Form 8-K Unum Group For: Oct 28
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 28, 2015 | ||||
UNUM GROUP | ||||
(Exact name of registrant as specified in its charter) | ||||
Delaware | 001-11294 | 62-1598430 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
1 Fountain Square
Chattanooga, Tennessee 37402
(Address of principal executive offices) (Zip Code)
(423) 294-1011
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
On October 28, 2015, Unum Group issued a news release reporting its results for the third quarter of 2015, a copy of which is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Also on October 28, 2015, Unum Group posted on its website at www.unum.com the Statistical Supplement relating to its financial results for the third quarter of 2015. A copy of the Statistical Supplement is furnished herewith as Exhibit 99.2 and incorporated herein by reference.
In accordance with General Instruction B.2 of Form 8-K, the information in this report, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference into any of Unum Group's filings under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits. | The following exhibits are furnished (but not filed) with this report: |
99.1 | News release of Unum Group dated October 28, 2015, concerning earnings for the third quarter of 2015. |
99.2 | Statistical Supplement of Unum Group for the third quarter of 2015. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Unum Group | |||
(Registrant) | |||
October 28, 2015 | By: | /s/ J. Paul Jullienne | |
Name: | J. Paul Jullienne | ||
Title: | Vice President, Managing Counsel, and | ||
Corporate Secretary | |||
INDEX TO EXHIBITS
Exhibit No. | Description |
99.1 | News release of Unum Group dated October 28, 2015, concerning earnings for the third quarter of 2015. |
99.2 | Statistical Supplement of Unum Group for the third quarter of 2015. |
Exhibit 99.1 | ||
1 Fountain Square | ||
Chattanooga, TN 37402 | ||
www.unum.com |
FOR IMMEDIATE RELEASE | |||
news | Contacts | ||
INVESTORS | Tom White | 423 294 8996 | |
Matt Barnett | 423 294 7498 | ||
MEDIA | Jim Sabourin | 423 294 6300 | |
Unum Group Reports Third Quarter 2015 Results
CHATTANOOGA, Tenn. (October 28, 2015) - Unum Group (NYSE: UNM) today reported net income of $203.8 million ($0.83 per diluted common share) for the third quarter of 2015, compared to net income of $219.1 million ($0.86 per diluted common share) for the third quarter of 2014.
After-tax operating income, which excludes after-tax realized investment gains and losses on the Company’s investment portfolio and the amortization of prior period actuarial losses on the Company’s pension plans, was $223.0 million ($0.91 per diluted common share) in the third quarter of 2015, compared to $219.1 million ($0.86 per diluted common share) in the third quarter of 2014. The combined impact of the amounts excluded resulted in a net after-tax loss of $19.2 million ($0.08 per diluted common share) for the third quarter of 2015, compared to an immaterial net amount and no impact to per diluted common share earnings in the third quarter of 2014.
“We had a very good third quarter, highlighted by continued growth in our core business segments, combined with strong profit margins,” said Richard P. McKenney, president and chief executive officer. “These results continue to drive strong capital generation which we actively redeployed in the third quarter through investing in organic growth, acquiring an attractive dental business for our U.K. operations, and returning capital to our shareholders through share repurchases and dividends.”
Effective January 1, 2015, the Company adopted an accounting standards update for tax credit partnership investments in qualified affordable housing projects (ASU 2014-01) and applied the amendments retrospectively, adjusting all prior periods presented in this release, as applicable.
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. |
RESULTS BY SEGMENT
Unum US Segment
Unum US reported operating income of $218.7 million in the third quarter of 2015, an increase of 3.1 percent from $212.1 million in the third quarter of 2014. Premium income for the segment increased 6.8 percent to $1,241.8 million in the third quarter of 2015, compared to premium income of $1,162.7 million in the third quarter of 2014. Net investment income for the segment was $214.3 million in the third quarter of 2015 and $214.4 million in the third quarter of 2014.
Within the Unum US operating segment, the group disability line of business reported a 3.2 percent increase in operating income, with $70.8 million in the third quarter of 2015 compared to $68.6 million in the third quarter of 2014. Premium income in group disability increased 7.9 percent to $567.5 million in the third quarter of 2015, compared to $526.0 million in the third quarter of 2014, primarily due to favorable persistency in the group long-term disability product line, sales growth, and premium rate increases. Net investment income declined by 2.5 percent to $121.7 million in the third quarter of 2015, compared to $124.8 million in the third quarter of 2014, primarily due to a decrease in the level of invested assets supporting this line of business and a decline in yields. The benefit ratio for the third quarter of 2015 was 80.5 percent, compared to 82.1 percent in the third quarter of 2014, reflecting lower new claim incidence levels and higher claim recoveries in the group long-term disability line. Group long-term disability sales increased 22.5 percent to $34.3 million in the third quarter of 2015, compared to $28.0 million in the third quarter of 2014. Group short-term disability sales declined 2.6 percent to $15.2 million in the third quarter of 2015, compared to $15.6 million in the third quarter of 2014. Persistency in the group long-term disability line of business improved to 92.1 percent for the first nine months of 2015, compared to 90.2 percent for the first nine months of 2014. Persistency in the group short-term disability line of business was 87.9 percent for the first nine months of 2015, compared to 88.9 percent for the same period of 2014.
The group life and accidental death and dismemberment line of business reported operating income of $60.2 million in the third quarter of 2015, a decline of 2.6 percent from $61.8 million in the third quarter of 2014, reflecting less favorable benefits experience, which offset an increase in premium income. Premium income for this line of business increased 5.8 percent to $368.6 million in the third quarter of 2015, compared to $348.3 million in the third quarter of 2014, primarily due to sales growth, partially offset by a decline in persistency. Net investment income increased by 2.7 percent to $34.7 million in the third quarter of 2015, compared to $33.8 million in the third quarter of 2014, primarily due to an increase in the level of invested assets supporting this line of business, partially offset by a decline in yields. The benefit ratio in the third quarter of 2015 was 71.0 percent, compared to 70.0 percent in the third quarter of 2014, reflecting a higher average paid claim size. Sales of group life and accidental death and dismemberment products increased 1.5 percent in the third quarter of 2015 to $34.1 million, compared to $33.6 million in the third quarter of 2014. Persistency in the group life line of business was 88.5 percent for the first nine months of 2015, compared to 89.8 percent for the same period of 2014.
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 2 |
The supplemental and voluntary line of business reported an increase of 7.3 percent in operating income to $87.7 million in the third quarter of 2015, compared to $81.7 million in the third quarter of 2014. Premium income for supplemental and voluntary increased 6.0 percent to $305.7 million in the third quarter of 2015, compared to $288.4 million in the third quarter of 2014. Net investment income increased slightly to $57.9 million in the third quarter of 2015, compared to $55.8 million in the third quarter of 2014, due to an increase in the level of invested assets and higher miscellaneous investment income, partially offset by a decline in yields. The interest adjusted loss ratio for the individual disability product line was 31.4 percent for the third quarter of 2015, compared to 31.1 percent for the third quarter of 2014. The benefit ratio for voluntary benefits improved to 45.8 percent in the third quarter of 2015, compared to 47.1 percent in the third quarter of 2014, due primarily to favorable mortality experience in the life product line and favorable claim incidence in the accident product line. Relative to the third quarter of 2014, sales in the individual disability line of business increased 47.2 percent in the third quarter of 2015 to $21.2 million. Sales in the voluntary benefits line of business increased 0.2 percent in the third quarter of 2015 to $46.2 million. Persistency in the individual disability product line was 90.2 percent for the first nine months of 2015, compared to 89.9 percent for the same period of 2014. Persistency in the voluntary benefits product line was 75.3 percent for the first nine months of 2015, compared to 77.7 percent for the first nine months of 2014.
Unum UK Segment
Unum UK reported operating income of $32.7 million in the third quarter of 2015, a decline of 2.4 percent from $33.5 million in the third quarter of 2014. In local currency, operating income increased by 5.0 percent to £21.1 million in the third quarter of 2015, compared to £20.1 million in the third quarter of 2014.
Premium income declined 5.2 percent to $144.6 million in the third quarter of 2015, compared to $152.6 million in the third quarter of 2014. In local currency, premium income was £93.3 million in the third quarter of 2015, an increase of 2.0 percent from £91.5 million in the third quarter of 2014. Net investment income declined to $28.0 million in the third quarter of 2015, compared to $34.4 million in the third quarter of 2014. In local currency, net investment income declined 12.1 percent to £18.1 million in the third quarter of 2015, compared to £20.6 million in the third quarter of 2014, primarily due to lower income from inflation index-linked bonds. The benefit ratio in the third quarter of 2015 was 67.8 percent, compared to 70.7 percent in the third quarter of 2014, reflecting favorable claims experience resulting from lower new claim incidence and higher claim recoveries in the group long-term disability line.
Persistency in the group long-term disability line of business was 88.5 percent for the first nine months of 2015, generally consistent with the first nine months of 2014. Persistency in the group life line of business improved to 80.6 percent for the first nine months of 2015, compared to 73.3 percent for the first nine months of 2014. Sales declined 7.9 percent to $19.7 million in the third quarter of 2015, compared to $21.4 million in the third quarter of 2014. In local currency, sales for the third quarter of 2015 were stable at £12.8 million.
On September 3, 2015, we acquired National Dental Plan Limited and associated companies (National Dental) for a total cash purchase price of £35.9 million or $54.3 million. National Dental, a provider of dental
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 3 |
insurance in the U.K. workplace, is reported in our Unum UK segment as part of our supplemental product line. This acquisition, the results of which are included in our consolidated financial statements for the period subsequent to the date of acquisition, did not have a material impact on revenue or results of operations during the third quarter of 2015.
Colonial Life Segment
Colonial Life reported a 7.5 percent increase in operating income to $76.3 million in the third quarter of 2015, compared to $71.0 million in the third quarter of 2014.
Premium income for the third quarter of 2015 increased 4.3 percent to $333.1 million, compared to $319.4 million in the third quarter of 2014, driven by sales growth in recent quarters, partially offset by a decline in persistency in the accident, sickness, and disability and cancer and critical illness product lines. Net investment income increased 1.1 percent to $35.9 million in the third quarter of 2015, compared to $35.5 million in the third quarter of 2014, due to an increase in the level of invested assets, partially offset by a decrease in yield. The benefit ratio in the third quarter of 2015 was 51.2 percent, compared to 52.7 percent in the third quarter of 2014, primarily reflecting favorable mortality experience in the life product line and the release of active life reserves in various product lines related to policy terminations.
Sales increased 11.1 percent to $95.3 million in the third quarter of 2015 from $85.8 million in the third quarter of 2014, with favorable sales trends in both the commercial and public sector market segments.
Closed Block Segment
The Closed Block segment reported operating income of $27.7 million in the third quarter of 2015, compared to $25.7 million in the third quarter of 2014.
Premium income for this segment declined 3.6 percent in the third quarter of 2015 compared to the third quarter of 2014, primarily due to expected policy terminations and maturities for the individual disability line of business, partially offset by a slight increase in premium income for the long-term care line of business due primarily to rate increases on in-force business. Net investment income increased 3.2 percent to $327.5 million in the third quarter of 2015, compared to $317.2 million in the third quarter of 2014, due to an increase in the level of invested assets and higher miscellaneous investment income, partially offset by a decrease in yield. The interest adjusted loss ratio for the individual disability line of business was 80.8 percent in the third quarter of 2015, compared to 82.3 percent in the third quarter of 2014, due primarily to favorable claim incidence. The interest adjusted loss ratio for the long-term care line of business was 89.9 percent in the third quarter of 2015 compared to 88.5 percent in the third quarter of 2014, reflecting higher claim incidence and lower claim recoveries.
Corporate Segment
The Corporate segment reported an operating loss of $26.9 million for the third quarter of 2015, compared to an operating loss of $25.1 million in the third quarter of 2014. The higher operating loss in the third quarter of 2015 was due primarily to lower net investment income.
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 4 |
OTHER INFORMATION
Shares Outstanding
The Company’s average number of shares outstanding, assuming dilution, was 246.3 million for the third quarter of 2015, compared to 254.8 million for the third quarter of 2014. Shares outstanding totaled 243.4 million at September 30, 2015. During the third quarter of 2015, the Company repurchased approximately 3.2 million shares at a cost of $115 million.
Capital Management
At September 30, 2015, the weighted average risk-based capital ratio for the Company’s traditional U.S. insurance companies was approximately 400 percent, and cash and marketable securities in the holding companies equaled $484 million.
Book Value
Book value per common share as of September 30, 2015 was $35.25, compared to $36.58 at September 30, 2014.
Outlook
The Company continues to anticipate growth in after-tax operating earnings per share for full-year 2015 to be towards the lower end of the outlook range announced in December 2014 of two percent to five percent.
NON-GAAP FINANCIAL MEASURES
We analyze our performance using non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP financial measures of "operating revenue," "before-tax operating income" or "before-tax operating loss," and "after-tax operating income" differ from total revenue, income before income tax, and net income as presented in our consolidated operating results and income statements prepared in accordance with GAAP due to the exclusion of net realized investment gains and losses, non-operating retirement-related gains or losses, and certain other items as specified in the reconciliations in the Financial Highlights section below. We believe operating revenue and operating income or loss are better performance measures and better indicators of the revenue and profitability and underlying trends in our business.
Realized investment gains or losses depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our segments. Our investment focus is on investment income to support our insurance liabilities as opposed to the generation of realized investment gains or losses. Although we may experience realized investment gains or losses which will affect future earnings levels, a long-term focus is necessary to maintain profitability over the life of the business since our underlying business is long-term in nature, and we need to earn the interest rates assumed in calculating our liabilities.
The amortization of prior period actuarial gains or losses, a component of the net periodic benefit cost for our pensions and other postretirement benefit plans, is driven by market performance as well as plan amendments and is not indicative of the operational results of our businesses. We believe that excluding the amortization of prior period gains or losses from operating income or loss provides investors with additional information for comparison and analysis of our operating results. Although we manage our non-operating retirement-related gains or losses separately from the operational performance of our business,
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 5 |
these gains or losses impact the overall profitability of our company and have historically increased or decreased over time, depending on plan amendments and market conditions and the resulting impact on the actuarial gains or losses in our pensions and other postretirement benefit plans.
We believe that excluding the year-to-date 2014 costs related to the early retirement of debt is appropriate because in conjunction with the debt redemption, we recognized in realized investment gains and losses a deferred gain from previously terminated derivatives which were associated with the hedge of this debt. The amount recognized as a realized investment gain, which basically offsets the cost of the debt redemption, is also excluded from our non-GAAP financial measures since we analyze our performance excluding amounts reported as realized investment gains or losses. We believe it provides investors with a more realistic view of our overall profitability if we are consistent in excluding both the cost of the retirement as well as the gain on the hedge of the debt.
We may at other times exclude certain other items from our discussion of financial ratios and metrics in order to enhance the understanding and comparability of our operational performance and the underlying fundamentals, but this exclusion is not an indication that similar items may not recur and does not replace net income or net loss as a measure of our overall profitability.
