- Results demonstrate strong balance sheet and resilient
business model; economic management and fair value hedging support
440% combined RBC ratio, above 375-400% target
- Net income of $1.7bn; Net income per share of $4.47
- Non-GAAP operating earnings1 of $526m, or $1.31 per share;
adjusting for notable items2, Non-GAAP operating earnings of $531m,
or $1.33 per share
- Equitable Financial upstreamed a $0.9bn dividend to Holdings
in July
- AB completed acquisition of Carval Investors, expanding
Private Markets AUM to $54bn
Equitable Holdings, Inc. (“Equitable Holdings”, “Holdings”, or
the “Company”) (NYSE: EQH) today announced financial results for
the second quarter ended June 30, 2022.
“With our resilient business model and fair value hedging
program, we continued to deliver robust results and our balance
sheet remains protected amidst challenging economic conditions and
declining markets. We reported second quarter Non-GAAP operating
earnings of $1.31 per share and the strength of our capital
position was reflected in our combined RBC ratio of 440%, above our
minimum combined target,” said Mark Pearson, President and Chief
Executive Officer.
Mr. Pearson continued, "Importantly, our clients continue to
turn to Equitable and AB for solutions amidst the uncertain market
outlook, evidenced by record sales in our retirement business, and
continued demand for Equitable Advisors and Bernstein Private
Wealth services."
Consolidated Results
Second Quarter
(in millions, except per share amounts or
unless otherwise noted)
2022
2021
Total Assets Under Management (“AUM”, in
billions)
$
754
$
869
Net income (loss) attributable to
Holdings
1,728
123
Net income (loss) attributable to Holdings
per common share
4.47
0.23
Non-GAAP operating earnings (loss)
526
758
Non-GAAP operating earnings (loss) per
common share (“EPS”)
1.31
1.71
As of June 30, 2022, total AUM was $754 billion, a
year-over-year decrease of 13.2% driven by lower markets partially
offset by net inflows over the prior twelve months.
The Net income attributable to Holdings for the second quarter
of 2022 was $1.7 billion compared to $123 million in the second
quarter of 2021 driven primarily by non-economic market impacts
from hedging under U.S. GAAP accounting.
Non-GAAP operating earnings in the second quarter of 2022 was
$526 million compared to $758 million in the second quarter of
2021. Excluding notable items3 of $5 million, second quarter 2022
Non-GAAP operating earnings were $531 million or $1.33 per
share.
As of June 30, 2022, book value per common share, including
accumulated other comprehensive income (“AOCI”), was $10.69. Book
value per common share, excluding AOCI, was $25.41.
Business
Highlights
- Business segment highlights:
- Individual Retirement (“IR”) reported net inflows of $634
million in the quarter, demonstrating the continued demand for our
industry-leading Structured Capital Strategies (“SCS”) buffered
annuity, which offset lower outflows from the legacy VA block in
the quarter.
- Group Retirement (“GR”) reported net inflows of $144 million,
up 42% over prior year, with total premiums of $1.1 billion up 16%
on a year-over-year basis, partially offsetting the impact of
declining markets on account values.
- Investment Management and Research (AllianceBernstein or “AB”)4
reported moderate net outflows of $2.7 billion with taxable fixed
income outflows partially offset by organic growth in municipals,
alternatives/multi-asset and active equities supporting a 2% fee
rate improvement year-over-year.
- Protection Solutions (“PS”) continues to benefit from our
strategic shift to less interest-sensitive VUL with $315 million in
VUL premiums, up 3% over prior year.
- Capital management program:
- The Company continues to deliver on its payout target returning
$295 million in the quarter including $75 million of quarterly cash
dividends and $220 million of share repurchases.
- As of June 30, 2022, the combined RBC ratio was approximately
440%, above our minimum combined RBC target of 375-400%.
- The Company reported cash and liquid assets of $1.3 billion at
Holdings as of quarter end and received a $930 million dividend
from Equitable Financial in July.
