10-QPeriod: Q2 FY2019

METLIFE INC Quarterly Report for Q2 Ended Jun 30, 2019

Filed August 6, 2019For Securities:METMET-PEMET-PFMET-PA

Summary

MetLife, Inc. (MET) reported its financial results for the second quarter ended June 30, 2019. The company demonstrated a strong performance, with net income available to common shareholders significantly increasing year-over-year, primarily driven by favorable changes in net derivative and net investment gains (losses). Adjusted earnings available to common shareholders remained relatively flat, reflecting a balance of business growth, market factor impacts, and underwriting results. The company continued to execute its capital management strategy, with substantial share repurchases and dividend payments. Total assets grew to $732.2 billion from $687.5 billion at the end of 2018, with total investments increasing to $461.1 billion. Liabilities also grew, driven by increases in future policy benefits and policyholder account balances. The company's equity base strengthened, with total MetLife, Inc. stockholders' equity reaching $63.8 billion. MetLife is actively managing its investment portfolio and hedging market risks with derivatives, noting the impact of market factors on its results, particularly interest rate movements and equity market performance. The company also provided an update on pending legal and regulatory matters, including a proposed settlement for a class action lawsuit related to group annuity benefits.

Financial Highlights

36 data points
Beta

Revenue

$17.50B

Net Income

$1.75B

10.0% Net Margin

EPS (Diluted)

$1.77

Total Assets

$732.17B

Cash & Equivalents

$18.43B

Free Cash Flow

$2.39B

Financial Statements
Beta
Revenue$17.50B
Operating Expenses$3.39B
Net Income$1.75B
EPS (Basic)$1.78
EPS (Diluted)$1.77
Shares Outstanding (Basic)946.20M
Shares Outstanding (Diluted)952.90M

Key Highlights

  • 1Net income available to MetLife, Inc.’s common shareholders increased to $1.68 billion for the three months ended June 30, 2019, up from $845 million in the prior year period.
  • 2Total assets grew to $732.2 billion as of June 30, 2019, compared to $687.5 billion as of December 31, 2018.
  • 3Adjusted earnings available to common shareholders remained relatively flat at $1.32 billion for the three months ended June 30, 2019, compared to $1.33 billion in the prior year period.
  • 4The company repurchased approximately 15.8 million shares of common stock during the quarter for $750 million.
  • 5MetLife announced an additional $2.0 billion authorization for common stock repurchases on July 31, 2019.
  • 6The company's investment portfolio is heavily weighted towards fixed income, with $318.7 billion in fixed maturity securities available-for-sale at estimated fair value as of June 30, 2019.
  • 7MetLife is subject to various litigation and regulatory matters, with a proposed settlement of $80 million for a class action lawsuit related to Total Control Accounts.

Frequently Asked Questions

MetLife's net income available to common shareholders significantly increased to $1.68 billion for the three months ended June 30, 2019, from $845 million in the same period last year. This improvement was primarily driven by favorable changes in net derivative gains and net investment gains.

Adjusted earnings available to common shareholders remained relatively flat, decreasing slightly to $1.32 billion for the three months ended June 30, 2019, from $1.33 billion in the prior year period. This stability reflects a balance between business growth, market factor impacts, and underwriting results.

MetLife manages its investment portfolio with a focus on asset-liability management, primarily investing in fixed income securities. As of June 30, 2019, the company held $318.7 billion in fixed maturity securities available-for-sale. MetLife also utilizes derivatives to hedge various market risks, including interest rate, foreign currency, credit, and equity market risks.

MetLife is actively managing its capital. During the quarter, the company repurchased approximately $750 million of its common stock and recently announced an additional $2.0 billion authorization for share repurchases. MetLife also continues to pay common and preferred stock dividends, demonstrating a commitment to returning capital to shareholders.

MetLife is involved in various litigation and regulatory matters. Notably, the company has proposed an $80 million settlement for a class action lawsuit related to Total Control Accounts, and is also addressing a material weakness identified in its internal controls related to certain group annuity benefit reserves, which has led to SEC investigations and potential additional legal actions.