MetLife Announces First Quarter 2019 Results

May 1, 2019 4:15 PM

NEW YORK--(BUSINESS WIRE)-- MetLife, Inc. (NYSE: MET) today announced its results for the first quarter ended March31, 2019.

First Quarter Results Summary

“I’m stepping into the CEO role at an exciting time for MetLife,” said Michel Khalaf, president and CEO of MetLife, Inc. “We are building on our momentum from 2018 with an excellent first quarter in 2019. Our business performance more than offset some market headwinds. Our commitment is to be a responsible steward of capital by investing in profitable growth, strengthening expense discipline, and creating long-term value for our customers and shareholders.”

First Quarter 2019 Summary

($ in millions, except per share data) Three months ended

March 31,

2019 2018 Change
Premiums, fees and other revenues $ 11,264 $ 11,044 2 %
Net investment income 4,908 3,745 31 %
Net investment gains (losses) 15 (333 )
Net derivative gains (losses) 115 349 (67 )%
Total revenues $ 16,302 $ 14,805 10 %
Total adjusted revenues $ 15,448 $ 15,148 2 %
Adjusted premiums, fees and other revenues $ 11,167 $ 10,929 2 %
Adjusted premiums, fees and other revenues, excluding pension risk transfer (PRT) $ 11,169 $ 10,929 2 %
Net income (loss) $ 1,349 $ 1,247 8 %
Net income (loss) per share $ 1.40 $ 1.19 18 %
Adjusted earnings $ 1,424 $ 1,423 %
Adjusted earnings per share $ 1.48 $ 1.36 9 %
Book value per share $ 58.06 $ 52.49 11 %
Book value per share, excluding AOCI other than FCTA $ 45.58 $ 43.36 5 %
Expense ratio 21.1 % 21.8 %
Direct expense ratio, excluding total notable items related to direct expenses and PRT 12.1 % 13.0 %
Adjusted expense ratio, excluding total notable items related to other expenses and PRT 19.9 % 20.8 %
ROE 10.3 % 9.0 %
ROE, excluding AOCI other than FCTA 12.5 % 11.2 %
Adjusted ROE, excluding AOCI other than FCTA 13.2 % 12.8 %

MetLife reported first quarter 2019 premiums, fees and other revenues of $11.3billion, up 2percent over the first quarter of 2018. Adjusted premiums, fees and other revenues were $11.2billion, up 2 percent, and 4 percent on a constant currency basis over the prior-year period.

Net investment income was $4.9 billion, up 31 percent. The increase in net investment income was driven by favorable changes in the estimated fair value of certain securities which do not qualify as separate accounts under GAAP. On an adjusted basis, net investment income was $4.3 billion, up 1 percent.

Net derivative gains amounted to $115million, or $91million after tax during the quarter.

Net income was $1.3billion, compared to net income of $1.2billion in the first quarter of 2018. On a per share basis, net income was $1.40, compared to net income of $1.19 in the prior-year period.

MetLife reported adjusted earnings of $1.4billion were flat compared to the first quarter of 2018, and up 2 percent on a constant currency basis. On a per share basis, which includes the impact of share repurchases, adjusted earnings were $1.48, up 9percent from the prior-year period.

Information regarding the non-GAAP and other financial measures included in this news release and reconciliation of the non-GAAP financial measures to GAAP measures are in “Non-GAAP and Other Financial Disclosures” below and in the tables that accompany this news release.

Supplemental slides for the first quarter of 2019, titled "1Q19 Supplemental Slides," are available on the MetLife Investor Relations website at www.metlife.com and in the Form8-K furnished by MetLife to the U.S. Securities and Exchange Commission in connection with this earnings news release.

Adjusted Earnings by Segment Summary*

Three months ended

March 31, 2019

Segment

Change from
prior-year period

Change from
prior-year period
(on a constant
currency basis)

U.S. 11%
Asia 9% 13%
Latin America (4)% (1)%
Europe, the Middle East and Africa (EMEA) 6% 23%
MetLife Holdings (25)%

*The percentages in this table are on a reported and constant currency basis, and do not exclude notable items.

