Latest news with #BrighthouseFinancial
Yahoo
22-05-2025
- Business
- Yahoo
TPG (NasdaqGS:TPG) Raises US$992 Million in Follow-On Equity Offering
TPG recently completed a follow-on equity offering, raising $992 million, and launched TPG Sports with notable partnerships. These developments came amidst a rebound in the broader market, which partially offset earlier declines, as showcased by a 13% rise in TPG's share price over the past month. The company's Q1 revenue and net income growth, despite a slight drop in basic earnings per share, may have positively supported this uptrend. Meanwhile, speculation over potential acquisitions like Brighthouse Financial appeared not to deviate significantly from market performance, which saw a 1% decline recently. We've identified 3 possible red flags with TPG (at least 1 which is a bit concerning) and understanding the impact should be part of your investment process. This technology could replace computers: discover the 22 stocks are working to make quantum computing a reality. TPG's recent follow-on equity offering that raised US$992 million and the launch of TPG Sports come at a time of broader market recovery. This capital injection and strategic expansion into sports, potentially bolstering partnerships and market reach, might influence TPG's revenue and earnings positively. The company's recent share price increase of 13% over the past month aligns with these developments but still remains below the analyst consensus price target of US$52.92 by approximately 12%. Over the longer term, TPG's total returns, including dividends, reflected an impressive growth of 87.33% over three years. In contrast, over the past year, TPG underperformed the broader US market, which achieved an 11.1% return, and similarly lagged behind the Capital Markets industry, which saw a 23.6% increase. These contrasting timelines highlight potential market volatility and the challenges TPG faces to sustain its growth trajectory. The recent developments may also impact revenue and earnings forecasts as TPG taps into new investments and opportunities. While analysts forecast revenue to decrease by 7.6% annually over the next three years, the firm's growing transaction fees and strategic acquisitions could sustain its earnings growth, which is expected to increase significantly. However, the company's current price-to-earnings ratio and market conditions suggest cautious optimism about reaching the optimistic price target of US$53.15, which is around 13.1% higher than today's share price of US$46.19. Review our historical performance report to gain insights into TPG's track record. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include NasdaqGS:TPG. This article was originally published by Simply Wall St. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@
Business Wire
20-05-2025
- Business
- Business Wire
Brighthouse Financial Recommends Shareholders Reject 'Mini-Tender' Offer by Potemkin Limited
CHARLOTTE, N.C.--(BUSINESS WIRE)--Brighthouse Financial, Inc. ('Brighthouse Financial' or the 'company') (Nasdaq: BHF) announced today that it has received notice of an unsolicited 'mini-tender' offer made by Potemkin Limited ('Potemkin') to Brighthouse Financial shareholders to purchase up to 100,000 shares of Brighthouse Financial's common stock at a price of $36.00 per share. This means that Brighthouse Financial shareholders who tender their shares in the offer will receive a price significantly below the current market price for the company's common stock and which is an approximate 41.12% discount to the closing price of the company's common stock as of May 19, 2025 ($61.14 per share). Brighthouse Financial does not endorse Potemkin's unsolicited mini-tender offer and is not affiliated or associated in any way with Potemkin, its mini-tender offer or the offer documentation. Brighthouse Financial recommends that shareholders do not tender their shares in response to Potemkin's offer because the offer is at a price that is significantly below the current market value of Brighthouse Financial's common stock. The offer is currently scheduled to expire at 5:00 p.m., New York City time, on September 16, 2025, unless extended or earlier revoked by Potemkin. Shareholders who tender their shares may withdraw them in the manner described in Potemkin's offering documents. A mini-tender offer is an offer for less than 5% of a company's shares and is therefore not subject to the disclosure and procedural requirements required by the U.S. Securities and Exchange Commission ('SEC') for larger tender offers. As a result, mini-tender offers do not provide investors with the same level of protections under U.S. securities laws that are provided for larger tender offers. The SEC has cautioned investors about mini-tender offers, providing guidance to investors at Brighthouse Financial encourages brokers and dealers, as well as other market participants, to review the SEC's letter regarding broker-dealer mini-tender offer dissemination and disclosures at and the NASD Notice to Members 99-53 issued in July 1999 regarding guidance to members forwarding mini-tender offers to their customers, which can be found at Shareholders should obtain current market quotations for their shares of Brighthouse Financial common stock, consult with their broker or financial advisor and exercise caution with respect to Potemkin's mini-tender offer. Brighthouse Financial requests that a copy of this news release be included with all distributions of materials relating to Potemkin's mini-tender offer related to Brighthouse Financial's common stock. About Brighthouse Financial, Inc. Brighthouse Financial, Inc. (Brighthouse Financial) (Nasdaq: BHF) is on a mission to help people achieve financial security. As one of the largest providers of annuities and life insurance in the U.S., 1 we specialize in products designed to help people protect what they've earned and ensure it lasts. Learn more at
Yahoo
10-05-2025
- Business
- Yahoo
Q1 2025 Brighthouse Financial Inc Earnings Call
Dana Amante; Head of Investor Relations; Brighthouse Financial Inc Eric Steigerwalt; President, Chief Executive Officer, Director; Brighthouse Financial Inc Edward Spehar; Chief Financial Officer, Executive Vice President; Brighthouse Financial Inc David Rosenbaum; Executive Vice President, Head of Product and Underwriting; Brighthouse Financial Inc John Rosenthal; Executive Vice President, Chief Investment Officer; Brighthouse Financial Inc Myles Lambert; Executive Vice President, Chief Distribution and Marketing Officer; Brighthouse Financial Inc Wes Carmichael; Analyst; Autonomous Research John Barnidge; Analyst; Piper Sandler & Co. Elyse Greenspan; Analyst; Wells Fargo Securities, LLC Suneet Kamath; Analyst; Jefferies LLC Wilma Burdis; Analyst; Raymond James & Associates, Inc. Ryan Krueger; Analyst; Keefe, Bruyette & Woods, Inc. Thomas Gallagher; Analyst; Evercore ISI Alex Scott; Analyst; Barclays Jimmy Bhullar; Analyst; JPMorgan Operator Good morning, ladies and gentlemen, and welcome to Brighthouse Financial's first-quarter 2025 earnings conference call. My name is Michelle, and I will be your coordinator today. (Operator Instructions) As a reminder, the conference is being recorded for replay purposes.I would now like to turn the presentation over to Dana Amante, Head of Investor Relations. Ms. Amante, you may proceed. Dana Amante Thank you and good morning. Welcome to Brighthouse Financial's first-quarter 2025 earnings call. Materials for today's call were released last night and can be found on the Investor Relations section of our website. We encourage you to review all of these materials. Today, you will hear from Eric Steigerwalt, our President and Chief Executive Officer; and Ed Spehar, our Chief Financial our prepared remarks, we will open the call up for a question-and-answer period. Also here with us today to participate in the discussions are Myles Lambert, our Chief Distribution and Marketing Officer; David Rosenbaum, Head of Product and Underwriting; and John Rosenthal, our Chief Investment we begin, I'd like to note that our discussion during this call may include forward-looking statements within the meaning of the federal securities laws. Brighthouse Financial's actual results may differ materially from the results anticipated in the forward-looking statements as a result of risks and uncertainties described from time to time in Brighthouse Financial's filings with the SEC. Information discussed on today's call speaks only as of today, May 9, 2025. The company undertakes no obligation to update any information discussed on today's this call, we will be discussing certain financial measures that are not based on generally accepted accounting principles, also known as non-GAAP measures. Reconciliation of these non-GAAP measures on a historical basis to the most directly comparable GAAP measures and related definitions may be found on our earnings release, slide presentation and financial supplement. And finally, references to statutory results, including certain statutory-based measures used by management are preliminary due to the timing of the filing of the statutory now I'll turn the call over to our CEO, Eric Steigerwalt. Eric Steigerwalt Thank you, Dana, and good morning, everyone. Brighthouse Financial reported solid results in the first quarter of 2025. During the quarter, we made further progress against our focused business strategy, including delivering strong sales results in both annuities and life insurance. We also made additional progress against the capital-focused strategic initiatives that we announced last year and that we continue to ended the quarter with holding company liquid assets of approximately $1 billion, maintaining a robust cash position. We also ended the quarter with an estimated combined risk-based capital or RBC ratio between 420% and 440%, which is within our target RBC ratio range of 400% to 450% in normal we have said in the past, balance sheet strength is essential to support our distribution franchise. I am pleased with the progress that we have made against our capital focused strategic initiatives, which includes our ongoing work to simplify our variable annuity or VA and Shield hedging we discussed on our fourth-quarter earnings call, as of year-end 2024, we have fully transitioned to hedging Shield annuity new business on a stand-alone basis, an important milestone in simplifying our hedging strategy. In 2025, we