Summary
Aflac Incorporated's 2011 annual report (10-K) highlights a year of revenue growth driven by a stronger Japanese Yen, though net earnings saw a decline primarily due to significant realized investment losses. The company's core business remains robust, with strong performance in its Japan segment contributing the majority of revenues and assets. Aflac Japan continues to lead in cancer and medical insurance sales, benefiting from an aging population and increased consumer interest in supplemental health products, alongside a growing contribution from the bank distribution channel. The U.S. segment also experienced sales growth, driven by a focus on field force support and product enhancements. Risks highlighted include adverse effects from global capital market and economic conditions, potential impairments on investment portfolios, and regulatory changes. The company continues to manage its investment portfolio by strategically reducing exposure to peripheral Eurozone countries and perpetual securities. Despite these challenges, Aflac maintains a strong capital and solvency position, supported by consistent premium growth and a diversified investment strategy.
Financial Highlights
33 data points| Revenue | $22.17B |
| SG&A Expenses | $2.34B |
| Operating Income | $4.50B |
| Interest Expense | $196.00M |
| Net Income | $1.94B |
| EPS (Basic) | $2.08 |
| EPS (Diluted) | $2.06 |
| Shares Outstanding (Basic) | 933.04M |
| Shares Outstanding (Diluted) | 938.74M |
Key Highlights
- 1Total revenues increased by 6.9% to $22.2 billion, primarily driven by a stronger Japanese Yen.
- 2Net earnings decreased to $2.0 billion ($4.18 per diluted share) from $2.3 billion ($4.95 per diluted share) in 2010, largely due to $1.6 billion in pretax net realized investment losses.
- 3Aflac Japan remains the dominant segment, accounting for 75% of total revenues and 87% of total assets.
- 4Aflac Japan saw new annualized premium sales increase by 18.6% in yen, exceeding expectations, driven by strong sales of the WAYS product through the bank channel.
- 5Aflac U.S. achieved sales growth of 6.8% in new annualized premiums, exceeding internal expectations, supported by enhanced products and increased sales force recruiting.
- 6The company's investment portfolio saw strategic "derisking" efforts, reducing exposure to peripheral Eurozone countries and perpetual securities.
- 7Shareholders' equity increased to $13.5 billion, with the company repurchasing approximately 6.0 million shares of common stock in 2011.