CONFERENCE CALL INFORMATION
Members of Unum Group senior management will host a conference call on Thursday, October 29, at 9:00 A.M. (Eastern Time) to discuss the results of operations for the third quarter. Topics may include forward-looking information such as the Company’s outlook on future results, trends in operations, and other material information.
The dial-in number for the conference call is (800) 289-0544 for U.S. and Canada (pass code 7553837). For international, the dial-in number is (913) 312-0654 (pass code 7553837). A live webcast of the call will also be available at www.investors.unum.com in a listen-only mode. It is recommended that webcast viewers access the “Investors” section of the Company’s website and opt-in to the webcast approximately 5-10 minutes prior to the start of the call. The Company will maintain a replay of the call on its website through Thursday, November 5. A replay of the call will also be available by dialing (888) 203-1112 (U.S. and Canada) or (719) 457-0820 (International) - pass code 7553837.
In conjunction with today’s earnings announcement, the Company’s Statistical Supplement for the third quarter of 2015 is available on the “Investors” section of the Company’s website.
ABOUT UNUM GROUP
Unum (www.unum.com) is one of the leading providers of employee benefits products and services and the largest provider of disability insurance products in the United States and the United Kingdom.
SAFE HARBOR STATEMENT
Certain information in this press release constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those not based on historical information, but rather relate to our outlook, future operations, strategies, financial results, or other developments and speak only as of the date made. These forward-looking statements, including statements about anticipated growth in after-tax operating income per share, are
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 6 |
subject to numerous assumptions, risks, and uncertainties, many of which are beyond our control. The following factors, in addition to other factors mentioned from time to time, may cause actual results to differ materially from those contemplated by the forward-looking statements: (1) sustained periods of low interest rates; (2) fluctuation in insurance reserve liabilities and claim payments due to changes in claim incidence, recovery rates, mortality and morbidity rates, and policy benefit offsets due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, the effectiveness of our claims operational processes, and changes in government programs; (3) unfavorable economic or business conditions, both domestic and foreign; (4) legislative, regulatory, or tax changes, both domestic and foreign, including the effect of potential legislation and increased regulation in the current political environment; (5) investment results, including, but not limited to, changes in interest rates, defaults, changes in credit spreads, impairments, and the lack of appropriate investments in the market which can be acquired to match our liabilities; (6) the failure of cyber or other information security systems, as well as the occurrence of events unanticipated in our disaster recovery systems; (7) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (8) changes in our financial strength and credit ratings; (9) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, external events, and/or inadequate or failed internal controls and procedures; (10) actual experience that deviates from our assumptions used in pricing, underwriting, and reserving; (11) actual persistency and/or sales growth that is higher or lower than projected; (12) changes in demand for our products due to, among other factors, changes in societal attitudes, the rate of unemployment, consumer confidence, and/or legislative and regulatory changes, including healthcare reform; (13) effectiveness of our risk management program; (14) contingencies and the level and results of litigation; (15) availability of reinsurance in the market and the ability of our reinsurers to meet their obligations to us; (16) ineffectiveness of our derivatives hedging programs due to changes in the economic environment, counterparty risk, ratings downgrades, capital market volatility, changes in interest rates, and/or regulation; (17) changes in accounting standards, practices, or policies; (18) fluctuation in foreign currency exchange rates; (19) ability to generate sufficient internal liquidity and/or obtain external financing; (20) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; and (21) terrorism, both within the U.S. and abroad, ongoing military actions, and heightened security measures in response to these types of threats.
For further discussion of risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Part I, Item 1A of our annual report on Form 10-K for the year ended December 31, 2014. The forward-looking statements in this press release are being made as of the date of this press release, and the Company expressly disclaims any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise.
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UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 7 |
Unum Group
FINANCIAL HIGHLIGHTS
(Unaudited)
($ in millions, except share data) | |||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Operating Revenue | $ | 2,684.4 | $ | 2,613.1 | $ | 8,050.0 | $ | 7,852.1 | |||||||
Net Realized Investment Gain (Loss) | (26.6 | ) | 1.2 | (41.1 | ) | 33.4 | |||||||||
Total Revenue | $ | 2,657.8 | $ | 2,614.3 | $ | 8,008.9 | $ | 7,885.5 | |||||||
Operating Income | $ | 328.5 | $ | 317.2 | $ | 971.7 | $ | 980.6 | |||||||
Net Realized Investment Gain (Loss) | (26.6 | ) | 1.2 | (41.1 | ) | 33.4 | |||||||||
Non-operating Retirement-related Loss | (3.0 | ) | (1.4 | ) | (8.9 | ) | (4.2 | ) | |||||||
Costs Related to Early Retirement of Debt | — | — | — | (13.2 | ) | ||||||||||
Income Tax | (95.1 | ) | (97.9 | ) | (280.7 | ) | (312.3 | ) | |||||||
Net Income | $ | 203.8 | $ | 219.1 | $ | 641.0 | $ | 684.3 | |||||||
PER SHARE INFORMATION | |||||||||||||||
Net Income Per Common Share | |||||||||||||||
Basic | $ | 0.83 | $ | 0.86 | $ | 2.58 | $ | 2.67 | |||||||
Assuming Dilution | $ | 0.83 | $ | 0.86 | $ | 2.57 | $ | 2.66 | |||||||
Weighted Average Common Shares - Basic (000s) | 245,400.0 | 253,586.1 | 248,372.9 | 256,573.6 | |||||||||||
Weighted Average Common Shares - Assuming Dilution (000s) | 246,324.4 | 254,795.5 | 249,228.1 | 257,783.7 | |||||||||||
Outstanding Shares - (000s) | 243,422.0 | 251,931.3 |
Reconciliation of Non-GAAP Financial Measures
Three Months Ended September 30 | |||||||||||||||
2015 | 2014 | ||||||||||||||
per share * | per share * | ||||||||||||||
After-tax Operating Income | $ | 223.0 | $ | 0.91 | $ | 219.1 | $ | 0.86 | |||||||
Net Realized Investment Gain (Loss), Net of Tax | (17.3 | ) | (0.07 | ) | 0.9 | — | |||||||||
Non-operating Retirement-related Loss, Net of Tax | (1.9 | ) | (0.01 | ) | (0.9 | ) | — | ||||||||
Net Income | $ | 203.8 | $ | 0.83 | $ | 219.1 | $ | 0.86 | |||||||
* Assuming Dilution |
September 30 | |||||||||||||||
2015 | 2014 | ||||||||||||||
per share | per share | ||||||||||||||
Total Stockholders' Equity (Book Value) | $ | 8,581.1 | $ | 35.25 | $ | 9,216.6 | $ | 36.58 | |||||||
Net Unrealized Gain on Securities | 158.6 | 0.65 | 462.0 | 1.83 | |||||||||||
Net Gain on Cash Flow Hedges | 405.1 | 1.66 | 383.5 | 1.52 | |||||||||||
Subtotal | 8,017.4 | 32.94 | 8,371.1 | 33.23 | |||||||||||
Foreign Currency Translation Adjustment | (146.6 | ) | (0.60 | ) | (69.5 | ) | (0.27 | ) | |||||||
Subtotal | 8,164.0 | 33.54 | 8,440.6 | 33.50 | |||||||||||
Unrecognized Pension and Postretirement Benefit Costs | (395.1 | ) | (1.62 | ) | (227.4 | ) | (0.91 | ) | |||||||
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income | $ | 8,559.1 | $ | 35.16 | $ | 8,668.0 | $ | 34.41 |
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. | 8 |
Unum Group
Statistical Supplement Third Quarter 2015
TABLE OF CONTENTS
(Dollars in millions, except share data and where noted)
Interim Results are Unaudited
Page | |||
See "Appendix to Statistical Supplement" on page 16 for a summary of significant items and a reconciliation of our non-GAAP financial measures. | |||
N.M. = not a meaningful percentage |
Unum Group Financial Highlights
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Consolidated U.S. GAAP Results¹ | |||||||||||||||||||||||
Premium Income | $ | 2,020.8 | $ | 1,947.2 | $ | 6,044.6 | $ | 5,829.3 | $ | 7,797.2 | $ | 7,624.7 | |||||||||||
Operating Revenue | $ | 2,684.4 | $ | 2,613.1 | $ | 8,050.0 | $ | 7,852.1 | $ | 10,508.4 | $ | 10,361.8 | |||||||||||
Net Realized Investment Gain (Loss) | (26.6 | ) | 1.2 | (41.1 | ) | 33.4 | 16.1 | 6.8 | |||||||||||||||
Revenue | $ | 2,657.8 | $ | 2,614.3 | $ | 8,008.9 | $ | 7,885.5 | $ | 10,524.5 | $ | 10,368.6 | |||||||||||
Net Income | $ | 203.8 | $ | 219.1 | $ | 641.0 | $ | 684.3 | $ | 402.1 | $ | 847.0 | |||||||||||
Net Income Per Share: | |||||||||||||||||||||||
Basic | $ | 0.83 | $ | 0.86 | $ | 2.58 | $ | 2.67 | $ | 1.57 | $ | 3.20 | |||||||||||
Assuming Dilution | $ | 0.83 | $ | 0.86 | $ | 2.57 | $ | 2.66 | $ | 1.57 | $ | 3.19 | |||||||||||
Operating Return on Equity | |||||||||||||||||||||||
Unum US | 13.6 | % | 13.5 | % | 13.2 | % | 13.3 | % | 13.3 | % | 13.4 | % | |||||||||||
Unum UK | 15.8 | % | 15.7 | % | 16.4 | % | 18.2 | % | 18.3 | % | 14.0 | % | |||||||||||
Colonial Life | 16.3 | % | 16.2 | % | 16.7 | % | 17.0 | % | 16.7 | % | 16.4 | % | |||||||||||
Core Operating Segments | 14.4 | % | 14.2 | % | 14.2 | % | 14.6 | % | 14.5 | % | 14.1 | % | |||||||||||
Consolidated | 11.1 | % | 10.5 | % | 11.3 | % | 10.9 | % | 11.3 | % | 11.3 | % | |||||||||||
Assets | $ | 61,503.8 | $ | 61,918.5 | $ | 62,450.2 | $ | 59,374.1 | |||||||||||||||
Stockholders' Equity | $ | 8,581.1 | $ | 9,216.6 | $ | 8,521.9 | $ | 8,639.9 |
Traditional U.S. Life Insurance Companies' Statutory Results² | |||||||||||||||||||||||
Net Gain from Operations, After Tax | $ | 190.4 | $ | 168.1 | $ | 506.8 | $ | 469.1 | $ | 618.1 | $ | 617.5 | |||||||||||
Net Realized Investment Gain (Loss), After Tax | (7.5 | ) | 4.7 | (8.3 | ) | 7.2 | 5.0 | (33.0 | ) | ||||||||||||||
Net Income | $ | 182.9 | $ | 172.8 | $ | 498.5 | $ | 476.3 | $ | 623.1 | $ | 584.5 | |||||||||||
Capital and Surplus | $ | 3,448.8 | $ | 3,388.4 | $ | 3,462.8 | $ | 3,450.5 | |||||||||||||||
Weighted Average Risk-based Capital Ratio | ~ 400% | ~ 400% | ~ 400% | ~ 400% |
1 Generally Accepted Accounting Principles
2 Our traditional U.S. life insurance companies are Provident Life and Accident Insurance Company, Unum Life Insurance Company of America, The Paul Revere Life Insurance Company, Colonial Life & Accident Insurance Company, Provident Life and Casualty Insurance Company, First Unum Life Insurance Company, and Unum Insurance Company.
1
Unum Group Capital Metrics
9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||||||||||||
(in millions) | per share | (in millions) | per share | (in millions) | per share | (in millions) | per share | ||||||||||||||||||||||||
As Adjusted | |||||||||||||||||||||||||||||||
Book Value | |||||||||||||||||||||||||||||||
Total Stockholders' Equity, As Reported | $ | 8,581.1 | $ | 35.25 | $ | 9,216.6 | $ | 36.58 | $ | 8,521.9 | $ | 33.78 | $ | 8,639.9 | $ | 33.23 | |||||||||||||||
Net Unrealized Gain on Securities | 158.6 | 0.65 | 462.0 | 1.83 | 290.3 | 1.15 | 135.7 | 0.52 | |||||||||||||||||||||||
Net Gain on Cash Flow Hedges | 405.1 | 1.66 | 383.5 | 1.52 | 391.0 | 1.55 | 396.3 | 1.52 | |||||||||||||||||||||||
Subtotal | 8,017.4 | 32.94 | 8,371.1 | 33.23 | 7,840.6 | 31.08 | 8,107.9 | 31.19 | |||||||||||||||||||||||
Foreign Currency Translation Adjustment | (146.6 | ) | (0.60 | ) | (69.5 | ) | (0.27 | ) | (113.4 | ) | (0.45 | ) | (47.1 | ) | (0.18 | ) | |||||||||||||||
Subtotal | 8,164.0 | 33.54 | 8,440.6 | 33.50 | 7,954.0 | 31.53 | 8,155.0 | 31.37 | |||||||||||||||||||||||
Unrecognized Pension and Postretirement Benefit Costs | (395.1 | ) | (1.62 | ) | (227.4 | ) | (0.91 | ) | (401.5 | ) | (1.59 | ) | (229.9 | ) | (0.88 | ) | |||||||||||||||
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income | $ | 8,559.1 | $ | 35.16 | $ | 8,668.0 | $ | 34.41 | $ | 8,355.5 | $ | 33.12 | $ | 8,384.9 | $ | 32.25 | |||||||||||||||
Dividends Paid | $ | 129.2 | $ | 0.515 | $ | 117.7 | $ | 0.455 | $ | 159.4 | $ | 0.620 | $ | 146.5 | $ | 0.550 |
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
Shares Repurchased (millions) | 3.2 | 2.9 | 9.4 | 8.7 | 8.7 | 11.2 | |||||||||||||||||
Cost of Shares Repurchased (millions)(1) | $ | 115.0 | $ | 100.5 | $ | 326.2 | $ | 300.6 | $ | 300.6 | $ | 318.6 | |||||||||||
Price (UNM closing price on last trading day of period) | $ | 32.08 | $ | 34.38 | $ | 34.88 | $ | 35.08 | |||||||||||||||
Leverage Ratio (As Adjusted) | 25.0 | % | 24.0 | % | 25.4 | % | 23.0 | % | |||||||||||||||
Holding Company Cash and Marketable Securities | $ | 484 | $ | 720 | $ | 575 | $ | 514 |
(1) Includes commissions of $0.1 million for each of the nine month periods ended September 30, 2015 and 2014, and a de minimis amount for each of the three month periods ended September 30, 2015 and 2014. For the years ended December 31, 2014 and 2013, respectively, $0.1 million and $0.2 million of commissions are included.
