AETNA REPORTS SECOND QUARTER 1995 RESULTS.HARTFORD Hartford, city (1990 pop. 139,739), state capital, Hartford co., central Conn., on the west bank of the Connecticut River; settled as Newtown 1635–36 on the site of a Dutch trading post (1633; abandoned 1654), inc. 1784. , Conn.--(BUSINESS WIRE)--July 28, 1995--Aetna Life & Casualty today announced second quarter 1995 operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before (a) of $203 million ($1.80 per common share) before environmental charges, compared with earnings of $217 million ($1.92 per common share) before environmental charges a year earlier. Second quarter 1994 earnings were bolstered bol·ster n. A long narrow pillow or cushion. tr.v. bol·stered, bol·ster·ing, bol·sters 1. To support or prop up with or as if with a long narrow pillow or cushion. 2. by a $54 million reduction in personal auto reserves. As previously announced, second quarter 1995 results included an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge of $488 million ($4.31 per common share) for additions to environmental reserves. Second quarter 1994 results included $77 million ($0.68 per share) of such charges. Including these charges, second quarter 1995 operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. were $284 million ($2.51 per share) compared with 1994 second quarter operating earnings of $140 million ($1.24 per share). "I'm I'm Contraction of I am. Our Living Language Speakers of some scattered varieties of American English sometimes use I'm instead of I've or I have in present perfect constructions, as in pleased to report progress in all of our businesses in the second quarter," Aetna Aetna, volcano: see Etna, Italy. Chairman Ronald E. Compton Compton, city (1990 pop. 90,454), Los Angeles co., S Calif., a suburb between Los Angeles and Long Beach; inc. 1888. It has aircraft, electronic, and steel industries. Largely African American, Compton is a noted center for rap music. said. "Our property-casualty business showed improved earnings before the environmental charge and last year's second quarter auto reserve release. "The international business also showed strong earnings gains, continuing our rapid growth in new markets, and the asset accumulation Accumulation 1) In the context of individual investing, it is the process of contributing cash to invest in securities over a period of time in order to build a portfolio of desired value. Dividends and capital gains are also reinvested during this process. businesses delivered solid results. In health, earnings declined as a result of increased medical costs, as well as planned investments to expand our managed care business. We expect the transition to managed care will position us to more effectively control medical costs, while ensuring high quality health care for our members. "Finally, our bottom line continues to benefit from our corporate cost-cutting program. We continue to invest in our health, asset accumulation and international businesses in order to improve Aetna's long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. financial performance." (a) Operating earnings include net income or loss, excluding net realized capital gains and losses. After-tax realized capital losses in the second quarter of 1995 were $13 million. Segment Results Aetna Health Plans, which includes health care, specialty health and group insurance, reported second quarter 1995 operating earnings of $73 million, compared with $93 million of earnings in the second quarter of 1994. The decline in earnings was due to higher medical costs in our indemnity Recompense for loss, damage, or injuries; restitution or reimbursement. An indemnity contract arises when one individual takes on the obligation to pay for any loss or damage that has been or might be incurred by another individual. and PPO PPO abbr. preferred provider organization PPO Managed care Preferred provider organization, see there Infectious disease Pleuropneumonia-like organism, see there product lines, combined with the continued investment in, and expansion of, the managed care-related business. Net realized capital losses were $4 million in the second quarter of 1995, compared to net gains of $1 million for the same period last year. Aetna Life Insurance & Annuity annuity: see insurance. annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. markets a variety of life insurance, retirement and investment products, and mutual funds to individuals and small businesses. In the second quarter of 1995, this segment reported operating earnings of $42 million, level with 1994 second quarter earnings. Aetna Life Insurance & Annuity benefited from increased earnings attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to growth in assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. , offset by increased operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. associated in part with the development of an improved contract administration system. Second quarter 1995 net realized capital gains were $4 million, compared to losses of $1 million in the 1994 second quarter. Large Case Pensions, which markets a variety of retirement and other savings products to large case customers, reported second quarter 1995 operating earnings of $20 million, compared with earnings of $14 million last year. The improvement primarily reflected an increase in fees and other income and higher interest margins. Net realized capital gains were $9 million