Exhibit 99.1
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Table of Contents
| Page | ||
| Letter to Investor/Analyst |
2 | |
| Basis of Presentation of Financial Information |
3 | |
| Use of Non-GAAP Measures |
4 | |
| Reconciliation of Net Earnings to Adjusted Pro Forma Net Operating Earnings |
5 | |
| Reconciliation of Historical Financial Information to Adjusted Pro Forma Financial Information - QTD |
6 | |
| Reconciliation of Historical Financial Information to Adjusted Pro Forma Financial Information - YTD |
7 | |
| Notes to Adjusted Pro Forma Financial Information |
8 | |
| Adjusted Pro Forma Highlights | ||
| Adjusted Pro Forma Financial Highlights - QTD |
10 | |
| Adjusted Pro Forma Financial Highlights - YTD |
11 | |
| Adjusted Pro Forma Earnings from Continuing Operations - QTD |
12 | |
| Adjusted Pro Forma Earnings from Continuing Operations - YTD |
13 | |
| Adjusted Pro Forma Information | ||
| Adjusted Pro Forma Statement of Earnings by Segment - QTD |
15 | |
| Adjusted Pro Forma Statement of Earnings by Segment - YTD |
16 | |
| Adjusted Pro Forma Segment Net Earnings QTD - Retirement Income and Investments |
17 | |
| Adjusted Pro Forma Segment Net Earnings YTD - Retirement Income and Investments |
18 | |
| Adjusted Pro Forma Net Earnings by Quarter |
19 | |
| Adjusted Pro Forma Segment Net Earnings by Quarter – Retirement Income and Investments |
20 | |
| Corporate Information | 21 | |
1
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Dear Investor/Analyst,
In advance of our Strategic Update meeting on December 15, 2004, we have prepared certain adjusted pro forma financial information, contained in this report, that reflects an upcoming change in the basis for the presentation of our pro forma financial results. We believe it is useful to investors and analysts for us to communicate this change, along with the resulting adjustments to our previously published pro forma financial information, in advance of year-end reporting.
Adjustments for pro forma financial information typically are required, consistent with SEC regulations, to be prepared assuming the relevant transactions were consummated at the beginning of the most recent fiscal year presented. In our case, this means that the pro forma financial information previously provided for the first three quarters of 2004 assumed that all transactions effected in connection with our IPO had an effective date of January 1, 2003, the beginning of the most recent fiscal year currently presented. Beginning with the publication of our financial information for fiscal year 2004, consistent with SEC regulations, this assumed effective date will change to January 1, 2004.
The change in the assumed effective date will impact the pro forma adjustments related to the reinsurance transactions that we entered into during the second quarter of 2004. The after-tax impact of this change is a $6 million reduction of our pro forma net earnings for the nine months ended September 30, 2004. This impact is reflected entirely in the Retirement Income and Investments segment, where most of the reinsured business was written. The change in the assumed effective date does not have any impact on the pro forma adjustments relating to the other transactions effected in connection with our IPO, including adjustments related to businesses that were not transferred to us and adjustments for changes in our capitalization.
This report provides our previously published pro forma financial information, as adjusted for the upcoming change in the assumed effective date. Please note that this report provides only adjusted pro forma financial information that differs from previously published pro forma financial information as a result of the upcoming change.
Please call if you have any additional questions.
Regards,
Jean Peters
Senior Vice President
Investor Relations and Corporate Communications
804 662-2693
Alicia Charity
Vice President
Investor Relations
804 662-2248
2
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Basis of Presentation of Financial Information
As part of a corporate reorganization effected in connection with the company’s IPO, the company acquired substantially all of the assets and liabilities of GE Financial Assurance Holdings, Inc. (GEFAHI), an indirect subsidiary of GE. The company also acquired certain other insurance businesses that were owned by other GE subsidiaries but managed by members of the company’s management team. In consideration for the assets that the company acquired and the liabilities that the company assumed, the company issued various equity and debt securities to GEFAHI.
The company has prepared its historical financial information as if the company had been in existence throughout all relevant periods. The historical financial information through the date of the corporate reorganization (May 24, 2004) includes all businesses that were owned by GEFAHI, including those that were not transferred to the company, as well as the other insurance businesses that the company acquired from other GE subsidiaries in connection with the corporate reorganization. As a result, the company’s historical financial information for periods prior to the corporate reorganization is not comparable to historical financial information for periods ending after that date.
