Primerica, Inc. · NYSE:PRI
Primerica — Q3 2023 Earnings Presentation
12 slides from Primerica's earnings presentation, Nov 8, 2023
Slide 1: Earnings Results
Earnings Results Quarter Ended September 30, 2023
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 GAAP Financial Results ● Adjusted net operating income of $154 ($ in millions, except per share amounts) Q3 2023 Q3 2022 % Change million grew 9%, while diluted adjusted Revenues $710.9 $673.3 6% Net income $152.1 $79.6 91% operating EPS of $4.28 grew 14% year- Stockholders’ equ
Slide 4: Distribution Highlights
Distribution Highlights Sales Force ● Focused on growing the size of the sales force Q3 2023 Q3 2022 % Change Distribution — Attractiveness of our entrepreneurial Recruits 92,269 127,788(1) (28%) business opportunity continues to fuel New life-licensed representatives 12,311 12,518 (2%) recruiting L
Slide 5: Production Highlights: Term Life Insurance
Production Highlights Term Life Insurance Production ● Strong demand for term life insurance products ($ in billions) Q3 2023 Q3 2022 % Change Issued life insurance policies 88,589 81,372(1) 9% Term Life — Policies issued grew 9% year-over-year Issued face amount(2) $29.5 $26.0 13% — Issued term lif
Slide 6: Production Highlights: Investment and Savings Products
Production Highlights Investment and Savings Products ● Sales during the quarter reflect: Production — Strong demand for guaranteed features ($ in billions) Q3 2023 Q3 2022 % Change provided by variable annuities Total product sales $2.2 $2.2 1% ISP — Temporary headwinds from managed account Client
Slide 7: Production Highlights: Senior Health
Production Highlights Senior Health ● LTV stability over four consecutive quarters ● Contract acquisition costs and sales volume pressured by: — Higher mix of newer, less productive agents — Higher than expected attrition of experienced agents — Inefficient use of leads ● Primerica senior health-cer
Slide 8: Operating Results: Term Life Segment
Operating Results Term Life Segment ● Adjusted direct premiums increased 6% year-over- year, driving operating income growth ($ in millions) Q3 2023 Q3 2022 % Change ● Margins and financial ratios remained stable, as Direct premiums $826.7 $804.6 3% expected under LDTI Premium ceded to IPO coinsurer
Slide 9: Operating Results: Investment & Savings Products Segment
Operating Results Investment & Savings Products Segment ● ISP pre-tax income up 9%, driven by: ($ in millions, except as noted) Q3 2023 Q3 2022 % Change — 7% increase in revenue-generating sales; Sales-based revenues $73.0 $68.0 7% Asset-based revenues $119.4 $107.5 11% primarily strong variable ann
Slide 10: Operating Results: Senior Health Segment
Operating Results Senior Health Segment ● LTV per approved policy of $911 reflected ($ in thousands) Q3 2023 Q3 2022 % Change higher commission rates and stabilized Commissions and fees $11,388 $14,601 (22%) churn Operating revenues $13,436 $17,183 (22%) ● Positive tail revenue adjustment of $2.3 Co
Slide 11: Investment Income and Invested Asset Portfolio
Investment Income and Invested Asset Portfolio Key Portfolio Attributes ● Adjusted net investment income of $35 million up $11 million compared to (based on amortized cost (except for market Q3 2023 value); excludes cash, period end) prior year period ● New money rate of 6.04% Fixed income / other m
Slide 12: Insurance & Operating Expense Highlights
Insurance & Operating Expense Highlights Insurance & Operating Expense ● Insurance and other operating expenses of $137 million, 4% higher than prior year period due to higher employee-related costs and normal business growth ● Outlook: — Expect fourth quarter 2023 expenses to increase around $4 mil