in the 1995 second quarter, compared to $3 million of net losses in the second quarter of 1994. Property-Casualty, which includes both personal and commercial property-casualty insurance, reported operating earnings of $91 million before environmental charges in the second quarter of 1995, compared with $105 million before environmental charges in the 1994 second quarter. Second quarter 1994 earnings benefited from a $54 million reduction in reserves in the personal auto business. Catastrophe Catastrophe, from the Greek Καταστροφή (katastrephein), literally means "to turn" (strephein) "downwards" (kata-). costs were $25 million this quarter, compared with $29 million in the second quarter of 1994. Adjusting for the above factors, 1995 earnings reflect improved underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. results, lower expenses and higher investment income. Environmental reserve additions in the 1995 second quarter were $488 million compared to $77 million in the 1994 second quarter. Including these environmental charges, second quarter 1995 operating losses were $396 million, compared to earnings of $28 million in the 1994 second quarter. This segment posted net realized capital losses of $22 million in the second quarter of 1995, compared with net losses of $8 million in the second quarter of 1994. International, which primarily sells life insurance and financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. products in non-U non-U adj. Chiefly British Not characteristic of the upper class, especially in language usage. [non- + U2. .S. markets, reported operating earnings of $23 million in the second quarter of 1995, compared with earnings of $17 million last year. The improvement in results primarily reflects earnings growth in the Pacific Rim Pacific Rim, term used to describe the nations bordering the Pacific Ocean and the island countries situated in it. In the post–World War II era, the Pacific Rim has become an increasingly important and interconnected economic region. . Net realized capital gains and losses were negligible  This article or section is written like a personal reflection or and may require .Please [ improve this article] by rewriting this article or section in an . in the second quarter of 1995 and 1994. The Corporate segment reported net operating expenses of $47 million in the second quarter of 1995, compared with $54 million in the 1994 second quarter. This reflected lower expenses from corporate staff areas partially offset by higher interest expense. Net realized capital losses were negligible in the second quarter of 1995, compared to net gains of $3 million in the 1994 second quarter. Net Income (Loss) The second quarter 1995 net loss was $297 million ($2.62 per common share), compared with net income of $132 million ($1.17 per common share) in the 1994 second quarter. Capital Gains/Losses Net income in the second quarter of 1995 reflected net realized capital losses of $13 million ($.11 per common share), compared with net losses of $8 million ($.07 per common share) in the second quarter of 1994, after taxes and after gains and losses allocated to experience-rated pension contractholders. Shareholders' Equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. Total shareholders' equity was $6.7 billion ($58.76 per common share) at June June: see month. 30, 1995, up 7 percent from first quarter 1995 primarily reflecting an increase in the market value of debt securities due to lower interest rates, partially offset by current quarter results. Year-to-Date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. Operating Results Year-to-date operating earnings, absent environmental charges, were $389 million ($3.45 per common share) in 1995, compared with $291 million ($2.58 per share) in 1994. 1995 after-tax environmental charges were $506 million ($4.48 per share) compared to $98 million ($.86 per share) in 1994. Including these charges, year-to-date operating losses in 1995 were $117 million ($1.03 per share), compared to 1994 year-to-date earnings of $194 million ($1.71 per share). -0- Consolidated Statements of Income(1) (Millions, except per share data)
3 Months Ended June 30, 6 Months Ended June 30,
1995 1994 1995 1994
Revenue Premiums $ 2,825.7 $ 2,839.0 $ 5,754.7 $ 5,581.3 Net investment income 1,140.6 1,121.0 2,226.5 2,247.5 Fees and other income 506.7 465.8 982.7 926.4 Net realized capital losses (25.9) (13.4) (32.3) (19.3) Total revenue 4,447.1 4,412.4 8,931.6 8,735.9 Benefits and Expenses Current and future benefits 3,767.4 3,114.5 6,889.8 6,232.1 Operating expenses 962.0 924.5 1,897.0 1,882.0 Amortization of deferred policy acquisition costs 196.6 185.2 383.8 377.2 Total benefits and expenses 4,926.0 4,224.2 9,170.6 8,491.3 Income (Loss) before income taxes (478.9) 188.2 (239.0) 244.6 Federal and foreign income taxes (benefits) (182.0) 55.8 (102.9) 66.5 Net Income (Loss) $ (296.9) $ 132.4 $ (136.1) $ 178.1 Shareholders' Equity $ 6,653.0 $6,049.4 $ 6,653.0 $ 6,049.4 Results per Common Share Net income (loss) $ (2.62) $ 1.17 $ (1.20) $ 1.58 Net realized capital losses, net of tax $ (.11) $ (.07) $ (.17) $ (.13) Shareholders' equity $ 58.76 $ 53.72 $ 58.76 $ 53.72 Dividends Declared $ .69 $ .69 $ 1.38 $ 1.38
(1) Additional information on the company's results is published
in the 1995 Second Quarter Financial and Asset Quality Supplements
available from Daniel S. Messina, Vice President, Financial
Relations, (203) 273-1763.