- Fair value hedging program targets the Company’s economic
liability while protecting the statutory balance sheet to CTE98 and
maintained c. 95% hedging effectiveness through volatile
markets.
- Delivering long-term shareholder value:
- AB closed the acquisition of CarVal Investors, further
enhancing the Company’s differentiated business model. The
transaction expands AB’s higher-multiple private markets platform
to $54 billion in AUM, which includes $2 billion of additional
funds raised by CarVal Investors since the acquisition announcement
in March.
- Continuing to deliver 8-10% annualized EPS growth supported by
the Company’s General Account rebalancing efforts, realizing $141
million of $180 million incremental investment income target to
date, and expense savings of $39 million of $80 million net expense
savings target.
Business Segment
Results
Individual Retirement
(in millions, unless otherwise noted)
Q2 2022
Q2 2021
Account value (in billions)
$
94.3
$
108.4
Segment net
flows
Current Product Offering
1,165
762
Legacy (1)
(532
)
(940
)
Total segment net flows
634
(178
)
Operating earnings (loss)
274
414
(1) Net flows of $(266) million and $(120) million not included
in Q2 2022 and Q2 2021, respectively, as it relates to AV ceded to
Venerable.
- Account value decreased by 13% primarily due to lower markets,
partially offset by record sales leading to record net inflows
since our IPO.
- Net inflows of $634 million increased compared to the second
quarter of 2021 led by net inflows of $1,165 million from our
current product offering of less capital-intensive products, which
was partially offset outflows from the legacy VA block of $(532)
million.
- Operating earnings decreased from $414 million in the prior
year quarter to $274 million, primarily driven by lower fee-type
revenue on lower average account values due to declining markets
and lower net investment income on lower alternative income and
prepayments.
- Operating earnings less notable items5 decreased from $365
million in the prior year quarter to $293 million. Notable items of
$19 million in the current period primarily reflects a net
investment income timing adjustment, partially offset by associated
DAC reactivity, and a one-time expense.
Group Retirement
(in millions, unless otherwise noted)
Q2 2022
Q2 2021
Account value (in billions)
$
41.2
$
46.3
Segment net flows
144
101
Operating earnings (loss)
131
171
- Account value decreased by 11% driven primarily by market
performance over the prior twelve months.
- Net flows of $144 million increased versus the prior year
quarter primarily due to strong inflows in our tax-exempt
market.
- Operating earnings decreased from $171 million to $131 million
versus the prior year quarter, primarily due to lower net
investment income from lower alternatives income and prepayments
and lower fee-type revenue on lower average account values due to
declining markets.
- Operating earnings less notable items5 increased from $154
million in the prior year quarter to $139 million. Notable items of
$8 million in the current period primarily reflects a one-time
expense.
Investment Management and Research
(in millions, unless otherwise noted)
Q2 2022
Q2 2021
Total AUM (in billions)
$
646.8
$
738.4
Segment net flows (in billions)
(2.7
)
6.2
Operating earnings (loss)
101
126
- AUM decreased by 12% due to market performance partially offset
by net inflows over the prior twelve months.
- Second quarter net flows of $(2.7) billion were driven by net
outflows in Retail and Private Wealth channels partially offset by
net inflows in the Institutional channel.
- Operating earnings decreased from $126 million to $101 million,
primarily driven by lower base fees and lower performance fees on
lower average AUM.
Protection Solutions
(in millions)
Q2 2022
Q2 2021
Gross written premiums
$
760
$
748
Annualized premiums
67
67
Operating earnings (loss)
101
63
- Gross written premiums increased 2% year-over-year with
continued success in our strategic shift to less interest-sensitive
VUL accumulation products with first year premiums up 13%
year-over-year.
- Operating earnings increased from $63 million to $101 million
versus the prior year quarter, primarily due to lower mortality and
PFBL reserve accrual partially offset by lower net investment
income from lower alternatives income and prepayments.