Prior to the completion of the IPO, the company entered into several significant reinsurance transactions with Union Fidelity Life Insurance Company (UFLIC), an indirect subsidiary of GE. As part of these transactions, the company ceded to UFLIC, effective as of January 1, 2004, policy obligations under all of its in-force structured settlement contracts, which had reserves of $12.0 billion, and substantially all of its in-force variable annuity contracts, which had general account reserves of $2.8 billion and separate account reserves of $7.9 billion, each as of December 31, 2003. These contracts represent substantially all of the company’s contracts that were in force as of December 31, 2003 for these products. In addition, effective as of January 1, 2004, the company ceded to UFLIC policy obligations under a block of long-term care insurance policies, which had reserves of $1.5 billion as of December 31, 2003. As part of the reinsurance transactions, UFLIC ceded to the company in-force blocks of Medicare supplement insurance, which had reserves of $19 million.
The unaudited pro forma financial information contained in this report reflects the company’s historical combined financial information as adjusted to give effect to the transactions described below and certain other transactions as if each had occurred as of January 1, 2003:
| • | the removal of certain businesses of GEFAHI that were not transferred to the company in connection with the corporate reorganization; |
| • | the reinsurance transactions with UFLIC; |
| • | the issuance of equity and debt securities to GEFAHI in exchange for the assets that the company acquired and the liabilities that the company assumed in connection with the corporate reorganization; and |
| • | the issuance and sale of $1.9 billion of senior notes and $500 million of commercial paper and the application of the proceeds therefrom. |
The unaudited adjusted pro forma financial information contained in this report reflects the company’s pro forma financial information, as further adjusted to give effect to the same transactions described above as if each had occurred as of January 1, 2004.
The unaudited pro forma financial information is based upon available information and assumptions that the company believes are reasonable. The unaudited pro forma financial information is for illustrative and informational purposes only and is not intended to represent or be indicative of what the company’s financial condition or results of operations would have been had the transactions described above occurred on the dates indicated, nor what they may be in the future.
3
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Use of Non-GAAP Measures
This report includes the non-GAAP financial measure entitled “net operating earnings.” The company defines net operating earnings as pro forma net earnings from continuing operations, excluding pro forma after-tax net realized investment gains and losses (which can fluctuate significantly from period to period), changes in accounting principles and non-recurring, infrequent or unusual items. There were no non-recurring, infrequent or unusual items excluded from pro forma net operating earnings for the periods presented in this financial supplement other than a $22 million tax charge during the three months ended June 30, 2004 arising from the company’s separation from GE on May 28, 2004.
Management believes that analysis of net operating earnings enhances understanding and comparability of performance by highlighting underlying business activity and profitability drivers. However, net operating earnings should not be viewed as a substitute for GAAP net earnings. In addition, the company’s definition of net operating earnings may differ from the definitions used by other companies. The table on page 5 of this report provides a reconciliation of adjusted pro forma net operating earnings (as defined below) to historical and pro forma net earnings.
All net realized investment gains (losses) are reflected in the Corporate and Other Segment and are not reflected in the results of any of the company’s other segments. As a result, the segment results contained in this financial supplement are presented on a net operating earnings basis, which is the same as net earnings under GAAP for all segments, except for the Corporate and Other Segment. For a reconciliation of pro forma net operating earnings for the Corporate and Other Segment to pro forma net earnings presented in accordance with GAAP, see the tables on pages 10 and 11 in this report. The term “net operating loss” as used in this report is also a non-GAAP financial measure and has an analogous meaning to “net operating earnings.”
Beginning with its earnings release for the year ended December 31, 2004, the company will present pro forma financial information for periods in 2004 that assumes the transactions described above had occurred on January 1, 2004. The company believes it is useful to its investors and analysts for it to communicate this change now, along with the resulting adjustments to previously published pro forma financial information, to enable them to become familiar with the change in the assumed effective date in advance of the year-end reporting season. As a result, this report includes the non-GAAP financial measure entitled “adjusted pro forma.”
The company defines adjusted pro forma to mean pro forma financial information for the first three quarters of 2004 (previously published and prepared in accordance with applicable regulations of the Securities and Exchange Commission, assuming that the transactions described above under “Basis of Historical and Pro Forma Financial Information” had occurred on January 1, 2003), as further adjusted to give effect to such transactions as if they had occurred on January 1, 2004. The tables on pages 5-7 provide reconciliations of adjusted pro forma financial information to historical financial information.
