Market Overview

AXA Equitable Holdings Reports Second Quarter 2018 Results

Share:

Second quarter Net Income of $158 million; Net Income per diluted
share of $0.28

Non-GAAP Operating Earnings1 of
$506 million; Non-GAAP Operating Earnings per diluted share of $0.90

Declared inaugural quarterly dividend of $0.13 per share

Authorized share repurchase of $500 million

AXA Equitable Holdings, Inc. ("AXA Equitable Holdings", or the
"Company") (NYSE:EQH) today announced financial results for the second
quarter of 2018, ending June 30, 2018.

"AXA Equitable Holdings delivered strong second quarter results, with
operating earnings growth across all our business segments," said Mark
Pearson, President and CEO of AXA Equitable Holdings. "During the
quarter, we also completed our initial public offering, a landmark
achievement for our company. I am pleased with the progress we continue
to make towards our strategic priorities to grow, optimize and
streamline our business in order to deliver more compelling accumulation
and protection solutions for our clients and enhance value for
shareholders."

Mr. Pearson continued, "Our Board of Directors has declared a $0.13 per
common share quarterly dividend and authorized a $500 million share
repurchase program. These actions demonstrate the Board's confidence in
our financial position and reflect our commitment to returning capital
to shareholders through a prudent and flexible approach."

Consolidated Results    
(in millions, except per share amounts or unless otherwise noted) 2Q18 2Q17
Total Assets Under Management ("AUM", in billions) $ 656 $ 631
Net income (loss) attributable to Holdings 158 608
Net income (loss) per diluted share $ 0.28 $ 1.08
Non-GAAP Operating Earnings (loss) 506 399
Non-GAAP Operating Earnings (loss) per diluted share ("EPS") $ 0.90 $ 0.71

Total AUM was $656 billion, up 4% compared to the second quarter of 2017.

Net income attributable to Holdings in the second quarter of 2018 was
$158 million, a decrease of $450 million compared to the second quarter
of 2017. Non-GAAP Operating Earnings in the second quarter of 2018
increased to $506 million from $399 million in the second quarter of
2017.

As of June 30, 2018, Book value per share, including accumulated other
comprehensive income ("AOCI"), was $23.84. Book value per share,
excluding AOCI, was $26.17 per share.

Second Quarter 2018 Highlights

  • Business segments highlights:
    • Strong performance in Individual Retirement, with operating
      earnings up 30% compared to the second quarter of 2017 to $399
      million.
    • Continued positive net flows in Group Retirement of $150 million.
    • Strong results in Investment Management and Research, as adjusted
      operating margin2 increased 240 basis points from the
      second quarter of 2017 to 27.3%.
    • Improved sales momentum in Protection Solutions, with annualized
      premiums up 22%.
  • Launched capital management program, specifically:
    • Declared quarterly cash dividend of $0.13 per share, payable on
      August 30, 2018.
    • Board of Directors authorized a $500 million share repurchase
      program.
    • The program will be funded through a combination of an approved
      insurance subsidiary dividend and non-regulated cash flows from
      AB. The aforementioned dividend and cash flows were upstreamed to
      AXA Equitable Holdings during July.
  • Capital position in-line with target CTE98 for variable annuities plus
    risk-based capital ("RBC") ratio of 350-400% for non-variable annuity
    insurance liabilities.
  • Continued to successfully execute on strategic priorities in the
    quarter, including:
    • Completed the initial public offering of AXA Equitable Holdings.
    • Completed approximately 50% of the Company's general account
      optimization initiative and achieved $48 million towards the $160
      million growth in pre-tax net investment income goal by 2020.
    • Reduced net expenses by $11 million year-to-date, and on track to
      deliver $75 million pre-tax productivity gains by 2020.
  • The company also announced today new members to its leadership team.
    • Nick Lane, current CEO AXA Japan, will be appointed President of
      AXA Equitable Life, leading the Individual Retirement, Group
      Retirement and Protection Solutions segments, as well as
      distribution. He will join the AXA Equitable Holdings Management
      Committee in the first quarter of 2019.
    • Brian Winikoff, current head of the Life, Retirement and Wealth
      Management organization will be departing the company. Brian will
      stay through the end of the year to ensure a smooth transition of
      his responsibilities.
    • William Eckert will become AXA Equitable Holdings Chief Accounting
      Officer effective August 15, 2018. Prior to this appointment, he
      was Senior Vice President, Corporate Controller and Principal
      Accounting Officer at Athene Holding Ltd. (NYSE:ATH).
    • Paul Hance will join as AXA Equitable Life Chief Actuary in
      September. Paul recently served as Vice President & Actuary, Head
      of Valuation Center of Excellence at Prudential Financial (NYSE: PRU).