Business Discussions

All comparisons of the results for the first quarter of 2019 in the business discussions that follow are with the first quarter of 2018, unless otherwise noted. See the first quarter of 2019 notable items table that follows the Business Discussions section of this release for additional information on notable items incurred in the first quarter of 2019.

U.S.

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $724 $653 11%
Adjusted premiums, fees and other revenues $6,058 $5,679 7%
Adjusted premiums, fees and other revenues, excluding PRT $6,060 $5,679 7%
Notable item(s) $0 $0

Group Benefits

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $342 $218 57%
Adjusted premiums, fees and other revenues $4,545 $4,423 3%
Notable item(s) $0 $0

Retirement and Income Solutions

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $285 $339 (16)%
Adjusted premiums, fees and other revenues $609 $371 64%
Adjusted premiums, fees and other revenues, excluding PRT $611 $371 65%
Notable item(s) $0 $0

Property & Casualty

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $97 $96 1%
Adjusted premiums, fees and other revenues $904 $885 2%
Notable item(s) $0 $0

ASIA

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $356 $327 9%
Adjusted earnings (constant currency) $356 $316 13%
Adjusted premiums, fees and other revenues $2,121 $2,157 (2)%
Notable item(s) $0 $0

LATIN AMERICA

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $134 $140 (4)%
Adjusted earnings (constant currency) $134 $135 (1)%
Adjusted premiums, fees and other revenues $942 $989 (5)%
Notable item(s) $0 $0

EMEA

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $86 $81 6%
Adjusted earnings (constant currency) $86 $70 23%
Adjusted premiums, fees and other revenues $659 $679 (3)%
Notable item(s) $0 $0

METLIFE HOLDINGS

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $317 $425 (25)%
Adjusted premiums, fees and other revenues $1,268 $1,331 (5)%
Notable item(s) $0 $62

CORPORATE & OTHER

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Adjusted earnings $(193) $(203)
Notable item(s) $(55) $(34)

INVESTMENTS

($ in millions)

Three months ended
March 31, 2019

Three months ended
March 31, 2018

Change
Net investment income (as reported on an adjusted basis) $4,281 $4,219 1%

FIRST QUARTER 2019 NOTABLE ITEMS

($ in millions) Adjusted Earnings
Three months ended March 31, 2019
Notable Items U.S. Asia

Latin
America

EMEA

MetLife
Holdings

Corporate
&
Other

Total

Group
Benefits

Retirement
and Income
Solutions

Property
&
Casualty

Expense initiative costs $(55) $(55)
Total notable items $0 $0 $0 $0 $0 $0 $0 $(55) $(55)

About MetLife

MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (MetLife), is one of the world's leading financial services companies, providing insurance, annuities, employee benefits and asset management to help its individual and institutional customers navigate their changing world. Founded in 1868, MetLife has operations in more than 40 countries and holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit www.metlife.com.

Conference Call

MetLife will hold its first quarter 2019 earnings conference call and audio webcast on Thursday, May 2, 2019, from 9-10 a.m. (ET). The conference call will be available live via telephone and the internet. To listen via telephone, dial 800-230-1085 (U.S.) or 612-234-9959 (outside the U.S.). To listen to the conference call via the internet, visit www.metlife.com through a link on the Investor Relations page. Those who want to listen to the call via telephone or the internet should dial in or go to the website at least 15 minutes prior to the call to register, and/or download and install any necessary audio software.

The conference call will be available for replay via telephone and the internet beginning at 11 a.m. (ET) on Thursday, May 2, 2019, until Thursday, May 9, 2019, at 11:59 p.m. (ET). To listen to a replay of the conference call via telephone, dial 800-475-6701 (U.S.) or 320-365-3844 (outside the U.S.). The access code for the replay is 462461. To access the replay of the conference call over the internet, visit the above-mentioned website.