- Operating earnings excluding notable items6 increased from $43
million in the prior year quarter to $79 million. Notable items of
$22 million in the current period primarily reflects favorable
mortality partially offset by a one-time expense.
Corporate and Other (“C&O”)
Operating loss of $81 million in the second quarter increased
compared to operating loss of $16 million in the prior year
quarter, primarily driven by lower net investment income from lower
alternatives income and prepayments. Operating loss excluding
notable items6 decreased from $29 million in the prior year quarter
to $81 million.
Exhibit 1: Notable
Items
Notable items represent the impact on results from our annual
actuarial assumption review, approximate impacts attributable to
significant variances from the Company’s expectations, and other
items that the Company believes may not be indicative of future
performance. The Company chooses to highlight the impact of these
items and Non-GAAP measures, less notable items to provide a better
understanding of our results of operations in a given period.
Certain figures may not sum due to rounding.
Impact of notable items by segment and Corporate &
Other:
Three Months Ended June
30,
(in millions)
2022
2021
Non-GAAP Operating Earnings
526
$
758
Post-tax Adjustments related to notable
items:
Individual Retirement
19
(49
)
Group Retirement
8
(17
)
Investment Management and Research
—
—
Protection Solutions
(22
)
(20
)
Corporate & Other
—
(13
)
Notable items subtotal
5
(100
)
Less: impact of actuarial assumption
update
—
—
Non-GAAP Operating Earnings, less Notable
Items
$
531
$
658
Impact of notable items by item category:
Three Months Ended June
30,
(in millions)
2022
2021
Non-GAAP Operating Earnings
526
$
758
Pre-tax adjustments related to Notable
Items:
Actuarial Updates/Reserve
(4
)
—
Mortality
(33
)
—
Expenses
12
—
Net Investment Income
17
(129
)
Subtotal
(8
)
(129
)
Post-tax impact of Notable Items
5
(100
)
Less: impact of actuarial assumption
update
—
—
Non-GAAP Operating Earnings, less Notable
Items
$
531
$
658
Impact of Notable Items by segment and corporate &
other:
Three months ended June 30, 2022
($m)
IR
GR
AB
PS
C&O
Consolidated
Non-GAAP Operating Earnings
274
131
101
101
(81
)
526
Pre-tax adjustments related to Notable
Items:
Actuarial Updates/Reserve
(4
)
—
—
—
(4
)
Mortality
—
—
—
(33
)
—
(33
)
Expenses
4
5
—
3
—
12
Net Investment Income
15
—
—
1
—
17
Pre-tax Subtotal
15
5
—
(29
)
—
(8
)
Tax adjustment
4
2
—
7
(1
)
13
Post-tax impact of Notable
Items
19
8
—
(22
)
—
5
Impact of Actuarial Assumption Update
—
—
—
—
—
—
Non-GAAP Operating Earnings, less
Notable Items
293
139
101
79
(81
)
531
Three months ended June 30, 2021 ($m)
IR
GR
AB
PS
C&O
Consolidated
Non-GAAP Operating Earnings
414
171
126
63
(16
)
758
Pre-tax adjustments related to Notable
Items:
Actuarial Updates/Reserve
—
—
—
—
—
—
Mortality
—
—
—
—
—
—
Expenses
—
—
—
—
—
—
Net Investment Income
(62
)
(22
)
—
(24
)
(20
)
(128
)
Pre-tax Subtotal
(62
)
(22
)
—
(24
)
(20
)
(128
)
Tax adjustment
13
5
—
4
8
30
Post-tax impact of Notable
Items
(49
)
(17
)
—
(20
)
(13
)
(100
)
Impact of Actuarial Assumption Update
—
—
—
—
—
—
Non-GAAP Operating Earnings, less
Notable Items
365
154
126
43
(29
)
658
Earnings Conference Call
Equitable Holdings will host a conference call at 8 a.m. ET
August 4, 2022 to discuss its second quarter 2022 results. The
conference call webcast, along with additional earnings materials
will be accessible on the company’s investor relations website at
ir.equitableholdings.com. Please log on to the webcast at least 15
minutes prior to the call to download and install any necessary
software.
