Summary
Aflac Inc. reported solid financial results for the first quarter of 2008, driven by strong premium growth in both its Japanese and U.S. operations. Total revenues increased to $4.27 billion from $3.75 billion in the prior year, with net earnings rising to $0.99 per diluted share compared to $0.85 in Q1 2007. The company's investment portfolio remains a significant asset, though it experienced a slight decline in unrealized gains due to widening credit spreads globally. Aflac Japan continues to be the primary contributor to earnings, showing robust premium income growth, while Aflac U.S. also demonstrated positive premium increases and expansion of its sales force. The company has continued its share repurchase program, including a significant accelerated share repurchase (ASR) in February 2008. Management is optimistic about the full-year outlook, raising its earnings per diluted share growth target to 14-15% over 2007, demonstrating confidence in its business strategy and market position.
Key Highlights
- 1Total revenues increased by 13.8% year-over-year to $4.27 billion for the quarter ended March 31, 2008.
- 2Net earnings per diluted share grew to $0.98 in Q1 2008 from $0.84 in Q1 2007, a 16.7% increase.
- 3Aflac Japan remains the dominant segment, with premium income up 17.7% in dollars (3.6% in yen).
- 4Aflac U.S. also saw positive momentum, with premium income increasing by 9.3%.
- 5The company executed an Accelerated Share Repurchase (ASR) program, purchasing 12.5 million shares for $757 million in February 2008.
- 6The company raised its full-year 2008 earnings per diluted share growth objective to 14%-15% from 13%-15%.