Non-GAAP and Other Financial Disclosures

Any references in this news release (except in this section and the tables that accompany this release) to: should be read as, respectively:
(i) net income (loss); (i) net income (loss) available to MetLife, Inc.’s common shareholders;
(ii) net income (loss) per share; (ii) net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(iii) adjusted earnings; (iii) adjusted earnings available to common shareholders;
(iv) adjusted earnings per share; (iv) adjusted earnings available to common shareholders per diluted common share;
(v) book value per share; (v) book value per common share;
(vi) book value per share, excluding AOCI other than FCTA; (vi) book value per common share, excluding AOCI other than FCTA;
(vii) book value per share-tangible common stockholders’ equity; (vii) book value per common share-tangible common stockholders’ equity;
(viii) premiums, fees and other revenues; (viii) premiums, fees and other revenues (adjusted);
(ix) return on equity; (ix) return on MetLife, Inc.’s common stockholders’ equity;
(x) return on equity, excluding AOCI other than FCTA; (x) return on MetLife, Inc.’s common stockholders’ equity, excluding AOCI, other than FCTA;
(xi) adjusted return on equity, excluding AOCI other than FCTA; (xi) adjusted return on MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA;
(xii) tangible return on equity; and (xii) return on MetLife, Inc.’s tangible common stockholders' equity; and
(xiii) adjusted tangible return on equity. (xiii) adjusted return on MetLife, Inc.’s tangible common stockholders’ equity.

In this news release, MetLife presents certain measures of its performance that are not calculated in accordance with accounting principles generally accepted in the United States of America (GAAP). MetLife believes that these non-GAAP financial measures enhance the understanding of MetLife’s performance by highlighting the results of operations and the underlying profitability drivers of the business.

The following non-GAAP financial measures should not be viewed as substitutes for the most directly comparable financial measures calculated in accordance with GAAP:

Non-GAAP financial measures: Comparable GAAP financial measures:
(i) adjusted revenues; (i) revenues;
(ii) adjusted expenses; (ii) expenses;
(iii) adjusted premiums, fees and other revenues; (iii) premiums, fees and other revenues;
(iv) adjusted premiums, fees and other revenues, excluding pension risk transfer (iv) premiums, fees and other revenues;
(v) adjusted earnings; (v) income (loss) from continuing operations, net of income tax;
(vi) net investment income, as reported on an adjusted basis (vi) net investment income
(vii) capitalization of deferred policy acquisition costs (DAC), as reported on an adjusted basis (vii) capitalization of DAC
(viii) other expenses, as reported on an adjusted basis (viii) other expenses
(ix) other expenses, as reported on an adjusted basis, on a constant currency basis (ix) other expenses
(x) adjusted earnings available to common shareholders; (x) net income (loss) available to MetLife, Inc.’s common shareholders;
(xi) adjusted earnings available to common shareholders on a constant currency basis; (xi) net income (loss) available to MetLife, Inc.’s common shareholders;
(xii) adjusted earnings available to common shareholders, excluding total notable items; (xii) net income (loss) available to MetLife, Inc.’s common shareholders;
(xiii) adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis; (xiii) net income (loss) available to MetLife, Inc.’s common shareholders;
(xiv) adjusted earnings available to common shareholders per diluted common share; (xiv) net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xv) adjusted earnings available to common shareholders on a constant currency basis per diluted common share; (xv) net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xvi) adjusted earnings available to common shareholders, excluding total notable items, per diluted common share; (xvi) net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xvii) adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis per diluted common share; (xvii) net income (loss) available to MetLife, Inc.’s common shareholders per diluted common share;
(xviii) adjusted return on equity; (xviii) return on equity;
(xix) adjusted return on equity, excluding AOCI other than FCTA; (xix) return on equity;
(xx) adjusted tangible return on equity; (xx) return on equity;
(xxi) investment portfolio gains (losses); (xxi) net investment gains (losses);
(xxii) derivative gains (losses); (xxii) net derivative gains (losses);
(xxiii) MetLife, Inc.’s tangible common stockholders’ equity; (xxiii) MetLife, Inc.’s stockholders’ equity;
(xxiv) MetLife, Inc.’s tangible common stockholders’ equity, excluding total notable items; (xxiv) MetLife, Inc.’s stockholders’ equity;
(xxv) MetLife, Inc.’s common stockholders’ equity, excluding AOCI other than FCTA; (xxv) MetLife, Inc.’s stockholders’ equity;
(xxvi) MetLife, Inc.’s common stockholders’ equity, excluding total notable items (excludes AOCI other than FCTA); (xxvi) MetLife, Inc.’s stockholders’ equity;
(xxvii) book value per common share, excluding AOCI other than FCTA (xxvii) book value per common share
(xxviii) book value per common share - tangible common stockholders' equity (xxviii) book value per common share
(xxix) free cash flow of all holding companies; (xxix) MetLife, Inc. (parent company only) net cash provided by (used in) operating activities;
(xxx) adjusted expense ratio; (xxx) expense ratio;
(xxxi) adjusted expense ratio, excluding total notable items related to other expenses and PRT; (xxxi) expense ratio;
(xxxii) direct expense ratio; and (xxxii) expense ratio; and
(xxxiii) direct expense ratio, excluding total notable items related to direct expenses and PRT. (xxxiii) expense ratio.

Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in this earnings news release and in this period’s quarterly financial supplement, which is available at www.metlife.com.

MetLife’s definitions of the various non-GAAP and other financial measures discussed in this news release may differ from those used by other companies:

Adjusted earnings and related measures

These measures are used by management to evaluate performance and allocate resources. Consistent with GAAP guidance for segment reporting, adjusted earnings is also MetLife’s GAAP measure of segment performance. Adjusted earnings and other financial measures based on adjusted earnings are also the measures by which MetLife senior management’s and many other employees’ performance is evaluated for the purposes of determining their compensation under applicable compensation plans. Adjusted earnings and other financial measures based on adjusted earnings allow analysis of MetLife's performance relative to its business plan and facilitate comparisons to industry results.

Adjusted earnings is defined as adjusted revenues less adjusted expenses, net of income tax. Adjusted loss is defined as negative adjusted earnings. Adjusted earnings available to common shareholders is defined as adjusted earnings less preferred stock dividends.

Adjusted revenues and adjusted expenses

These financial measures, along with the related adjusted premiums, fees and other revenues, focus on our primary businesses principally by excluding the impact of market volatility, which could distort trends, and revenues and costs related to non-core products and certain entities required to be consolidated under GAAP. Also, these measures exclude results of discontinued operations under GAAP and other businesses that have been or will be sold or exited by MetLife but do not meet the discontinued operations criteria under GAAP and are referred to as divested businesses. Divested businesses also includes the net impact of transactions with exited businesses that have been eliminated in consolidation under GAAP and costs relating to businesses that have been or will be sold or exited by MetLife that do not meet the criteria to be included in results of discontinued operations under GAAP.

Adjusted revenues also excludes net investment gains (losses) (NIGL) and net derivative gains (losses) (NDGL). Adjusted expenses also excludes goodwill impairments.

The following additional adjustments are made to revenues, in the line items indicated, in calculating adjusted revenues:

The following additional adjustments are made to expenses, in the line items indicated, in calculating adjusted expenses:

Adjusted earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the measurement period under GAAP business combination accounting guidance.

The tax impact of the adjustments mentioned above are calculated net of the U.S. or foreign statutory tax rate, which could differ from MetLife’s effective tax rate. Additionally, the provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.

Investment portfolio gains (losses) and derivative gains (losses)

These are measures of investment and hedging activity. Investment portfolio gains (losses) principally excludes amounts that are reported within net investment gains (losses) but do not relate to the performance of the investment portfolio, such as gains (losses) on sales and divestitures of businesses, goodwill impairment or changes in estimated fair value. Derivative gains (losses) principally excludes earned income on derivatives and amortization of premium on derivatives, where such derivatives are either hedges of investments or are used to replicate certain investments, and where such derivatives do not qualify for hedge accounting. This earned income and amortization of premium is reported within adjusted earnings and not within derivative gains (losses).

Return on equity, allocated equity, tangible equity and related measures

The above measures are, when considered in conjunction with regulatory capital ratios, a measure of capital adequacy.

Expense ratio, direct expense ratio, adjusted expense ratio and related measures

Statistical sales information:

Sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity.

The following additional information is relevant to an understanding of MetLife’s performance results:

Forward-Looking Statements

This news release may contain or incorporate by reference information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words and terms such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” "will," and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.