Solid performance across all business segments

Individual Retirement

(in millions, unless otherwise noted)   2Q18   2Q17
Account value (in billions) $ 103.1 $ 98.6
Segment net flows (149 ) 178
Operating earnings (loss) 399 308
  • Account value increased 5% mainly due to market appreciation over the
    last twelve months.
  • Net outflows improved versus first quarter 2018 at $(149) million with
    continued outflows from the fixed rate living benefits block,
    partially offset by $867 million of net inflows on newer, less
    capital-intensive products.
  • Operating earnings increased 30% due to increased revenue on higher
    account value, improved variable annuity margins, and lower operating
    expenses.

Group Retirement

(in millions, unless otherwise noted)   2Q18     2Q17
Account value (in billions) $ 34.6 $ 32.0
Segment net flows 150 196
Operating earnings (loss) 78 48
  • Account value increased by 8% due to both market appreciation and
    continued positive net flows, primarily in the 403(b) education market.
  • Net flows benefited from an increase in gross premiums, driven by
    growth in renewals and strong client retention.
  • Operating earnings increased 63% primarily driven by higher fee income
    due to equity market performance, higher net investment income, and
    lower operating expenses.

Investment Management and Research

(in millions, unless otherwise noted)   2Q18   2Q17
Total AUM (in billions) $ 539.8 $ 516.6
Segment net flows (7,700 ) 4,700
Operating earnings (loss) 97 61
  • AUM increased to $539.8 billion over the last twelve months due to
    market appreciation of $24.6 billion, partially offset by total net
    outflows of $1.4 billion.
  • Net outflows in the second quarter of 2018 were primarily driven by a
    low-fee institutional redemption in April and weakness in taxable
    fixed income, partially offset by net inflows into active equity
    services.
  • Operating earnings increased to $97 million, reflecting the Company's
    increased ownership in AllianceBernstein (or "AB")3 to 65%
    as of April 23, 2018, and driven by higher average AUM and higher fee
    rate realization, reflecting a continued shift to higher fee products.

Protection Solutions

(in millions)   2Q18   2Q17
Gross written premiums $ 767 $ 750
Annualized premiums 66 54
Operating earnings (loss) 24 16
  • Gross written premiums were up 2% year-over-year driven by higher
    first year premiums.
  • Annualized premiums increased 22% year-over-year mainly due to sales
    growth from variable life insurance and employee benefits products.
  • Operating earnings increased 50% year-over-year, primarily driven by
    an increase in policy charges, fee income and premiums along with
    higher net investment income due to the general account portfolio
    optimization and higher asset balances. Higher amortization of
    deferred acquisition costs continued in the quarter.

Corporate and Other

Operating loss of $(92) million, a decrease of $58 million
year-over-year, driven by lower revenues from run-off business and
higher interest expense from the issuance of public debt in April.

Capital Management

AXA Equitable Holdings launched a capital management program, in-line
with the Company's long-term target of returning 40-60% of Non-GAAP
Operating Earnings to shareholders on an annualized basis starting in
2018.

  • The Board of Directors of AXA Equitable Holdings has declared a
    quarterly cash dividend of $0.13 per share. The dividend will be
    payable on August 30, 2018 to shareholders of record as of the close
    of business on August 23, 2018.
  • The Board of Directors also authorized a $500 million share repurchase
    program. Under this authorization, the Company may, from time to time
    through March 31, 2019, purchase shares of its common stock through
    various means4.
  • The program will be funded through a combination of an approved
    insurance subsidiary dividend and non-regulated cash flows from AB.
    The aforementioned dividend and cash flows were upstreamed to AXA
    Equitable Holdings during July.