have continued to revise our hedging strategy for both our in-force VA and our first-generation Shield book of the execution of our capital focused strategic initiatives continues, it is important to note that our focus on protecting our statutory balance sheet under adverse market scenarios remains to sales, as I mentioned earlier, we delivered strong sales results in the quarter. I'm especially pleased with the continued sales growth of our flagship Shield annuity product suite, which I will discuss in more detail in a moment. Also in the quarter, we continued to drive steady growth in sales of our life insurance total annuity sales in the quarter were strong at approximately $2.3 billion. This includes approximately $2 billion in total Shield sales, which increased 3% sequentially and 5% compared with the first quarter of 2024. As we have said previously, last year, we launched updates to our Shield suite that are designed to help these products remain competitive and adapt to changes in the industry, and we remain proud to be a leader in the registered index-linked annuity our total annuity sales were strong in the quarter, they were down 21% compared with the first quarter of 2024, primarily driven by lower sales of fixed annuities. Sequentially, annuity sales increased 1%. We're pleased to be one of the top annuity providers in the United States, and we continue to leverage the depth and breadth of our expertise, along with our strong distribution relationships to competitively position ourselves in the markets that we choose to compete I mentioned earlier, we continue to drive steady growth in sales of our life insurance product suite in the quarter. Life sales totaled $36 million, which is a 24% increase compared with the first quarter of 2024 and a 9% increase sequentially. As we have discussed previously, we have expanded into the institutional space with BlackRock's LifePath Paycheck, or LPP product, becoming available in defined contribution plans last year. Earlier this year, BlackRock announced that LPP is now live in six employer retirement plans, totaling $16 billion in assets under inflows associated with LPP are expected to be uneven on a quarter-to-quarter basis as defined contribution plans implement the solution, we do expect to see additional flows in 2025. We remain very excited about LPP and its success to date and we expect our involvement with this product to enable Brighthouse to reach new customers through the worksite to expenses, corporate expenses in the quarter were $239 million on a pretax basis, which was higher than our run rate expectation. It is important to note that this higher level of corporate expenses is nontrendable and we expect corporate expenses to normalize for the remainder of we remain focused on maintaining a disciplined approach to expense management which is an important aspect of our business strategy. Regarding capital return to shareholders. In the quarter, we continued to return capital through the repurchase of our common stock. We repurchased $59 million of our common stock in the quarter, with an additional $26 million repurchased through May 6. Before wrapping up, I would like to briefly touch on the current macro Financial has a proven track record of being able to navigate volatile markets and periods of uncertainty, and we believe that we are well positioned to navigate this current environment. We remain focused on our mission and strategy and on delivering for our partners, customers and wrap up, we delivered a solid quarter to start the year, and I'm pleased with our progress as we continue to execute our business strategy. We continued to generate strong sales in both annuities and life insurance as well as support our distribution franchise through our strong balance sheet and robust liquidity position. In addition, we continue to make progress against our strategic initiatives, designed to improve capital efficiency, unlock capital and remain within our target combined RBC ratio range in normal markets.I'll now turn the call over to Ed to discuss our first-quarter financial results. Edward Spehar Thank you, Eric, and good morning, everyone. After the market closed yesterday, Brighthouse Financial reported results for the first quarter of 2025, including preliminary statutory results. Statutory combined total adjusted capital or TAC, was approximately $5.5 billion at March 31, compared with approximately $5.4 billion at December 31. The estimated combined risk-based capital or RBC ratio was between 420% and 440%, within our target range of 400% to 450% in normal market conditions. And normalized statutory earnings for the quarter were approximately $300 results benefited from a 25 basis point increase in the prescribed 20-year treasury yield mean reversion point, which increased from 3.75% to 4%. Additionally, as Eric mentioned earlier, we continue to make progress on our capital focused strategic we discussed on the fourth-quarter earnings call, as of year-end 2024, we fully transitioned to hedging new business for our Shield product suite on a stand-alone basis. We continue to develop a separate hedging strategy for our variable annuity and first-generation Shield annuity block of business. We expect to complete the transition to this revised strategy for this legacy block of business before we continue to focus on protecting our statutory balance sheet under adverse market scenarios. Holding company liquid assets are still substantial with approximately $1 billion at March 31. We think about our capital strength as a combination of the operating company's RBC ratio, holding company liquid assets and a conservative capital turning to first-quarter adjusted earnings results, adjusted earnings for the quarter were $235 million, including an unfavorable notable item of $10 million, or $0.17 per share related to an actuarial model refinement. Adjusted earnings, excluding the impact from the notable item, were $245 million which compares with adjusted earnings on the same basis of $352 million in the fourth quarter of 2024 and $268 million in the first quarter of 2024. Adjusted earnings results, excluding the impact of the notable item, were approximately $15 million or $0.26 per share below our average quarterly run rate investment income was $39 million or approximately $0.66 below our quarterly average run rate expectation. The alternative investment portfolio yield in the quarter was 1.4%. As a reminder, we continue to expect a yield on this portfolio of 9% to 11% annually over the long term. Our underwriting margin was above our run rate expectation, which more than offset the impact from corporate expenses that were high relative to our quarterly run rate expectation. While the underwriting margin was higher versus our run rate expectation, it was lower sequentially, driven by normal fluctuations in the volume and severity of claims net of to results by segment, the Annuity segment reported adjusted earnings less notable items of $324 million, which was relatively flat sequentially. The Life segment reported adjusted earnings of $9 million. Sequentially, results reflected a lower underwriting margin, lower net investment income and higher expenses. The Runoff segment had an adjusted loss of $64 million. Results reflected lower net investment income, partially offset by a higher underwriting margin sequentially. The Corporate and Other segment reported an adjusted loss of $24 million, which reflected higher expenses closing, we are pleased with our first quarter results, particularly because statutory results were in line with our expectations. The estimated combined RBC ratio ended the quarter within our target range and we maintained a robust level of holding company liquid will now turn the call over to the operator to begin the question-and-answer session. Operator (Operator Instructions) Wes Carmichael, Autonomous Research. Wes Carmichael Hey, good morning, everybody. Sorry if I missed this one clarification, but, Ed, the 25 basis point increase in mean reversion point, could you quantify how much of benefit that was to normalize net earnings? Edward Spehar Sure. Wes, it was around $200 million. Wes Carmichael Okay. I guess my second question on sales and fixed annuities. It's been a little bit softer the last couple of quarters. And I know you had some change in the reinsurance partner, but would you expect that to accelerate from here or is the competitive environment just not very attractive? David Rosenbaum Wes, this is David. I'll start with that. So sales move around a bit, and you've seen that in our results for fixed annuities. The first quarter of last year 2024 was a big sales volume for us. And then the third quarter, as you mentioned, was also a solid quarter after we reestablished ourselves in the fixed market after we brought on a new reinsurance when we think about this market, there's a lot of competition, as you mentioned. It is very rate dependent, and we're going to continue to monitor sales volumes and the competitive environment in conjunction with our reinsurance partners. And our goal here is to really have consistent competitive rates while maintaining our pricing discipline. So we are looking to build momentum to drive fixed sales over the remainder of the year. Operator John Barnidge, Piper Sandler. John Barnidge Thank you very much for the opportunity. My question is on your outlook for flows and surrender activity this year. How are you thinking about that trending given the dynamic macro environment? David Rosenbaum Yes. Thanks, John. So let me just start with the drivers that we've seen over the last five to six quarters continued in the first quarter of this year as expected. So outflows were modestly lower than the fourth quarter and up over the first quarter of last year, driven by VA and Shield outflows, but specifically full when we think about 2025, we have a substantial amount of fixed rate annuities, particularly the three- and five-year coming out of surrender in the second half -- in 2025, but weighted to the second half of 2025. We continue to have more shield come out of surrender each month as you've seen, as we've had growing sales over the last few years. And then third, not surrender charge related, but we do continue to see outflows of our variable annuity block. So given these factors, I currently expect flows to be at the 2024 level or higher this year. John Barnidge And my follow-up question, how