-0- Segment Information(a) (Millions)
3 Months Ended June 30, 6 Months Ended June 30,
1995 1994 1995 1994
Aetna Health Plans: Premiums $ 1,461.8 $ 1,429.7 $ 2,956.5 $ 2,756.6 Operating earnings 73.0 93.2 149.4 182.6 Net realized capital gains (losses) (3.5) 0.8 (6.3) (11.2) Net Income $ 69.5 $ 94.0 $ 143.1 $ 171.4 Aetna Life Insurance & Annuity: Premiums $ 49.6 $ 38.7 $ 92.0 $ 74.7 Operating earnings 42.4 42.3 84.0 83.8 Net realized capital gains (losses) 4.1 (1.0) 6.0 (3.0) Net Income $ 46.5 $ 41.3 $ 90.0 $ 80.8 Large Case Pensions: Premiums $ 58.8 $ 43.3 $ 183.2 $ 100.2 Operating earnings 19.9 14.3 36.2 26.9 Net realized capital gains (losses) 8.8 (2.9) 3.8 (8.9) Net Income $ 28.7 $ 11.4 $ 40.0 $ 18.0 Property-Casualty: Premiums $ 1,003.2 $ 1,093.5 $ 2,050.1 $ 2,211.4 Adjusted operating earnings 91.4 104.5 174.4 82.7 Environmental charges (487.5) (76.8) (505.7) (97.6) Operating earnings (losses) (396.1) 27.7 (331.3) (14.9) Net realized capital gains (losses) (21.9) (7.7) (18.3) 8.7 Net Income (Loss) $ (418.0) $ 20.0 $ (349.6) $ (6.2) International: Premiums $ 252.3 $ 233.8 $ 472.9 $ 438.4 Operating earnings 23.3 16.9 40.2 27.5 Net realized capital gains (losses) 0.3 (0.2) (2.5) 2.8 Net Income $ 23.6 $ 16.7 $ 37.7 $ 30.3 Corporate: Net operating expenses $ (46.9) $ (54.0) $ (95.1) $ (112.3) Net realized capital gains (losses) (0.3) 3.0 (2.2) (3.9) Net Expense $ (47.2) $ (51.0) $ (97.3) $ (116.2) Total Company: Premiums $ 2,825.7 $ 2,839.0 $ 5,754.7 $ 5,581.3 Adjusted operating earnings 203.1 217.2 389.1 291.2 Environmental charges (487.5) (76.8) (505.7) (97.6) Operating earnings (losses) (284.4) 140.4 (116.6) 193.6 Net realized capital losses (12.5) (8.0) (19.5) (15.5) Net Income (Loss) $ (296.9) $ 132.4 $ (136.1) $ 178.1 (a) Additional information on the company's results is published in the 1995 Second Quarter Financial and Asset Quality Supplements available from Daniel S Daniel, book of the Bible Daniel, book of the Bible. It combines "court" tales, perhaps originating from the 6th cent. B.C., and a series of apocalyptic visions arising from the time of the Maccabean emergency (167–164 B.C. . Messina Messina (mās-sē`nä), city (1991 pop. 231,693), capital of Messina prov., NE Sicily, Italy, on the Strait of Messina, opposite the Italian mainland. It is a busy seaport and a commercial and light industrial center. , Vice President, Financial Relations, (203) 273-1763. CONTACT: Eric ERIC Educational Research Information Clearinghouse ERIC Educational Resources Information Center ERIC ERISA Industry Committee ERIC Epidemiologic Research and Information Center (Durham, NC) D. Cormier (Media) (203) 273-8096 or Daniel S. Messina (Investors) (203) 273-6184 |
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