Holding company cash and liquid assets were approximately $400 million
as of June 30, 2018, prior to the upstreamed dividend and cash flows
mentioned above.

 
1 This press release includes certain non-GAAP financial
measures. More information on these measures and reconciliations to
the most comparable U.S. GAAP measures can be found in the "Use of
Non-GAAP Financial Measures" section of this release.
2 Adjusted Operating Margin is a non-GAAP financial
measure used by AB's management in evaluating AB's financial
performance on a standalone basis and to compare its performance, as
reported by AB in its public filings. It is not comparable to any
other non-GAAP financial measure used herein.
3 Refers to AllianceBernstein L.P. and AllianceBernstein
Holding L.P.
4 Means of share purchases may include open market
transactions, privately negotiated transactions (including share
repurchases from AXA SA), forward, derivative, accelerated
repurchase, or automatic share repurchase transactions, or tender
offers. The $500 million share repurchase authorization expires on
March 31, 2019 (unless extended), and does not obligate the company
to purchase any shares. The authorization for the share repurchase
program may be terminated, increased or decreased by the board of
directors at any time.
 

Earnings Conference Call

AXA Equitable Holdings will host a conference call on Tuesday, August
14, 2018, at 8 a.m. ET, to discuss its second quarter results. The
conference call webcast, along with additional earnings materials will
be accessible on the Company's investor relations website at ir.axaequitableholdings.com.
Please log on to the webcast at least 15 minutes prior to the call to
download and install any necessary software. To join the conference call
via telephone, please use one of the following dial-in numbers:

  • Domestic: +1 844-897-7515
  • International: +1 647-689-5390
  • Access code: 2680528

A webcast replay will be made available on the AXA Equitable Holdings
Investor Relations website at ir.axaequitableholdings.com.

About AXA Equitable Holdings

AXA Equitable Holdings, Inc. (NYSE:EQH) is one of the leading financial
services companies in the U.S. and is comprised of two complementary and
well-established principal franchises, AXA Equitable Life Insurance
Company and AllianceBernstein. We have been helping clients prepare for
their financial future since 1859 and have a combined total of more than
12,100 employees and financial professionals, 5.4 million customer
relationships and $656 billion of assets under management (as of
06/30/18).

Forward-looking and cautionary statements

This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements give expectations or forecasts of future
events. These statements can be identified by the fact that they do not
relate strictly to historical or current facts. Words such as "expects,"
"believes," "anticipates," "intends," "seeks," "aims," "plans,"
"assumes," "estimates," "projects," "should," "would," "could," "may,"
"will," "shall" or variations of such words are generally part of
forward-looking statements. Forward-looking statements are made based on
management's current expectations and beliefs concerning future
developments and their potential effects upon AXA Equitable Holdings and
its subsidiaries. There can be no assurance that future developments
affecting AXA Equitable Holdings will be those anticipated by
management. Forward-looking statements include, without limitation, all
matters that are not historical facts.