Many factors will be important in determining the results of MetLife, Inc., its subsidiaries and affiliates. Forward-looking statements are based on our assumptions and current expectations, which may be inaccurate, and on the current economic environment, which may change. These statements are not guarantees of future performance. They involve a number of risks and uncertainties that are difficult to predict. Results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in MetLife, Inc.’s filings with the U.S. Securities and Exchange Commission. These factors include: (1)difficult economic conditions, including risks relating to interest rates, credit spreads, equity, real estate, obligors and counterparties, currency exchange rates, derivatives, and terrorism and security; (2)adverse global capital and credit market conditions, which may affect our ability to meet liquidity needs and access capital, including through our credit facilities; (3)downgrades in our claims paying ability, financial strength or credit ratings; (4)availability and effectiveness of reinsurance, hedging or indemnification arrangements; (5)increasing cost and limited market capacity for statutory life insurance reserve financings; (6) the impact on us of changes to and implementation of the wide variety of laws and regulations to which we are subject; (7)regulatory, legislative or tax changes relating to our operations that may affect the cost of, or demand for, our products or services; (8)adverse results or other consequences from litigation, arbitration or regulatory investigations; (9)legal, regulatory and other restrictions affecting MetLife, Inc.’s ability to pay dividends and repurchase common stock; (10)MetLife, Inc.’s primary reliance, as a holding company, on dividends from subsidiaries to meet free cash flow targets and debt payment obligations and the applicable regulatory restrictions on the ability of the subsidiaries to pay such dividends; (11)investment losses, defaults and volatility; (12) potential liquidity and other risks resulting from our participation in a securities lending program and other transactions; (13) changes to investment valuations, allowances and impairments taken on investments, and methodologies, estimates and assumptions;

(14)differences between actual claims experience and underwriting and reserving assumptions; (15)political, legal, operational, economic and other risks relating to our global operations; (16)competitive pressures, including with respect to pricing, entry of new competitors, consolidation of distributors, the development of new products by new and existing competitors, and for personnel; (17) the impact of technological changes on our businesses; (18)catastrophe losses; (19)a deterioration in the experience of the closed block established in connection with the reorganization of Metropolitan Life Insurance Company; (20) impairment of goodwill or other long-lived assets, or the establishment of a valuation allowance against our deferred income tax asset; (21)changes in assumptions related to deferred policy acquisition costs, deferred sales inducements or value of business acquired; (22)exposure to losses related to guarantees in certain products; (23)ineffectiveness of risk management policies and procedures or models; (24)a failure in our cybersecurity systems or other information security systems or our disaster recovery plans; (25) any failure to protect the confidentiality of client information; (26)changes in accounting standards; (27) our associates taking excessive risks; (28)difficulties in marketing and distributing products through our distribution channels; (29)increased expenses relating to pension and other postretirement benefit plans; (30)inability to protect our intellectual property rights or claims of infringement of others’ intellectual property rights; (31) difficulties, unforeseen liabilities, asset impairments, or rating agency actions arising from business acquisitions and dispositions, joint ventures, or other legal entity reorganizations; (32) unanticipated or adverse developments that could adversely affect our expected operational or other benefits from the separation of Brighthouse Financial, Inc. and its subsidiaries; (33)the possibility that MetLife, Inc.’s Board of Directors may influence the outcome of stockholder votes through the voting provisions of the MetLife Policyholder Trust; (34)provisions of laws and our incorporation documents that may delay, deter or prevent takeovers and corporate combinations involving MetLife; and (35)other risks and uncertainties described from time to time in MetLife, Inc.’s filings with the U.S. Securities and Exchange Commission.

MetLife, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if MetLife, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife, Inc. makes on related subjects in reports to the U.S. Securities and Exchange Commission.

MetLife, Inc.
GAAP Interim Condensed Consolidated Statements of Operations
(Unaudited)
(In millions)

