Summary
MetLife Inc. reported its third quarter 2012 financial results, highlighting a significant shift in its financial performance compared to the previous year. While GAAP "income (loss) from continuing operations, net of income tax" showed a substantial decrease to a net loss of $(957) million from a profit of $3,442 million in the prior-year period, this was heavily influenced by a substantial $1.9 billion goodwill impairment charge related to its U.S. retail annuities business and unfavorable changes in net derivative gains (losses). In contrast, the company's "operating earnings available to common shareholders," a non-GAAP measure that management uses to evaluate performance, showed a strong improvement. Operating earnings available to common shareholders increased by 46.8% to $1,417 million from $965 million in the prior-year period. This growth was primarily driven by improved investment results, higher asset-based fee revenue stemming from strong sales, and lower catastrophe losses. MetLife continues to navigate a challenging economic environment, including low interest rates, and is focused on strategic objectives such as refining its U.S. business, expanding its global employee benefits, growing its emerging markets presence, and driving customer centricity.
Financial Highlights
35 data points| Revenue | $16.50B |
| Operating Expenses | $4.25B |
| Operating Income | $1.09B |
| Net Income | -$954.00M |
| EPS (Basic) | $-0.92 |
| EPS (Diluted) | $-0.92 |
| Shares Outstanding (Basic) | 1.07B |
| Shares Outstanding (Diluted) | 1.07B |
Key Highlights
- 1MetLife reported a significant goodwill impairment charge of $1.9 billion in the current quarter related to its U.S. retail annuities business, contributing to a net loss of $(957) million.
- 2Operating earnings available to common shareholders saw a substantial increase of 46.8% to $1,417 million, driven by improved investment results and higher asset-based fee revenue.
- 3The company experienced unfavorable changes in net derivative gains (losses), which negatively impacted GAAP income, primarily due to changes in interest rates, equity market movements, and a nonperformance risk adjustment.
- 4Sales in several businesses, particularly in the U.S. group term life and disability, and dental businesses, showed growth.
- 5Annuity sales declined in response to pricing discipline and risk management strategies in the current challenging economic environment.
- 6The company continues to focus on expense management and integration costs related to the ALICO acquisition.
- 7MetLife is actively managing its capital and liquidity, with plans to increase its operating return on common equity to between 12% and 14% by 2016.