do you think about the opportunity to better optimize your investment portfolio to be more competitive in the rival market? John Rosenthal Hi, John, it's John. We're always thinking about ways to optimize the investment portfolio and the investment return. I can't give you any specifics but we're always working on it. So I think we're improving, but we're always working on it. Operator Elyse Greenspan, Wells Fargo. Elyse Greenspan My first question is just on the RBC move in the quarter. And I think the mean reversion change was probably something within the neighborhood of 25 basis points. So were there any other pushes and pulls within RBC, it seems like it might have been stable to slightly up, excluding the mean reversion change in the quarter. Edward Spehar Good morning, Elyse, I think it's closer to 15 percentage points, the $200 million number that I cited, not 25 million. Elyse Greenspan Okay. So then anything else you would highlight within RBC away from that? Edward Spehar Sure. So we had some higher -- we had norm stat earnings beyond the $200 million. You see we said it was approximately $300 million. I've also talked in the past about the seasonality of the capital charges associated with our fixed business. So in the past, I had said you could think about maybe 20 RBC points a year from strain in total.I would say that number is higher now than it was. And that's a good thing from the standpoint of we're writing business that we think is generating shareholder value. So we all know that strain is a fact of life in the life insurance industry. You have to put up capital when you write business and then you get the cash over time. So we do have more strain, I would say, than the 20 RBC points I've talked about in the we still have the seasonality impact that I've discussed, which is related to the business risk capital charge for fixed, the C4 charge, right? It comes in once a year and then -- I mean, over the course of a year, and then it's released and you start again in the new year. So you will see in the first quarter an impact from strain that's much more modest than what you would see in the subsequent quarters. So there is some benefit in the RBC from the seasonality of the capital charges. Elyse Greenspan And then my follow-up, in past quarters, you guys have spoken about actions to increase value. I think last quarter, you were talking about slow reinsurance, and there's been other actions mentioned. Can you just talk to -- talk about things that you guys are considering right now? Edward Spehar Sure. So we did talk about flow reinsurance. We continue to look at reinsurance options, including flow reinsurance. So that still is something that we are considering over time. I think the top priority today would be the simplification of our hedging strategy for our in-force VA and first-generation Shield heard us talk about how beginning in July of last year, we started to hedge our new product suite, Shield 2.0 on a stand-alone basis. We extended that to the entire in-force block of our level pay plus Shield products and implemented the modeling associated with that in our financial -- in our actuarial modeling to realize the full benefit of that stand-alone hedging for new we've talked about modifying our strategy for this block of in-force VA and first-generation Shield. So an underlying goal of that effort is to simplify I would stress, though, that we continue to manage to protect our statutory balance sheet. Our hedging position is, again, maintaining that up to $500 million first loss tolerance that we've talked about. So we still have significant protection. It's not like a wholesale change in how we're managing the risk but it is an approach that we are taking to simplify how we're going to address this in-force VA and first-generation Shield block. Operator Suneet Kamath, Jefferies. Suneet Kamath I think on the last call, Ed, you mentioned that you weren't expecting distributable earnings out of BLIC in '25. Is that still your expectation? And if that's the case, I guess, what changes in '26 to get the distributable earnings going again? Thanks. Edward Spehar Good morning, Suneet, I recall on the last call that I said that our final financial plan, anticipated dividends over the three-year period from the operating companies. I don't remember a specific comment that I made about BLIC. And I guess I would just say, I'm not going to -- I wouldn't go beyond what I said last time, which is that our plan over the three-year period contemplates that we will take money up to the holding company we don't get into specifics about any annual forecast for statutory results. Suneet Kamath Got it. I thought you said something about starting next year, but I get the point that you're making. And I guess -- Edward Spehar Maybe I did. I don't -- it doesn't -- I didn't recall but perhaps I did, but I know my point was that I was trying to make a comment about the three-year outlook for cash flow from the operating companies. Suneet Kamath I got it. That's fine. And then I guess maybe a bigger question for Eric. If I look at your stock price at the end of '17, it was $58. If I look at where it is now, it's $58. So in seven-plus years were flat despite all the buybacks that you've done. And I guess, the question sort of like what I asked last time is, does it make sense to just be part of a larger organization where you can benefit from more capital and more diversification and all those sort of things versus being a stand-alone kind of annuity writer? Eric Steigerwalt Good morning, Suneet, how are you? And look, my answer is going to be pretty much the same as last time, right? I think last time you commented on complexity as well. And look, every single day, we're dealing with whether it's complexity or capital generation or sales, et cetera, we're doing our jobs here. We've got a strategy that I think logically can produce shareholder value. And so we're just going to keep following that strategy, whether it's sort of from a BAU point of view or when we talk about some strategic initiatives that we have I talked about them last time.I won't repeat them because I think Ed kind of listed some of them off from Elyse's question. But even in addition to what he said, there are other sort of value drivers that we can unlock over time. And it's our job to do that. So we're just going to keep doing what we're doing. We have bought back about roughly $2.5 billion of stock over the years. And our strategy -- with the inclusion of strategic initiatives from time to time is unchanged. Operator (Operator Instructions) Wilma Burdis, Raymond James. Wilma Burdis You guys touched on this a little bit with Elyse's question, but could you just give us a little bit more detail on where you are with hedging the legacy block, where you're at right now, what steps you have left to complete? And then I know you kind of touched on this a little bit, but if you could just help me understand what you guys did in July with the new business versus year-end and just how the kind of new business hedging played out? Edward Spehar Sure, Wilma. Let me start with the second one first. So when I said stand-alone hedging, it means essentially you're buying a call spread and writing an out of the money put. And that is the option basket that creates the payout profile that matches the -- what you're guaranteeing the the first question, we're not going to get into more detail about what we're doing. One of the -- I mean, the primary reason not to do that is we run a very large derivative book. We have a very large hedging program and we're not going to talk about things that we are working on and things that we will be doing that could be used to drive what actions we might be taking in the marketplace. That would not be in the interest of shareholders. Operator Ryan Krueger, KBW. Ryan Krueger I guess just one more question on the changes you're making to the hedging strategy. I understand the simplification point. I guess I was just hoping to better understand like what is it -- like how do you expect the changes to -- from a practical standpoint to benefit the company going forward? Like what are the -- whatever the intended outcomes of what you're doing? And then are you making changes along the way or are you more studying what you want to do and then you're going to make all the changes at once later this year? Edward Spehar Yes. So it is more the latter for your second question. So we will decide what we're going to do. We will than implement. So it is not a gradual is more as you described. I would go back to your first question. I highlighted that an underlying goal here is simplification. So if we look at our block of business, historically, the approach we took managing this block of business with Shield and VA was driven by the capital benefits that we were achieving from writing Shield relative to the offset of VA. That had an inherent level of complexity that was more than tolerable, given the clear capital benefit that we were we have now achieved what we have targeted since the separation, which is a balanced risk profile, between the VA block and our Shield block. We have decided that we would like to pivot away from complexity toward simplification. And so that is the overarching goal of what we're doing here. Ryan Krueger Got it. And then are you able to give us any perspective on how the VA hedge program performed in the volatility of April? Edward Spehar Sure. So there are -- we look at grids when we think about our up to $500 million max loss tolerance, and those grids have the equity market and interest rates on the axis. And if we look at our vertical for the equity market -- now again, this is a grid. There are obviously other things that happen in market environments. Basis risk, for example, is something you've heard us talk about in the past is one if we look at our grid today and you think about this vertical of the down equity market, we show very little impact between zero and down 30. And we show an impact between down 30 to down 50 that is underneath that $500 million max loss. Operator Wilma Burdis, Raymond James. Wilma Burdis Could you just talk a little bit more about your share repurchase program and how it works, given it seems like you leaned in on buybacks in April when prices were low? Eric Steigerwalt I'll start, if Ed wants to jump in, he can. In the first quarter, I think I laid this all out, but I'll just