Forward-looking statements are subject to known and unknown risks and
uncertainties, many of which may be beyond our control. We caution you
that forward-looking statements are not guarantees of future performance
or outcomes and that actual performance and outcomes, including, without
limitation, our actual results of operations or financial condition, may
differ materially from those made in or suggested by the forward-looking
statements contained herein. In addition, even if our results of
operations, financial condition and cash flows are consistent with the
forward-looking statements contained herein, those results may not be
indicative of results in subsequent periods. New factors emerge from
time to time that may cause our business not to develop as we expect,
and it is not possible for us to predict all of them. Factors that could
cause actual results and outcomes to differ from those reflected in
forward-looking statements include, without limitation: adverse
conditions in the global capital markets and the economy; variable
annuity guaranteed benefits features within certain of our products;
inadequacy of our reinsurance and hedging programs; competition from
other insurance companies, banks, asset managers and other financial
institutions; the failure of our new business strategy in accomplishing
our objectives; risks related to our Investment Management and Research
segment, including significant fluctuations in AB's AUM, the
industry-wide shift from actively-managed investment services to passive
services, termination of investment advisory agreement, inability to
deliver consistent performance, the quantitative models AB uses in
certain of its investment services containing errors, and fluctuations
in exchange rates; inability to recruit, motivate and retain key
employees and experienced and productive financial professionals; the
amount of statutory capital we have and must hold to meet our statutory
capital requirements and our financial strength and credit ratings
varying significantly from time to time; Holdings' dependence on the
ability of its insurance subsidiaries to pay dividends and other
distributions to Holdings, and the failure of its insurance subsidiaries
to generate sufficient statutory earnings or have sufficient statutory
surplus to enable them to pay ordinary dividends; operational failures,
failure of information systems or failure to protect the confidentiality
of customer information, including by service providers, or losses due
to defaults, errors or omissions by third parties and affiliates; risks
related to strategic transactions; the occurrence of a catastrophe,
including natural or man-made disasters; failure to protect our
intellectual property and infringement claims by a third party; our
investment advisory agreements with clients, and selling and
distribution agreements with various financial intermediaries and
consultants, being subject to termination or non-renewal on short
notice; failure of our insurance to fully cover potential exposures;
changes in accounting standards; Risks and increased compliance and
regulatory costs due to certain of our administrative operations and
offices being located internationally; our counterparties' requirements
to pledge collateral or make payments related to declines in estimated
fair value of specified assets and changes in the actual or perceived
soundness or condition of other financial institutions and market
participants; gross unrealized losses on fixed maturity and equity
securities, illiquid investments and defaults on investments; changes to
policyholder behavior assumptions under the contracts reinsured to our
affiliated captives, the performance of their hedging program, their
liquidity needs, their overall financial results and changes in
regulatory requirements regarding the use of captives; the failure to
administer or meet any of the complex product and regulatory
requirements of our retirement and protection products; changes in
statutory reserve or other requirements; a downgrade in our financial
strength and claims-paying ratings; consolidation of or a loss of, or
significant change in, key product distribution relationships; the
failure of our risk management policies and procedures to adequately
identify, monitor and manage risks; inadequate reserves due to
differences between our actual experience and management's estimates and
assumptions; mortality, longevity and morbidity rates or persistency
rates differing significantly from our pricing expectations; the
acceleration of the amortization of DAC; inherent uncertainty in our
financial models that rely on a number of estimates, assumptions and
projections; subjective determination of the amount of allowances and
impairments taken on our investments; changes in the partnership
structure of AB or changes in the tax law governing partnerships; U.S.
federal and state legislative and regulatory action affecting financial
institutions and changes in supervisory and enforcement policies; the
Tax Cuts and Jobs Act and future changes in U.S. tax laws and
regulations or interpretations thereof; adverse outcomes of legal or
regulatory actions; conflicts of interest that arise because our
controlling stockholder and its affiliates have continuing agreements
and business relationships with us; and our failure to effectively
remediate the material weaknesses in our internal control over financial
reporting; costs associated with any rebranding that we expect to
undertake after AXA ceases to own at least a majority of our outstanding
common stock; failure to replicate or replace functions, systems and
infrastructure provided by AXA or certain of its affiliates and loss of
benefits from AXA's global contracts; and future sales of shares by
existing stockholders could cause our stock price to decline.

Forward-looking statements should be read in conjunction with the other
cautionary statements included and the risks, uncertainties and other
factors identified in our Quarterly Report on Form 10-Q and in our Form
S-1 Registration Statement (file no. 333-221521), filed or to be filed
with the U.S. Securities and Exchange Commission, including in the
sections entitled "Risk Factors" and "Management's Discussion and
Analyses of Results of Operations and Financial Condition". Further, any
forward-looking statement speaks only as of the date on which it is
made, and we undertake no obligation to update or revise any
forward-looking statement to reflect events or circumstances after the
date on which the statement is made or to reflect the occurrence of
unanticipated events, except as otherwise may be required by law.