To register for the conference call, please use the following
link: EQH Second Quarter 2022 Earnings Call
After registering, you will receive an email confirmation
including dial in details and a unique conference call code for
entry. Registration is open through the live call. To ensure you
are connected for the full call we suggest registering a day in
advance or at minimum 10 minutes before the start of the call.
A webcast replay will be made available on the Equitable
Holdings Investor Relations website at
ir.equitableholdings.com.
About Equitable Holdings
Equitable Holdings, Inc. (NYSE: EQH) is a financial services
holding company comprised of two complementary and well-established
principal franchises, Equitable and AllianceBernstein. Founded in
1859, Equitable provides advice, protection and retirement
strategies to individuals, families and small businesses.
AllianceBernstein is a global investment management firm that
offers high-quality research and diversified investment services to
institutional investors, individuals and private wealth clients in
major world markets. Equitable Holdings has approximately 12,000
employees and financial professionals, $754 billion in assets under
management (as of 6/30/2022) and more than 5 million client
relationships globally.
Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as “expects,” “believes,” “anticipates,”
“intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,”
“projects,” “should,” “would,” “could,” “may,” “will,” “shall” or
variations of such words are generally part of forward-looking
statements. Forward-looking statements are made based on
management’s current expectations and beliefs concerning future
developments and their potential effects upon Equitable Holdings,
Inc. (“Holdings”) and its consolidated subsidiaries. “We,” “us” and
“our” refer to Holdings and its consolidated subsidiaries, unless
the context refers only to Holdings as a corporate entity. There
can be no assurance that future developments affecting Holdings
will be those anticipated by management. Forward-looking statements
include, without limitation, all matters that are not historical
facts.
These forward-looking statements are not a guarantee of future
performance and involve risks and uncertainties, and there are
certain important factors that could cause actual results to
differ, possibly materially, from expectations or estimates
reflected in such forward-looking statements, including, among
others: (i) conditions in the financial markets and economy,
including the impact of COVID-19 and related economic conditions,
equity market declines and volatility, interest rate fluctuations,
impacts on our goodwill and changes in liquidity and access to and
cost of capital; (ii) operational factors, including reliance on
the payment of dividends to Holdings by its subsidiaries,
protection of confidential customer information or proprietary
business information, operational failures by us or our service
providers, and catastrophic events, such as the outbreak of
pandemic diseases including COVID-19; (iii) credit, counterparties
and investments, including counterparty default on derivative
contracts, failure of financial institutions, defaults by third
parties and affiliates and economic downturns, defaults and other
events adversely affecting our investments; (iv) our reinsurance
and hedging programs; (v) our products, structure and product
distribution, including variable annuity guaranteed benefits
features within certain of our products, variations in statutory
capital requirements, financial strength and claims-paying ratings,
state insurance laws limiting the ability of our insurance
subsidiaries to pay dividends and key product distribution
relationships; (vi) estimates, assumptions and valuations,
including risk management policies and procedures, potential
inadequacy of reserves and experience differing from pricing
expectations, amortization of deferred acquisition costs and
financial models; (vii) our Investment Management and Research
segment, including fluctuations in assets under management and the
industry-wide shift from actively-managed investment services to
passive services; (viii) legal and regulatory risks, including
federal and state legislation affecting financial institutions,
insurance regulation and tax reform; (ix) risks related to our
common stock and (x) general risks, including strong industry
competition, information systems failing or being compromised and
protecting our intellectual property.
