Voya Financial, Inc. · NYSE:VOYA
Voya Financial — Q3 2021 Earnings Presentation
23 slides from Voya Financial's earnings presentation, Nov 3, 2021
Slide 1: Voya Financial Third Quarter 2021 Investor Presentation
Voya Financial Third Quarter 2021 Investor Presentation November 3, 2021
Slide 2: Forward-Looking and Other Cautionary Statements
Forward-Looking and Other Cautionary Statements This presentation and the remarks made orally contain forward-looking statements. The company does not assume any obligation to revise or update these statements to reflect new information, subsequent events or changes in strategy. Forward-looking stat
Slide 3: Agenda
Agenda 1. Key Themes and Strategic Priorities ■ Rod Martin, Chairman and Chief Executive Officer 2. Business Segment Performance and Financial Highlights ■ Mike Smith, Vice Chairman and Chief Financial Officer 3
Slide 4: Key Themes
Key Themes ■ 3Q’21 adjusted operating earnings of $2.57 per share1 ■ Notable items for 3Q’21 are: Delivered Record EPS ■ $1.17 of prepayment and alternative income above our long-term expectations in 3Q’21 ■ $0.05 of DAC/VOBA and other intangibles unlocking2 ■ $(0.14) of Covid-19 related claims impa
Slide 5: Recognition of our Culture and Values
Recognition of our Culture and Values Partnered to raise awareness for Awarded Retirement Leader of the National Disability Employment Awareness Month Year by Fund Intelligence Named a Great Place to Work® by the Two Voya board members recognized in Great Place to Work Institute for the sixth Savoy
Slide 6: Agenda
Agenda 1. Key Themes and Strategic Priorities ■ Rod Martin, Chairman and Chief Executive Officer 2. Business Segment Performance and Financial Highlights ■ Mike Smith, Vice Chairman and Chief Financial Officer 6
Slide 7: Third Quarter 2021 Results – Financial Highlights
Third Quarter 2021 Results – Financial Highlights After-tax Adjusted Operating Net Income (Loss) Available to Earnings Per Share¹ Common Shareholders 3Q’21 3Q’21 $2.57 $142 per diluted share million Notable Items 3Q’21 Includes 3Q’21 ■ Prepayment and alternative income above our $1.17 ■ Adjusted ope
Slide 8: Wealth Solutions – Industry Leading Provider of Outcome-Oriented Solutions and Capabilities
Wealth Solutions – Industry Leading Provider of Outcome-Oriented Solutions and Capabilities across all Plan Sizes and Markets Adjusted Operating Earnings1 ($ millions) Full Service Client Assets ($ billions) Current Quarter TTM Spread-based Fee-based $1,127 $181 $180 $153 $148 $147 $120 $348 Include
Slide 9: Investment Management – Delivering Strong Investment Performance and Long-Term Net Flows
Investment Management – Delivering Strong Investment Performance and Long-Term Net Flows Adjusted Operating Earnings1 ($ millions) Assets Under Management ($ billions) Current Quarter TTM General Account External Clients $271 $253 $253 $238 $166 $180 $215 $214 Includes Prepayments and $47 $63 $58 $3
Slide 10: Health Solutions – Growing while Maintaining Underwriting and Expense Discipline
Health Solutions – Growing while Maintaining Underwriting and Expense Discipline Adjusted Operating Earnings1 ($ millions) Annualized In-Force Premiums ($ millions) Current Quarter TTM Group Life & Disability Stop Loss Voluntary $2,490 $2,515 $2,267 $221 $550 $561 $208 $474 $1,191 $1,184 $1,091 Incl
Slide 11: Robust Capital Position with Strong Free Cash Flow Generation
Robust Capital Position with Strong Free Cash Flow Generation Excess Capital Dividends1 ($ billions)2 $59 million Increased quarterly common stock dividend by 21% to $0.20, resulting in a dividend yield >1% $1.5 Share Repurchases1 $892 million 2021 YTD capital returned $833 million to shareholders
Slide 12: Helping Americans Get Ready to Retire Better