For the Three Months Ended

March 31,
2019 2018
Revenues
Premiums $ 9,405 $ 9,178
Universal life and investment-type product policy fees 1,365 1,392
Net investment income 4,908 3,745
Other revenues 494 474
Net investment gains (losses) 15 (333 )
Net derivative gains (losses) 115 349
Total revenues 16,302 14,805
.
Expenses
Policyholder benefits and claims 9,072 8,718
Interest credited to policyholder account balances 1,961 769
Policyholder dividends 300 297
Capitalization of DAC (812 ) (796 )
Amortization of DAC and VOBA 624 693
Amortization of negative VOBA (10 ) (22 )
Interest expense on debt 234 286
Other expenses 3,189 3,204
Total expenses 14,558 13,149
Income (loss) from continuing operations before provision for income tax 1,744 1,656
Provision for income tax expense (benefit) 359 399
Income (loss) from continuing operations, net of income tax 1,385 1,257
Income (loss) from discontinued operations, net of income tax
Net income (loss) 1,385 1,257
Less: Net income (loss) attributable to noncontrolling interests 4 4
Net income (loss) attributable to MetLife, Inc. 1,381 1,253
Less: Preferred stock dividends 32 6
Net income (loss) available to MetLife, Inc.'s common shareholders $ 1,349 $ 1,247
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(In millions, except per share data)
For the Three Months Ended
March 31,
2019 2018
Reconciliation to Adjusted Earnings Available to Common Shareholders

Earnings Per
Weighted Average
Common Share Diluted (1)

Earnings Per
Weighted Average
Common Share Diluted (1)

Net income (loss) available to MetLife, Inc.'s common shareholders $ 1,349 $ 1.40 $ 1,247 $ 1.19
Adjustments from net income (loss) available to common shareholders to adjusted earnings available to common shareholders:
Less: Net investment gains (losses) 15 0.02 (333 ) (0.32 )
Net derivative gains (losses) 115 0.12 349 0.33
Premiums
Universal life and investment-type product policy fees 27 0.03 32 0.03
Net investment income 627 0.65 (474 ) (0.44 )
Other revenues 70 0.07 83 0.08
Policyholder benefits and claims and policyholder dividends (131 ) (0.14 ) (47 ) (0.05 )
Interest credited to policyholder account balances (713 ) (0.74 ) 348 0.33
Capitalization of DAC 1
Amortization of DAC and VOBA 31 0.03 4
Amortization of negative VOBA 1
Interest expense on debt
Other expenses (88 ) (0.09 ) (94 ) (0.09 )
Goodwill impairment
Provision for income tax (expense) benefit (24 ) (0.03 ) (42 ) (0.04 )
Income (loss) from discontinued operations, net of income tax
Add: Net income (loss) attributable to noncontrolling interests 4 4
Adjusted earnings available to common shareholders 1,424 1.48 1,423 1.36
Less: Total notable items (2) (55 ) (0.06 ) 28 0.03
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 1,479 $ 1.54 $ 1,395 $ 1.34
Adjusted earnings available to common shareholders on a constant currency basis $ 1,424 $ 1.48 $ 1,396 $ 1.34
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2) $ 1,479 $ 1.54 $ 1,368 $ 1.31
Weighted average common shares outstanding - diluted 963.3 1,044.4
See footnotes on last page.