Forward-looking statements should be read in conjunction with
the other cautionary statements, risks, uncertainties and other
factors identified in Holdings’ filings with the Securities and
Exchange Commission. Further, any forward-looking statement speaks
only as of the date on which it is made, and we undertake no
obligation to update or revise any forward-looking statement to
reflect events or circumstances after the date on which the
statement is made or to reflect the occurrence of unanticipated
events, except as otherwise may be required by law.
Use of Non-GAAP Financial Measures
In addition to our results presented in accordance with U.S.
GAAP, we report Non-GAAP Operating Earnings, Non-GAAP Operating
EPS, and Book Value per common share, excluding AOCI, each of which
is a measure that is not determined in accordance with U.S. GAAP.
Management principally uses these non-GAAP financial measures in
evaluating performance because they present a clearer picture of
our operating performance and they allow management to allocate
resources. Similarly, management believes that the use of these
Non-GAAP financial measures, together with relevant U.S. GAAP
measures, provide investors with a better understanding of our
results of operations and the underlying profitability drivers and
trends of our business. These non-GAAP financial measures are
intended to remove from our results of operations the impact of
market changes (where there is mismatch in the valuation of assets
and liabilities) as well as certain other expenses which are not
part of our underlying profitability drivers or likely to re-occur
in the foreseeable future, as such items fluctuate from
period-to-period in a manner inconsistent with these drivers. These
measures should be considered supplementary to our results that are
presented in accordance with U.S. GAAP and should not be viewed as
a substitute for the U.S. GAAP measures. Other companies may use
similarly titled non-GAAP financial measures that are calculated
differently from the way we calculate such measures. Consequently,
our non-GAAP financial measures may not be comparable to similar
measures used by other companies.
We also discuss certain operating measures, including AUM, AV,
and certain other operating measures, which management believes
provide useful information about our businesses and the operational
factors underlying our financial performance.
Non-GAAP Operating Earnings
Non-GAAP Operating Earnings is an after-tax non-GAAP financial
measure used to evaluate our financial performance on a
consolidated basis that is determined by making certain adjustments
to our consolidated after-tax net income attributable to Holdings.
The most significant of such adjustments relates to our derivative
positions, which protect economic value and statutory capital, and
are more sensitive to changes in market conditions than the
variable annuity product liabilities as valued under U.S. GAAP.
This is a large source of volatility in net income.
Non-GAAP Operating Earnings equals our consolidated after-tax
net income attributable to Holdings adjusted to eliminate the
impact of the following items:
- Items related to variable annuity product features, which
include: (i) certain changes in the fair value of the derivatives
and other securities we use to hedge these features; (ii) the
effect of benefit ratio unlock adjustments, including extraordinary
economic conditions or events such as COVID-19; (iii) changes in
the fair value of the embedded derivatives reflected within
variable annuity products’ net derivative results and the impact of
these items on DAC amortization on our SCS product; and (iv) DAC
amortization for the SCS variable annuity product arising from
near-term fluctuations in index segment returns;
- Investment (gains) losses, which includes credit loss
impairments of securities/investments, sales or disposals of
securities/investments, realized capital gains/losses and valuation
allowances;
- Net actuarial (gains) losses, which includes actuarial gains
and losses as a result of differences between actual and expected
experience on pension plan assets or projected benefit obligation
during a given period related to pension, other postretirement
benefit obligations, and the one-time impact of the settlement of
the defined benefit obligation;
- Other adjustments, which primarily include restructuring costs
related to severance and separation, COVID-19 related impacts, net
derivative gains (losses) on certain Non-GMxB derivatives, net
investment income from certain items including consolidated VIE
investments, seed capital mark-to-market adjustments, unrealized
gain/losses associated with equity securities, certain legal
accruals; and a bespoke deal to repurchase UL policies from one
entity that had invested in numerous policies purchased in the life
settlement market, which disposed of the risk of additional COI
litigation by that entity related to those UL policies; and
- Income tax expense (benefit) related to the above items and
non-recurring tax items, which includes the effect of uncertain tax
positions for a given audit period.