2
Unum Group Ratings
AM Best | Fitch | Moody's | S&P | ||||
Outlook | Stable | Stable | Stable | Stable | |||
Issuer Credit Ratings | bbb | BBB | Baa2 | BBB | |||
Financial Strength Ratings | |||||||
Provident Life and Accident | A | A | A2 | A | |||
Unum Life of America | A | A | A2 | A | |||
Colonial Life & Accident | A | A | A2 | A | |||
Paul Revere Life | A | A | A2 | A | |||
Unum Limited | NR | NR | NR | A- |
NR = not rated
3
Unum Group Consolidated Statements of Income
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Revenue | |||||||||||||||||||||||
Premium Income | $ | 2,020.8 | $ | 1,947.2 | $ | 6,044.6 | $ | 5,829.3 | $ | 7,797.2 | $ | 7,624.7 | |||||||||||
Net Investment Income | 612.1 | 611.3 | 1,844.8 | 1,859.5 | 2,492.2 | 2,506.9 | |||||||||||||||||
Net Realized Investment Gain (Loss) | (26.6 | ) | 1.2 | (41.1 | ) | 33.4 | 16.1 | 6.8 | |||||||||||||||
Other Income | 51.5 | 54.6 | 160.6 | 163.3 | 219.0 | 230.2 | |||||||||||||||||
Total Revenue | 2,657.8 | 2,614.3 | 8,008.9 | 7,885.5 | 10,524.5 | 10,368.6 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 1,690.9 | 1,653.6 | 5,047.6 | 4,938.3 | 7,310.8 | 6,595.7 | |||||||||||||||||
Commissions | 246.3 | 232.0 | 747.8 | 697.2 | 935.3 | 909.5 | |||||||||||||||||
Interest and Debt Expense - Non-recourse Debt | 1.6 | 1.8 | 5.0 | 5.5 | 7.3 | 8.5 | |||||||||||||||||
Interest and Debt Expense - All Other Debt | 36.5 | 36.6 | 108.9 | 123.5 | 160.2 | 140.9 | |||||||||||||||||
Deferral of Acquisition Costs | (139.4 | ) | (127.8 | ) | (425.1 | ) | (381.6 | ) | (524.0 | ) | (466.8 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 117.0 | 107.9 | 375.4 | 332.9 | 440.8 | 418.9 | |||||||||||||||||
Other Expenses | 406.0 | 393.2 | 1,227.6 | 1,173.1 | 1,652.1 | 1,541.9 | |||||||||||||||||
Total Benefits and Expenses | 2,358.9 | 2,297.3 | 7,087.2 | 6,888.9 | 9,982.5 | 9,148.6 | |||||||||||||||||
Income Before Income Tax | 298.9 | 317.0 | 921.7 | 996.6 | 542.0 | 1,220.0 | |||||||||||||||||
Income Tax Expense | 95.1 | 97.9 | 280.7 | 312.3 | 139.9 | 373.0 | |||||||||||||||||
Net Income | $ | 203.8 | $ | 219.1 | $ | 641.0 | $ | 684.3 | $ | 402.1 | $ | 847.0 | |||||||||||
Average Weighted Shares Outstanding | |||||||||||||||||||||||
Basic | 245.4 | 253.6 | 248.4 | 256.6 | 255.5 | 264.7 | |||||||||||||||||
Assuming Dilution | 246.3 | 254.8 | 249.2 | 257.8 | 256.7 | 265.9 | |||||||||||||||||
Actual Number of Shares Outstanding | 243.4 | 251.9 | 252.3 | 260.0 |
4
Unum Group Sales Data for Unum US Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||||||||
9/30/2015 | 9/30/2014 | % Change | 9/30/2015 | 9/30/2014 | % Change | 12/31/2014 | 12/31/2013 | ||||||||||||||||||||||
Sales by Product | |||||||||||||||||||||||||||||
Group Disability and Group Life and AD&D | |||||||||||||||||||||||||||||
Group Long-term Disability | $ | 34.3 | $ | 28.0 | 22.5 | % | $ | 123.5 | $ | 107.5 | 14.9 | % | $ | 223.6 | $ | 173.3 | |||||||||||||
Group Short-term Disability | 15.2 | 15.6 | (2.6 | ) | 71.6 | 58.7 | 22.0 | 118.8 | 101.9 | ||||||||||||||||||||
Group Life and AD&D | 34.1 | 33.6 | 1.5 | 125.7 | 137.2 | (8.4 | ) | 264.8 | 199.4 | ||||||||||||||||||||
Subtotal | 83.6 | 77.2 | 8.3 | 320.8 | 303.4 | 5.7 | 607.2 | 474.6 | |||||||||||||||||||||
Supplemental and Voluntary | |||||||||||||||||||||||||||||
Individual Disability | 21.2 | 14.4 | 47.2 | 46.5 | 40.7 | 14.3 | 56.8 | 52.2 | |||||||||||||||||||||
Voluntary Benefits | 46.2 | 46.1 | 0.2 | 217.4 | 189.3 | 14.8 | 238.1 | 218.8 | |||||||||||||||||||||
Subtotal | 67.4 | 60.5 | 11.4 | 263.9 | 230.0 | 14.7 | 294.9 | 271.0 | |||||||||||||||||||||
Total Sales | $ | 151.0 | $ | 137.7 | 9.7 | $ | 584.7 | $ | 533.4 | 9.6 | $ | 902.1 | $ | 745.6 | |||||||||||||||
Sales by Market Sector | |||||||||||||||||||||||||||||
Group Disability and Group Life and AD&D | |||||||||||||||||||||||||||||
Core Market (< 2,000 lives) | $ | 61.2 | $ | 60.4 | 1.3 | % | $ | 228.5 | $ | 211.8 | 7.9 | % | $ | 401.7 | $ | 324.4 | |||||||||||||
Large Case Market | 22.4 | 16.8 | 33.3 | 92.3 | 91.6 | 0.8 | 205.5 | 150.2 | |||||||||||||||||||||
Subtotal | 83.6 | 77.2 | 8.3 | 320.8 | 303.4 | 5.7 | 607.2 | 474.6 | |||||||||||||||||||||
Supplemental and Voluntary | 67.4 | 60.5 | 11.4 | 263.9 | 230.0 | 14.7 | 294.9 | 271.0 | |||||||||||||||||||||
Total Sales | $ | 151.0 | $ | 137.7 | 9.7 | $ | 584.7 | $ | 533.4 | 9.6 | $ | 902.1 | $ | 745.6 |
5
Unum Group Sales Data for Unum UK Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||||||||
(in millions of dollars) | 9/30/2015 | 9/30/2014 | % Change | 9/30/2015 | 9/30/2014 | % Change | 12/31/2014 | 12/31/2013 | |||||||||||||||||||||
Sales by Product | |||||||||||||||||||||||||||||
Group Long-term Disability | $ | 11.8 | $ | 12.0 | (1.7 | )% | $ | 36.8 | $ | 39.1 | (5.9 | )% | $ | 57.4 | $ | 50.5 | |||||||||||||
Group Life | 6.7 | 8.4 | (20.2 | ) | 16.9 | 17.8 | (5.1 | ) | 23.8 | 21.4 | |||||||||||||||||||
Supplemental | 1.2 | 1.0 | 20.0 | 3.2 | 2.9 | 10.3 | 3.9 | 3.9 | |||||||||||||||||||||
Total Sales | $ | 19.7 | $ | 21.4 | (7.9 | ) | $ | 56.9 | $ | 59.8 | (4.8 | ) | $ | 85.1 | $ | 75.8 | |||||||||||||
Sales by Market Sector | |||||||||||||||||||||||||||||
Group Long-term Disability and Group Life | |||||||||||||||||||||||||||||
Core Market (< 500 lives) | $ | 12.9 | $ | 9.7 | 33.0 | % | $ | 29.9 | $ | 29.9 | — | % | $ | 42.5 | $ | 38.9 | |||||||||||||
Large Case Market | 5.6 | 10.7 | (47.7 | ) | 23.8 | 27.0 | (11.9 | ) | 38.7 | 33.0 | |||||||||||||||||||
Subtotal | 18.5 | 20.4 | (9.3 | ) | 53.7 | 56.9 | (5.6 | ) | 81.2 | 71.9 | |||||||||||||||||||
Supplemental | 1.2 | 1.0 | 20.0 | 3.2 | 2.9 | 10.3 | 3.9 | 3.9 | |||||||||||||||||||||
Total Sales | $ | 19.7 | $ | 21.4 | (7.9 | ) | $ | 56.9 | $ | 59.8 | (4.8 | ) | $ | 85.1 | $ | 75.8 | |||||||||||||
(in millions of pounds) | |||||||||||||||||||||||||||||
Sales by Product | |||||||||||||||||||||||||||||
Group Long-term Disability | £ | 7.7 | £ | 7.1 | 8.5 | % | £ | 24.1 | £ | 23.4 | 3.0 | % | £ | 35.1 | £ | 32.2 | |||||||||||||
Group Life | 4.3 | 5.1 | (15.7 | ) | 11.0 | 10.7 | 2.8 | 14.4 | 13.7 | ||||||||||||||||||||
Supplemental | 0.8 | 0.6 | 33.3 | 2.1 | 1.7 | 23.5 | 2.4 | 2.5 | |||||||||||||||||||||
Total Sales | £ | 12.8 | £ | 12.8 | — | £ | 37.2 | £ | 35.8 | 3.9 | £ | 51.9 | £ | 48.4 | |||||||||||||||
Sales by Market Sector | |||||||||||||||||||||||||||||
Group Long-term Disability and Group Life | |||||||||||||||||||||||||||||
Core Market (< 500 lives) | £ | 8.3 | £ | 5.8 | 43.1 | % | £ | 19.4 | £ | 17.9 | 8.4 | % | £ | 25.8 | £ | 24.9 | |||||||||||||
Large Case Market | 3.7 | 6.4 | (42.2 | ) | 15.7 | 16.2 | (3.1 | ) | 23.7 | 21.0 | |||||||||||||||||||
Subtotal | 12.0 | 12.2 | (1.6 | ) | 35.1 | 34.1 | 2.9 | 49.5 | 45.9 | ||||||||||||||||||||
Supplemental | 0.8 | 0.6 | 33.3 | 2.1 | 1.7 | 23.5 | 2.4 | 2.5 | |||||||||||||||||||||
Total Sales | £ | 12.8 | £ | 12.8 | — | £ | 37.2 | £ | 35.8 | 3.9 | £ | 51.9 | £ | 48.4 |
5. 1
Unum Group Sales Data for Colonial Life Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||||||||
9/30/2015 | 9/30/2014 | % Change | 9/30/2015 | 9/30/2014 | % Change | 12/31/2014 | 12/31/2013 | ||||||||||||||||||||||
Sales by Product | |||||||||||||||||||||||||||||
Accident, Sickness, and Disability | $ | 59.9 | $ | 56.1 | 6.8 | % | $ | 169.6 | $ | 160.1 | 5.9 | % | $ | 260.7 | $ | 238.2 | |||||||||||||
Life | 18.6 | 15.7 | 18.5 | 53.1 | 48.2 | 10.2 | 78.8 | 68.1 | |||||||||||||||||||||
Cancer and Critical Illness | 16.8 | 14.0 | 20.0 | 45.9 | 40.1 | 14.5 | 70.6 | 61.3 | |||||||||||||||||||||
Total Sales | $ | 95.3 | $ | 85.8 | 11.1 | $ | 268.6 | $ | 248.4 | 8.1 | $ | 410.1 | $ | 367.6 | |||||||||||||||
Sales by Market Sector | |||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||
Core Market (< 1,000 lives) | $ | 60.1 | $ | 58.0 | 3.6 | % | $ | 182.4 | $ | 173.5 | 5.1 | % | $ | 275.6 | $ | 246.0 | |||||||||||||
Large Case Market | 11.7 | 9.2 | 27.2 | 28.9 | 28.9 | — | 53.2 | 49.0 | |||||||||||||||||||||
Subtotal | 71.8 | 67.2 | 6.8 | 211.3 | 202.4 | 4.4 | 328.8 | 295.0 | |||||||||||||||||||||
Public Sector | 23.5 | 18.6 | 26.3 | 57.3 | 46.0 | 24.6 | 81.3 | 72.6 | |||||||||||||||||||||
Total Sales | $ | 95.3 | $ | 85.8 | 11.1 | $ | 268.6 | $ | 248.4 | 8.1 | $ | 410.1 | $ | 367.6 |
5. 2
Unum Group Consolidated Balance Sheets
September 30 | December 31 | ||||||
2015 | 2014 | ||||||
As Adjusted | |||||||
Assets | |||||||
Investments | |||||||
Fixed Maturity Securities | $ | 44,401.5 | $ | 45,064.9 | |||
Mortgage Loans | 1,925.9 | 1,856.6 | |||||
Policy Loans | 3,406.0 | 3,306.6 | |||||
Other Long-term Investments | 590.2 | 545.0 | |||||
Short-term Investments | 598.1 | 974.3 | |||||
Total Investments | 50,921.7 | 51,747.4 | |||||
Other Assets | |||||||
Cash and Bank Deposits | 109.3 | 102.5 | |||||
Accounts and Premiums Receivable | 1,621.2 | 1,634.7 | |||||
Reinsurance Recoverable | 4,770.6 | 4,906.4 | |||||
Accrued Investment Income | 698.4 | 696.1 | |||||
Deferred Acquisition Costs | 1,960.9 | 1,901.3 | |||||
Goodwill | 232.1 | 198.7 | |||||
Property and Equipment | 529.6 | 531.7 | |||||
Income Tax Receivable | — | 69.5 | |||||
Other Assets | 660.0 | 661.9 | |||||
Total Assets | $ | 61,503.8 | $ | 62,450.2 | |||
Liabilities | |||||||
Policy and Contract Benefits | $ | 1,505.6 | $ | 1,529.3 | |||
Reserves for Future Policy and Contract Benefits | 44,544.9 | 45,929.4 | |||||
Unearned Premiums | 452.8 | 396.6 | |||||
Other Policyholders’ Funds | 1,656.7 | 1,657.8 | |||||
Income Tax Payable | 5.7 | — | |||||
Deferred Income Tax | 73.4 | 62.0 | |||||
Short-term Debt | 506.1 | 151.9 | |||||
Long-term Debt - Non-recourse | 335.8 | 398.4 | |||||
Long-term Debt - All Other | 1,881.3 | 2,230.3 | |||||
Payables for Collateral on Investments | 410.4 | 73.8 | |||||
Other Liabilities | 1,550.0 | 1,498.8 | |||||
Total Liabilities | 52,922.7 | 53,928.3 | |||||
Stockholders’ Equity | |||||||
Common Stock | 30.2 | 30.2 | |||||
Additional Paid-in Capital | 2,239.2 | 2,221.2 | |||||
Accumulated Other Comprehensive Income | 22.0 | 166.4 | |||||
Retained Earnings | 7,814.1 | 7,302.3 | |||||
Treasury Stock | (1,524.4 | ) | (1,198.2 | ) | |||
Total Stockholders’ Equity | 8,581.1 | 8,521.9 | |||||
Total Liabilities and Stockholders’ Equity | $ | 61,503.8 | $ | 62,450.2 |
6
Unum Group Deferred Acquisition Costs by Segment
Unum US | Unum UK | Colonial Life | Consolidated | ||||||||||||
Balances at December 31, 2013 | $ | 1,051.5 | $ | 34.3 | $ | 743.4 | $ | 1,829.2 | |||||||
Capitalization | 292.7 | 10.5 | 220.8 | 524.0 | |||||||||||
Amortization | (248.1 | ) | (12.5 | ) | (180.2 | ) | (440.8 | ) | |||||||
Adjustment Related to Unrealized Investment Gains | 0.4 | — | (9.6 | ) | (9.2 | ) | |||||||||
Foreign Currency | — | (1.9 | ) | — | (1.9 | ) | |||||||||
Balances at December 31, 2014 | 1,096.5 | 30.4 | 774.4 | 1,901.3 | |||||||||||
Capitalization | 230.7 | 7.2 | 187.2 | 425.1 | |||||||||||
Amortization | (216.4 | ) | (8.8 | ) | (150.2 | ) | (375.4 | ) | |||||||
Adjustment Related to Unrealized Investment Losses | 3.2 | — | 7.6 | 10.8 | |||||||||||
Foreign Currency | — | (0.9 | ) | — | (0.9 | ) | |||||||||
Balances at September 30, 2015 | $ | 1,114.0 | $ | 27.9 | $ | 819.0 | $ | 1,960.9 |
6. 1
Unum Group Balance Sheets by Segment - September 30, 2015
Unum US | |||||||||||||||||||||||||||||||||||
Group Disability | Group Life and Accidental Death & Dismemberment | Supplemental and Voluntary | Total Unum US | Unum UK | Colonial Life | Closed Block | Corporate | Consolidated | |||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
Investments | $ | 9,097.2 | $ | 2,723.0 | $ | 4,232.5 | $ | 16,052.7 | $ | 3,318.0 | $ | 2,691.5 | $ | 27,508.3 | $ | 1,351.2 | $ | 50,921.7 | |||||||||||||||||
Deferred Acquisition Costs | 76.4 | 64.9 | 972.7 | 1,114.0 | 27.9 | 819.0 | — | — | 1,960.9 | ||||||||||||||||||||||||||
Goodwill | — | — | 187.6 | 187.6 | 44.5 | — | — | — | 232.1 | ||||||||||||||||||||||||||
All Other | 567.9 | 202.1 | 506.4 | 1,276.4 | 245.9 | 259.8 | 5,923.6 | 683.4 | 8,389.1 | ||||||||||||||||||||||||||
Total Assets | $ | 9,741.5 | $ | 2,990.0 | $ | 5,899.2 | $ | 18,630.7 | $ | 3,636.3 | $ | 3,770.3 | $ | 33,431.9 | $ | 2,034.6 | $ | 61,503.8 | |||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||
Reserves and Policyholder Benefits | $ | 7,771.5 | $ | 1,724.7 | $ | 3,714.4 | $ | 13,210.6 | $ | 2,800.5 | $ | 2,200.2 | $ | 29,948.7 | $ | — | $ | 48,160.0 | |||||||||||||||||
Debt | — | — | — | — | — | — | 335.8 | 2,387.4 | 2,723.2 | ||||||||||||||||||||||||||
All Other | 424.6 | 155.5 | 391.0 | 971.1 | 82.4 | 268.8 | (89.5 | ) | 806.7 | 2,039.5 | |||||||||||||||||||||||||
Total Liabilities | 8,196.1 | 1,880.2 | 4,105.4 | 14,181.7 | 2,882.9 | 2,469.0 | 30,195.0 | 3,194.1 | 52,922.7 | ||||||||||||||||||||||||||
Allocated Stockholders' Equity | |||||||||||||||||||||||||||||||||||
Other Allocated Stockholders' Equity | 1,532.1 | 1,079.8 | 1,685.7 | 4,297.6 | 690.9 | 1,222.9 | 3,044.2 | (1,238.2 | ) | 8,017.4 | |||||||||||||||||||||||||
Net Unrealized Gain on Securities and Net Gain on Cash Flow Hedges | 13.3 | 30.0 | 108.1 | 151.4 | 62.5 | 78.4 | 192.7 | 78.7 | 563.7 | ||||||||||||||||||||||||||
Total Allocated Stockholders' Equity | 1,545.4 | 1,109.8 | 1,793.8 | 4,449.0 | 753.4 | 1,301.3 | 3,236.9 | (1,159.5 | ) | 8,581.1 | |||||||||||||||||||||||||
Total Liabilities and Allocated Stockholders' Equity | $ | 9,741.5 | $ | 2,990.0 | $ | 5,899.2 | $ | 18,630.7 | $ | 3,636.3 | $ | 3,770.3 | $ | 33,431.9 | $ | 2,034.6 | $ | 61,503.8 |
Allocated stockholders' equity is determined on the basis of an internal allocation formula that reflects the volume and risk components of the business and aligns with our target capital levels for regulatory and rating agency purposes. We modify this formula periodically to recognize changes in the views of capital requirements.