tell you again, we repurchased $59 million. In -- since then -- since the end of the first quarter through May 6, we repurchased another $26 million. And so we haven't -- you can look historically at what we've done. We haven't given any forward-looking guidance in quite a each time we're giving what we repurchased in the quarter and then up to close to the call date. That's what we did in the first quarter and then post the first quarter through May 6. Operator (Operator Instructions) Tom Gallagher, Evercore ISI. Thomas Gallagher I guess first question is the -- was the $100 million to $150 million of, let's call it, normal capital generation excluding the mean reversion, was that more or less in line with your plan? Like did the hedges actually perform the way they were supposed to you on both the VA and the (inaudible) side this quarter within a certain tolerance?And then I guess I'm a little surprised to hear you saying -- sounds like everything is being reevaluated from a hedging standpoint. You guys have been at this for a year. So is it like what's changed other than performance and about what you're seeing, is it you've done more work on the cash flow projections and now you're wanting to have better outcomes? Like why is it you're now reevaluating trying to simplify what you've been spending a lot of time on already? Just want to understand kind of what's going on behind the scenes. Edward Spehar Yes. So let me start with your first question. I think I said in my prepared remarks that results were in line with our expectations. And so I would just reiterate that again that the first quarter statutory results were close to what we thought they were going to be. And obviously, the performance of our hedge portfolio is a key component of that second part of your question, I guess I would go back first to what I said to Ryan and second, in terms of the time line here, we started talking about hedging new business on a stand-alone basis on our third quarter earnings call. We talked about some additional steps on our fourth quarter call. And we have been talking about how we are working on what revised approach might make sense for this in-force VA and first-generation Shield given the size of the blocks now, given the fact that we have this more balanced risk profile than what we had seen I don't know that it's -- I guess I would characterize it a little differently than what you have, which is this is not a surprise. We've been talking about this. It's not a wholesale change. I just described to you, for example, that we're very protected for what we believe were very protected for an adverse market environment, which has always been our overarching goal to protect the statutory balance sheet. So I wouldn't -- I wouldn't say that it's a -- it's a wholesale change. It's an approach that we think now makes sense given where we are in this current market environment with the current mix of business that we have. Thomas Gallagher Okay. Appreciate that, Ed. So really, this isn't going back to the drawing board wanting to do something meaningfully different? Would you say it's not wanting to pigeonhole you to a sound bite, but not -- would you say the frameworks in place and this is going to be making some changes to it or is it possible there's going to be something more meaningful? I just want to make sure I'm fully understanding like what the message is. Edward Spehar Yes, this is not going back to the drawing board. Operator Alex Scott, Barclays. Alex Scott Maybe the first one for you, just on the cash flow projections you've given us over time, and I know you don't have any (inaudible) sort of officially out there right now. But I feel like there was a time where we expect these cash flows to like really inflect up over time. It seems to be getting pushed out. Is it just keep getting -- pushing -- is it getting pushed out? Or at this point, is it not reasonable to expect the cash flows would inflect up on the in-force block.I'm just trying to understand that and if it's not, like what is it that's causing that? And like why wouldn't you need to adjust your balance sheet for that if it's not coming to fruition? Edward Spehar Yes. Could you clarify -- Alex, could you clarify that last comment, you trailed off a little bit, adjust our balance sheet for what? Alex Scott Sure. I'm saying if you thought that eventually the reserves would release and you'd have more cash flow coming through and they're not, then do we need be concerned that if you don't find some strategic alternatives here that you would need to make a bigger adjustment to the statutory balance sheet, I guess, or the GAAP balance sheet, right, which I guess is more the GAAP balance sheet just given the GAAP equities, a heck is a lot higher than the stat. But I'm just trying to think about risk of -- risk around reserves, liability, valuation, whether GAAP or stat is -- there's no strategic alternatives. And if the cash flows really aren't inflecting upwards the way that you guys have kind of thought over the last few years? Edward Spehar Yes. So, Alex, there's a lot that you're talking about here. I mean -- I mean, look, we're not going to discuss cash flow projections prior to having cash flow projections. I mean, we have put them out. You can deduce what you would like from what we have put out in the as I've said over the years, this is a very significant effort to create those cash flows. And as I said on the last call, we have things that we're working on to make sure that we have the right positioning, like I just said, on this revision to how we're going to hedge this in-force VA first-generation Shield block before we would be putting out new projected cash it's, number one, the priority of the people in the finance organization and elsewhere, to work on this simplification effort for the hedging strategy. And then after that, it would be to turn our attention to other things, which would include the cash flow projections. So clearly, we're in May right now, and you could probably deduce from my comments that the midyear target for releasing the long-term statutory free cash flow projections is no longer realistic.I had suggested on the last quarter call that there was a chance it was slipping because of the other things we're focused on. And I would confirm now that we don't have an updated date for when we would do it. But I don't think we would continue to stick with the midyear that we had said to you in the so everything else that you're asking, I think you would have to think about what questions you would want to ask after you see the updated numbers because we're not going to go into discussions about cash flow projections that were put out, I guess, last September. Sorry, sorry, sorry, two Septembers ago. Alex Scott Got it. That's helpful. And thank you for entertaining the question. Maybe one that's much more on a positive note, we -- as much as we focus about the in-force, you all have talked about the growth opportunities. When you think across (inaudible), demographic changes, implant annuities and the potential for that to take a much bigger share of 401(k) assets over time.I mean, how do you think about the value there and just what you can do with that if you had more capital flexibility? I mean, if Brighthouse had more capital flexibility, would it be a game changer for what you could do in terms of growth into some of those opportunities? And how big can these opportunities be? Eric Steigerwalt I'll start and Myles or David might want to jump in. So far, we've been able to grow everywhere we want to. I don't think we said this, maybe I said it in my prepared remarks, I can't remember. But March was our highest (inaudible) sales month ever. So I mean, we're growing Paycheck, I think you mentioned, that's going to take some time, obviously. And I've said over and over that the flows will be intermittent. But we certainly expect more this year. And -- I and others think that the growth possibilities are fantastic potentially. We're not constrained do have to remember, right, as David said, I thought pretty eloquently, it's about growth. It's about our fabulous distributors. But it's also about pricing discipline. So we're constantly looking at that balance. And right now, I don't feel like we're constrained to never once -- I have never won some staring at miles here, told him, you can't sell. He's unconstrained, but we are going to run this company for profitable growth. David or Myles, do you want to add anything? Myles Lambert You nailed it that, Eric. Operator Wes Carmichael, Autonomous Research. Wes Carmichael I had a question on surrenders in the annuity business. And if I look at the AUM roll forward for VA and Shield, that surrender rate, maybe it's consistent quarter to quarter, but it's been picking up steam for quite some time. So just hoping you could talk a little bit about what you're seeing is that legacy VA, what types of products are surrendering here? And would you expect that pace to continue? David Rosenbaum Yes. Thanks, Wes. So very similar remarks to John's question earlier. But the drivers that we've seen over the last five to six quarters continued in the first quarter of 2025. So we're seeing full surrenders of Shield and VA. And you think about Shield, we have more business coming out of the sort of intercharge period. Outflows are weighted to VA, continue to benefit from the outflows of the capital-intensive legacy given the volume of business that we've written, Shield is becoming a larger contributor to the outflows and from time to time, based on sales volumes, fixed annuities as well. So kind of where we think -- where I think about the flows for 2025, at the 2024 level or higher in 2025 is kind of the current expectation. And really, the difference year-over-year is more business from our fixed annuities coming out of surrender charge and that sort of weighted to the second half of the year. Wes Carmichael Got it. That's helpful, David. And just last one. I think last quarter, there was a $100 million or so cash injection into BLIC from the parent. And as we move forward to this quarter, RBC has improved here.I guess would you expect capital that's injected down there to stay down there? It seems like you've got a lot of liquidity at the holdco, but I guess in my mind, it always gives you a bit more flexibility if capital is at the top of the house. Edward Spehar Yeah, Wes, hey. I would just go back to