Use of Non-GAAP financial measures

In addition to our results presented in accordance with U.S. GAAP, we
report Non-GAAP Operating Earnings, Non-GAAP Operating EPS and Book
value per share, excluding AOCI, each of which is a measure that is not
determined in accordance with U.S. GAAP. Management believes that the
use of these non-GAAP financial measures, together with relevant U.S.
GAAP measures, provides a better understanding of our results of
operations and the underlying profitability drivers and trends of our
business. These non-GAAP financial measures are intended to remove from
our results of operations the impact of market changes (other than with
respect to equity method investments) as well as certain other expenses
which are not part of our underlying profitability drivers or likely to
re-occur in the foreseeable future, as such items fluctuate from
period-to-period in a manner inconsistent with these drivers. These
measures should be considered supplementary to our results that are
presented in accordance with U.S. GAAP and should not be viewed as a
substitute for the U.S. GAAP measures. Other companies may use similarly
titled non-GAAP financial measures that are calculated differently from
the way we calculate such measures. Consequently, our non-GAAP financial
measures may not be comparable to similar measures used by other
companies.

Non-GAAP Operating Earnings

Non-GAAP Operating Earnings is an after-tax non-GAAP financial measure
used to evaluate our financial performance on a consolidated basis that
is determined by making certain adjustments to our consolidated
after-tax net income attributable to Holdings. The most significant of
such adjustments relates to our derivative positions, which protect
economic value and statutory capital, and are more sensitive to changes
in market conditions than the variable annuity product liabilities as
valued under U.S. GAAP. This is a large source of volatility in net
income.

In the first quarter of 2018, the Company revised its Non-GAAP Operating
Earnings definition as it relates to the treatment of certain elements
of the profitability of its variable annuity products with
indexed-linked features to align to the treatment of its variable
annuity products with GMxB features. In addition, adjustments for
variable annuity products with index-linked features previously included
within Other adjustments in the calculation of Non-GAAP Operating
Earnings are now included with the adjustments for variable annuity
products with GMxB features in the broader adjustment category, Variable
annuity product features. The presentation of Non-GAAP Operating
Earnings in prior periods was revised to reflect this change in
definition.

Non-GAAP Operating Earnings equals our consolidated after-tax net income
attributable to Holdings adjusted to eliminate the impact of the
following items:

  • Items related to Variable annuity product features, which include
    certain changes in the fair value of the derivatives and other
    securities we use to hedge these features, the effect of benefit ratio
    unlock adjustments and changes in the fair value of the embedded
    derivatives reflected within Variable annuity products' net derivative
    results;
  • Investment (gains) losses, which includes other-than-temporary
    impairments of securities, sales or disposals of
    securities/investments, realized capital gains/losses and valuation
    allowances;
  • Goodwill impairment, which includes a write-down of goodwill in first
    quarter of 2017.
  • Net actuarial (gains) losses, which includes actuarial gains and
    losses as a result of differences between actual and expected
    experience on pension plan assets or projected benefit obligation
    during a given period related to pension, other postretirement benefit
    obligations, and the one-time impact of the settlement of the defined
    benefit obligation;
  • Other adjustments, which includes restructuring costs related to
    severance, lease write-offs related to non-recurring restructuring
    activities, and separation costs; and
  • Income tax expense (benefit) related to the above items and
    non-recurring tax items, which includes the effect of uncertain tax
    positions for a given audit period, permanent differences due to
    goodwill impairment, and the Tax Reform Act.

Because Non-GAAP Operating Earnings excludes the foregoing items that
can be distortive or unpredictable, management believes that this
measure enhances the understanding of the Company's underlying drivers
of profitability and trends in our business, thereby allowing management
to make decisions that will positively impact our business.

We use our prevailing corporate federal income tax rate of 21% in 2018
and 35% in 2017, while taking into account any non-recurring differences
for events recognized differently in our financial statements and
federal income tax returns as well as partnership income taxed at lower
rates when reconciling Net income (loss) attributable to Holdings to
Non-GAAP Operating Earnings.