6. 2
Unum Group Balance Sheets by Segment - December 31, 2014 - As Adjusted
Unum US | |||||||||||||||||||||||||||||||||||
Group Disability | Group Life and Accidental Death & Dismemberment | Supplemental and Voluntary | Total Unum US | Unum UK | Colonial Life | Closed Block | Corporate | Consolidated | |||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
Investments | $ | 9,216.6 | $ | 2,673.8 | $ | 4,214.6 | $ | 16,105.0 | $ | 3,399.2 | $ | 2,650.8 | $ | 27,668.8 | $ | 1,923.6 | $ | 51,747.4 | |||||||||||||||||
Deferred Acquisition Costs | 69.8 | 59.8 | 966.9 | 1,096.5 | 30.4 | 774.4 | — | — | 1,901.3 | ||||||||||||||||||||||||||
Goodwill | — | — | 187.6 | 187.6 | 11.1 | — | — | — | 198.7 | ||||||||||||||||||||||||||
All Other | 619.3 | 129.4 | 538.7 | 1,287.4 | 261.8 | 267.0 | 6,291.4 | 495.2 | 8,602.8 | ||||||||||||||||||||||||||
Total Assets | $ | 9,905.7 | $ | 2,863.0 | $ | 5,907.8 | $ | 18,676.5 | $ | 3,702.5 | $ | 3,692.2 | $ | 33,960.2 | $ | 2,418.8 | $ | 62,450.2 | |||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||
Reserves and Policyholder Benefits | $ | 8,104.9 | $ | 1,722.2 | $ | 3,712.4 | $ | 13,539.5 | $ | 2,894.3 | $ | 2,149.7 | $ | 30,929.6 | $ | — | $ | 49,513.1 | |||||||||||||||||
Debt | — | — | — | — | — | — | 398.4 | 2,382.2 | 2,780.6 | ||||||||||||||||||||||||||
All Other | 333.2 | 91.2 | 371.1 | 795.5 | 69.8 | 258.8 | (296.2 | ) | 806.7 | 1,634.6 | |||||||||||||||||||||||||
Total Liabilities | 8,438.1 | 1,813.4 | 4,083.5 | 14,335.0 | 2,964.1 | 2,408.5 | 31,031.8 | 3,188.9 | 53,928.3 | ||||||||||||||||||||||||||
Allocated Stockholders' Equity | |||||||||||||||||||||||||||||||||||
Other Allocated Stockholders' Equity | 1,457.9 | 1,005.7 | 1,682.9 | 4,146.5 | 648.4 | 1,178.8 | 2,814.3 | (947.4 | ) | 7,840.6 | |||||||||||||||||||||||||
Net Unrealized Gain on Securities and Net Gain on Cash Flow Hedges | 9.7 | 43.9 | 141.4 | 195.0 | 90.0 | 104.9 | 114.1 | 177.3 | 681.3 | ||||||||||||||||||||||||||
Total Allocated Stockholders' Equity | 1,467.6 | 1,049.6 | 1,824.3 | 4,341.5 | 738.4 | 1,283.7 | 2,928.4 | (770.1 | ) | 8,521.9 | |||||||||||||||||||||||||
Total Liabilities and Allocated Stockholders' Equity | $ | 9,905.7 | $ | 2,863.0 | $ | 5,907.8 | $ | 18,676.5 | $ | 3,702.5 | $ | 3,692.2 | $ | 33,960.2 | $ | 2,418.8 | $ | 62,450.2 |
6. 3
Unum Group Financial Results by Segment
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
9/30/2015 | 9/30/2014 | % Change | 9/30/2015 | 9/30/2014 | % Change | ||||||||||||||||
As Adjusted | As Adjusted | ||||||||||||||||||||
Premium Income | |||||||||||||||||||||
Unum US | $ | 1,241.8 | $ | 1,162.7 | 6.8 | % | $ | 3,708.4 | $ | 3,472.9 | 6.8 | % | |||||||||
Unum UK | 144.6 | 152.6 | (5.2 | ) | 425.8 | 458.3 | (7.1 | ) | |||||||||||||
Colonial Life | 333.1 | 319.4 | 4.3 | 1,001.2 | 952.6 | 5.1 | |||||||||||||||
Closed Block | 301.3 | 312.5 | (3.6 | ) | 909.2 | 945.5 | (3.8 | ) | |||||||||||||
2,020.8 | 1,947.2 | 3.8 | 6,044.6 | 5,829.3 | 3.7 | ||||||||||||||||
Net Investment Income | |||||||||||||||||||||
Unum US | 214.3 | 214.4 | — | 645.0 | 655.7 | (1.6 | ) | ||||||||||||||
Unum UK | 28.0 | 34.4 | (18.6 | ) | 90.1 | 112.3 | (19.8 | ) | |||||||||||||
Colonial Life | 35.9 | 35.5 | 1.1 | 109.8 | 107.9 | 1.8 | |||||||||||||||
Closed Block | 327.5 | 317.2 | 3.2 | 979.6 | 958.5 | 2.2 | |||||||||||||||
Corporate | 6.4 | 9.8 | (34.7 | ) | 20.3 | 25.1 | (19.1 | ) | |||||||||||||
612.1 | 611.3 | 0.1 | 1,844.8 | 1,859.5 | (0.8 | ) | |||||||||||||||
Other Income | |||||||||||||||||||||
Unum US | 28.1 | 30.2 | (7.0 | ) | 90.4 | 91.4 | (1.1 | ) | |||||||||||||
Unum UK | — | — | — | — | 0.1 | (100.0 | ) | ||||||||||||||
Colonial Life | 0.1 | 0.1 | — | 0.1 | 0.1 | — | |||||||||||||||
Closed Block | 21.5 | 23.4 | (8.1 | ) | 67.5 | 69.5 | (2.9 | ) | |||||||||||||
Corporate | 1.8 | 0.9 | 100.0 | 2.6 | 2.2 | 18.2 | |||||||||||||||
51.5 | 54.6 | (5.7 | ) | 160.6 | 163.3 | (1.7 | ) | ||||||||||||||
Total Operating Revenue | |||||||||||||||||||||
Unum US | 1,484.2 | 1,407.3 | 5.5 | 4,443.8 | 4,220.0 | 5.3 | |||||||||||||||
Unum UK | 172.6 | 187.0 | (7.7 | ) | 515.9 | 570.7 | (9.6 | ) | |||||||||||||
Colonial Life | 369.1 | 355.0 | 4.0 | 1,111.1 | 1,060.6 | 4.8 | |||||||||||||||
Closed Block | 650.3 | 653.1 | (0.4 | ) | 1,956.3 | 1,973.5 | (0.9 | ) | |||||||||||||
Corporate | 8.2 | 10.7 | (23.4 | ) | 22.9 | 27.3 | (16.1 | ) | |||||||||||||
$ | 2,684.4 | $ | 2,613.1 | 2.7 | $ | 8,050.0 | $ | 7,852.1 | 2.5 |
7
Unum Group Financial Results by Segment - Continued
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
9/30/2015 | 9/30/2014 | % Change | 9/30/2015 | 9/30/2014 | % Change | ||||||||||||||||
As Adjusted | As Adjusted | ||||||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||
Unum US | $ | 1,265.5 | $ | 1,195.2 | 5.9 | % | $ | 3,808.0 | $ | 3,584.6 | 6.2 | % | |||||||||
Unum UK | 139.9 | 153.5 | (8.9 | ) | 412.3 | 461.1 | (10.6 | ) | |||||||||||||
Colonial Life | 292.8 | 284.0 | 3.1 | 879.6 | 835.6 | 5.3 | |||||||||||||||
Closed Block | 622.6 | 627.4 | (0.8 | ) | 1,865.3 | 1,882.9 | (0.9 | ) | |||||||||||||
Corporate | 35.1 | 35.8 | (2.0 | ) | 113.1 | 120.5 | (6.1 | ) | |||||||||||||
2,355.9 | 2,295.9 | 2.6 | 7,078.3 | 6,884.7 | 2.8 | ||||||||||||||||
Income (Loss) Before Income Tax, Net Realized Investment Gain (Loss), and Non-operating Retirement-related Loss | |||||||||||||||||||||
Unum US | 218.7 | 212.1 | 3.1 | 635.8 | 635.4 | 0.1 | |||||||||||||||
Unum UK | 32.7 | 33.5 | (2.4 | ) | 103.6 | 109.6 | (5.5 | ) | |||||||||||||
Colonial Life | 76.3 | 71.0 | 7.5 | 231.5 | 225.0 | 2.9 | |||||||||||||||
Closed Block | 27.7 | 25.7 | 7.8 | 91.0 | 90.6 | 0.4 | |||||||||||||||
Corporate | (26.9 | ) | (25.1 | ) | (7.2 | ) | (90.2 | ) | (93.2 | ) | 3.2 | ||||||||||
328.5 | 317.2 | 3.6 | 971.7 | 967.4 | 0.4 | ||||||||||||||||
Income Tax Expense | 105.5 | 98.1 | 7.5 | 301.3 | 304.4 | (1.0 | ) | ||||||||||||||
Income Before Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss, Net of Tax | 223.0 | 219.1 | 1.8 | 670.4 | 663.0 | 1.1 | |||||||||||||||
Net Realized Investment Gain (Loss), Net of Tax | (17.3 | ) | 0.9 | N.M. | (23.6 | ) | 24.0 | (198.3 | ) | ||||||||||||
Non-operating Retirement-related Loss, Net of Tax | (1.9 | ) | (0.9 | ) | (111.1 | ) | (5.8 | ) | (2.7 | ) | (114.8 | ) | |||||||||
Net Income | $ | 203.8 | $ | 219.1 | (7.0 | ) | $ | 641.0 | $ | 684.3 | (6.3 | ) |
7. 1
Unum Group Quarterly Historical Financial Results by Segment
9/30/15 | 6/30/15 | 3/31/15 | 12/31/14 | 9/30/14 | 6/30/14 | 3/31/14 | 12/31/13 | 9/30/13 | |||||||||||||||||||||||||||
As Adjusted | |||||||||||||||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||||||||||||||
Unum US | $ | 1,241.8 | $ | 1,236.4 | $ | 1,230.2 | $ | 1,186.8 | $ | 1,162.7 | $ | 1,157.7 | $ | 1,152.5 | $ | 1,121.3 | $ | 1,124.6 | |||||||||||||||||
Unum UK | 144.6 | 142.2 | 139.0 | 148.9 | 152.6 | 154.0 | 151.7 | 137.9 | 137.3 | ||||||||||||||||||||||||||
Colonial Life | 333.1 | 335.9 | 332.2 | 321.1 | 319.4 | 316.8 | 316.4 | 308.1 | 309.1 | ||||||||||||||||||||||||||
Closed Block | 301.3 | 303.0 | 304.9 | 311.1 | 312.5 | 315.1 | 317.9 | 323.4 | 326.3 | ||||||||||||||||||||||||||
2,020.8 | 2,017.5 | 2,006.3 | 1,967.9 | 1,947.2 | 1,943.6 | 1,938.5 | 1,890.7 | 1,897.3 | |||||||||||||||||||||||||||
Net Investment Income | |||||||||||||||||||||||||||||||||||
Unum US | 214.3 | 215.7 | 215.0 | 223.2 | 214.4 | 218.2 | 223.1 | 228.2 | 230.2 | ||||||||||||||||||||||||||
Unum UK | 28.0 | 38.6 | 23.5 | 38.7 | 34.4 | 44.3 | 33.6 | 42.0 | 30.3 | ||||||||||||||||||||||||||
Colonial Life | 35.9 | 36.9 | 37.0 | 37.6 | 35.5 | 35.8 | 36.6 | 34.8 | 35.9 | ||||||||||||||||||||||||||
Closed Block | 327.5 | 331.7 | 320.4 | 323.0 | 317.2 | 325.8 | 315.5 | 327.5 | 314.7 | ||||||||||||||||||||||||||
Corporate | 6.4 | 7.8 | 6.1 | 10.2 | 9.8 | 8.3 | 7.0 | 0.8 | 7.9 | ||||||||||||||||||||||||||
612.1 | 630.7 | 602.0 | 632.7 | 611.3 | 632.4 | 615.8 | 633.3 | 619.0 | |||||||||||||||||||||||||||
Other Income | |||||||||||||||||||||||||||||||||||
Unum US | 28.1 | 31.4 | 30.9 | 30.7 | 30.2 | 30.3 | 30.9 | 29.3 | 30.2 | ||||||||||||||||||||||||||
Unum UK | — | — | — | (0.1 | ) | — | 0.2 | (0.1 | ) | — | 0.1 | ||||||||||||||||||||||||
Colonial Life | 0.1 | — | — | — | 0.1 | 0.1 | (0.1 | ) | 0.1 | — | |||||||||||||||||||||||||
Closed Block | 21.5 | 22.8 | 23.2 | 22.3 | 23.4 | 24.5 | 21.6 | 22.4 | 23.6 | ||||||||||||||||||||||||||
Corporate | 1.8 | 0.5 | 0.3 | 2.8 | 0.9 | (0.2 | ) | 1.5 | 5.0 | 0.3 | |||||||||||||||||||||||||
51.5 | 54.7 | 54.4 | 55.7 | 54.6 | 54.9 | 53.8 | 56.8 | 54.2 | |||||||||||||||||||||||||||
Total Operating Revenue | |||||||||||||||||||||||||||||||||||
Unum US | 1,484.2 | 1,483.5 | 1,476.1 | 1,440.7 | 1,407.3 | 1,406.2 | 1,406.5 | 1,378.8 | 1,385.0 | ||||||||||||||||||||||||||
Unum UK | 172.6 | 180.8 | 162.5 | 187.5 | 187.0 | 198.5 | 185.2 | 179.9 | 167.7 | ||||||||||||||||||||||||||
Colonial Life | 369.1 | 372.8 | 369.2 | 358.7 | 355.0 | 352.7 | 352.9 | 343.0 | 345.0 | ||||||||||||||||||||||||||
Closed Block | 650.3 | 657.5 | 648.5 | 656.4 | 653.1 | 665.4 | 655.0 | 673.3 | 664.6 | ||||||||||||||||||||||||||
Corporate | 8.2 | 8.3 | 6.4 | 13.0 | 10.7 | 8.1 | 8.5 | 5.8 | 8.2 | ||||||||||||||||||||||||||
$ | 2,684.4 | $ | 2,702.9 | $ | 2,662.7 | $ | 2,656.3 | $ | 2,613.1 | $ | 2,630.9 | $ | 2,608.1 | $ | 2,580.8 | $ | 2,570.5 |
8
Unum Group Quarterly Historical Financial Results by Segment - Continued
9/30/15 | 6/30/15 | 3/31/15 | 12/31/14 | 9/30/14 | 6/30/14 | 3/31/14 | 12/31/13 | 9/30/13 | |||||||||||||||||||||||||||
As Adjusted | |||||||||||||||||||||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||||||||||||||
Unum US | $ | 1,265.5 | $ | 1,280.7 | $ | 1,261.8 | $ | 1,231.2 | $ | 1,195.2 | $ | 1,190.4 | $ | 1,199.0 | $ | 1,153.6 | $ | 1,168.1 | |||||||||||||||||
Unum UK | 139.9 | 142.5 | 129.9 | 149.3 | 153.5 | 158.9 | 148.7 | 144.0 | 136.4 | ||||||||||||||||||||||||||
Colonial Life | 292.8 | 295.2 | 291.6 | 284.7 | 284.0 | 277.8 | 273.8 | 294.0 | 276.4 | ||||||||||||||||||||||||||
Closed Block | 622.6 | 620.9 | 621.8 | 1,325.2 | 627.4 | 628.8 | 626.7 | 646.7 | 639.6 | ||||||||||||||||||||||||||
Corporate | 35.1 | 41.7 | 36.3 | 37.4 | 35.8 | 49.7 | 35.0 | 39.7 | 33.6 | ||||||||||||||||||||||||||
2,355.9 | 2,381.0 | 2,341.4 | 3,027.8 | 2,295.9 | 2,305.6 | 2,283.2 | 2,278.0 | 2,254.1 | |||||||||||||||||||||||||||
Income (Loss) Before Income Tax, Net Realized Investment Gain (Loss), and Non-operating Retirement-related Loss | |||||||||||||||||||||||||||||||||||
Unum US | 218.7 | 202.8 | 214.3 | 209.5 | 212.1 | 215.8 | 207.5 | 225.2 | 216.9 | ||||||||||||||||||||||||||