MetLife, Inc.
(Unaudited)
(In millions)
For the Three Months Ended
March 31,
2019 2018
Premiums, Fees and Other Revenues
Premiums, fees and other revenues $ 11,264 $ 11,044
Less: Unearned revenue adjustments (5 )
GMIB fees 27 30
Settlement of foreign currency earnings hedges 2 4
TSA fees 68 79
Divested businesses 7
Adjusted premiums, fees and other revenues $ 11,167 $ 10,929
Net Investment Income
Net investment income $ 4,908 $ 3,745
Less: Investment hedge adjustments (105 ) (110 )
Operating joint venture adjustments 1
Unit-linked contract income 736 (353 )
Securitization entities income
Certain partnership distributions (4 ) (12 )
Divested businesses
Net investment income, as reported on an adjusted basis $ 4,281 $ 4,219
Revenues and Expenses
Total revenues $ 16,302 $ 14,805
Less: Net investment gains (losses) 15 (333 )
Less: Net derivative gains (losses) 115 349
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses) (5 )
Less: Other adjustments to revenues:
GMIB fees 27 30
Investment hedge adjustments (105 ) (110 )
Operating joint venture adjustments 1
Unit-linked contract income 736 (353 )
Securitization entities income
Settlement of foreign currency earnings hedges 2 4
Certain partnership distributions (4 ) (12 )
TSA fees 68 79
Divested businesses 7
Total adjusted revenues $ 15,448 $ 15,148
Total expenses $ 14,558 $ 13,149
Less: Adjustments related to net investment (gains) losses and net derivative (gains) losses (24 ) (14 )
Less: Goodwill impairment
Less: Other adjustments to expenses:
Inflation and pass-through adjustments 79 41
GMIB costs and amortization of DAC and VOBA related to GMIB fees and GMIB costs 49 15
Market value adjustments and amortization of DAC, VOBA and negative VOBA related to market value adjustments (4 )
PAB hedge adjustments (3 ) (1 )
Unit-linked contract costs 716 (347 )
Securitization entities debt expense
Noncontrolling interest (6 ) (7 )
Regulatory implementation costs 3 1
Acquisition, integration and other costs 23 11
TSA fees 68 79
Divested businesses 9
Total adjusted expenses $ 13,657 $ 13,362
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(In millions, except per share and ratio data)
March 31,
Book Value (3) 2019 2018
Book value per common share $ 58.06 $ 52.49
Less: Net unrealized investment gains (losses), net of income tax 14.59 11.28
Defined benefit plans adjustment, net of income tax (2.11 ) (2.15 )
Book value per common share, excluding AOCI other than FCTA 45.58 43.36
Less: Goodwill, net of income tax 9.56 9.20
VODA and VOCRA, net of income tax 0.31 0.36
Book value per common share - tangible common stockholders' equity $ 35.71 $ 33.80
Common shares outstanding, end of period 950.2 1,024.1
For the Three Months Ended
March 31,
Expense Detail and Ratios 2019 2018
Reconciliation of Capitalization of DAC to Capitalization of DAC, as reported on an adjusted basis.
Capitalization of DAC $ (812 ) $ (796 )
Less: Divested businesses (1 )
Capitalization of DAC, as reported on an adjusted basis $ (812 ) $ (795 )
Reconciliation of Other Expenses to Other Expenses, as reported on an adjusted basis
Other expenses $ 3,189 $ 3,204
Less: Noncontrolling interest (6 ) (7 )
Less: Regulatory implementation costs 3 1
Less: Acquisition, integration and other costs 23 11
Less: TSA fees 68 79
Less: Divested businesses 10
Other expenses, as reported on an adjusted basis $ 3,101 $ 3,110
Other detail and ratios
Other expenses $ 3,189 $ 3,204
Capitalization of DAC (812 ) (796 )
Other expenses, net of capitalization of DAC $ 2,377 $ 2,408
Premiums, fees and other revenues $ 11,264 $ 11,044
Expense ratio 21.1 % 21.8 %
Direct expenses $ 1,420 $ 1,462
Less: Total notable items related to direct expenses 70 43
Direct expenses, excluding total notable items related to direct expenses $ 1,350 $ 1,419
Other expenses, as reported on an adjusted basis $ 3,101 $ 3,110
Capitalization of DAC, as reported on an adjusted basis (812 ) (795 )
Other expenses, net of capitalization of DAC, as reported on an adjusted basis 2,289 2,315
Less: Total notable items related to other expenses, as reported on an adjusted basis 70 43
Other expenses, net of capitalization of DAC, excluding total notable items related to other expenses, as reported on an adjusted basis $ 2,219 $ 2,272
Adjusted premiums, fees and other revenues $ 11,167 $ 10,929
Less: Pension risk transfer (PRT) (2 )
Adjusted premiums, fees and other revenues, excluding PRT $ 11,169 $ 10,929
Direct expense ratio 12.7 % 13.4 %
Direct expense ratio, excluding total notable items related to direct expenses and PRT 12.1 % 13.0 %
Adjusted expense ratio 20.5 % 21.2 %
Adjusted expense ratio, excluding total notable items related to other expenses and PRT 19.9 % 20.8 %
See footnotes on last page.
MetLife, Inc.
(Unaudited)
For the Three Months Ended
March 31, (4)