what I said, I think, in response to Suneet's question, which is our three-year financial plan does contemplate dividends to the holding company. Operator Tom Gallagher, Evercore ISI. Thomas Gallagher Thanks. Hey, Eric, just wanted to get your perspective. We obviously have had to recent industry transactions that certainly matter for Brighthouse from a business mix standpoint on the private side. You had the met VA (inaudible) deal, you had the Lincoln partnership announcement with Bain. I'm sure you guys are paying close attention to those. Anything you read into those on, we'll call it, market pricing points as it relates to private public. And anything that informed you on your business risk market dynamics? Anything you can comment on either one of those or kind of in a broader sense, what do you think is happening from an industry standpoint? Eric Steigerwalt Sure, Tom. So you're referring to the Bain-Lincoln transaction, I think, and then I think you mentioned the MetLife transaction. So maybe overall, look, you're right. And -- we've known each other for a long time. We look at look in detail at everything. We're constantly tinkering with our strategy at the edges as any good management team would be doing. So the Bain-Lincoln transaction, I'm not really going to talk about it. I don't think it's my place to talk about it at all, but it's interesting. And it was opportunistic, I'm sure, on their part. And we look at transactions like that with an eye towards, okay, they are to the possible. Here's another transaction that we have to look about at and think about what could it possibly mean for Brighthouse in the then with respect to the VA transaction, look, I can't comment on any specifics, but I will tell you this. Certainly, again, your gut is always right on stuff like this, Tom. Obviously, we're looking at it. We've been looking at this kind of stuff for years and years. We have not done a transaction. We've done other reinsurance transactions, as you I would say one thing, this block of business isn't -- you can't logically draw a straight line to large blocks of business, right? So it doesn't really tell us anything with respect to our overall block of a small piece, and therefore, even though at separation, which is now almost eight years ago, there were a lot of similarities between us and our former parent's blocks. Eight years has gone by, very different potentially surrender patterns, et cetera. And then, of course, this is just one block. So you can't extrapolate one block to an average of much larger blocks and really in any company's cases. However, of course, Tom, as now I've already said, we're looking at all these if -- and if they could potentially be an avenue down the road that we ought to go, then at some point, we could go there. I hope that's helpful to some degree. Operator Jimmy Bhullar, JPMorgan. Jimmy Bhullar So first, I had a question on the RBC ratio. I think, Ed, you mentioned that the mean reversion benefit was around 15 points on the RBC. I don't know if you quantified the benefit of the lower C4 charge a seasonal impact. Could you tell us what that was? Edward Spehar Yes, Jimmy, I did not quantify it. But I would just say, like I've said in the past, I think the first quarter of maybe '23. I made a comment about this. There was a capital benefit in the first quarter because of the C4 release. And then you will have this business risk charge then you will have it come in as you write business over the course of the year. So while I have said that the strain. I used to say 20 RBC points, I'd say it's more than that now. The average you can take whatever that number is and divide by 4, but I'm telling you that the first quarter is generally going to be pretty insignificant from a strain standpoint. So you'll have more in the subsequent three quarters. Jimmy Bhullar So -- and then I think in your -- in the past, your comments about 5 points a quarter and then that's coming back. It sort of implies that it would be a 5, maybe 10-point benefit. But if I'm not off by a lot, is it reasonable to assume that your RBC could drop in 2Q as -- at least that tailwind goes away. Obviously, the main reversion tailwind goes away, assuming normal hedging results, assuming normal statutory results outside of hedging? Edward Spehar Yes. So, Jimmy, I guess -- I mean, I said we don't give annual RBC forecast. So I'm certainly not going to get into quarterly RBC forecast, sorry. Jimmy Bhullar And then just on the strategic initiatives that you're thinking about. It seems like capital is not a constraint for growth. So is the reason that you thought of doing things and some of the actions that you've already taken more to just to improve your capital cushion on the balance sheet from a sort of balance sheet standpoint as opposed to accelerating growth. Is that a fair point? Eric Steigerwalt Well, we're [dualing] buttons here, Jimmy. Look, we're trying to unlock capital all the time. and we're going to continue to do that. It helps you eventually remain unconstrained from a growth point of view. So you've seen some of the ones that we've already executed on and you should expect us to be looking at other things as well.I want to try to stay ahead of the curve so that we can remain, as I already said, unconstrained from a growth perspective, both on the retail side and on the institutional side. Jimmy Bhullar And just lastly, if you look at your valuation, obviously, the market is concerned about your capital and hedges and other results. You've been buying back stock, which implies that you're comfortable with how things are and you're willing to let capital out the door to buy stock at a reasonable price. So for a company that's buying back stock and has been buying back very actively over the past several years, considering the sale at such a low multiple would seem odd unless there was a need for capital and sort of a dire need for capital? Otherwise, you're capitalizing your business at a relatively low valuation. So what are your views on that?Because I can understand the logic of someone -- having somebody come in and take a small stake and give you a little bit of more cushion. But exploring the sale of an entire company at a multiple that's so low where you're actively -- so actively buying back stock seems a little odd, unless you really need the money. Eric Steigerwalt Jimmy, it's Eric. Look, I mean, I've already commented now a couple of times during the call with respect to the fact that we have not been constrained with respect to growth since the beginning. And then I'm going to assume that you're asking about some reports in the press. And I'm just going to say, we don't comment on market rumors or speculation, so I'm just going to leave it at that. Operator And I'm showing no further questions at this time. And I would like to hand the conference back over to Dana Amante for closing remarks. Dana Amante Thank you, Michelle, and thank you, everyone, for joining the call today. Have a great day. Operator This does conclude today's conference call. Thank you for participating, and you may now disconnect. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Washington Post
08-05-2025
- Business
- Washington Post
Brighthouse Financial: Q1 Earnings Snapshot
CHARLOTTE, N.C. — CHARLOTTE, N.C. — Brighthouse Financial Inc. (BHF) on Thursday reported a loss of $268 million in its first quarter. The Charlotte, North Carolina-based company said it had a loss of $5.04 per share. Earnings, adjusted for non-recurring costs, came to $4.17 per share.
Yahoo
08-05-2025
- Business
- Yahoo
Brighthouse Financial Announces First Quarter 2025 Results
Estimated combined risk-based capital ("RBC") ratio between 420% and 440%; holding company liquid assets of $1.0 billion The company repurchased $85 million of its common stock year-to-date through May 6, 2025 Annuity sales of $2.3 billion, including $2.0 billion in sales of the company's flagship Shield Level Annuities Life sales of $36 million, reflecting continued steady growth of the company's life insurance suite Net loss available to shareholders of $294 million, or $5.04 per diluted share Adjusted earnings, less notable items*, of $245 million, or $4.17 per diluted share CHARLOTTE, N.C., May 08, 2025--(BUSINESS WIRE)--Brighthouse Financial, Inc. ("Brighthouse Financial" or the "company") (Nasdaq: BHF) announced today its financial results for the first quarter ended March 31, 2025. First Quarter 2025 Results The company reported a net loss available to shareholders of $294 million in the first quarter of 2025, or $5.04 per diluted share, compared with a net loss available to shareholders of $519 million in the first quarter of 2024, or $8.22 per diluted share. The company anticipates volatility in net income (loss) given the differences between its hedge target and GAAP reserves, which are impacted by market performance. The company ended the first quarter of 2025 with common stockholders' equity ("book value") of $3.5 billion, or $61.17 per common share, and book value, excluding accumulated other comprehensive income ("AOCI") of $8.2 billion, or $141.87 per common share. _________ * Information regarding the non-GAAP and other financial measures included in this news release and a reconciliation of such non-GAAP financial measures to the most directly comparable GAAP measures are provided in the Non-GAAP and Other Financial Disclosures discussion below, as well as in the tables that accompany this news release and/or the First Quarter 2025 Brighthouse Financial, Inc. Financial Supplement and/or the First Quarter 2025 Brighthouse Financial, Inc. Earnings Call Presentation (which are available on the Brighthouse Financial Investor Relations webpage at Additional information regarding notable items can be found on the last page of this news release. For the first quarter of 2025, the company reported adjusted earnings* of $235 million, or $4.01 per diluted share, compared with an adjusted loss of $98 million, or $1.56 per diluted share, for the first quarter of 2024. Adjusted earnings for the quarter reflect a $10 million unfavorable notable item, or $0.17 per diluted share, related to an actuarial model refinement. Corporate expenses in the quarter were $239 million, up from $207 million in the first quarter of 2024 and $210 million in the fourth quarter of 2024, all on a pre-tax basis. The company's annuity sales decreased 21% quarter-over-quarter, primarily