Because Non-GAAP operating earnings excludes the foregoing items
that can be distortive or unpredictable, management believes that
this measure enhances the understanding of the Company’s underlying
drivers of profitability and trends in our business, thereby
allowing management to make decisions that will positively impact
our business.
We use the prevailing corporate federal income tax rate of 21%
while taking into account any non-recurring differences for events
recognized differently in our financial statements and federal
income tax returns as well as partnership income taxed at lower
rates when reconciling Net income (loss) attributable to Holdings
to Non-GAAP operating earnings.
The table below presents a reconciliation of Net income (loss)
attributable to Holdings to Non-GAAP Operating Earnings for the
three months and six months ended June 30, 2022 and 2021:
Three Months Ended June
30,
Six Months Ended June
30,
(in millions)
2022
2021
2022
2021
Net income (loss) attributable to
Holdings
$
1,728
$
123
$
2,301
$
(1,365
)
Adjustments related to:
Variable annuity product features
(1,924
)
1,193
(2,525
)
3,460
Investment (gains) losses
231
(420
)
557
(603
)
Net actuarial (gains) losses related to
pension and other postretirement benefit obligations
19
26
38
60
Other adjustments (1) (2) (3)
148
7
368
531
Income tax expense (benefit) related to
above adjustments
321
(171
)
329
(726
)
Non-recurring tax items
3
—
6
1
Non-GAAP Operating Earnings
$
526
$
758
$
1,074
$
1,358
_______________
(1) Includes Separation Costs of $16 million and $37
million for the three months and six months ended June 30, 2021,
respectively. Separation costs were completed during 2021.
(2) Includes certain gross legal expenses related to the cost of
insurance litigation of $107 million and $0 million, $166 million
and $180 million for the three and six months ended June 30, 2022
and 2021, respectively. Includes policyholder benefit costs of $0
million and $75 million for the three and six months ended June 30,
2022 stemming from a deal to repurchase UL policies from one entity
that had invested in numerous policies purchased in the life
settlement market.
(3) Includes Non-GMxB related derivative hedge losses of ($38)
million, ($100) million, ($40) million and $144 million for the
three and six months ended June 30, 2022 and 2021,
respectively.
Non-GAAP Operating EPS
Non-GAAP Operating Earnings per common share is calculated by
dividing Non-GAAP Operating Earnings less preferred dividends by
diluted common shares outstanding. The table below presents a
reconciliation of GAAP EPS to Non-GAAP Operating EPS for the three
months and six months ended June 30, 2022 and 2021.
Three Months Ended June
30,
Six Months Ended June
30,
(per share amounts)
2022
2021
2022
2021
Net income (loss) attributable to Holdings
(1)
$
4.54
$
0.29
$
5.96
$
(3.18
)
Less: Preferred stock dividend
0.07
0.06
0.10
0.09
Net Income (loss) available to common
shareholders
4.47
0.23
5.86
(3.27
)
Adjustments related to:
Variable annuity product features
(5.06
)
2.79
(6.54
)
8.06
Investment (gains) losses
0.61
(0.98
)
1.44
(1.41
)
Net actuarial (gains) losses related to
pension and other postretirement benefit obligations
0.05
0.06
0.10
0.14
Other adjustments (2) (3) (4)
0.39
0.01
0.95
1.24
Income tax expense (benefit) related to
above adjustments
0.84
(0.40
)
0.85
(1.69
)
Non-recurring tax items
0.01
—
0.02
—
Non-GAAP Operating Earnings
$
1.31
$
1.71
$
2.68
$
3.07
_______________
(1) For periods presented with a net loss, basic shares are used
for EPS .
(2) Includes separation costs of $0.04 and $0.09 for the three
months and six months ended June 30, 2021, respectively.