The table below presents a reconciliation of Net income (loss)
attributable to Holdings to Non-GAAP Operating Earnings for the three
and six months ended June 30, 2018 and 2017:

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

(in millions) 2018   2017 2018   2017
Net income (loss) attributable to Holdings $ 158 $ 608 $ 326 $ 318
Adjustments related to:
Variable annuity product features 280 (40 ) 492 251
Investment (gains) losses 22 (4 ) (80 ) 20
Goodwill impairment 369

Net actuarial (gains) losses related to pension
and other
postretirement benefit obligations

27 33 158 67
Other adjustments 89 26 179 5

Income tax expense (benefit) related to
above adjustments

(81 ) (7 ) (144 ) (242 )
Non-recurring tax items 11   (217 ) 39   (85 )
Non-GAAP Operating Earnings $ 506   $ 399   $ 970   $ 703  

Non-GAAP Operating EPS

Non-GAAP Operating EPS is calculated by dividing Non-GAAP Operating
Earnings by ending diluted common shares outstanding. The table below
presents a reconciliation of GAAP EPS to Non-GAAP Operating EPS for the
three months ended June 30, 2018 and 2017:

  Three Months Ended June 30,   Six Months Ended June 30,
(per share amounts) 2018   2017 2018   2017
Net income (loss) attributable to Holdings $ 0.28 $ 1.08 $ 0.58   $ 0.57
Adjustments related to:
Variable annuity product features 0.50 (0.07 ) 0.88 0.45
Investment (gains) losses 0.04 (0.01 ) (0.14 ) 0.04
Goodwill impairment 0.66

Net actuarial (gains) losses related to pension
and other
postretirement benefit obligations

0.05 0.06 0.28 0.12
Other adjustments 0.15 0.05 0.32 (0.01 )

Income tax expense (benefit) related to above
adjustments

(0.14 ) (0.01 ) (0.26 ) (0.43 )
Non-recurring tax items 0.02   (0.39 ) 0.07   (0.15 )
Non-GAAP Operating Earnings $ 0.90   $ 0.71   $ 1.73   $ 1.25  

Book Value Per Share, excluding AOCI

We use the term "book value" to refer to "shareholders' equity." Book
Value Per Share, excluding AOCI, is our stockholder's equity, excluding
AOCI, divided by ending common shares outstanding - diluted.

   

June 30,
2018

December 31,
2017

Book value per share $ 23.84 $ 24.04
Per share impact of AOCI 2.33   0.19
Book Value Per Share, excluding AOCI $ 26.17 $ 24.23

Other Operating Measures

We also use certain operating measures which management believes provide
useful information about our businesses and the operational factors
underlying our financial performance.

Account Value

Account value generally equals the aggregate policy account value of our
retirement products.

Assets Under Management ("AUM")

AUM means investment assets that are managed by one of our subsidiaries
and includes: (i) assets managed by AB, (ii) the assets in our general
account investment assets portfolio and (iii) the separate account
assets of our Individual Retirement, Group Retirement and Protection
Solutions businesses. Total AUM reflects exclusions between segments to
avoid double counting.

Conditional Tail Expectation ("CTE") 98

CTE98 is defined as the amount of assets required to satisfy contract
holder obligations across market environments in the average of the
worst 2 percent of scenarios over the life of the contracts.

Consolidated Statements of Income (Loss)

   

Three Months
Ended June 30,

Six Months Ended
June 30,

2018   2017 2018   2017
(in millions)
REVENUES
Policy charges and fee income $ 987 $ 935 $ 1,959 $ 1,891
Premiums 275 277 554 558
Net derivative gains (losses) (73 ) 729 (354 ) 494
Net investment income (loss) 596 803 1,187 1,583
Investment gains (losses), net:
Total other-than-temporary impairment losses (13 ) (14 )
Other investment gains (losses), net (22 ) 17   80   (6 )
Total investment gains (losses), net (22 ) 4   80   (20 )
Investment management and service fees 1,075 998 2,130 1,952
Other income 124   136   241   254  
Total revenues 2,962   3,882   5,797   6,712  
BENEFITS AND OTHER DEDUCTIONS
Policyholders' benefits 920 1,741 1,528 2,834
Interest credited to policyholders' account balances 268 242 539 488