4
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Reconciliation of Net Earnings to Adjusted Pro Forma Net Operating Earnings
(Amounts in millions, except per share data)
| Three months ended |
Six months ended |
Nine months ended |
||||||||||||||||||
| March 31, 2004 |
June 30, 2004 |
September 30, 2004 |
June 30, 2004 |
September 30, 2004 |
||||||||||||||||
| Net earnings |
$ | 272 | $ | 268 | $ | 271 | $ | 540 | $ | 811 | ||||||||||
| Net earnings from discontinued operations, net of taxes |
— | — | — | — | — | |||||||||||||||
| (Gain) loss on sale of discontinued operations, net of taxes |
(7 | ) | — | — | (7 | ) | (7 | ) | ||||||||||||
| Cumulative effect of accounting change, net of taxes |
(5 | ) | — | — | (5 | ) | (5 | ) | ||||||||||||
| Net earnings from continuing operations |
260 | 268 | 271 | 528 | 799 | |||||||||||||||
| Excluded assets and liabilities (a) |
1 | 6 | — | 7 | 7 | |||||||||||||||
| Reinsurance transactions (b) |
4 | (4 | ) | 2 | — | 2 | ||||||||||||||
| Capital structure and other (c) |
(9 | ) | (9 | ) | — | (18 | ) | (18 | ) | |||||||||||
| Pro forma net earnings from continuing operations | 256 | 261 | 273 | 517 | 790 | |||||||||||||||
| Adjustments for change in assumed effective date (d) |
(2 | ) | (2 | ) | (2 | ) | (4 | ) | (6 | ) | ||||||||||
| Adjusted pro forma net earnings from continuing operations | 254 | 259 | 271 | 513 | 784 | |||||||||||||||
| Pro forma net realized (gains) losses on investments, net of taxes |
(10 | ) | (4 | ) | (2 | ) | (14 | ) | (16 | ) | ||||||||||
| One-time tax charge relating to initial public offering, net of taxes |
— | 22 | — | 22 | 22 | |||||||||||||||
| Adjusted pro forma net operating earnings | $ | 244 | $ | 277 | $ | 269 | $ | 521 | $ | 790 | ||||||||||
| Net earnings per share | ||||||||||||||||||||
| Basic |
$ | 0.56 | $ | 0.55 | $ | 0.55 | $ | 1.10 | $ | 1.66 | ||||||||||
| Diluted |
$ | 0.56 | $ | 0.55 | $ | 0.55 | $ | 1.10 | $ | 1.65 | ||||||||||
| Net earnings from continuing operations per share | ||||||||||||||||||||
| Basic |
$ | 0.53 | $ | 0.55 | $ | 0.55 | $ | 1.08 | $ | 1.63 | ||||||||||
| Diluted |
$ | 0.53 | $ | 0.55 | $ | 0.55 | $ | 1.08 | $ | 1.63 | ||||||||||
| Pro forma net earnings from continuing operations per share | ||||||||||||||||||||
| Basic |
$ | 0.52 | $ | 0.53 | $ | 0.56 | $ | 1.06 | $ | 1.61 | ||||||||||
| Diluted |
$ | 0.52 | $ | 0.53 | $ | 0.56 | $ | 1.05 | $ | 1.61 | ||||||||||
| Adjusted pro forma net earnings from continuing operations | ||||||||||||||||||||
| Basic |
$ | 0.52 | $ | 0.53 | $ | 0.55 | $ | 1.05 | $ | 1.60 | ||||||||||
| Diluted |
$ | 0.52 | $ | 0.53 | $ | 0.55 | $ | 1.05 | $ | 1.60 | ||||||||||
| Adjusted pro forma net operating earnings per share | ||||||||||||||||||||
| Basic |
$ | 0.50 | $ | 0.57 | $ | 0.55 | $ | 1.06 | $ | 1.61 | ||||||||||
| Diluted |
$ | 0.50 | $ | 0.57 | $ | 0.55 | $ | 1.06 | $ | 1.61 | ||||||||||
| Shares outstanding | ||||||||||||||||||||
| Basic |
489.5 | 489.5 | 489.6 | 489.5 | 489.5 | |||||||||||||||
| Diluted |
489.5 | 490.1 | 490.4 | 490.1 | 490.4 | |||||||||||||||
Note: For a discussion of notes (a), (b), (c), and (d) to these tables see Notes To Adjusted Pro Forma Financial Information on page 8.
