Lincoln Financial Says Last Quarter Looked Good: Earnings

Executives from Lincoln National Corp. — a company better known as Lincoln Financial Group — are telling roughly the same kinds of earnings story that colleagues at other life and health insurers have been telling this month.

All sorts of headwinds could have caused problems in the fourth quarter of 2019, and could still cause problems later, but, really, earnings were good.

Dennis Glass, Lincoln’s chief executive officer, said in a comment about the results that the numbers demonstrate the company’s long-term track record of strong financial performance.

(Related: Prudential Aims to Cut Stock-Related Annuity Risk: Earnings)

“Throughout the course of the year we grew sales, diversified our mix of business, appropriately adjusted our assumptions, and continued to execute on our expense initiatives, all of which positions us to continue to drive long-term shareholder value,” Glass said.

Resources

The U.S. Securities and Exchange Commission’s Fast Search company filing search tool is available here. Enter the company’s stock symbol (such as, LNC, for Lincoln) in the search form to see the official earnings filings.

Lincoln is reporting $431 million in net income for the latest quarter on $4.3 billion in revenue, compared with $399 million in net income on $4.5 billion in revenue for the fourth quarter of 2018.

The annuities unit is reporting $312 million in pre-tax operating income on $1.2 billion in operating revenue and $3.9 billion in deposits, up from $300 million in pre-tax operating income on $1.1 billion in revenue and $3.8 billion in deposits for the year-earlier quarter.

Commissions incurred increased to $322 million, from $291 million.

Here’s what happened to deposits into three types of annuities between the fourth quarter of 2018 and the latest quarter:

• Traditional Fixed Annuities: $1.2 billion (down from $1.3 billion)
• Variable Annuities with Guaranteed Living Benefits: $1.4 billion (up from $1.3 billion)
• Variable Annuities without Guaranteed Living Benefits: $1.3 billion (up from $1.1 billion)

The life unit is reporting $222 million in pre-tax operating income on $1.8 billion in operating revenue and $2.4 billion in deposits, up from $218 million in pre-tax operating income on $1.8 billion in operating revenue and $1.9 billion in deposits for the year-earlier quarter.

Commissions incurred increased to $337 million, from $241 million.

Here’s what happened to first-year premiums for some types of life products between the fourth quarter of 2018 and the latest quarter:

• Universal Life: $20 million (up from $14 million)
• Indexed Universal Life: $76 million (up from $22 million)
• Variable Universal Life: $107 million (up from $103 million)
• MoneyGuard: $124 million (up from $58 million)
• Term Life: $39 million (up from $33 million)
• Executive Benefits: $81 million (up from $32 million)

Cigna Corp. (NYSE:CI)

Cigna is reporting $984 million in net income for the fourth quarter on $38 billion in revenue, up from $147 million in net income on $14 billion in revenue for the fourth quarter of 2018.

The Bloomfield, Connecticut-based company ended the quarter providing or administering health coverage for 17 million people, change, or 1% more than it was covering a year earlier.

The company recently acquired the Express Scripts Inc. pharmacy benefits manager (PBM) company.

Here’s what happened to four types of health plan enrollment:

• Medicare Advantage: 444,000 (up from 436,000)
• Commercial Insurance: 2.1 million (up from 1.9 million)
• Administrative Services for Self-Funded Employer Plans: Held steady at 12 million
• International Coverage: Held steady at 1.6 million

FBL Financial Group Inc. (NYSE:FFG)

FBL is reporting $35 million in net income for the fourth quarter on $194 million in revenue, up from $6.5 million in net income on $159 million in revenue for the fourth quarter of 2018.

The West Des Moines, Iowa-based company’s annuity unit is reporting $14 million in pre-tax adjusted operating income on $54 million in revenue, compared with $12 million in pre-tax adjusted operating income on $55 million in revenue.

The annuity unit is reporting that commission spending increased to $662,000, from $631,000.

The number of direct annuity contracts provided fell to 51,536, from 52,911.

Here’s what happened to payments into two types of annuities between the fourth quarter of 2018 and the latest quarter:

• Traditional Fixed Annuities: $10 million (down from $21 million)
• Group Annuities: $826,000 (down from $1.5 million)

The West Des Moines, Iowa-based company’s life unit is reporting $25 million in pre-tax adjusted operating income on $110 million in revenue, up from $8.4 million in pre-tax adjusted operating income on $106 million in revenue.