National Western Life Announces Fourth Quarter and 2004 Earnings
07 Marzo 2005 - 7:41PM
PR Newswire (US)
National Western Life Announces Fourth Quarter and 2004 Earnings
AUSTIN, Texas, March 7 /PRNewswire-FirstCall/ -- Ross R. Moody,
President of National Western Life Insurance Company
(NASDAQ:NWLIA), announced today fourth quarter 2004 consolidated
net earnings of $18.8 million, or $5.22 per diluted share, versus
consolidated net earnings of $18.5 million, or $5.17 per diluted
share, reported for the fourth quarter of 2003. For the year ended
December 31, 2004, the Company reported consolidated net earnings
of $122.2 million, or $33.91 per diluted share, compared with $55.8
million, or $15.64 per diluted share, reported a year ago. The 2004
results include the effect of a required change in accounting for
certain annuity contracts during the first quarter of the year
which increased reported net earnings by $54.7 million, or $15.18
per diluted share. The Company's book value per share at December
31, 2004 increased to $225.62. Earnings from operations, excluding
net realized gains and losses on investments(1), totaled $17.8
million, or $4.94 per diluted share, for the fourth quarter ended
December 31, 2004, compared with $16.3 million, or $4.54 per
diluted share, for the quarter ended December 31, 2003. For the
full year, earnings from operations were $65.2 million, or $18.10
per diluted share, versus $56.9 million, or $15.94 per diluted
share, for the year ended December 31, 2003. Mr. Moody noted the
operating results for 2004 represented a record outcome for the
Company. "In 2004, we continued to follow our core strategy of
building the underlying value of National Western through
controlled, profitable growth. While operating revenues increased
approximately 12%, our operating earnings increased by nearly 15%."
Mr. Moody pointed toward the 18% growth in book value per share
during 2004 as indicative of the increase in the intrinsic value of
the Company. Mr. Moody observed that although the Company's annuity
sales(2) in 2004 of $895 million trailed the record set in 2003 of
$1.2 billion, the Company's sales levels were in line with
expectations. "During the past year, we communicated with many
interested stakeholders, including rating agencies, our intention
of maintaining the profit criteria of our products at desired
levels of production. The annuity sales levels achieved in 2004 fit
squarely in the range that we had targeted for the year." Sales of
life insurance products(2) in 2004 matched levels achieved in 2003.
Mr. Moody indicated that 2004 domestic life insurance sales were
the highest since 2001 and international life sales in the month of
December set a Company record. "The economic environment continues
to be difficult for the sale of life insurance products but we are
able to capitalize on our advantages in certain niches to either
maintain our sales levels or increase them." Mr. Moody added that
the Company achieved record sales levels for both its domestic
equity-indexed annuity products and its international
equity-indexed life insurance product. The Company's investment
performance as measured by net investment income, excluding
derivative income(3), totaled $303.8 million for the year ended
December 31, 2004, compared to $273.2 million in the same period of
2003. Mr. Moody noted that the overall quality of the Company's
fixed income portfolio continued to strengthen from the poor credit
climate that existed in 2001 through 2003. The Company reported
realized investment gains, net of taxes, of $2.3 million, or $0.63
per diluted share, for the full year of 2004 compared to net
realized investment losses of $1.1 million, or $0.30 per diluted
share, during 2003. At December 31, 2004, the Company maintained
total stockholders' equity of $809 million, assets of $6.0 billion,
and life insurance in force of $13.8 billion. (1) The Company views
earnings from operations, a non-GAAP financial measure, as an
important indicator of financial performance. Presented in
conjunction with net earnings, the combined presentation can
enhance an investor's understanding of the Company's underlying
profitability and results from ongoing operations. The definition
of earnings from operations, as presented in this press release,
excludes net realized investment gains and losses after tax. A
reconciliation of earnings from operations to net earnings has been
included as part of this press release. (2) Sales for a life
insurance company are a non-GAAP financial measure. Sales as shown
in this press release are presented in accordance with industry
practice and represent the amount of new business sold during the
period. The Company believes sales are a useful measure of
distribution productivity and are also a leading indicator of
future revenue trends. There is no comparable GAAP financial
measure and, as a result, no reconciliation is provided. (3) The
Company considers net investment income, excluding derivative
income, a useful measurement of the Company's underlying investment
portfolio performance by removing the volatility from changes in
fair values of derivative instruments. As net investment income,
excluding derivative income, is considered a non-GAAP financial
measure, the following reconciliation is provided. ($'s in
millions) Three Months Ended Twelve Months Ended December 31,
December 31, 2004 2003 2004 2003 Net investment income $102.8 94.2
315.8 299.0 Derivative income 22.3 19.1 12.0 25.8 Net investment
income excluding derivative income $80.5 75.1 303.8 273.2 Summary
of Consolidated Operating Results (In thousands except per share
data) Three Months Ended Twelve Months Ended December 31, December
31, 2004 2003 2004 2003 Revenues: Revenues, excluding realized
investment gains (losses) and derivative income $108,222 101,852
418,652 375,116 Derivative income 22,345 19,140 11,988 25,799
Realized gains (losses) on investments 1,544 3,416 3,506 (1,647)
Total revenues $132,111 124,408 434,146 399,268 Earnings: Earnings
from operations $17,845 16,313 65,194 56,852 Net realized gains
(losses) on investments 1,004 2,221 2,278 (1,070) Cumulative effect
of a change in accounting principle --- --- 54,697 --- Net earnings
$18,849 18,534 122,169 55,782 Basic Earnings Per Share: Earnings
from operations $4.99 4.60 18.29 16.08 Net realized gains (losses)
on investments 0.28 0.63 0.64 (0.30) Cumulative effect of a change
in accounting principle --- --- 15.34 --- Net earnings $5.27 5.23
34.27 15.78 Basic Weighted Average Shares 3,580 3,547 3,565 3,535
Diluted Earnings Per Share: Earnings from operations $4.94 4.54
18.10 15.94 Net realized gains (losses) on investments 0.28 0.63
0.63 (0.30) Cumulative effect of a change in accounting principle
--- --- 15.18 --- Net earnings $5.22 5.17 33.91 15.64 Diluted
Weighted Average Shares 3,613 3,589 3,603 3,565 Investor Relations
Contact: Brian M. Pribyl Senior Vice President Chief Financial
& Administrative Officer (512) 719-2493 DATASOURCE: National
Western Life Insurance Company CONTACT: Brian M. Pribyl, Senior
Vice President, Chief Financial & Administrative Officer of
National Western Life Insurance Company, +1-512-719-2493, or Web
site: http://www.nationalwesternlife.com/
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