(3) Includes certain gross legal expenses related to the cost of
insurance litigation of $107 million and $0 million, $166 million
and $180 million for the three and six months ended June 30, 2022
and 2021, respectively. Includes policyholder benefit costs of $0
million and $75 million for the three and six months ended June 30,
2022 stemming from a deal to repurchase UL policies from one entity
that had invested in numerous policies purchased in the life
settlement market. The legal accruals impact per common share is
$0.28 and $0.00, $0.43 and $0.42 for the three and six months ended
June 30, 2022 and 2021. No adjustments were made to prior period
non-GAAP operating EPS as the impact was immaterial.
(4) Includes Non-GMxB related derivative hedge losses of
($0.10), ($0.23), ($0.09) and $0.34 for the three and six months
ended June 30, 2022 and 2021, respectively.
Book Value per common share, excluding AOCI
We use the term “book value” to refer to total equity
attributable to Holdings’ common shareholders. Book Value per
common share, excluding AOCI, is our total equity attributable to
Holdings, excluding AOCI and preferred stock, divided by ending
common shares outstanding.
June 30,
2022
December 31,
2021
Book value per common share
$
10.69
$
25.45
Per share impact of AOCI
14.72
(5.12
)
Book Value per common share, excluding
AOCI
$
25.41
$
20.33
Other Operating Measures
We also use certain operating measures which management believes
provide useful information about our businesses and the operational
factors underlying our financial performance.
Account Value (“AV”)
Account value generally equals the aggregate policy account
value of our retirement products.
Assets Under Management (“AUM”)
AUM means investment assets that are managed by one of our
subsidiaries and includes: (i) assets managed by AB, (ii) the
assets in our general account investment portfolio and (iii) the
separate account assets of our Individual Retirement, Group
Retirement and Protection Solutions businesses. Total AUM reflects
exclusions between segments to avoid double counting.
Segment net flows
Net change in segment customer account balances in a period
including, but not limited to, gross premiums, surrenders,
withdrawals and benefits. It excludes investment performance,
interest credited to customer accounts and policy charges.
Consolidated
Statements of Income (Loss) (Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in millions)
REVENUES
Policy charges and fee income
$
813
$
939
$
1,653
$
1,888
Premiums
238
241
485
499
Net derivative gains (losses)
2,229
(1,199
)
3,050
(3,745
)
Net investment income (loss)
711
1,033
1,515
1,917
Investment gains (losses), net:
Credit losses on available-for-sale debt
securities and loans
(9
)
5
1
6
Other investment gains (losses), net
(223
)
415
(559
)
598
Total investment gains (losses), net
(232
)
420
(558
)
604
Investment management and service fees
1,197
1,318
2,552
2,575
Other income
212
198
415
365
Total revenues
5,168
2,950
9,112
4,103
BENEFITS AND OTHER DEDUCTIONS
Policyholders’ benefits
914
828
1,974
1,767
Interest credited to policyholders’
account balances
309
309
624
600
Compensation and benefits
518
568
1,113
1,148
Commissions and distribution-related
payments
394
397
816
779
Interest expense
50
51
97
125
Amortization of deferred policy
acquisition costs
160
106
341
193
Other operating costs and expenses
583
447
1,120
1,055
Total benefits and other deductions
2,928
2,706
6,085
5,667
Income (loss) from continuing operations,
before income taxes
2,240
244
3,027
(1,564
)
Income tax (expense) benefit
(467
)
(21
)
(615
)
387
Net income (loss)
1,773
223
2,412
(1,177
)
Less: Net income (loss) attributable to
the noncontrolling interest
45
100
111
188
Net income (loss) attributable to
Holdings
1,728
123
2,301
(1,365
)
Less: Preferred stock dividends
26
26
40
39
Net income (loss) available to Holdings’
common shareholders
$
1,702
$
97
$
2,261
$
(1,404
)
Earnings Per Common
Share
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in millions)
Earnings per common share
Basic
$
4.49
$
0.23
$
5.89
$
(3.27
)
Diluted
$
4.47
$
0.23
$
5.86
$
(3.27
)
Weighted average shares
Weighted average common stock outstanding
for basic earnings per common share
378.9
424.2
383.7
429.2
Weighted average common stock outstanding
for diluted earnings per common share (1)
380.6
428.3
386.1
429.2
(1) Due to net loss for the six months ended June 30, 2021
approximately 3.9 million share awards were excluded from the
diluted EPS calculation.
