Improved mortality experience and higher asset management margins helped drive a 56% increase in earnings at Phoenix Companies Inc. during the second quarter.[@@]
Phoenix, Hartford, is reporting $22 million in net income for the latest quarter on $624 million in revenue, compared with $14 million in net income on $666 million in revenue for the second quarter of 2004.
The life and asset management operations did well “despite a lackluster equity market and low interest rates,” says Phoenix Chairman Dona Young.
Life and annuity pre-tax income increased to $59 million, from $34 million. Life earnings include a $23.6 million benefit related to the effects of improved mortality experience on deferred business acquisition costs, Phoenix says.
Phoenix recently sold its retail life and annuity distribution operation to another company, and it has been restructuring and centralizing control over its asset management business.
The restructuring of the asset management business led to a $6.7 million post-tax restructuring charge, Phoenix says.
New life sales dropped as a result of the decision to drop the retail distribution operation, but total annualized life premium revenue rose 10%, and the company is predicting it will achieve a double-digit growth rate for total life sales for 2005.
Annuity deposit production also suffered from the sale of the distribution operation, but a slew of product introductions should improve annuity production, Phoenix says.