Unum UK | 32.7 | 38.3 | 32.6 | 38.2 | 33.5 | 39.6 | 36.5 | 35.9 | 31.3 | ||||||||||||||||||||||||||
Colonial Life | 76.3 | 77.6 | 77.6 | 74.0 | 71.0 | 74.9 | 79.1 | 49.0 | 68.6 | ||||||||||||||||||||||||||
Closed Block | 27.7 | 36.6 | 26.7 | (668.8 | ) | 25.7 | 36.6 | 28.3 | 26.6 | 25.0 | |||||||||||||||||||||||||
Corporate | (26.9 | ) | (33.4 | ) | (29.9 | ) | (24.4 | ) | (25.1 | ) | (41.6 | ) | (26.5 | ) | (33.9 | ) | (25.4 | ) | |||||||||||||||||
328.5 | 321.9 | 321.3 | (371.5 | ) | 317.2 | 325.3 | 324.9 | 302.8 | 316.4 | ||||||||||||||||||||||||||
Income Tax Expense (Benefit) | 105.5 | 99.3 | 96.5 | (143.4 | ) | 98.1 | 104.0 | 102.3 | 88.5 | 94.8 | |||||||||||||||||||||||||
Income (Loss) Before Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss, Net of Tax | 223.0 | 222.6 | 224.8 | (228.1 | ) | 219.1 | 221.3 | 222.6 | 214.3 | 221.6 | |||||||||||||||||||||||||
Net Realized Investment Gain (Loss), Net of Tax | (17.3 | ) | 3.7 | (10.0 | ) | (11.2 | ) | 0.9 | 19.0 | 4.1 | 5.8 | (17.2 | ) | ||||||||||||||||||||||
Non-operating Retirement-related Loss, Net of Tax | (1.9 | ) | (2.0 | ) | (1.9 | ) | (42.9 | ) | (0.9 | ) | (0.9 | ) | (0.9 | ) | (1.5 | ) | (1.7 | ) | |||||||||||||||||
Net Income (Loss) | $ | 203.8 | $ | 224.3 | $ | 212.9 | $ | (282.2 | ) | $ | 219.1 | $ | 239.4 | $ | 225.8 | $ | 218.6 | $ | 202.7 | ||||||||||||||||
Net Income (Loss) Per Common Share - Assuming Dilution | $ | 0.83 | $ | 0.90 | $ | 0.84 | $ | (1.12 | ) | $ | 0.86 | $ | 0.93 | $ | 0.86 | $ | 0.83 | $ | 0.77 |
8. 1
Unum Group Financial Results for Unum US Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | $ | 1,241.8 | $ | 1,162.7 | $ | 3,708.4 | $ | 3,472.9 | $ | 4,659.7 | $ | 4,517.1 | |||||||||||
Net Investment Income | 214.3 | 214.4 | 645.0 | 655.7 | 878.9 | 919.4 | |||||||||||||||||
Other Income | 28.1 | 30.2 | 90.4 | 91.4 | 122.1 | 128.3 | |||||||||||||||||
Total | 1,484.2 | 1,407.3 | 4,443.8 | 4,220.0 | 5,660.7 | 5,564.8 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 866.6 | 818.0 | 2,586.3 | 2,442.3 | 3,288.1 | 3,222.4 | |||||||||||||||||
Commissions | 137.4 | 130.3 | 421.8 | 396.5 | 528.7 | 505.2 | |||||||||||||||||
Deferral of Acquisition Costs | (74.1 | ) | (70.6 | ) | (230.7 | ) | (214.5 | ) | (292.7 | ) | (252.0 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 65.0 | 58.5 | 216.4 | 188.8 | 248.1 | 230.0 | |||||||||||||||||
Other Expenses | 270.6 | 259.0 | 814.2 | 771.5 | 1,043.6 | 1,000.8 | |||||||||||||||||
Total | 1,265.5 | 1,195.2 | 3,808.0 | 3,584.6 | 4,815.8 | 4,706.4 | |||||||||||||||||
Income Before Income Tax and Net Realized Investment Gains and Losses | 218.7 | 212.1 | 635.8 | 635.4 | 844.9 | 858.4 | |||||||||||||||||
Unclaimed Death Benefits (UDB) Reserve Increase | — | — | — | — | — | 75.4 | |||||||||||||||||
Group Life Waiver of Premium Benefit (Waiver) Reserve Reduction | — | — | — | — | — | (85.0 | ) | ||||||||||||||||
Operating Income | $ | 218.7 | $ | 212.1 | $ | 635.8 | $ | 635.4 | $ | 844.9 | $ | 848.8 | |||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratio | 69.8 | % | 70.4 | % | 69.7 | % | 70.3 | % | 70.6 | % | 71.3 | % | |||||||||||
Benefit Ratio Excluding UDB and Waiver Reserve Adjustments | 71.6 | % | |||||||||||||||||||||
Other Expense Ratio | 21.8 | % | 22.3 | % | 22.0 | % | 22.2 | % | 22.4 | % | 22.2 | % | |||||||||||
Income Ratio | 17.6 | % | 18.2 | % | 17.1 | % | 18.3 | % | 18.1 | % | 19.0 | % | |||||||||||
Operating Income Ratio | 17.6 | % | 18.2 | % | 17.1 | % | 18.3 | % | 18.1 | % | 18.8 | % |
9
Unum Group Financial Results for Unum US Group Disability
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Group Long-term Disability | $ | 414.3 | $ | 387.7 | $ | 1,229.0 | $ | 1,157.4 | $ | 1,553.5 | $ | 1,553.9 | |||||||||||
Group Short-term Disability | 153.2 | 138.3 | 452.5 | 413.4 | 558.1 | 519.6 | |||||||||||||||||
Total Premium Income | 567.5 | 526.0 | 1,681.5 | 1,570.8 | 2,111.6 | 2,073.5 | |||||||||||||||||
Net Investment Income | 121.7 | 124.8 | 371.9 | 383.8 | 515.9 | 547.4 | |||||||||||||||||
Other Income | 21.6 | 22.9 | 70.0 | 67.6 | 91.0 | 95.6 | |||||||||||||||||
Total | 710.8 | 673.7 | 2,123.4 | 2,022.2 | 2,718.5 | 2,716.5 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 457.1 | 431.9 | 1,367.9 | 1,293.5 | 1,746.4 | 1,732.9 | |||||||||||||||||
Commissions | 42.4 | 39.7 | 128.9 | 120.9 | 161.2 | 164.0 | |||||||||||||||||
Deferral of Acquisition Costs | (10.3 | ) | (9.3 | ) | (31.8 | ) | (28.3 | ) | (40.2 | ) | (29.6 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 8.4 | 6.5 | 25.2 | 19.5 | 26.3 | 21.1 | |||||||||||||||||
Other Expenses | 142.4 | 136.3 | 426.9 | 407.7 | 550.0 | 532.4 | |||||||||||||||||
Total | 640.0 | 605.1 | 1,917.1 | 1,813.3 | 2,443.7 | 2,420.8 | |||||||||||||||||
Operating Income | $ | 70.8 | $ | 68.6 | $ | 206.3 | $ | 208.9 | $ | 274.8 | $ | 295.7 | |||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratio | 80.5 | % | 82.1 | % | 81.3 | % | 82.3 | % | 82.7 | % | 83.6 | % | |||||||||||
Other Expense Ratio | 25.1 | % | 25.9 | % | 25.4 | % | 26.0 | % | 26.0 | % | 25.7 | % | |||||||||||
Operating Income Ratio | 12.5 | % | 13.0 | % | 12.3 | % | 13.3 | % | 13.0 | % | 14.3 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Group Long-term Disability | 92.1 | % | 90.2 | % | 90.6 | % | 87.2 | % | |||||||||||||||
Group Short-term Disability | 87.9 | % | 88.9 | % | 89.6 | % | 88.0 | % |
9. 1
Unum Group Financial Results for Unum US Group Life and Accidental Death & Dismemberment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Group Life | $ | 336.5 | $ | 316.1 | $ | 1,007.5 | $ | 939.2 | $ | 1,262.3 | $ | 1,213.9 | |||||||||||
Accidental Death & Dismemberment | 32.1 | 32.2 | 98.0 | 93.9 | 125.9 | 121.6 | |||||||||||||||||
Total Premium Income | 368.6 | 348.3 | 1,105.5 | 1,033.1 | 1,388.2 | 1,335.5 | |||||||||||||||||
Net Investment Income | 34.7 | 33.8 | 102.0 | 101.1 | 135.2 | 139.1 | |||||||||||||||||
Other Income | 0.5 | 0.4 | 1.5 | 1.2 | 1.4 | 1.8 | |||||||||||||||||
Total | 403.8 | 382.5 | 1,209.0 | 1,135.4 | 1,524.8 | 1,476.4 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 261.8 | 243.7 | 792.5 | 724.5 | 975.8 | 909.9 | |||||||||||||||||
Commissions | 30.0 | 28.3 | 90.5 | 84.8 | 113.3 | 108.9 | |||||||||||||||||
Deferral of Acquisition Costs | (7.9 | ) | (7.3 | ) | (24.7 | ) | (22.0 | ) | (31.3 | ) | (24.7 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 6.5 | 5.2 | 19.6 | 15.8 | 21.4 | 15.6 | |||||||||||||||||
Other Expenses | 53.2 | 50.8 | 160.5 | 151.2 | 205.2 | 198.2 | |||||||||||||||||
Total | 343.6 | 320.7 | 1,038.4 | 954.3 | 1,284.4 | 1,207.9 | |||||||||||||||||
Income Before Income Tax and Net Realized Investment Gains and Losses | 60.2 | 61.8 | 170.6 | 181.1 | 240.4 | 268.5 | |||||||||||||||||
UDB Reserve Increase | — | — | — | — | — | 49.1 | |||||||||||||||||
Waiver Reserve Reduction | — | — | — | — | — | (85.0 | ) | ||||||||||||||||
Operating Income | $ | 60.2 | $ | 61.8 | $ | 170.6 | $ | 181.1 | $ | 240.4 | $ | 232.6 | |||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratio | 71.0 | % | 70.0 | % | 71.7 | % | 70.1 | % | 70.3 | % | 68.1 | % | |||||||||||
Benefit Ratio Excluding UDB and Waiver Reserve Adjustments | 70.8 | % | |||||||||||||||||||||
Other Expense Ratio | 14.4 | % | 14.6 | % | 14.5 | % | 14.6 | % | 14.8 | % | 14.8 | % | |||||||||||
Income Ratio | 16.3 | % | 17.7 | % | 15.4 | % | 17.5 | % | 17.3 | % | 20.1 | % | |||||||||||
Operating Income Ratio | 16.3 | % | 17.7 | % | 15.4 | % | 17.5 | % | 17.3 | % | 17.4 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Group Life | 88.5 | % | 89.8 | % | 90.8 | % | 88.1 | % | |||||||||||||||
Accidental Death & Dismemberment | 89.5 | % | 90.9 | % | 91.1 | % | 88.8 | % |
9. 2
Unum Group Financial Results for Unum US Supplemental and Voluntary
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Individual Disability | $ | 119.6 | $ | 116.9 | $ | 355.9 | $ | 348.8 | $ | 466.1 | $ | 465.3 | |||||||||||
Voluntary Benefits | 186.1 | 171.5 | 565.5 | 520.2 | 693.8 | 642.8 | |||||||||||||||||
Total Premium Income | 305.7 | 288.4 | 921.4 | 869.0 | 1,159.9 | 1,108.1 | |||||||||||||||||
Net Investment Income | 57.9 | 55.8 | 171.1 | 170.8 | 227.8 | 232.9 | |||||||||||||||||
Other Income | 6.0 | 6.9 | 18.9 | 22.6 | 29.7 | 30.9 | |||||||||||||||||
Total | 369.6 | 351.1 | 1,111.4 | 1,062.4 | 1,417.4 | 1,371.9 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 147.7 | 142.4 | 425.9 | 424.3 | 565.9 | 579.6 | |||||||||||||||||
Commissions | 65.0 | 62.3 | 202.4 | 190.8 | 254.2 | 232.3 | |||||||||||||||||
Deferral of Acquisition Costs | (55.9 | ) | (54.0 | ) | (174.2 | ) | (164.2 | ) | (221.2 | ) | (197.7 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 50.1 | 46.8 | 171.6 | 153.5 | 200.4 | 193.3 | |||||||||||||||||
Other Expenses | 75.0 | 71.9 | 226.8 | 212.6 | 288.4 | 270.2 | |||||||||||||||||
Total | 281.9 | 269.4 | 852.5 | 817.0 | 1,087.7 | 1,077.7 | |||||||||||||||||
Income Before Income Tax and Net Realized Investment Gains and Losses | 87.7 | 81.7 | 258.9 | 245.4 | 329.7 | 294.2 | |||||||||||||||||
UDB Reserve Increase | — | — | — | — | — | 26.3 | |||||||||||||||||
Operating Income | $ | 87.7 | $ | 81.7 | $ | 258.9 | $ | 245.4 | $ | 329.7 | $ | 320.5 | |||||||||||
Interest Adjusted Loss Ratio: | |||||||||||||||||||||||
Individual Disability | 31.4 | % | 31.1 | % | 29.8 | % | 29.7 | % | 30.0 | % | 29.6 | % | |||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratios: | |||||||||||||||||||||||
Individual Disability | 52.3 | % | 52.7 | % | 50.9 | % | 51.3 | % | 51.6 | % | 51.3 | % | |||||||||||
Voluntary Benefits | 45.8 | % | 47.1 | % | 43.3 | % | 47.1 | % | 46.9 | % | 53.0 | % | |||||||||||
Benefit Ratio Excluding UDB Reserve Increase: | |||||||||||||||||||||||
Voluntary Benefits | 48.9 | % | |||||||||||||||||||||
Other Expense Ratio | 24.5 | % | 24.9 | % | 24.6 | % | 24.5 | % | 24.9 | % | 24.4 | % | |||||||||||
Income Ratio | 28.7 | % | 28.3 | % | 28.1 | % | 28.2 | % | 28.4 | % | 26.5 | % | |||||||||||
Operating Income Ratio | 28.7 | % | 28.3 | % | 28.1 | % | 28.2 | % | 28.4 | % | 28.9 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Individual Disability | 90.2 | % | 89.9 | % | 90.0 | % | 90.5 | % | |||||||||||||||
Voluntary Benefits | 75.3 | % | 77.7 | % | 77.6 | % | 77.0 | % |
9. 3
Unum Group Financial Results for Unum UK Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Group Long-term Disability | $ | 100.6 | $ | 104.5 | $ | 296.5 | $ | 313.4 | $ | 418.9 | $ | 389.9 | |||||||||||
Group Life | 29.7 | 34.1 | 90.6 | 102.6 | 133.2 | 106.4 | |||||||||||||||||
Supplemental | 14.3 | 14.0 | 38.7 | 42.3 | 55.1 | 60.3 | |||||||||||||||||