Return on Equity 2019 2018
Return on MetLife, Inc.'s:
Common stockholders' equity 10.3 % 9.0 %
Common stockholders' equity, excluding AOCI other than FCTA 12.5 % 11.2 %
Tangible common stockholders' equity 16.2 % 14.4 %
Adjusted return on MetLife, Inc.'s:
Common stockholders' equity 10.9 % 10.3 %
Common stockholders' equity, excluding AOCI other than FCTA 13.2 % 12.8 %
Common stockholders' equity, excluding total notable items (excludes AOCI other than FCTA) (2) 13.7 % 12.4 %
Tangible common stockholders' equity 17.1 % 16.4 %
Tangible common stockholders' equity, excluding total notable items (2) 17.7 % 16.0 %
Adjusted Return on Allocated Equity:
U.S. 27.0 % 24.1 %
Asia 10.0 % 9.2 %
Latin America 18.1 % 17.8 %
EMEA 12.3 % 9.3 %
MetLife Holdings 13.2 % 16.9 %
Adjusted Return on Allocated Tangible Equity:
U.S. 30.7 % 27.9 %
Asia 15.2 % 13.9 %
Latin America 29.9 % 29.8 %
EMEA 22.1 % 15.3 %
MetLife Holdings 14.8 % 19.0 %
See footnotes on last page.
MetLife, Inc.
Adjusted Earnings Available to Common Shareholders
(Unaudited)
(In millions)
For the Three Months Ended
March 31,
2019 2018
U.S. (5):
Adjusted earnings available to common shareholders $ 724 $ 653
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 724 $ 653
Adjusted premiums, fees and other revenues $ 6,058 $ 5,679
Less: PRT (2 )
Adjusted premiums, fees and other revenues, excluding PRT $ 6,060 $ 5,679
Group Benefits (5):
Adjusted earnings available to common shareholders $ 342 $ 218
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 342 $ 218
Retirement & Income Solutions (5):
Adjusted earnings available to common shareholders $ 285 $ 339
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 285 $ 339
Adjusted premiums, fees and other revenues $ 609 $ 371
Less: PRT (2 )
Adjusted premiums, fees and other revenues, excluding PRT $ 611 $ 371
Property & Casualty (5):
Adjusted earnings available to common shareholders $ 97 $ 96
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 97 $ 96
See footnotes on last page.
MetLife, Inc.
Adjusted Earnings Available to Common Shareholders (Continued)
(Unaudited)
(In millions)
For the Three Months Ended
March 31,
2019 2018
Asia:
Adjusted earnings available to common shareholders $ 356 $ 327
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 356 $ 327
Adjusted earnings available to common shareholders on a constant currency basis $ 356 $ 316
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2) $ 356 $ 316
Latin America:
Adjusted earnings available to common shareholders $ 134 $ 140
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 134 $ 140
Adjusted earnings available to common shareholders on a constant currency basis $ 134 $ 135
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2) $ 134 $ 135
EMEA:
Adjusted earnings available to common shareholders $ 86 $ 81
Less: Total notable items (2)
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 86 $ 81
Adjusted earnings available to common shareholders on a constant currency basis $ 86 $ 70
Adjusted earnings available to common shareholders, excluding total notable items, on a constant currency basis (2) $ 86 $ 70
MetLife Holdings (5):
Adjusted earnings available to common shareholders $ 317 $ 425
Less: Total notable items (2) 62
Adjusted earnings available to common shareholders, excluding total notable items (2) $ 317 $ 363
Corporate & Other (5):
Adjusted earnings available to common shareholders $ (193 ) $ (203 )
Less: Total notable items (2) (55 ) (34 )
Adjusted earnings available to common shareholders, excluding total notable items (2) $ (138 ) $ (169 )
See footnotes on last page.
MetLife, Inc.
(Unaudited)
(1) Adjusted earnings available to common shareholders is calculated on a standalone basis and may not equal the sum of (i) adjusted earnings available to common shareholders, excluding total notable items and (ii) total notable items.
(2) Notable items reflect the unexpected impact of events that affect MetLife’s results, but that were unknown and that MetLife could not anticipate when it devised its Business Plan. Notable items also include certain items regardless of the extent anticipated in the Business Plan to help investors have a better understanding of MetLife's results and to evaluate and forecast those results. Notable items can affect MetLife’s results either positively or negatively.
(3) Book values exclude $3,340 million and $2,560 million of equity related to preferred stock at March 31, 2019 and 2018, respectively.
(4) Annualized using quarter-to-date results.
(5) Results on a constant currency basis are not included as constant currency impact is not significant.

For Media: Ashia Razzaq

MetLife

(212) 578-1538

For Investors: John Hall

MetLife

(212) 578-7888

Source: MetLife, Inc.

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