5
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Reconciliation of Historical Financial Information to Adjusted Pro Forma Financial Information - QTD
(Dollar amounts in millions)
| Three Months Ended March 31, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma adjustments - excluded assets and liabilities (a) |
Pro forma adjustments - reinsurance transactions (b) |
Pro forma adjustments - capital structure and other (c) |
Pro forma |
Adjustments for change in assumed effective date (d) |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 1,722 | $ | (54 | ) | $ | (49 | ) | $ | — | $ | 1,619 | $ | — | $ | 1,619 | |||||||||
| Net investment income |
1,037 | (18 | ) | (247 | ) | — | 772 | (19 | ) | 753 | |||||||||||||||
| Net realized investment gains (losses) |
16 | (1 | ) | — | — | 15 | — | 15 | |||||||||||||||||
| Policy fees and other income |
249 | (67 | ) | (30 | ) | — | 152 | (3 | ) | 149 | |||||||||||||||
| Total revenues |
3,024 | (140 | ) | (326 | ) | — | 2,558 | (22 | ) | 2,536 | |||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
1,351 | (49 | ) | (213 | ) | — | 1,089 | (9 | ) | 1,080 | |||||||||||||||
| Interest credited |
396 | — | (66 | ) | — | 330 | (7 | ) | 323 | ||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
508 | (73 | ) | (21 | ) | — | 414 | (1 | ) | 413 | |||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
345 | (29 | ) | (30 | ) | — | 286 | (2 | ) | 284 | |||||||||||||||
| Interest expense |
47 | — | — | 14 | 61 | — | 61 | ||||||||||||||||||
| Total benefits and expenses |
2,647 | (151 | ) | (330 | ) | 14 | 2,180 | (19 | ) | 2,161 | |||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
377 | 11 | 4 | (14 | ) | 378 | (3 | ) | 375 | ||||||||||||||||
| Provision for income taxes |
117 | 10 | — | (5 | ) | 122 | (1 | ) | 121 | ||||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 260 | $ | 1 | $ | 4 | $ | (9 | ) | $ | 256 | $ | (2 | ) | $ | 254 | |||||||||
|
Three Months Ended June 30, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma adjustments - excluded assets and liabilities (a) |
Pro forma adjustments - reinsurance transactions (b) |
Pro forma capital structure and other (c) |
Pro forma |
Adjustments for change in assumed effective date (d) |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 1,708 | $ | (26 | ) | $ | (42 | ) | $ | — | $ | 1,640 | $ | — | $ | 1,640 | |||||||||
| Net investment income |
1,001 | (10 | ) | (176 | ) | — | 815 | (18 | ) | 797 | |||||||||||||||
| Net realized investment gains (losses) |
8 | (2 | ) | — | — | 6 | — | 6 | |||||||||||||||||
| Policy fees and other income |
204 | (36 | ) | (20 | ) | — | 148 | (4 | ) | 144 | |||||||||||||||
| Total revenues |
2,921 | (74 | ) | (238 | ) | — | 2,609 | (22 | ) | 2,587 | |||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
1,290 | (22 | ) | (168 | ) | — | 1,100 | (3 | ) | 1,097 | |||||||||||||||
| Interest credited |
364 | — | (30 | ) | — | 334 | (10 | ) | 324 | ||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
476 | (44 | ) | (12 | ) | — | 420 | (4 | ) | 416 | |||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
305 | (17 | ) | (21 | ) | — | 267 | (3 | ) | 264 | |||||||||||||||
| Interest expense |
47 | — | — | 12 | 59 | — | 59 | ||||||||||||||||||
| Total benefits and expenses |
2,482 | (83 | ) | (231 | ) | 12 | 2,180 | (20 | ) | 2,160 | |||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
439 | 9 | (7 | ) | (12 | ) | 429 | (2 | ) | 427 | |||||||||||||||
| Provision for income taxes |
171 | 3 | (3 | ) | (3 | ) | 168 | — | 168 | ||||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 268 | $ | 6 | $ | (4 | ) | $ | (9 | ) | $ | 261 | $ | (2 | ) | $ | 259 | ||||||||
|
Three Months Ended September 30, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma excluded assets |
Pro forma adjustments - reinsurance |
Pro forma capital structure (c) |
Pro forma |
Adjustments for change in assumed effective date (d) |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 1,523 | $ | — | $ | — | $ | — | $ | 1,523 | $ | — | $ | 1,523 | |||||||||||
| Net investment income |
785 | — | 21 | — | 806 | (21 | ) | 785 | |||||||||||||||||
| Net realized investment gains (losses) |
3 | — | — | — | 3 | — | 3 | ||||||||||||||||||
| Policy fees and other income |
159 | — | 2 | — | 161 | (2 | ) | 159 | |||||||||||||||||
| Total revenues |
2,470 | — | 23 | — | 2,493 | (23 | ) | 2,470 | |||||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
1,034 | — | 7 | — | 1,041 | (7 | ) | 1,034 | |||||||||||||||||
| Interest credited |
328 | — | 8 | — | 336 | (8 | ) | 328 | |||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
399 | — | 2 | — | 401 | (2 | ) | 399 | |||||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
242 | — | 2 | — | 244 | (2 | ) | 242 | |||||||||||||||||
| Interest expense |
60 | — | — | — | 60 | — | 60 | ||||||||||||||||||
| Total benefits and expenses |
2,063 | — | 19 | — | 2,082 | (19 | ) | 2,063 | |||||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
407 | — | 4 | — | 411 | (4 | ) | 407 | |||||||||||||||||
| Provision for income taxes |
136 | — | 2 | — | 138 | (2 | ) | 136 | |||||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 271 | $ | — | $ | 2 | $ | — | $ | 273 | $ | (2 | ) | $ | 271 | ||||||||||
Note: For a discussion of notes (a), (b), (c), and (d) to these tables see Notes To Adjusted Pro Forma Financial Information on page 8.