Total Premium Income | 144.6 | 152.6 | 425.8 | 458.3 | 607.2 | 556.6 | |||||||||||||||||
Net Investment Income | 28.0 | 34.4 | 90.1 | 112.3 | 151.0 | 148.5 | |||||||||||||||||
Other Income | — | — | — | 0.1 | — | 0.1 | |||||||||||||||||
Total | 172.6 | 187.0 | 515.9 | 570.7 | 758.2 | 705.2 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 98.0 | 108.0 | 289.5 | 328.4 | 431.0 | 413.3 | |||||||||||||||||
Commissions | 11.3 | 11.5 | 33.6 | 32.0 | 42.8 | 38.0 | |||||||||||||||||
Deferral of Acquisition Costs | (2.6 | ) | (2.9 | ) | (7.2 | ) | (7.6 | ) | (10.5 | ) | (9.8 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 3.2 | 3.2 | 8.8 | 9.6 | 12.5 | 14.7 | |||||||||||||||||
Other Expenses | 30.0 | 33.7 | 87.6 | 98.7 | 134.6 | 117.0 | |||||||||||||||||
Total | 139.9 | 153.5 | 412.3 | 461.1 | 610.4 | 573.2 | |||||||||||||||||
Operating Income | $ | 32.7 | $ | 33.5 | $ | 103.6 | $ | 109.6 | $ | 147.8 | $ | 132.0 | |||||||||||
10
Unum Group Financial Results for Unum UK Segment - Continued
(in millions of pounds, except exchange rate) | Three Months Ended | Nine Months Ended | Year Ended | ||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Group Long-term Disability | £ | 64.9 | £ | 62.7 | £ | 193.4 | £ | 187.8 | £ | 254.4 | £ | 249.2 | |||||||||||
Group Life | 19.2 | 20.5 | 59.1 | 61.5 | 80.8 | 68.2 | |||||||||||||||||
Supplemental | 9.2 | 8.3 | 25.3 | 25.3 | 33.4 | 38.5 | |||||||||||||||||
Total Premium Income | 93.3 | 91.5 | 277.8 | 274.6 | 368.6 | 355.9 | |||||||||||||||||
Net Investment Income | 18.1 | 20.6 | 58.7 | 67.2 | 91.6 | 94.9 | |||||||||||||||||
Other Income | — | (0.1 | ) | — | — | 0.1 | 0.1 | ||||||||||||||||
Total | 111.4 | 112.0 | 336.5 | 341.8 | 460.3 | 450.9 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 63.3 | 64.7 | 188.8 | 196.7 | 261.4 | 264.5 | |||||||||||||||||
Commissions | 7.3 | 6.9 | 22.0 | 19.2 | 26.0 | 24.3 | |||||||||||||||||
Deferral of Acquisition Costs | (1.7 | ) | (1.7 | ) | (4.7 | ) | (4.5 | ) | (6.4 | ) | (6.2 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 2.0 | 1.9 | 5.7 | 5.7 | 7.6 | 9.3 | |||||||||||||||||
Other Expenses | 19.4 | 20.1 | 57.1 | 59.0 | 81.9 | 74.7 | |||||||||||||||||
Total | 90.3 | 91.9 | 268.9 | 276.1 | 370.5 | 366.6 | |||||||||||||||||
Operating Income | £ | 21.1 | £ | 20.1 | £ | 67.6 | £ | 65.7 | £ | 89.8 | £ | 84.3 | |||||||||||
Weighted Average Pound/Dollar Exchange Rate | 1.550 | 1.667 | 1.533 | 1.668 | 1.646 | 1.566 | |||||||||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratio | 67.8 | % | 70.7 | % | 68.0 | % | 71.6 | % | 70.9 | % | 74.3 | % | |||||||||||
Other Expense Ratio | 20.8 | % | 22.0 | % | 20.6 | % | 21.5 | % | 22.2 | % | 21.0 | % | |||||||||||
Operating Income Ratio | 22.6 | % | 22.0 | % | 24.3 | % | 23.9 | % | 24.4 | % | 23.7 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Group Long-term Disability | 88.5 | % | 88.4 | % | 90.1 | % | 82.2 | % | |||||||||||||||
Group Life | 80.6 | % | 73.3 | % | 76.0 | % | 66.7 | % | |||||||||||||||
Supplemental | 88.6 | % | 86.5 | % | 86.6 | % | 78.8 | % |
10. 1
Unum Group Financial Results for Colonial Life Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Accident, Sickness, and Disability | $ | 196.5 | $ | 190.7 | $ | 591.1 | $ | 569.0 | $ | 759.8 | $ | 738.7 | |||||||||||
Life | 62.5 | 57.9 | 188.1 | 172.8 | 231.8 | 221.1 | |||||||||||||||||
Cancer and Critical Illness | 74.1 | 70.8 | 222.0 | 210.8 | 282.1 | 272.4 | |||||||||||||||||
Total Premium Income | 333.1 | 319.4 | 1,001.2 | 952.6 | 1,273.7 | 1,232.2 | |||||||||||||||||
Net Investment Income | 35.9 | 35.5 | 109.8 | 107.9 | 145.5 | 144.1 | |||||||||||||||||
Other Income | 0.1 | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 | |||||||||||||||||
Total | 369.1 | 355.0 | 1,111.1 | 1,060.6 | 1,419.3 | 1,376.5 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 170.5 | 168.3 | 510.2 | 492.7 | 660.6 | 667.0 | |||||||||||||||||
Commissions | 72.7 | 64.6 | 217.8 | 191.6 | 262.3 | 252.5 | |||||||||||||||||
Deferral of Acquisition Costs | (62.7 | ) | (54.3 | ) | (187.2 | ) | (159.5 | ) | (220.8 | ) | (205.0 | ) | |||||||||||
Amortization of Deferred Acquisition Costs | 48.8 | 46.2 | 150.2 | 134.5 | 180.2 | 174.2 | |||||||||||||||||
Other Expenses | 63.5 | 59.2 | 188.6 | 176.3 | 238.0 | 224.3 | |||||||||||||||||
Total | 292.8 | 284.0 | 879.6 | 835.6 | 1,120.3 | 1,113.0 | |||||||||||||||||
Income Before Income Tax and Net Realized Investment Gains and Losses | 76.3 | 71.0 | 231.5 | 225.0 | 299.0 | 263.5 | |||||||||||||||||
UDB Reserve Increase | — | — | — | — | — | 20.1 | |||||||||||||||||
Operating Income | $ | 76.3 | $ | 71.0 | $ | 231.5 | $ | 225.0 | $ | 299.0 | $ | 283.6 | |||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Benefit Ratio | 51.2 | % | 52.7 | % | 51.0 | % | 51.7 | % | 51.9 | % | 54.1 | % | |||||||||||
Benefit Ratio Excluding UDB Reserve Increase | 52.5 | % | |||||||||||||||||||||
Other Expense Ratio | 19.1 | % | 18.5 | % | 18.8 | % | 18.5 | % | 18.7 | % | 18.2 | % | |||||||||||
Income Ratio | 22.9 | % | 22.2 | % | 23.1 | % | 23.6 | % | 23.5 | % | 21.4 | % | |||||||||||
Operating Income Ratio | 22.9 | % | 22.2 | % | 23.1 | % | 23.6 | % | 23.5 | % | 23.0 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Accident, Sickness, and Disability | 74.8 | % | 75.3 | % | 75.5 | % | 75.2 | % | |||||||||||||||
Life | 85.0 | % | 84.9 | % | 85.2 | % | 85.2 | % | |||||||||||||||
Cancer and Critical Illness | 81.6 | % | 83.1 | % | 83.5 | % | 83.1 | % |
11
Unum Group Financial Results for Closed Block Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Premium Income | |||||||||||||||||||||||
Individual Disability | $ | 142.2 | $ | 154.0 | $ | 433.0 | $ | 472.9 | $ | 624.8 | $ | 687.5 | |||||||||||
Long-term Care | 158.6 | 158.3 | 475.0 | 471.9 | 630.9 | 630.6 | |||||||||||||||||
All Other | 0.5 | 0.2 | 1.2 | 0.7 | 0.9 | 0.7 | |||||||||||||||||
Total Premium Income | 301.3 | 312.5 | 909.2 | 945.5 | 1,256.6 | 1,318.8 | |||||||||||||||||
Net Investment Income | 327.5 | 317.2 | 979.6 | 958.5 | 1,281.5 | 1,270.2 | |||||||||||||||||
Other Income | 21.5 | 23.4 | 67.5 | 69.5 | 91.8 | 93.9 | |||||||||||||||||
Total | 650.3 | 653.1 | 1,956.3 | 1,973.5 | 2,629.9 | 2,682.9 | |||||||||||||||||
Benefits and Expenses | |||||||||||||||||||||||
Benefits and Change in Reserves for Future Benefits | 555.8 | 559.3 | 1,661.6 | 1,674.9 | 2,931.1 | 2,293.0 | |||||||||||||||||
Commissions | 24.9 | 25.6 | 74.6 | 77.1 | 101.5 | 113.8 | |||||||||||||||||
Interest and Debt Expense | 1.6 | 1.8 | 5.0 | 5.5 | 7.3 | 8.4 | |||||||||||||||||
Other Expenses | 40.3 | 40.7 | 124.1 | 125.4 | 168.2 | 160.4 | |||||||||||||||||
Total | 622.6 | 627.4 | 1,865.3 | 1,882.9 | 3,208.1 | 2,575.6 | |||||||||||||||||
Income (Loss) Before Income Tax and Net Realized Investment Gains and Losses | 27.7 | 25.7 | 91.0 | 90.6 | (578.2 | ) | 107.3 | ||||||||||||||||
Long-term Care (LTC) Reserve Increase | — | — | — | — | 698.2 | — | |||||||||||||||||
Operating Income | $ | 27.7 | $ | 25.7 | $ | 91.0 | $ | 90.6 | $ | 120.0 | $ | 107.3 | |||||||||||
Interest Adjusted Loss Ratios: | |||||||||||||||||||||||
Individual Disability | 80.8 | % | 82.3 | % | 81.4 | % | 84.4 | % | 83.6 | % | 82.6 | % | |||||||||||
Long-term Care | 89.9 | % | 88.5 | % | 86.9 | % | 84.7 | % | 196.6 | % | 89.6 | % | |||||||||||
Long-term Care Excluding the Reserve Increase | 85.9 | % | |||||||||||||||||||||
Operating Ratios (% of Premium Income): | |||||||||||||||||||||||
Other Expense Ratio | 13.4 | % | 13.0 | % | 13.6 | % | 13.3 | % | 13.4 | % | 12.2 | % | |||||||||||
Income (Loss) Ratio | 9.2 | % | 8.2 | % | 10.0 | % | 9.6 | % | (46.0 | )% | 8.1 | % | |||||||||||
Operating Income Ratio | 9.2 | % | 8.2 | % | 10.0 | % | 9.6 | % | 9.5 | % | 8.1 | % | |||||||||||
Persistency: | |||||||||||||||||||||||
Individual Disability | 91.0 | % | 91.1 | % | 91.3 | % | 91.8 | % | |||||||||||||||
Long-term Care | 95.4 | % | 95.1 | % | 95.4 | % | 95.5 | % |
12
Unum Group Financial Results for Corporate Segment
Three Months Ended | Nine Months Ended | Year Ended | |||||||||||||||||||||
9/30/2015 | 9/30/2014 | 9/30/2015 | 9/30/2014 | 12/31/2014 | 12/31/2013 | ||||||||||||||||||
As Adjusted | As Adjusted | As Adjusted | |||||||||||||||||||||
Operating Revenue | |||||||||||||||||||||||
Net Investment Income | $ | 6.4 | $ | 9.8 | $ | 20.3 | $ | 25.1 | $ | 35.3 | $ | 24.7 | |||||||||||
Other Income | 1.8 | 0.9 | 2.6 | 2.2 | 5.0 | 7.7 | |||||||||||||||||
Total | 8.2 | 10.7 | 22.9 | 27.3 | 40.3 | 32.4 | |||||||||||||||||
Interest and Other Expenses | 35.1 | 35.8 | 113.1 | 120.5 | 157.9 | 147.5 | |||||||||||||||||
Operating Loss Including Costs Related to Early Retirement of Debt | (26.9 | ) | (25.1 | ) | (90.2 | ) | (93.2 | ) | (117.6 | ) | (115.1 | ) | |||||||||||
Costs Related to Early Retirement of Debt | — | — | — | 13.2 | 13.2 | — | |||||||||||||||||
Operating Loss | $ | (26.9 | ) | $ | (25.1 | ) | $ | (90.2 | ) | $ | (80.0 | ) | $ | (104.4 | ) | $ | (115.1 | ) |
13
Unum Group Reserves
September 30, 2015 | |||||||||||||||||||||||||||||
Gross | Total | ||||||||||||||||||||||||||||
Policy | Claim Reserves | Reinsurance | Total | ||||||||||||||||||||||||||
Reserves | % | Incurred | IBNR | % | Total | Ceded | Net | ||||||||||||||||||||||
Group Disability | $ | — | — | % | $ | 6,384.5 | $ | 601.6 | 29.2 | % | $ | 6,986.1 | $ | 69.4 | $ | 6,916.7 | |||||||||||||
Group Life and Accidental Death & Dismemberment | 68.6 | 0.4 | 709.9 | 184.1 | 3.8 | 962.6 | 4.2 | 958.4 | |||||||||||||||||||||
Individual Disability | 552.3 | 3.2 | 1,231.0 | 127.2 | 5.7 | 1,910.5 | 112.1 | 1,798.4 | |||||||||||||||||||||
Voluntary Benefits | 1,409.9 | 8.0 | 48.6 | 52.8 | 0.4 | 1,511.3 | 28.4 | 1,482.9 | |||||||||||||||||||||
Unum US Segment | 2,030.8 | 11.6 | 8,374.0 | 965.7 | 39.1 | 11,370.5 | 214.1 | 11,156.4 | |||||||||||||||||||||
Unum UK Segment | 22.9 | 0.1 | 2,092.7 | 155.5 | 9.4 | 2,271.1 | 108.0 | 2,163.1 | |||||||||||||||||||||
Colonial Life Segment | 1,733.2 | 9.9 | 275.5 | 132.3 | 1.7 | 2,141.0 | 7.6 | 2,133.4 | |||||||||||||||||||||
Individual Disability | 647.0 | 3.7 | 9,988.5 | 264.1 | 42.9 | 10,899.6 | 1,563.5 | 9,336.1 | |||||||||||||||||||||
Long-term Care | 7,259.6 | 41.5 | 1,187.6 | 120.7 | 5.5 | 8,567.9 | 43.6 | 8,524.3 | |||||||||||||||||||||
Other | 5,806.8 | 33.2 | 207.2 | 136.7 | 1.4 | 6,150.7 | 4,976.5 | 1,174.2 | |||||||||||||||||||||
Closed Block Segment | 13,713.4 | 78.4 | 11,383.3 | 521.5 | 49.8 | 25,618.2 | 6,583.6 | 19,034.6 | |||||||||||||||||||||
Subtotal | $ | 17,500.3 | 100.0 | % | $ | 22,125.5 | $ | 1,775.0 | 100.0 | % | 41,400.8 | 6,913.3 | 34,487.5 | ||||||||||||||||