Compensation and benefits (includes $41, $41, $81
and $82 of
deferred policy acquisition costs,
respectively)

558 546 1,178 1,085

Commissions and distribution related payments
(includes $132,
$138, $251 and $270 of
deferred policy acquisition costs,
respectively)

418 400 829 795
Interest expense 60 38 106 73

Amortization of deferred policy acquisition costs (net
of
capitalization of $173, $179, $332 and $352 of
deferred
policy acquisition costs, respectively)

(1 ) (113 ) 14 (168 )
Other operating costs and expenses 425   414   919   1,158  
Total benefits and other deductions 2,648   3,268   5,113   6,265  
Income (loss) from continuing operations, before income taxes 314 614 684 447
Income tax (expense) benefit (59 ) 84   (138 ) 54  
Net income (loss) 255 698 546 501

Less: net (income) loss attributable to the
noncontrolling
interest

(97 ) (90 ) (220 ) (183 )
Net income (loss) attributable to Holdings 158   608   326   318  

Earnings Per Share

   

Three Months Ended
June 30,

Six Months Ended
June 30,

2018   2017 2018   2017
(in millions, except per

share data)

Earnings per share - Common stock
Basic $ 0.28   $ 1.08   $ 0.58   $ 0.57
Diluted $ 0.28   $ 1.08   $ 0.58   $ 0.57
Weighted Average Shares

Weighted average common stock outstanding for
basic earnings
per common share

561.0   561.0   561.0   561.0

Weighted average common stock outstanding for
diluted
earnings per common share

561.1   561.0   561.1   561.0

Results of Operations by Segment

   

Three Months Ended
June 30,

Six Months Ended
June 30,

2018   2017 2018   2017
(in millions)
Operating earnings (loss) by segment:
Individual Retirement $ 399 $ 308 $ 759 $ 510
Group Retirement 78 48 154 107
Investment Management and Research 97 61 178 93
Protection Solutions 24 16 47 55
Total segment operating earnings 598   433   1,138   765  
Corporate and Other (92 ) (34 ) (168 ) (62 )
Non-GAAP Operating Earnings $ 506   $ 399   $ 970   $ 703  

Select Balance Sheet Statistics

   
June 30,
2018
December 31,
2017
(in millions)
ASSETS
Total investments and cash and cash equivalents $ 83,661 $ 86,596
Separate Accounts assets 122,967 124,552
Total assets 231,012 235,648
 
LIABILITIES
Short-term and Long-term debt $ 4,922 $ 2,408
Future policy benefits and other policyholders' liabilities 29,351 30,299
Policyholders' account balances 48,849 47,171
Total liabilities 216,003 218,440
EQUITY
Total equity attributable to Holdings $ 13,376 $ 13,485

Total equity attributable to Holdings excluding Accumulated other
comprehensive
income (loss)

14,686 13,593

Assets Under Management

 
June 30,
2018
  December 31,
2017
(in millions)

Assets under management

AB AUM: $ 539,800 $ 554,485
Exclusion for General Account and Other (57,757 ) (59,669 )
Exclusion for Separate Accounts (32,919 )   (33,748 )
AB Third Party $ 449,124     $ 461,068  
Total Company AUM
AB Third Party $ 449,124 $ 461,068
General Account and Other(1) 83,661 86,596
Separate Accounts(2) 122,967   124,552  
Total AUM $ 655,752   $ 672,216  
(1)   "General Account and Other Affiliated Accounts" refers to assets
held in the general accounts of our insurance companies and other
assets on which we bear the investment risk.
(2) "Separate Accounts" refers to the separate account investment assets
of our insurance subsidiaries excluding any assets on which we bear
the investment risk.

View Comments and Join the Discussion!