIC 2A-2C (BBB) 35% Note: Percentages may not total 100 due to rounding. 17
Slide 18: Statutory – Corporate Portfolio
Statutory – Corporate Portfolio June 30, 2024 Corporate Portfolio Rating Distribution1 Key Highlights CCC and below: <0.1% • Market/book ratio of the corporate portfolio is 0.94 B: <1% AAA: <1% BB: 2% AA: 7% • High-yield corporates account for 1% of the total investment portfolio and 2% of total cor
Slide 19: Statutory – ABS Portfolio
Statutory – ABS Portfolio June 30, 2024 ABS Sector Distribution1 NAIC Rating Distribution Single family rental 1% Aircraft 1% Other 4% Equipment leases 0% Whole business securitization 2% NAIC 4 Music royalties 3% <0.1% NAIC 1A-1D (AAA-AA-) Fiber 3% NAIC 3 (BB) 59% <0.1% PDP wells 3% Timeshare 5% NA
Slide 20: Statutory – Collateralized Loan Obligations (CLO) Debt
Statutory – Collateralized Loan Obligations (CLO) Debt June 30, 2024 CLO NAIC Distribution1 Key Highlights • CLO exposure highly rated with virtually all rated single A B AAA or above <1% 56% BBB • Exposure is diversified among 42 different managers and <1% 68 CLOs • Each CLO is diversified, averagi
Slide 21: Statutory – Commercial Mortgage-Backed Securities (CMBS)
Statutory – Commercial Mortgage-Backed Securities (CMBS) June 30, 2024 CMBS Distribution CMBS Single Asset/Single Borrower Distribution Single Asset/Single Borrower Other, 1% 37% Hotel, 4% Multi-family, 5% Agency Industrial, 6% $1.2b 5% Conduit Retail, 9% 58% Key Highlights Office, 12% • 97% are rat
Slide 22: Statutory – Commercial Mortgage Loan Portfolio
Statutory – Commercial Mortgage Loan Portfolio1 June 30, 2024 CML NAIC Distribution CML Property Type Distribution Multi-Family CM 1 28% 69% CM 3/4 Other Industrial 4% 4% 25% $7.0b Hotels $7.0b 11% CM 2 27% Office 10% Retail Loan-to-Value / Debt Service Coverage2 22% Debt Service Coverage Ratio • Hi
Slide 23: Statutory – Commercial Mortgage Loan Office Exposure
Statutory – Commercial Mortgage Loan Office Exposure1 June 30, 2024 NAIC Rating Distribution – Office Exposure Office Type – Office Exposure Geographic – Office Exposure Medical Office CM 1 86% 1% Suburban Principal CM 3/4 74% Geographic Location Balance % Office Single Story 3% Washington-Baltimore
Slide 24: Appendix
Appendix @ JACKSON’
Slide 25: VA Market Risk Benefits
VA Market Risk Benefits Liability Effect Category Runs Through Description of Impact Drivers Changes in Interest Rates Net Income Movement in risk free rates (impacts both assumed future separate account returns and discounting of cash flows) Fund Performance Net Income Separate account returns gros
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to presenting our results of operations and financial condition in accordance with U.S. GAAP, we use and report, selected non-GAAP financial measures. Management believes that the use of these non-GAAP financial measures, together with relevant U.S. GAAP finan
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted Book Value Attributable to Common Shareholders Adjusted Book Value Attributable to Common Shareholders excludes Preferred Stock and Accumulated Other Comprehensive Income (Loss) (AOCI) attributable to Jackson Financial Inc (JFI), which does not include AOCI arisi
Slide 28: Adjusted Operating Earnings Reconciliation
Adjusted Operating Earnings Reconciliation For the Six $ millions, except effective tax rate For the Three Months Ended Months Ended 6/30/23 9/30/23 12/31/23 3/31/24 6/30/24 6/30/23 6/30/24 Net income (loss) attributable to Jackson Financial Inc. common shareholders 1,204 2,762 (1,570) 784 264 (293)
Slide 29: Select U.S. GAAP to Non-GAAP Reconciliation
Select U.S. GAAP to Non-GAAP Reconciliation For the Six $ millions, except per share and shares outstanding data For the Three Months Ended Months Ended 6/30/23 9/30/23 12/31/23 3/31/24 6/30/24 6/30/23 6/30/24 Net Income (Loss) 1,220 2,790 (1,560) 802 282 (276) 1,084 Income attributable to non-contr
Slide 30: Glossary
Glossary Assets Under Management (AUM) - Investment assets that are managed by one of our subsidiaries and includes: (i) assets managed by PPM America, Inc. (PPM), including our investment portfolio (but excludes assets held in funds withheld accounts for reinsurance transactions), (ii) third-party
Slide 31: Glossary
Glossary Net Flows - The net change in customer account balances during a period, including gross premiums, surrenders, withdrawals and benefits. Net flows exclude investment performance, interest credited to customer accounts and policy charges. Registered Index-Linked Annuity (RILA) - A registered