6
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Reconciliation of Historical Financial Information to Adjusted Pro Forma Financial Information - YTD
(Dollar amounts in millions)
| Three Months Ended March 31, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma adjustments - excluded assets and liabilities (a) |
Pro forma adjustments - reinsurance transactions (b) |
Pro forma adjustments - capital structure and other (c) |
Pro forma |
Adjustments for change in |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 1,722 | $ | (54 | ) | $ | (49 | ) | $ | — | $ | 1,619 | $ | — | $ | 1,619 | |||||||||
| Net investment income |
1,037 | (18 | ) | (247 | ) | — | 772 | (19 | ) | 753 | |||||||||||||||
| Net realized investment gains (losses) |
16 | (1 | ) | — | — | 15 | — | 15 | |||||||||||||||||
| Policy fees and other income |
249 | (67 | ) | (30 | ) | — | 152 | (3 | ) | 149 | |||||||||||||||
| Total revenues |
3,024 | (140 | ) | (326 | ) | — | 2,558 | (22 | ) | 2,536 | |||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
1,351 | (49 | ) | (213 | ) | — | 1,089 | (9 | ) | 1,080 | |||||||||||||||
| Interest credited |
396 | — | (66 | ) | — | 330 | (7 | ) | 323 | ||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
508 | (73 | ) | (21 | ) | — | 414 | (1 | ) | 413 | |||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
345 | (29 | ) | (30 | ) | — | 286 | (2 | ) | 284 | |||||||||||||||
| Interest expense |
47 | — | — | 14 | 61 | — | 61 | ||||||||||||||||||
| Total benefits and expenses |
2,647 | (151 | ) | (330 | ) | 14 | 2,180 | (19 | ) | 2,161 | |||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
377 | 11 | 4 | (14 | ) | 378 | (3 | ) | 375 | ||||||||||||||||
| Provision for income taxes |
117 | 10 | — | (5 | ) | 122 | (1 | ) | 121 | ||||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 260 | $ | 1 | $ | 4 | $ | (9 | ) | $ | 256 | $ | (2 | ) | $ | 254 | |||||||||
|
Six Months Ended June 30, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma adjustments - excluded assets and liabilities (a) |
Pro forma adjustments - reinsurance transactions (b) |
Pro forma adjustments - capital structure and other (c) |
Pro forma |
Adjustments for change in assumed effective date (d) |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 3,430 | $ | (80 | ) | $ | (91 | ) | $ | — | $ | 3,259 | $ | — | $ | 3,259 | |||||||||
| Net investment income |
2,038 | (28 | ) | (423 | ) | — | 1,587 | (37 | ) | 1,550 | |||||||||||||||
| Net realized investment gains (losses) |
24 | (3 | ) | — | — | 21 | — | 21 | |||||||||||||||||
| Policy fees and other income |
453 | (103 | ) | (50 | ) | — | 300 | (7 | ) | 293 | |||||||||||||||
| Total revenues |
5,945 | (214 | ) | (564 | ) | — | 5,167 | (44 | ) | 5,123 | |||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
2,641 | (71 | ) | (381 | ) | — | 2,189 | (12 | ) | 2,177 | |||||||||||||||
| Interest credited |
760 | — | (96 | ) | — | 664 | (17 | ) | 647 | ||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
984 | (117 | ) | (33 | ) | — | 834 | (5 | ) | 829 | |||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
650 | (46 | ) | (51 | ) | — | 553 | (5 | ) | 548 | |||||||||||||||
| Interest expense |
94 | — | — | 26 | 120 | — | 120 | ||||||||||||||||||
| Total benefits and expenses |
5,129 | (234 | ) | (561 | ) | 26 | 4,360 | (39 | ) | 4,321 | |||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
816 | 20 | (3 | ) | (26 | ) | 807 | (5 | ) | 802 | |||||||||||||||
| Provision for income taxes |
288 | 13 | (3 | ) | (8 | ) | 290 | (1 | ) | 289 | |||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 528 | $ | 7 | $ | — | $ | (18 | ) | $ | 517 | $ | (4 | ) | $ | 513 | |||||||||
|
Nine Months Ended September 30, 2004 | |||||||||||||||||||||||||
| Historical |
Pro forma excluded assets |
Pro forma adjustments - reinsurance |
Pro forma capital structure (c) |
Pro forma |
Adjustments for change in assumed effective date (d) |
Adjusted pro forma | |||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Premiums |
$ | 4,953 | $ | (80 | ) | $ | (91 | ) | $ | — | $ | 4,782 | $ | — | $ | 4,782 | |||||||||
| Net investment income |
2,823 | (28 | ) | (402 | ) | — | 2,393 | (58 | ) | 2,335 | |||||||||||||||