Adjustment to Reserves for Unrealized Gain on Securities | 4,649.7 | 308.1 | 4,341.6 | ||||||||||||||||||||||||||
Consolidated | $ | 46,050.5 | $ | 7,221.4 | $ | 38,829.1 |
The decrease in the adjustment to reserves for unrealized gain on securities, relative to year-end 2014, was due primarily to an increase in credit spreads. This adjustment is consistent with a similar adjustment to our invested assets.
14
Unum Group Reserves
December 31, 2014 | |||||||||||||||||||||||||||||
Gross | Total | ||||||||||||||||||||||||||||
Policy | Claim Reserves | Reinsurance | Total | ||||||||||||||||||||||||||
Reserves | % | Incurred | IBNR | % | Total | Ceded | Net | ||||||||||||||||||||||
Group Disability | $ | — | — | % | $ | 6,558.4 | $ | 581.1 | 29.5 | % | $ | 7,139.5 | $ | 66.9 | $ | 7,072.6 | |||||||||||||
Group Life and Accidental Death & Dismemberment | 68.8 | 0.4 | 712.6 | 195.4 | 3.7 | 976.8 | 3.9 | 972.9 | |||||||||||||||||||||
Individual Disability | 555.6 | 3.2 | 1,201.5 | 127.3 | 5.5 | 1,884.4 | 112.5 | 1,771.9 | |||||||||||||||||||||
Voluntary Benefits | 1,366.4 | 8.0 | 52.3 | 58.4 | 0.5 | 1,477.1 | 29.1 | 1,448.0 | |||||||||||||||||||||
Unum US Segment | 1,990.8 | 11.6 | 8,524.8 | 962.2 | 39.2 | 11,477.8 | 212.4 | 11,265.4 | |||||||||||||||||||||
Unum UK Segment | 22.8 | 0.1 | 2,168.2 | 145.2 | 9.6 | 2,336.2 | 112.3 | 2,223.9 | |||||||||||||||||||||
Colonial Life Segment | 1,670.4 | 9.8 | 279.4 | 127.3 | 1.7 | 2,077.1 | 9.9 | 2,067.2 | |||||||||||||||||||||
Individual Disability | 735.0 | 4.3 | 10,150.9 | 285.6 | 43.1 | 11,171.5 | 1,551.7 | 9,619.8 | |||||||||||||||||||||
Long-term Care | 6,884.2 | 40.2 | 1,083.3 | 111.9 | 4.9 | 8,079.4 | 42.5 | 8,036.9 | |||||||||||||||||||||
Other | 5,811.4 | 34.0 | 214.3 | 140.7 | 1.5 | 6,166.4 | 4,959.8 | 1,206.6 | |||||||||||||||||||||
Closed Block Segment | 13,430.6 | 78.5 | 11,448.5 | 538.2 | 49.5 | 25,417.3 | 6,554.0 | 18,863.3 | |||||||||||||||||||||
Subtotal | $ | 17,114.6 | 100.0 | % | $ | 22,420.9 | $ | 1,772.9 | 100.0 | % | 41,308.4 | 6,888.6 | 34,419.8 | ||||||||||||||||
Adjustment to Reserves for Unrealized Gain on Securities | 6,150.3 | 365.0 | 5,785.3 | ||||||||||||||||||||||||||
Consolidated | $ | 47,458.7 | $ | 7,253.6 | $ | 40,205.1 |
14. 1
Unum Group Investments
9/30/2015 | 9/30/2015 | 6/30/2015 | |||||||||||||||
Fixed Maturity Securities (Fair Value) | |||||||||||||||||
Public | $ | 28,354.0 | 63.9 | % | Selected Statistics | ||||||||||||
Asset-Backed Securities | 67.7 | 0.2 | Earned Book Yield | 5.36 | % | 5.38 | % | ||||||||||
Residential Mortgage-Backed Securities (1) | 2,230.0 | 5.0 | Average Duration (in years) | 7.61 | 7.55 | ||||||||||||
Commercial Mortgage-Backed Securities | 132.0 | 0.3 | |||||||||||||||
Private Placements | 5,332.1 | 12.0 | |||||||||||||||
High Yield | 3,391.2 | 7.6 | |||||||||||||||
Government Securities | 2,716.0 | 6.1 | |||||||||||||||
Municipal Securities (2) | 2,129.4 | 4.8 | |||||||||||||||
Redeemable Preferred Stocks | 49.1 | 0.1 | |||||||||||||||
Total | $ | 44,401.5 | 100.0 | % | |||||||||||||
Amortized Cost | Fair Value | ||||||||||||||||
Quality Ratings of Fixed Maturity Securities | Schedule BA and Non-Current | ||||||||||||||||
Aaa | 9.2 | % | 9.2 | % | Total Non-Current Investments | $ | 40.1 | $ | 40.2 | ||||||||
Aa | 8.7 | 9.2 | Total Schedule BA Assets | $ | 440.0 | $ | 452.4 | ||||||||||
A | 29.5 | 30.9 | |||||||||||||||
Baa | 43.7 | 43.0 | |||||||||||||||
Below Baa | 8.9 | 7.7 | |||||||||||||||
Total | 100.0 | % | 100.0 | % | |||||||||||||
(1) Includes $25.1 million of high yield mortgage-backed securities. | |||||||||||||||||
(2) Includes $17.2 million of high yield municipal securities. |
15
Unum Group Investments at September 30, 2015
Fixed Maturity Securities - By Industry Classification - Unrealized Gain (Loss) | ||||||||||||||||||||||||
Classification | Fair Value | Net Unrealized Gain | Fair Value of Fixed Maturity Securities with Gross Unrealized Loss | Gross Unrealized Loss | Fair Value of Fixed Maturity Securities with Gross Unrealized Gain | Gross Unrealized Gain | ||||||||||||||||||
Basic Industry | $ | 2,551.1 | $ | 135.1 | $ | 742.8 | $ | 62.6 | $ | 1,808.3 | $ | 197.7 | ||||||||||||
Capital Goods | 4,031.5 | 435.3 | 439.4 | 15.9 | 3,592.1 | 451.2 | ||||||||||||||||||
Communications | 2,968.0 | 321.6 | 516.6 | 33.2 | 2,451.4 | 354.8 | ||||||||||||||||||
Consumer Cyclical | 1,387.7 | 131.4 | 212.7 | 11.8 | 1,175.0 | 143.2 | ||||||||||||||||||
Consumer Non-Cyclical | 6,004.1 | 640.5 | 869.3 | 34.9 | 5,134.8 | 675.4 | ||||||||||||||||||
Energy | 5,443.9 | 302.8 | 1,655.1 | 188.3 | 3,788.8 | 491.1 | ||||||||||||||||||
Financial Institutions | 3,374.4 | 316.8 | 343.8 | 5.4 | 3,030.6 | 322.2 | ||||||||||||||||||
Mortgage/Asset-Backed | 2,429.7 | 197.4 | 113.3 | 1.0 | 2,316.4 | 198.4 | ||||||||||||||||||
Sovereigns | 1,224.6 | 182.7 | — | — | 1,224.6 | 182.7 | ||||||||||||||||||
Technology | 1,296.7 | 52.3 | 521.9 | 14.7 | 774.8 | 67.0 | ||||||||||||||||||
Transportation | 1,701.8 | 214.7 | 158.8 | 6.2 | 1,543.0 | 220.9 | ||||||||||||||||||
U.S. Government Agencies and Municipalities | 3,620.8 | 522.9 | 416.7 | 8.2 | 3,204.1 | 531.1 | ||||||||||||||||||
Public Utilities | 8,318.1 | 1,204.8 | 266.9 | 9.9 | 8,051.2 | 1,214.7 | ||||||||||||||||||
Redeemable Preferred Stocks | 49.1 | 5.1 | 10.8 | 0.2 | 38.3 | 5.3 | ||||||||||||||||||
Total | $ | 44,401.5 | $ | 4,663.4 | $ | 6,268.1 | $ | 392.3 | $ | 38,133.4 | $ | 5,055.7 | ||||||||||||
Gross Unrealized Loss on Fixed Maturity Securities By Length of Time in Unrealized Loss Position | ||||||||||||||||||||||||
Investment-Grade | Below-Investment-Grade | |||||||||||||||||||||||
Category | Fair Value | Gross Unrealized Loss | Fair Value | Gross Unrealized Loss | ||||||||||||||||||||
<= 90 days | $ | 1,154.3 | $ | 34.0 | $ | 869.7 | $ | 36.4 | ||||||||||||||||
> 90 <= 180 days | 2,629.7 | 117.4 | 657.7 | 65.0 | ||||||||||||||||||||
> 180 <= 270 days | 276.1 | 17.2 | 27.3 | 3.7 | ||||||||||||||||||||
> 270 days <= 1 year | 95.5 | 15.5 | 131.8 | 34.9 | ||||||||||||||||||||
> 1 year | 136.1 | 10.4 | 289.9 | 57.8 | ||||||||||||||||||||
Total | $ | 4,291.7 | $ | 194.5 | $ | 1,976.4 | $ | 197.8 | ||||||||||||||||
15. 1
Appendix to Statistical Supplement
2015 Significant Items
• | In September 2015, we acquired 100 percent of the common shares and voting interests in National Dental Plan Limited and associated companies (National Dental) for a total cash purchase price of £35.9 million or $54.3 million. National Dental, a provider of dental insurance in the U.K. workplace, is reported in our Unum UK segment as part of our supplemental product line. This acquisition, the results of which are included in our consolidated financial statements for the period subsequent to the date of acquisition, is not expected to have a material impact on revenue or results of operations during 2015. |
• | In January 2014, the Financial Accounting Standards Board (FASB) issued an update permitting entities to make an accounting policy election to account for investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit). We adopted this update effective January 1, 2015 and applied the amendments retrospectively, adjusting all prior period operating results, balance sheets, and related metrics throughout this document. |
2014 Significant Items
• | Fourth quarter of 2014 reserve increase of $698.2 million before tax and $453.8 million after tax related to long-term care. |
• | Fourth quarter of 2014 settlement loss of $64.4 million before tax and $41.9 million after tax related to a pension plan amendment. |
• | Second quarter of 2014 costs related to early retirement of debt of $13.2 million before tax and $10.4 million after tax. |
• | In December 2014, we retired 60 million shares of our treasury stock with an average total cost of $1,451.7 million. |
2013 Significant Items
• | Fourth quarter of 2013 claim reserve increases of $49.1 million for Unum US group life, $26.3 million for Unum US voluntary life, and $20.1 million for Colonial Life voluntary life, for a total reserve increase of $95.5 million with a corresponding decrease in net income of $62.1 million, less applicable income tax, related to unclaimed death benefits. |
• | Fourth quarter of 2013 reserve reduction of $85.0 million before tax and $55.2 million after tax related to Unum US group life waiver of premium benefits. |
Non-GAAP Financial Measures
We analyze our performance using non-GAAP financial measures which exclude or include amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. We believe the following non-GAAP financial measures are better performance measures and better indicators of the revenue and profitability and underlying trends in our business:
• | Operating revenue, which excludes realized investment gains or losses; |
• | Before-tax operating income or loss, which excludes realized investment gains or losses, non-operating retirement-related gains or losses, income tax, and certain other items, as applicable, and after-tax operating income or loss which includes income tax; |
• | Operating return on equity, which is calculated using after-tax operating income or loss and excludes from equity the unrealized gain or loss on securities and net gain on cash flow hedges; |
• | Leverage ratio, which excludes the unrealized gain or loss on securities and net gain on cash flow hedges, and the non-recourse debt and associated capital of Northwind Holdings, LLC; and |
• | Book value per common share, which is calculated excluding AOCI. |
16 |
Appendix to Statistical Supplement - Continued
Realized investment gains or losses; non-operating retirement-related gains or losses; unrealized gains or losses on securities and net gains on cash flow hedges depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our Company. Leverage ratio and book value per common share excluding certain components of AOCI, certain of which tend to fluctuate depending on market conditions and general economic trends, are important measures. We also exclude certain other items from our discussion of financial ratios and metrics in order to enhance the understanding and comparability of our operational performance and the underlying fundamentals, but this exclusion is not an indication that similar items may not recur and does not replace the comparable GAAP measures in the determination of overall profitability. For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures, refer to the "Reconciliation of Non-GAAP Financial Measures" beginning on page 16.2.