Results of Operations
by Segment
Three Months Ended June
30,
Six Months Ended June
30,
2022
2021
2022
2021
(in millions)
Operating earnings (loss) by
segment:
Individual Retirement
$
274
$
414
$
567
$
777
Group Retirement
131
171
281
322
Investment Management and Research
101
126
237
247
Protection Solutions
101
63
136
104
Corporate and Other (1)
(81
)
(16
)
(147
)
(92
)
Non-GAAP Operating Earnings
$
526
$
758
$
1,074
$
1,358
(1) Includes interest expense and financing fees of $52 million,
$57 million, $105 million and $115 million for the three and six
months ended June 30, 2022,and 2021 respectively.
Select Balance Sheet
Statistics
June 30, 2022
December 31, 2021
(in millions)
ASSETS
Total investments and cash and cash
equivalents
$
98,325
$
110,299
Separate Accounts assets
116,765
147,306
Total assets
253,482
292,262
LIABILITIES
Short-term and long-term debt
$
4,085
$
3,931
Future policy benefits and other
policyholders' liabilities
34,717
36,717
Policyholders’ account balances
78,766
79,357
Total liabilities
246,135
278,699
EQUITY
Preferred stock
1,562
1,562
Accumulated other comprehensive income
(loss)
(5,548
)
2,004
Total equity attributable to Holdings
$
5,589
$
11,519
Total equity attributable to Holdings'
common shareholders (ex. AOCI)
9,575
7,953
Assets Under
Management (Unaudited)
June 30, 2022
December 31, 2021
(in billions)
Assets Under Management
AB AUM
$
646.8
$
778.6
Exclusion for General Account and other
Affiliated Accounts
(69.4
)
(79.7
)
Exclusion for Separate Accounts
(38.4
)
(48.8
)
AB third party
$
539.0
$
650.1
Total company AUM
AB third party
$
539.0
$
650.1
General Account and other Affiliated
Accounts (1) (3)
98.3
110.3
Separate Accounts (2) (3)
116.8
147.3
Total AUM
$
754.1
$
907.7
_______________
(1) “General Account and Other Affiliated Accounts” refers to
assets held in the general accounts of our insurance companies and
other assets on which we bear the investment risk.
(2) “Separate Accounts” refers to the separate account
investment assets of our insurance subsidiaries excluding any
assets on which we bear the investment risk.
(3) As of June 30, 2021, September 30, 2021, December 31, 2021,
March 31, 2022 and June 30, 2022, Separate Account and General
Account AUM is inclusive of $16.9 billion, $63 million, $16.3
billion, $64 million, $16.6 billion, $61 million, $15.1 billion,
$60 million, $12.7 billion and $60 million, respectively, Account
Value ceded to Venerable. For additional information on the
Venerable transaction see Note 1 of the Notes to Consolidated
Financial Statements within the 10-Q.
_______________
1 This press release includes certain Non-GAAP financial
measures. More information on these measures and reconciliations to
the most comparable U.S. GAAP measures can be found in the “Use of
Non-GAAP Financial Measures” section of this release.
2 Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
3 Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
4 Refers to AllianceBernstein L.P. and AllianceBernstein Holding
L.P., collectively.
5 Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
6 Please refer to Exhibit 1 for detailed reconciliation and
definitions related to notable items.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220803005724/en/
Investor Relations Işıl Müderrisoğlu (212) 314-2476
IR@equitable.com
Media Relations Todd Williamson (212) 314-2010
mediarelations@equitable.com
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