| Net realized investment gains (losses) |
27 | (3 | ) | — | — | 24 | — | 24 | |||||||||||||||||
| Policy fees and other income |
612 | (103 | ) | (48 | ) | — | 461 | (9 | ) | 452 | |||||||||||||||
| Total revenues |
8,415 | (214 | ) | (541 | ) | — | 7,660 | (67 | ) | 7,593 | |||||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||||||||||
| Benefits and other changes in policy reserves |
3,675 | (71 | ) | (374 | ) | — | 3,230 | (19 | ) | 3,211 | |||||||||||||||
| Interest credited |
1,088 | — | (88 | ) | — | 1,000 | (25 | ) | 975 | ||||||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
1,383 | (117 | ) | (31 | ) | — | 1,235 | (7 | ) | 1,228 | |||||||||||||||
| Amortization of deferred acquisition costs and intangibles |
892 | (46 | ) | (49 | ) | — | 797 | (7 | ) | 790 | |||||||||||||||
| Interest expense |
154 | — | — | 26 | 180 | — | 180 | ||||||||||||||||||
| Total benefits and expenses |
7,192 | (234 | ) | (542 | ) | 26 | 6,442 | (58 | ) | 6,384 | |||||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
1,223 | 20 | 1 | (26 | ) | 1,218 | (9 | ) | 1,209 | ||||||||||||||||
| Provision for income taxes |
424 | 13 | (1 | ) | (8 | ) | 428 | (3 | ) | 425 | |||||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 799 | $ | 7 | $ | 2 | $ | (18 | ) | $ | 790 | $ | (6 | ) | $ | 784 | |||||||||
Note: For a discussion of notes (a), (b), (c), and (d) to these tables see Notes To Adjusted Pro Forma Financial Information on page 8.
7
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Notes to Adjusted Pro Forma Financial Information
| (a) | Reflects adjustments to exclude amounts included in the company’s historical combined earnings relating to (1) certain businesses (formerly reported in the company’s Affinity Segment) and certain investment partnerships, which in each case were not transferred to the company, and (2) net realized investment (gains) losses and related tax benefit arising from sales of Affinity segment assets that were reflected in the company’s Corporate and Other Segment. |
| (b) | Reflects adjustments to record the effects of the reinsurance transactions the company entered into with, and the related contribution the company made to, UFLIC, an indirect subsidiary of GE. As part of these transactions, the company ceded to UFLIC all of its in-force structured settlement contracts, substantially all of its in-force variable annuity contracts, and a block of long-term care insurance policies that it reinsured from Travelers in 2000, and it assumed from UFLIC a block of Medicare supplement insurance, all effective as of January 1, 2004. The unaudited pro forma earnings information gives effect to the reinsurance transactions as if each occurred as of January 1, 2003 and excludes the effects of all ceded reinsured contracts that were issued before January 1, 2003. The company has continued to sell variable annuities and structured settlements after completion of the reinsurance transactions and is retaining that business for its own account, subject to third party reinsurance in the ordinary course of business. |
As a result, the company’s unaudited pro forma combined statement of earnings reflects premiums and fees from these products issued after January 1, 2003, even though variable annuities and structured settlements issued during 2003 are included in the blocks of policies reinsured to UFLIC. The company’s pro forma combined statements of earnings exclude the impact of the entire block of long-term care insurance policies that the company ceded to UFLIC as the company did not issue any new policies for this block in 2003, and the company will not issue any in the future.
Under the reinsurance transactions, the company receives an expense allowance to reimburse it for costs it incurs to service the reinsured blocks. Actual costs and expense allowance amounts will be determined by expense studies to be conducted periodically. The pro forma adjustments have been prepared assuming that actual costs incurred during the pro forma periods, as determined under the company’s historical cost structure and allocation methods, were reimbursed by an expense allowance.