16. 1
Reconciliation of Non-GAAP Financial Measures
Three Months Ended | |||||||||||||||||||||||||||||||||||
September 30 | June 30 | March 31 | December 31 | September 30 | June 30 | March 31 | December 31 | September 30 | |||||||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||||||||
Operating Revenue | $ | 2,684.4 | $ | 2,702.9 | $ | 2,662.7 | $ | 2,656.3 | $ | 2,613.1 | $ | 2,630.9 | $ | 2,608.1 | $ | 2,580.8 | $ | 2,570.5 | |||||||||||||||||
Net Realized Investment Gain (Loss) | (26.6 | ) | 0.8 | (15.3 | ) | (17.3 | ) | 1.2 | 25.9 | 6.3 | 9.3 | (26.1 | ) | ||||||||||||||||||||||
Total Revenue | $ | 2,657.8 | $ | 2,703.7 | $ | 2,647.4 | $ | 2,639.0 | $ | 2,614.3 | $ | 2,656.8 | $ | 2,614.4 | $ | 2,590.1 | $ | 2,544.4 |
After-Tax | Average | Annualized | |||||||||
Operating | Allocated | Operating | |||||||||
Income (Loss) | Equity(1) | Return | |||||||||
(in millions) | On Equity | ||||||||||
Three Months Ended September 30, 2015 | |||||||||||
Unum US | $ | 143.8 | $ | 4,237.4 | 13.6 | % | |||||
Unum UK | 26.6 | 674.0 | 15.8 | % | |||||||
Colonial Life | 49.7 | 1,219.4 | 16.3 | % | |||||||
Core Operating Segments | 220.1 | 6,130.8 | 14.4 | % | |||||||
Closed Block | 18.3 | 3,028.5 | |||||||||
Corporate | (15.4 | ) | (1,144.6 | ) | |||||||
Total | $ | 223.0 | $ | 8,014.7 | 11.1 | % | |||||
Three Months Ended September 30, 2014 | |||||||||||
Unum US | $ | 139.0 | $ | 4,124.7 | 13.5 | % | |||||
Unum UK | 26.4 | 669.6 | 15.7 | % | |||||||
Colonial Life | 46.2 | 1,145.1 | 16.2 | % | |||||||
Core Operating Segments | 211.6 | 5,939.4 | 14.2 | % | |||||||
Closed Block | 16.9 | 2,820.2 | |||||||||
Corporate | (9.4 | ) | (400.2 | ) | |||||||
Total | $ | 219.1 | $ | 8,359.4 | 10.5 | % |
(1)Excludes unrealized gain on securities and net gain on cash flow hedges and is calculated using the stockholders' equity balances presented on page 16.4.
16. 2 |
Reconciliation of Non-GAAP Financial Measures - Continued
After-Tax | Average | Annualized | |||||||||
Operating | Allocated | Operating | |||||||||
Income (Loss) | Equity(2) | Return | |||||||||
(in millions) | On Equity | ||||||||||
Nine Months Ended September 30, 2015 | |||||||||||
Unum US | $ | 417.1 | $ | 4,222.1 | 13.2 | % | |||||
Unum UK | 82.3 | 669.7 | 16.4 | % | |||||||
Colonial Life | 150.6 | 1,200.8 | 16.7 | % | |||||||
Core Operating Segments | 650.0 | 6,092.6 | 14.2 | % | |||||||
Closed Block | 60.4 | 2,929.2 | |||||||||
Corporate | (40.0 | ) | (1,092.8 | ) | |||||||
Total | $ | 670.4 | $ | 7,929.0 | 11.3 | % | |||||
Nine Months Ended September 30, 2014 | |||||||||||
Unum US | $ | 416.3 | $ | 4,158.8 | 13.3 | % | |||||
Unum UK | 87.1 | 636.4 | 18.2 | % | |||||||
Colonial Life | 146.3 | 1,148.6 | 17.0 | % | |||||||
Core Operating Segments | 649.7 | 5,943.8 | 14.6 | % | |||||||
Closed Block | 59.8 | 2,780.0 | |||||||||
Corporate | (36.1 | ) | (484.3 | ) | |||||||
Total | $ | 673.4 | $ | 8,239.5 | 10.9 | % |
(2)Excludes unrealized gain on securities and net gain on cash flow hedges and is calculated using the stockholders' equity balances presented on page 16.4.
16. 3
Reconciliation of Non-GAAP Financial Measures - Continued
After-Tax | Average | ||||||||||
Operating | Allocated | Operating | |||||||||
Income (Loss) | Equity(3) | Return | |||||||||
(in millions) | On Equity | ||||||||||
Year Ended December 31, 2014 | |||||||||||
Unum US | $ | 554.9 | $ | 4,157.4 | 13.3 | % | |||||
Unum UK | 116.4 | 635.3 | 18.3 | % | |||||||
Colonial Life | 194.4 | 1,163.1 | 16.7 | % | |||||||
Core Operating Segments | 865.7 | 5,955.8 | 14.5 | % | |||||||
Closed Block | 79.2 | 2,756.3 | |||||||||
Corporate | (45.8 | ) | (737.8 | ) | |||||||
Total | $ | 899.1 | $ | 7,974.3 | 11.3 | % | |||||
Year Ended December 31, 2013 | |||||||||||
Unum US | $ | 556.5 | $ | 4,141.8 | 13.4 | % | |||||
Unum UK | 104.5 | 744.3 | 14.0 | % | |||||||
Colonial Life | 184.4 | 1,122.6 | 16.4 | % | |||||||
Core Operating Segments | 845.4 | 6,008.7 | 14.1 | % | |||||||
Closed Block | 70.0 | 2,580.4 | |||||||||
Corporate | (44.0 | ) | (870.4 | ) | |||||||
Total | $ | 871.4 | $ | 7,718.7 | 11.3 | % |
(3)Excludes unrealized gain on securities and net gain on cash flow hedges and is calculated using the stockholders' equity balances presented below.
Average allocated equity is computed as follows:
(in millions) | 9/30/2015 | 6/30/2015 | 12/31/2014 | 9/30/2014 | 6/30/2014 | 12/31/2013 | 12/31/2012 | ||||||||||||||||||||
Total Stockholders' Equity, As Reported | $ | 8,581.1 | $ | 8,515.7 | $ | 8,521.9 | $ | 9,216.6 | $ | 9,218.3 | $ | 8,639.9 | $ | 8,604.6 | |||||||||||||
Net Unrealized Gain on Securities | 158.6 | 112.1 | 290.3 | 462.0 | 501.2 | 135.7 | 873.5 | ||||||||||||||||||||
Net Gain on Cash Flow Hedges | 405.1 | 391.7 | 391.0 | 383.5 | 369.5 | 396.3 | 401.6 | ||||||||||||||||||||
Total Stockholders' Equity, As Adjusted | $ | 8,017.4 | $ | 8,011.9 | $ | 7,840.6 | $ | 8,371.1 | $ | 8,347.6 | $ | 8,107.9 | $ | 7,329.5 | |||||||||||||
Three Months Ended | Nine Months Ended | Twelve Months Ended | Three Months Ended | Nine Months Ended | Twelve Months Ended | ||||||||||||||||||||||
9/30/2015 | 12/31/2014 | 9/30/2014 | 12/31/2013 | ||||||||||||||||||||||||
Average Stockholders' Equity Excluding Net Unrealized Gain on Securities and Net Gain on Cash Flow Hedges | $ | 8,014.7 | $ | 7,929.0 | $ | 7,974.3 | $ | 8,359.4 | $ | 8,239.5 | $ | 7,718.7 |
16. 4
Reconciliation of Non-GAAP Financial Measures - Continued
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||||||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||||||||||||||||||
(in millions) | per share * | (in millions) | per share * | (in millions) | per share * | (in millions) | per share * | ||||||||||||||||||||||||
After-tax Operating Income | $ | 223.0 | $ | 0.91 | $ | 219.1 | $ | 0.86 | $ | 670.4 | $ | 2.69 | $ | 673.4 | $ | 2.61 | |||||||||||||||
Net Realized Investment Gain (Loss), Net of Tax | (17.3 | ) | (0.07 | ) | 0.9 | — | (23.6 | ) | (0.10 | ) | 24.0 | 0.10 | |||||||||||||||||||
Non-operating Retirement-related Loss, Net of Tax | (1.9 | ) | (0.01 | ) | (0.9 | ) | — | (5.8 | ) | (0.02 | ) | (2.7 | ) | (0.01 | ) | ||||||||||||||||
Costs Related to Early Retirement of Debt, Net of Tax | — | — | — | — | — | — | (10.4 | ) | (0.04 | ) | |||||||||||||||||||||
Net Income | $ | 203.8 | $ | 0.83 | $ | 219.1 | $ | 0.86 | $ | 641.0 | $ | 2.57 | $ | 684.3 | $ | 2.66 |
Year Ended December 31 | |||||||||||||||
2014 | 2013 | ||||||||||||||
(in millions) | per share * | (in millions) | per share * | ||||||||||||
After-tax Operating Income | $ | 899.1 | $ | 3.51 | $ | 871.4 | $ | 3.28 | |||||||
Net Realized Investment Gain, Net of Tax | 12.8 | 0.05 | 3.9 | 0.02 | |||||||||||
Non-operating Retirement-related Loss, Net of Tax | (45.6 | ) | (0.18 | ) | (21.4 | ) | (0.08 | ) | |||||||
Costs Related to Early Retirement of Debt, Net of Tax | (10.4 | ) | (0.04 | ) | — | — | |||||||||
LTC Reserve Increase, Net of Tax | (453.8 | ) | (1.77 | ) | — | — | |||||||||
UDB Reserve Increase, Net of Tax | — | — | (62.1 | ) | (0.24 | ) | |||||||||
Waiver Reserve Reduction, Net of Tax | — | — | 55.2 | 0.21 | |||||||||||
Net Income | $ | 402.1 | $ | 1.57 | $ | 847.0 | $ | 3.19 | |||||||
* Assuming Dilution |
September 30 | December 31 | ||||||||||||||
(in millions) | 2015 | 2014 | 2014 | 2013 | |||||||||||
Debt, As Reported | $ | 2,723.2 | $ | 2,783.3 | $ | 2,780.6 | $ | 2,612.0 | |||||||
Excluding Non-recourse Debt | 335.8 | 404.8 | 398.4 | 440.0 | |||||||||||
Debt, As Adjusted | $ | 2,387.4 | $ | 2,378.5 | $ | 2,382.2 | $ | 2,172.0 | |||||||
Total Stockholders' Equity, As Reported | $ | 8,581.1 | $ | 9,216.6 | $ | 8,521.9 | $ | 8,639.9 | |||||||
Excluding Net Unrealized Gain on Securities and Net Gain on Cash Flow Hedges | 563.7 | 845.5 | 681.3 | 532.0 | |||||||||||
Excluding Northwind Capital | 851.3 | 842.0 | 849.9 | 846.4 | |||||||||||
Equity, As Adjusted | 7,166.1 | 7,529.1 | 6,990.7 | 7,261.5 | |||||||||||
Debt, As Adjusted | 2,387.4 | 2,378.5 | 2,382.2 | 2,172.0 | |||||||||||
Total Capital, As Adjusted | $ | 9,553.5 | $ | 9,907.6 | $ | 9,372.9 | $ | 9,433.5 | |||||||
Leverage Ratio | 25.0 | % | 24.0 | % | 25.4 | % | 23.0 | % |
16. 5
Reconciliation of Non-GAAP Financial Measures - Continued
Three Months Ended | |||
June 30, 2015 | |||
(in millions) | |||
Operating Income (Loss) | |||
Group Disability | $ | 61.2 | |
Group Life and Accidental Death & Dismemberment | 52.5 | ||
Supplemental and Voluntary | 89.1 | ||
Unum US | 202.8 | ||
Unum UK | 38.3 | ||
Colonial Life | 77.6 | ||
Closed Block | 36.6 | ||
Corporate | (33.4 | ) | |
Total | 321.9 | ||
Income Tax Expense | (99.3 | ) | |
Net Realized Investment Gain, Net of Tax | 3.7 | ||
Non-operating Retirement-related Loss, Net of Tax | (2.0 | ) | |
Net Income | $ | 224.3 |
16. 6
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