10-QPeriod: Q2 FY2022

AFLAC INC Quarterly Report for Q2 Ended Jun 30, 2022

Filed August 2, 2022For Securities:AFL

Summary

Aflac Incorporated reported net earnings of $1.39 billion for the second quarter of 2022, a significant increase from $1.11 billion in the same quarter of the previous year. Diluted earnings per share (EPS) also saw a substantial rise to $2.16 from $1.62. For the first six months of 2022, net earnings were $2.42 billion, largely flat compared to $2.40 billion in the prior year period, with diluted EPS at $3.73 compared to $3.49. The company's performance was bolstered by strong net investment gains, which more than offset a slight decrease in total revenues and net earned premiums, particularly in the Aflac Japan segment. The company's investment portfolio, totaling $121.4 billion at quarter-end, experienced fluctuations, with a decrease in fair value of fixed maturity securities available for sale due to market conditions. However, Aflac maintained a robust capital position with shareholders' equity at $26.4 billion. The company continued its commitment to returning capital to shareholders through share repurchases and dividends, repurchasing $1.2 billion of its stock in the first half of 2022 and increasing its quarterly dividend.

Financial Highlights

34 data points
Beta

Revenue

$5.32B

Net Income

$1.39B

26.2% Net Margin

EPS (Diluted)

$2.17

Total Assets

$135.63B

Cash & Equivalents

$5.17B

Free Cash Flow

$510.00M

Financial Statements
Beta
Revenue$5.32B
SG&A Expenses$802.00M
Operating Expenses$1.33B
Operating Income$1.14B
Interest Expense$41.00M
Net Income$1.39B
EPS (Basic)$2.18
EPS (Diluted)$2.17
Shares Outstanding (Basic)640.71M
Shares Outstanding (Diluted)643.24M

Key Highlights

  • 1Net earnings for Q2 2022 increased by 25.6% year-over-year to $1.39 billion.
  • 2Diluted EPS grew to $2.16 in Q2 2022 from $1.62 in Q2 2021.
  • 3Total revenues decreased slightly to $5.4 billion for Q2 2022 from $5.56 billion in Q2 2021.
  • 4Net earned premiums in the Aflac Japan segment decreased by 19% in dollar terms for Q2 2022.
  • 5Aflac U.S. saw an increase in new annualized premium sales of 15.6% in Q2 2022.
  • 6Shareholders' equity decreased to $26.4 billion at June 30, 2022, from $33.3 billion at December 31, 2021, largely due to market fluctuations affecting accumulated other comprehensive income.
  • 7The company repurchased $1.2 billion of its common stock in the first six months of 2022 and announced a 21.2% increase in its quarterly dividend.

Frequently Asked Questions

For the second quarter of 2022, Aflac reported net earnings of $1.39 billion, or $2.16 per diluted share, compared to $1.11 billion, or $1.62 per diluted share, in the second quarter of 2021.

Aflac Japan's pretax adjusted earnings decreased 14.3% in dollar terms due to lower net earned premiums and constrained sales impacted by pandemic conditions. In contrast, Aflac U.S. saw an increase in new annualized premium sales of 15.6%, though pretax adjusted earnings decreased 15.5% due to higher incurred benefits and adjusted expenses, reflecting investments in its platform and growth initiatives.

The weakening yen against the U.S. dollar in the second quarter of 2022 (down 15.4% year-over-year) suppressed the reported dollar-denominated results for Aflac Japan. Adjusted earnings per diluted share were impacted by approximately negative $0.09 due to the weaker yen.

Shareholders' equity stood at $26.4 billion as of June 30, 2022. Aflac repurchased $1.2 billion of its common stock in the first half of 2022 and increased its quarterly cash dividend by 21.2% year-over-year, demonstrating a commitment to shareholder returns.