In addition to investment assets transferred to UFLIC in exchange for a reinsurance recoverable asset from UFLIC, concurrently, the company contributed $1.836 billion of capital to UFLIC which primarily represented the excess statutory capital in the company’s insurance subsidiaries after giving effect to the reinsurance transactions. As a significant portion of the assets transferred and contributed were not owned for the entire period, the pro forma earnings adjustments to reduce net investment income and net realized investment gains were based upon a proportional allocation of investment income from the investment assets historically identified (1) as supporting the blocks of business reinsured for the reinsurance, and (2) as representing surplus of subsidiaries providing assets to be contributed to UFLIC for the contribution.
| (c) | Reflects adjustments for changes in the company’s capitalization to exclude the impact of commercial paper, short-term borrowings from GE Capital and derivatives that were not transferred to the company in connection with the corporate reorganization and to include the impact of the issuance of $600 million of the company’s 6.00% Equity Units and $100 million of the company’s 5.25% mandatorily redeemable Series A Cumulative Preferred Stock, both of which were completed on May 28, 2004, the issuance of 3, 5, 10 and 30 year notes totaling $1.9 billion which was completed June 15, 2004, and the issuance of $500 million of commercial paper which was completed June 14, 2004, as well as interest expense related to the accretion of the company’s obligation to GE under the Tax Matters Agreement and the tax impacts resulting from these changes in the company’s capitalization. |
| (d) | Reflects adjustments to record the effects of the reinsurance transactions described in footnote (b) as if each occurred as of January 1, 2004 (rather than January 1, 2003) and excludes the effects of all ceded reinsured contracts that were issued after January 1, 2003 but before January 1, 2004. All these adjustments relate to the company’s Retirement Income and Investments segment because none of the company’s other segments include ceded reinsured contracts that were issued after January 1, 2003. In the Retirement Income and Investments segment, such contracts include variable annuities and structured settlements. |
8
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
ADJUSTED PRO FORMA HIGHLIGHTS
9
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Financial Highlights - QTD
(Amounts in millions, except per share data)
| Three months ended |
||||||||||||
| Adjusted pro forma earnings by segment |
March 31, 2004 |
June 30, 2004 |
September 30, 2004 |
|||||||||
| Earnings (loss) from continuing operations before income taxes and accounting change |
||||||||||||
| Protection |
$ | 192 | $ | 206 | $ | 216 | ||||||
| Retirement Income and Investments |
46 | 68 | 62 | |||||||||
| Mortgage Insurance |
148 | 163 | 150 | |||||||||
| Corporate and Other |
(11 | ) | (10 | ) | (21 | ) | ||||||
| Total |
$ | 375 | $ | 427 | $ | 407 | ||||||
| Segment net earnings (loss) |
||||||||||||
| Protection |
$ | 123 | $ | 129 | $ | 135 | ||||||
| Retirement Income and Investments |
30 | 43 | 40 | |||||||||
| Mortgage Insurance |
103 | 114 | 102 | |||||||||
| Corporate and Other |
(2 | ) | (27 | ) | (6 | ) | ||||||
| Total |
$ | 254 | $ | 259 | $ | 271 | ||||||
| Net operating earnings (loss) |
||||||||||||
| Protection |
$ | 123 | $ | 129 | $ | 135 | ||||||
| Retirement Income and Investments |
30 | 43 | 40 | |||||||||
| Mortgage Insurance |
103 | 114 | 102 | |||||||||
| Corporate and Other (see reconciliation below) |
(12 | ) | (9 | ) | (8 | ) | ||||||
| Total |
$ | 244 | $ | 277 | $ | 269 | ||||||
| Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.” | ||||||||||||
| As of or for the three months ended |
||||||||||||
| Adjusted pro forma earnings per share |
March 31, 2004 |
June 30, 2004 |
September 30, 2004 |
|||||||||
| Basic EPS |
||||||||||||
| Net earnings from continuing operations per share |
$ | 0.52 | $ | 0.53 | $ | 0.55 | ||||||
| Net operating earnings per share |
$ | 0.50 | $ | 0.57 | $ | 0.55 | ||||||
| Diluted EPS |
||||||||||||
| Net earnings from continuing operations per share |
$ | 0.52 | $ | 0.53 | $ | 0.55 | ||||||
| Net operating earnings per share |
$ | 0.50 | $ | 0.57 | $ | 0.55 | ||||||
| Shares outstanding (millions) |
||||||||||||
| Basic |
489.5 | 489.5 | 489.6 | |||||||||
| Diluted |
489.5 | 490.1 | 490.4 | |||||||||
| Three months ended |
||||||||||||
| Reconciliation of Corporate and Other segment net loss to pro forma net operating loss |
March 31, 2004 |
June 30, 2004 |
September 30, 2004 |
|||||||||
| Segment net loss |
$ | 4 | $ | (10 | ) | $ | (6 | ) | ||||
| Excluded assets and liabilities (a) |
1 | (6 | ) | — | ||||||||
| Reinsurance transactions (b) |
2 | (2 | ) | — | ||||||||
| Capital structure and other (c) |
(9 | ) | (9 | ) | — | |||||||
| Pro forma net loss from continuing operations |
(2 | ) | (27 | ) | (6 | ) | ||||||
| Net realized (gains) losses on investments, net of taxes |
(10 | ) | (4 | ) | (2 | ) | ||||||
| One-time tax charge relating to initial public offering |
— | 22 | — | |||||||||
| Pro forma net operating loss |
$ | (12 | ) | $ | (9 | ) | $ | (8 | ) | |||
Note: For a discussion of notes (a), (b), (c), and (d) to these tables see Notes To Adjusted Pro Forma Financial Information on page 8.