driven by lower sales of fixed annuities, partially offset by increased sales of Shield Level Annuities. Annuity sales increased 1% sequentially. Life sales increased 24% quarter-over-quarter and 9% sequentially. During the first quarter of 2025, the company repurchased $59 million of its common stock, with an additional $26 million of its common stock repurchased, on a trade date basis, through May 6, 2025. "Brighthouse Financial's estimated combined RBC ratio as of the end of the quarter was within our target range, and we maintained a robust level of holding company liquid assets," said Eric Steigerwalt, president and CEO, Brighthouse Financial. "Overall, we produced solid results in the quarter, including growing sales of our flagship Shield Level Annuities Product Suite, which increased 5% quarter-over-quarter and 3% sequentially." Key Metrics (Unaudited, dollars in millions except share and per share amounts) As of or For the Three Months Ended March 31, 2025 March 31, 2024 Total Per share Total Per share Net income (loss) available to shareholders (1) $(294) $(5.04) $(519) $(8.22) Adjusted earnings (loss) (1), (2) $235 $4.01 $(98) $(1.56) Adjusted earnings, less notable items (1) $245 $4.17 $268 $4.25 Weighted average common shares outstanding - diluted (1) 58,697,818 N/A 63,036,773 N/A Book value $3,540 $61.17 $2,496 $39.88 Book value, excluding AOCI $8,210 $141.87 $7,909 $126.35 Ending common shares outstanding 57,868,389 N/A 62,595,426 N/A (1) Per share amounts are on a diluted basis and may not recalculate due to rounding. For loss periods, dilutive shares were not included in the calculation as inclusion of such shares would have an anti-dilutive effect. See Non-GAAP and Other Financial Disclosures discussion in this news release. (2) The company uses the term "adjusted loss" throughout this news release to refer to negative adjusted earnings values. Results by Segment (Unaudited, in millions) For the Three Months Ended ADJUSTED EARNINGS (LOSS) March 31, 2025 December 31, 2024 March 31, 2024 Annuities $314 $279 $313 Life $9 $52 $(36) Run-off $(64) $(27) $(341) Corporate & Other $(24) $— $(34) Sales (Unaudited, in millions) For the Three Months Ended March 31, 2025 December 31, 2024 March 31, 2024 Annuities (1) $2,259 $2,239 $2,873 Life $36 $33 $29 (1) Annuities sales include sales of a fixed index annuity product, which represents 100% of gross sales on directly written business and the proportion of assumed gross sales under reinsurance agreements. Sales of this product were $26 million for the first quarter of 2025, $62 million for the fourth quarter of 2024 and $191 million for the first quarter of 2024. Annuities Adjusted earnings in the Annuities segment were $314 million in the current quarter, compared with adjusted earnings of $313 million in the first quarter of 2024 and adjusted earnings of $279 million in the fourth quarter of 2024. The current quarter included a $10 million unfavorable notable item related to an actuarial model refinement. There were no notable items in the first quarter of 2024. The fourth quarter of 2024 included a $48 million unfavorable notable item. On a quarter-over-quarter basis, adjusted earnings, less notable items, reflect higher net investment income and a higher underwriting margin, partially offset by higher expenses and lower fees. On a sequential basis, adjusted earnings, less notable items, were relatively flat. As mentioned above, the company's annuity sales decreased 21% quarter-over-quarter, primarily driven by lower sales of fixed annuities, partially offset by increased sales of Shield Level Annuities. Annuity sales increased 1% sequentially. Life Adjusted earnings in the Life segment were $9 million in the current quarter, compared with an adjusted loss of $36 million in the first quarter of 2024 and adjusted earnings of $52 million in the fourth quarter of 2024. There were no notable items in the current quarter. The first quarter of 2024 included a $73 million unfavorable notable item. There were no notable items in the fourth quarter of 2024. On a quarter-over-quarter basis, adjusted earnings, less notable items, reflect a lower underwriting margin and higher expenses. On a sequential basis, adjusted earnings, less notable items, reflect a lower underwriting margin, lower net investment income and higher expenses. As mentioned above, life sales increased 24% quarter-over-quarter and 9% sequentially. Run-off The Run-off segment had an adjusted loss of $64 million in the current quarter, compared with an adjusted loss of $341 million in the first quarter of 2024 and an adjusted loss of $27 million in the fourth quarter of 2024. There were no notable items in the current quarter. The first quarter of 2024 included a $293 million unfavorable notable item. There were no notable items in the fourth quarter of 2024. On both a quarter-over-quarter and sequential basis, the adjusted loss, less notable items, reflects lower net investment income, partially offset by a higher underwriting margin. Corporate & Other The Corporate & Other segment had an adjusted loss of $24 million in the current quarter, compared with an adjusted loss of $34 million in the first quarter of 2024 and break-even adjusted earnings in the fourth quarter of 2024. There were no notable items in the current quarter or the comparison quarters. On a quarter-over-quarter basis, the adjusted loss, less notable items, reflects a higher tax benefit, partially offset by lower net investment income. On a sequential basis, the adjusted loss reflects higher expenses. Net Investment Income and Adjusted Net Investment Income (Unaudited, in millions) For the Three Months Ended March 31, 2025 December 31, 2024 March 31, 2024 Net investment income $1,297 $1,373 $1,254 Adjusted net investment income $1,291 $1,376 $1,267 Net Investment Income Net investment income was $1,297 million and adjusted net investment income* was $1,291 million in the current quarter. Adjusted net investment income increased $24 million on a quarter-over-quarter basis and decreased $85 million sequentially. The quarter-over-quarter increase was primarily driven by asset growth. The sequential decrease was primarily driven by lower alternative investment income. The adjusted net investment income yield* was 4.25% during the quarter. Statutory Capital and Liquidity (Unaudited, in billions) As of March 31,2025 (1) December 31, 2024 March 31, 2024 Statutory combined total adjusted capital $5.5 $5.4 $6.0 (1) Reflects preliminary statutory results as of March 31, 2025. Capitalization As of March 31, 2025: Statutory combined total adjusted capital(1) was $5.5 billion Estimated combined RBC ratio(1) was between 420% and 440% Holding company liquid assets were $1.0 billion _______________ (1) Reflects preliminary statutory results as of March 31, 2025. Earnings Conference Call Brighthouse Financial will hold a conference call and audio webcast to discuss its financial results for the first quarter of 2025 at 8:00 a.m. Eastern Time on Friday, May 9, 2025. In connection with this call, the company has prepared a presentation for use with investors and other members of the investment community. This presentation is available on the Brighthouse Financial Investor Relations webpage at To listen to the audio webcast via the internet and to access the related presentation, please visit the Brighthouse Financial Investor Relations webpage at To join the conference call via telephone as a participant, please register in advance at A replay of the conference call will be made available until Friday, May 23, 2025, on the Brighthouse Financial Investor Relations webpage at About Brighthouse Financial, Inc. Brighthouse Financial, Inc. (Brighthouse Financial) (Nasdaq: BHF) is on a mission to help people achieve financial security. As one of the largest providers of annuities and life insurance in the U.S.,(1) we specialize in products designed to help people protect what they've earned and ensure it lasts. Learn more at (1) Ranked by 2023 admitted assets. Best's Review®: Top 200 U.S. Life/Health Insurers. AM Best, 2024. Note Regarding Forward-Looking Statements This news release and other oral or written statements that we make from time to time may contain information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve substantial risks and uncertainties. We have tried, wherever possible, to identify such statements using words such as "anticipate," "estimate," "expect," "project," "may," "will," "could," "intend," "goal," "target," "guidance," "forecast," "preliminary," "objective," "continue," "aim," "plan," "believe" and other words and terms of similar meaning, or that are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include, without limitation, statements relating to future actions, prospective services or products, financial projections, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, as well as trends in operating and financial results. Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of Brighthouse Financial. These statements are based on current expectations and the current economic environment and involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others: differences between actual experience and actuarial assumptions and the effectiveness of our actuarial models; higher risk management costs and exposure to increased market risk due to guarantees within certain of our products; the effectiveness of our risk management strategy and the impacts of such strategy on volatility in our profitability measures and the negative effects on our statutory capital; material differences between actual outcomes and the sensitivities calculated under certain scenarios that we may utilize in connection with our risk management strategies; the impact of interest rates on our future universal life with secondary guarantees ("ULSG") policyholder obligations and net income volatility; the potential material adverse effect of changes in accounting standards, practices or policies applicable to us, including changes in the accounting for long-duration contracts; loss of business and other negative impacts resulting from a downgrade or a potential downgrade in our financial strength or credit ratings; the availability of reinsurance and the ability of the counterparties to our reinsurance or indemnification arrangements to perform their obligations thereunder; heightened competition, including with respect to service, product features, product mix, scale, price, actual or perceived financial strength, claims-paying ratings, credit ratings, e-business capabilities and name recognition; our ability to market and distribute our products through distribution channels and maintain relationships with key distribution partners; any failure of third parties to provide services we need, any failure of the practices and procedures of such third parties and any inability to obtain information or assistance we need from third parties; the ability of our subsidiaries to pay dividends to us, and our ability to pay dividends to our shareholders and repurchase our common stock; the risks associated with climate change; the adverse impact of public health crises, extreme mortality events or similar occurrences on our business and the economy in general; the impact of adverse capital and credit market conditions, including with respect to our ability to meet liquidity needs and access capital; the impact of economic conditions in the capital markets and the U.S. and global economy, as well as geopolitical events, tariffs imposed or threatened by the U.S. or foreign governments, military actions or catastrophic events, on our profitability measures as well as our investment portfolio, including on realized and unrealized losses and impairments, net investment spread and net investment income; the financial risks that our investment portfolio is subject to, including credit risk, interest rate risk, inflation risk, market valuation risk, liquidity risk, real estate risk, derivatives risk, and other factors outside our control; the impact of changes in regulation and in supervisory and enforcement policies or interpretations thereof on our insurance business or other operations; the potential material negative tax impact of potential future tax legislation that could make some of our products less attractive to consumers or increase our tax liability; the effectiveness of our policies, procedures and processes in managing risk; the loss or disclosure of confidential information, damage to our reputation and impairment of our ability to conduct business effectively as a result of any failure in cyber- or other information security systems; whether all or any portion of the tax consequences of our separation from MetLife, Inc. are not as expected, leading to material additional taxes or material adverse consequences to tax attributes that impact us; and other factors described from time to time in documents that we file with the U.S. Securities and Exchange Commission (the "SEC"). For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements included and the risks, uncertainties and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2024, particularly in the sections entitled "Risk Factors" and "Quantitative and Qualitative Disclosures About Market Risk," as well as in our other subsequent filings with the SEC. 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. Non-GAAP and Other Financial Disclosures Our definitions of non-GAAP and other financial measures may differ from those used by other companies. Non-GAAP Financial Disclosures We present certain measures of our performance that are not calculated in accordance with accounting principles generally accepted in the United States of America, also known as "GAAP." We believe that these non-GAAP financial measures enhance the understanding of our performance by the investor community by highlighting the results of operations and the underlying profitability drivers of our 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: Most directly comparable GAAP financial measures: adjusted earnings net income (loss) available to shareholders (1) adjusted earnings, less notable items net income (loss) available to shareholders (1) adjusted revenues revenues adjusted expenses expenses adjusted earnings per common share earnings per common share, diluted (1) adjusted earnings per common share, less notable items earnings per common share, diluted (1) adjusted return on common equity return on common equity (2) adjusted return on common equity, less notable items return on common equity (2) adjusted net investment income net investment income adjusted net investment income yield net investment income yield __________________ (1) Brighthouse uses net income (loss) available to shareholders to refer to net income (loss) available to Brighthouse Financial, Inc.'s common shareholders, and earnings per common share, diluted to refer to net income (loss) available to shareholders per common share. (2) Brighthouse uses return on common equity to refer to return on Brighthouse Financial, Inc.'s common stockholders' equity. Reconciliations to the most directly comparable historical GAAP measures are included for those measures which are presented herein. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are not accessible on a forward-looking basis because we believe it is not possible without unreasonable efforts to provide other than a range of net investment gains and losses and net derivative gains and losses, which can fluctuate significantly within or outside the range and from period to period and may have a material impact on net income (loss) available to shareholders. Adjusted Earnings, Adjusted Revenues and Adjusted Expenses Adjusted earnings is a financial measure used by management to evaluate performance and facilitate comparisons to industry results. This financial measure, which may be positive or negative, focuses on our primary businesses by excluding the impact of market volatility, which could distort trends. Adjusted earnings was updated during the first quarter of 2025 in connection with the establishment of a trading portfolio comprised of certain fixed income securities. The company did not have trading securities prior to the first quarter of 2025. Adjusted earnings reflect adjusted revenues less (i) adjusted expenses, (ii) provision for income tax expense (benefit), (iii) net income (loss) attributable to noncontrolling interests and (iv) preferred stock dividends. Provided below are the adjustments to GAAP revenues and GAAP expenses used to calculate adjusted revenues and adjusted expenses, respectively. The following items are excluded from total revenues in calculating the adjusted revenues component of adjusted earnings: Net investment gains (losses); Investment gains (losses) on trading securities measured at estimated fair value through net investment income; and Net derivative gains (losses) ("NDGL"), excluding earned income and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment ("Investment Hedge Adjustments"). The following items are excluded from total expenses in calculating the adjusted expenses component of adjusted earnings: Change in market risk benefits; and Change in fair value of the crediting rate on experience-rated contracts and market value adjustments on institutional group annuities that are economically offset by gains (losses) on the related trading securities ("Market Value Adjustments"). The provision for income tax related to adjusted earnings is calculated using the statutory tax rate of 21%, net of impacts related to the dividends received deduction, tax credits and current period non-recurring items. Consistent with GAAP guidance for segment reporting, adjusted earnings is also our GAAP measure of segment performance. Adjusted Earnings per Common Share and Adjusted Return on Common Equity Adjusted earnings per common share and adjusted return on common equity are measures used by management to evaluate the execution of our business strategy and align such strategy with our shareholders' interests. Adjusted earnings per common share is defined as adjusted earnings for the period divided by the weighted average number of fully diluted shares of common stock outstanding for the period. The weighted average common shares outstanding used to calculate adjusted earnings per share will differ from such shares used to calculate diluted net income (loss) available to shareholders per common share when the inclusion of dilutive shares has an anti-dilutive effect for one calculation but not for the other. Adjusted return on common equity is defined as total annual adjusted earnings on a four quarter trailing basis, divided by the simple average of the most recent five quarters of total Brighthouse Financial, Inc.'s common stockholders' equity, excluding AOCI. Adjusted Net Investment Income Adjusted net investment income is used by management to measure our performance, and we believe it enhances the understanding of our investment portfolio results. Adjusted net investment income represents GAAP net investment income plus Investment Hedge Adjustments less investment gains (losses) on trading securities. Adjusted Net Investment Income Yield Similar to adjusted net investment income, adjusted net investment income yield is used by management as a performance measure that we believe enhances the understanding of our investment portfolio results. Adjusted net investment income yield represents adjusted net investment income as a percentage of average quarterly asset carrying values. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. Investment fee and expense yields are calculated as a percentage of average quarterly asset estimated fair values. Asset estimated fair values exclude collateral received in connection with our securities lending program, freestanding derivative assets and collateral received from derivative counterparties. Other Financial Disclosures Corporate Expenses Corporate expenses includes functional department expenses, public company expenses, certain investment expenses, retirement funding and incentive compensation. Notable Items Certain of the non-GAAP measures described above may be presented further adjusted to exclude notable items. Notable items reflect the unfavorable (favorable) after-tax impact on our results of certain unanticipated items and events, as well as certain items and events that were anticipated. The presentation of notable items and non-GAAP measures, less notable items is intended to help investors better understand our results and to evaluate and forecast those results. Book Value per Common Share and Book Value per Common Share, excluding AOCI Brighthouse uses the term "book value" to refer to "Brighthouse Financial, Inc.'s common stockholders' equity, including AOCI." Book value per common share is defined as ending Brighthouse Financial, Inc.'s common stockholders' equity, including AOCI, divided by ending common shares outstanding. Book value per common share, excluding AOCI, is defined as ending Brighthouse Financial, Inc.'s common stockholders' equity, excluding AOCI, divided by ending common shares outstanding. CTE70 CTE70 is defined as the amount of assets required to satisfy contract holder obligations across market environments in the average of the worst thirty percent of a set of capital market scenarios over the life of the contracts. CTE98 CTE98 is defined as the amount of assets required to satisfy contract holder obligations across market environments in the average of the worst two percent of a set of capital market scenarios over the life of the contracts. Holding Company Holding company means, collectively, Brighthouse Financial, Inc., Brighthouse Holdings, LLC, and Brighthouse Services, LLC. Holding Company Liquid Assets Holding company liquid assets include liquid assets in Brighthouse Financial, Inc., Brighthouse Holdings, LLC, and Brighthouse Services, LLC. Liquid assets are comprised of cash and cash equivalents, short-term investments and publicly-traded securities, excluding assets that are pledged or otherwise committed. Assets pledged or otherwise committed include assets held in trust. Total Adjusted Capital Total adjusted capital primarily consists of statutory capital and surplus, as well as the statutory asset valuation reserve. When referred to as "combined," represents that of our insurance subsidiaries as a whole. Sales Life insurance sales consist of 100 percent of annualized new premium for term life, first-year paid premium for whole life, universal life, and variable universal life, and total paid premium for indexed universal life. We exclude company-sponsored internal exchanges, corporate-owned life insurance, bank-owned life insurance, and private placement variable universal life. Annuity sales consist of 100 percent of direct statutory premiums, except for fixed index annuity sales, which represents 100 percent of gross sales on directly written business and the proportion of assumed gross sales under reinsurance agreements. Annuity sales exclude certain internal exchanges. These sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity. Normalized Statutory Earnings (Loss) Normalized statutory earnings (loss) is used by management to measure our insurance companies' ability to pay future distributions and incorporates the effectiveness of our hedging program as well as other factors related to our business. Normalized statutory earnings (loss) is calculated as statutory pre-tax net gain (loss) from operations adjusted for the favorable or unfavorable impacts of (i) net realized capital gains (losses) before capital gains tax (excluding gains (losses) and taxes transferred to the interest maintenance reserve), (ii) the change in total asset requirement at CTE98, net of the change in our variable annuity reserves, which are calculated at CTE70, and (iii) pre-tax unrealized gains (losses) associated with our variable annuities and Shield hedges, net of reinsurance, and other equity risk management strategies. Normalized statutory earnings (loss) may be further adjusted for certain unanticipated items that impact our results in order to help management and investors better understand, evaluate and forecast those results. Risk-Based Capital Ratio The risk-based capital ratio is a method of measuring an insurance company's capital, taking into consideration its relative size and risk profile, in order to ensure compliance with minimum regulatory capital requirements set by the National Association of Insurance Commissioners. When referred to as "combined," represents that of our insurance subsidiaries as a whole. The reporting of our combined risk-based capital ratio is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities. Condensed Statements of Operations (Unaudited, in millions) For the Three Months Ended Revenues March 31, 2025 December 31, 2024 March 31, 2024 Premiums $186 $207 $202 Universal life and investment-type product policy fees 543 540 436 Net investment income 1,297 1,373 1,254 Other revenues 136 150 145 Revenues before NIGL and NDGL 2,162 2,270 2,037 Net investment gains (losses) (83) (73) (42) Net derivative gains (losses) 311 (992) (1,921) Total revenues $2,390 $1,205 $74 Expenses Policyholder benefits and claims $649 $662 $968 Interest credited to policyholder account balances 561 569 502 Amortization of DAC and VOBA 148 148 151 Change in market risk benefits 893 (1,487) (1,440) Interest expense on debt 38 38 38 Other expenses 455 441 469 Total expenses 2,744 371 688 Income (loss) before provision for income tax (354) 834 (614) Provision for income tax expense (benefit) (88) 162 (123) Net income (loss) (266) 672 (491) Less: Net income (loss) attributable to noncontrolling interests 2 1 2 Net income (loss) attributable to Brighthouse Financial, Inc. (268) 671 (493) Less: Preferred stock dividends 26 25 26 Net income (loss) available to Brighthouse Financial, Inc.'s common shareholders $(294) $646 $(519) Condensed Balance Sheets (Unaudited, in millions) As of ASSETS March 31, 2025 December 31, 2024 March 31, 2024 Investments: Fixed maturity securities available-for-sale $80,640 $80,055 $80,474 Trading securities 365 — — Equity securities 73 77 86 Mortgage loans 23,051 23,286 22,670 Policy loans 1,436 2,024 1,651 Limited partnerships and limited liability companies 4,839 4,827 4,920 Short-term investments 1,569 1,868 1,347 Other invested assets 5,284 5,250 4,746 Total investments 117,257 117,387 115,894 Cash and cash equivalents 4,667 5,045 3,823 Accrued investment income 1,267 1,277 1,297 Reinsurance recoverables 20,454 20,515 19,570 Premiums and other receivables 734 611 664 DAC and VOBA 4,672 4,710 4,829 Current income tax recoverable 20 19 28 Deferred income tax asset 1,808 1,875 2,063 Market risk benefit assets 914 1,092 839 Other assets 364 370 349 Separate account assets 82,524 85,636 90,332 Total assets $234,681 $238,537 $239,688 LIABILITIES AND EQUITY Liabilities Future policy benefits $31,834 $31,475 $32,245 Policyholder account balances 85,618 87,989 84,159 Market risk benefit liabilities 9,165 8,329 8,964 Other policy-related balances 3,866 3,878 3,798 Payables for collateral under securities loaned and other transactions 3,904 3,891 3,653 Long-term debt 3,155 3,155 3,155 Other liabilities 9,311 9,160 9,122 Separate account liabilities 82,524 85,636 90,332 Total liabilities 229,377 233,513 235,428 Equity Preferred stock, at par value — — — Common stock, at par value 1 1 1 Additional paid-in capital 13,939 13,927 13,989 Retained earnings (deficit) (1,387) (1,119) (2,000) Treasury stock (2,644) (2,572) (2,382) Accumulated other comprehensive income (loss) (4,670) (5,278) (5,413) Total Brighthouse Financial, Inc.'s stockholders' equity 5,239 4,959 4,195 Noncontrolling interests 65 65 65 Total equity 5,304 5,024 4,260 Total liabilities and equity $234,681 $238,537 $239,688 Reconciliation of Net Income (Loss) Available to Shareholders to Adjusted Earnings (Loss) and Adjusted Earnings, Less Notable Items, and Reconciliation of Net Income (Loss) Available to Shareholders per Common Share to Adjusted Earnings (Loss) per Common Share and Adjusted Earnings, Less Notable Items, per Common Share (Unaudited, in millions except per share data) For the Three Months Ended ADJUSTED EARNINGS, LESS NOTABLE ITEMS March 31, 2025 December 31, 2024 March 31, 2024 Net income (loss) available to shareholders $(294) $646 $(519) Less: Net investment gains (losses) (83) (73) (42) Less: Investment gains (losses) on trading securities 6 — — Less: Net derivative gains (losses), excluding investment hedge adjustments 311 (995) (1,934) Less: Change in market risk benefits (893) 1,487 1,440 Less: Market value adjustments (10) 14 4 Less: Provision for income tax (expense) benefit on reconciling adjustments 140 (91) 111 Adjusted earnings (loss) 235 304 (98) Less: Notable items (10) (48) (366) Adjusted earnings, less notable items $245 $352 $268 ADJUSTED EARNINGS, LESS NOTABLE ITEMS, PER COMMON SHARE (1) Net income (loss) available to shareholders per common share $(5.04) $10.79 $(8.22) Less: Net investment gains (losses) (1.42) (1.22) (0.67) Less: Investment gains (losses) on trading securities 0.10 — — Less: Net derivative gains (losses), excluding investment hedge adjustments 5.34 (16.63) (30.68) Less: Change in market risk benefits (15.33) 24.86 22.84 Less: Market value adjustments (0.17) 0.23 0.06 Less: Provision for income tax (expense) benefit on reconciling adjustments 2.40 (1.52) 1.76 Less: Impact of inclusion of dilutive shares 0.03 — — Adjusted earnings (loss) per common share 4.01 5.07 (1.56) Less: Notable items (0.17) (0.80) (5.81) Adjusted earnings, less notable items per common share $4.17 $5.88 $4.25 (1) Per share calculations are on a diluted basis and may not recalculate or foot due to rounding. For loss periods, dilutive shares were not included in the calculation as inclusion of such shares would have an anti-dilutive effect. See Non-GAAP and Other Financial Disclosures discussion in this news release. Reconciliation of Net Investment Income to Adjusted Net Investment Income (Unaudited, in millions) For the Three Months Ended ADJUSTED NET INVESTMENT INCOME (1) March 31, 2025 December 31, 2024 March 31, 2024 Net investment income $1,297 $1,373 $1,254 Add: Investment hedge adjustments — 3 13 Less: Investment gains (losses) on trading securities 6 — — Adjusted net investment income $1,291 $1,376 $1,267 Reconciliation of Investment Income Yield to Adjusted Net Investment Income Yield For the Three Months Ended ADJUSTED NET INVESTMENT INCOME YIELD (1) March 31, 2025 December 31, 2024 March 31, 2024 Investment income yield 4.39% 4.64% 4.39% Investment fees and expenses (0.14)% (0.13)% (0.14)% Adjusted net investment income yield 4.25% 4.51% 4.25% Notable Items (Unaudited, in millions) For the Three Months Ended NOTABLE ITEMS IMPACTING ADJUSTED EARNINGS March 31, 2025 December 31, 2024 March 31, 2024 Actuarial items and other insurance adjustments $10 $48 $366 Total notable items (1) $10 $48 $366 NOTABLE ITEMS BY SEGMENT Annuities $10 $48 $— Life — — 73 Run-off — — 293 Corporate & Other — — — Total notable items (1) $10 $48 $366 (1) See Non-GAAP and Other Financial Disclosures discussion in this news release. View source version on Contacts FOR INVESTORS Dana Amante(980) 949-3073damante@ FOR MEDIA Deon Roberts(980)