Helping Americans Get Ready to Retire Better 1 Delivered Record EPS in 3Q’21 2 Continued Momentum Across All Businesses 3 Strong Shareholder Return 12
Slide 13: Appendix
PLAN | INVEST | PROTECT 13 FINANCIAL
Slide 14: Seasonality of Financial Items
Seasonality of Financial Items 1Q 2Q 3Q 4Q ■ Corporate Markets tends to have ■ 91 fee and crediting interest ■ Education Tax-Exempt ■ Corporate Markets typically see Wealth Solutions the highest recurring deposits days in quarter Markets typically see lowest highest transfer / single deposits recurr
Slide 15: Analyst Modeling Considerations
Analyst Modeling Considerations Prepayment Income ■ Long-term prepayment income quarterly expectation in 2021 (pre-tax, pre-DAC): $8 million for Wealth Solutions and Alternative Income ■ Approximately 9% annual long-term expected returns (pre-tax, pre-DAC) for alternative income ■ Recurring deposit
Slide 16: 3Q'21 and 3Q'20 Notable Items Impacts
3Q’21 and 3Q’20 Notable Items Impacts Prepays and Alt DAC/VOBA and Adjusted Covid-19 Income Other Operating Related Claims Other Notables5 Above/(Below) Intangibles 3Q’21 Earnings1 Expectations2 Unlocking3 Impact4 Wealth Solutions $319 $147 $7 – $(18) Investment Management 63 21 – – (4) Health Solut
Slide 17: Reliable Long-Term Investment Performance Critical to Future Success
Reliable Long-Term Investment Performance Critical to Future Success % AUM Above Benchmark or Peer Median1 98 87 87 92 90 93 69 70 72 33 30 35 Equity Multi-Asset Fixed Voya IM Income Total 3 Year 5 Year 10 Year 1. Voya Investment Management calculations as of September 30, 2021. Metrics presented ar
Slide 18: Emphasis on ESG and Leading ESG Practices
Emphasis on ESG and Leading ESG Practices Governance Social Environmental Robust, independent Aligned social purpose Encouraging oversight aligning and empowering sustainable practices business with individuals at home and the shareholder interests workplace • Board Gender parity • Socially responsi
Slide 19: Investment Portfolio COVID-19 Exposure and Stress Tests
Investment Portfolio COVID-19 Exposure and Stress Tests COVID-19 Sector Exposure1 Investment Portfolio Stress Test1 Potential Impact to Excess Capital Remaining GA from Rating Migration and Impairments in 4Q’21 89% Stress case: ~$50 million2 Potential impact assumes no active management Negative
Slide 20: Well-Diversified Investment Portfolio Built for Through-The-Cycle Risk Adjusted Returns
Well-Diversified Investment Portfolio Built for Through-The- Cycle Risk Adjusted Returns $40 Billion General Account Investment Portfolio1 Munis LP/Equity 2% 5% Short Term / Treasury 6% 2% 44% Public Corporate CML 14% 33% 50% Securitized 24% 2 Private Fixed Maturity Ratings Credit 19% NAIC 1 NAIC 2
Slide 21: Spotlight: Commercial Mortgage Loans
Spotlight: Commercial Mortgage Loans Key Message: ~$5.6 billion allocation1 with weighted average debt service coverage ratio (DSCR) of 2.2x and weighted average loan-to-value (LTV) ratio of 46%2. Retail focus on need driven properties, such as grocery anchored. No material exposure to real estate e
Slide 22: Spotlight: BBB Exposure
Spotlight: BBB Exposure Key Message: ~$15.1 billion NAIC 2 portfolio1,2 is approximately 66%/34% split between Public and Private. Private exposure provides combination of structural protections and attractive value. Minimal BIG allocation is opportunistic. % of Fixed Maturity Assets4 11.6% 6.4% 15.
Slide 23: Reconciliation of 3Q'21 Adjusted Operating Earnings to Net Income
Reconciliation of 3Q’21 Adjusted Operating Earnings to Net Income ($ millions; all figures are after-tax) 3Q’21 315 (1) (1) (2) (137) (33) 142 Adjusted Net Investment Income (Loss) Net Guaranteed Income (Loss) Other Net Income Operating Gains (Losses) from Benefit Hedging Related to (Loss) Available