10
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Financial Highlights - YTD
(Amounts in millions, except per share data)
| Adjusted pro forma earnings by segment |
Three months ended March 31, 2004 |
Six months ended June 30, 2004 |
Nine months ended September 30, 2004 |
|||||||||
| Earnings (loss) from continuing operations before income taxes and accounting change |
||||||||||||
| Protection |
$ | 192 | $ | 398 | $ | 614 | ||||||
| Retirement Income and Investments |
46 | 114 | 176 | |||||||||
| Mortgage Insurance |
148 | 311 | 461 | |||||||||
| Corporate and Other |
(11 | ) | (21 | ) | (42 | ) | ||||||
| Total |
$ | 375 | $ | 802 | $ | 1,209 | ||||||
| Segment net earnings (loss) |
||||||||||||
| Protection |
$ | 123 | $ | 252 | $ | 387 | ||||||
| Retirement Income and Investments |
30 | 73 | 113 | |||||||||
| Mortgage Insurance |
103 | 217 | 319 | |||||||||
| Corporate and Other |
(2 | ) | (29 | ) | (35 | ) | ||||||
| Total |
$ | 254 | $ | 513 | $ | 784 | ||||||
| Net operating earnings (loss) |
||||||||||||
| Protection |
$ | 123 | $ | 252 | $ | 387 | ||||||
| Retirement Income and Investments |
30 | 73 | 113 | |||||||||
| Mortgage Insurance |
103 | 217 | 319 | |||||||||
| Corporate and Other (see reconciliation below) |
(12 | ) | (21 | ) | (29 | ) | ||||||
| Total |
$ | 244 | $ | 521 | $ | 790 | ||||||
Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.”
| Adjusted pro forma earnings per share |
As of or for the March 31, 2004 |
As of or for the June 30, 2004 |
As of or for the September 30, 2004 |
|||||||||
| Basic EPS |
||||||||||||
| Net earnings from continuing operations per share |
$ | 0.52 | $ | 1.05 | $ | 1.60 | ||||||
| Net operating earnings per share |
$ | 0.50 | $ | 1.06 | $ | 1.61 | ||||||
| Diluted EPS |
||||||||||||
| Net earnings from continuing operations per share |
$ | 0.52 | $ | 1.05 | $ | 1.60 | ||||||
| Net operating earnings per share |
$ | 0.50 | $ | 1.06 | $ | 1.61 | ||||||
| Shares outstanding (millions) |
||||||||||||
| Basic |
489.5 | 489.5 | 489.5 | |||||||||
| Diluted |
489.5 | 490.1 | 490.4 | |||||||||
| Reconciliation of Corporate and Other segment net loss to pro forma net operating loss |
Three months ended March 31, 2004 |
Six months ended June 30, 2004 |
Nine months ended 2004 |
|||||||||
| Segment net loss |
$ | 4 | $ | (6 | ) | $ | (12 | ) | ||||
| Excluded assets and liabilities (a) |
1 | (5 | ) | (5 | ) | |||||||
| Reinsurance transactions (b) |
2 | — | — | |||||||||
| Capital structure and other (c) |
(9 | ) | (18 | ) | (18 | ) | ||||||
| Pro forma net loss from continuing operations |
(2 | ) | (29 | ) | (35 | ) | ||||||
| Net realized (gains) losses on investments, net of taxes |
(10 | ) | (14 | ) | (16 | ) | ||||||
| One-time tax charge relating to initial public offering |
— | 22 | 22 | |||||||||
| Pro forma net operating loss |
$ | (12 | ) | $ | (21 | ) | $ | (29 | ) | |||
Note: For a discussion of notes (a), (b), (c), and (d) to these tables see Notes To Adjusted Pro Forma Financial Information on page 8.
11
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Earnings From Continuing Operations - QTD
(Dollar amounts in millions)
| Three months ended |
||||||||||||
| March 31, 2004 |
June 30, 2004 |
September 30, 2004 |
||||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 1,619 | $ | 1,640 | $ | 1,523 | ||||||
| Net investment income |
753 | 797 | 785 | |||||||||
| Net realized investment gains |
15 | 6 | 3 | |||||||||
| Policy fees and other income |
149 | 144 | 159 | |||||||||
| Total revenues |
2,536 | 2,587 | 2,470 | |||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
1,080 | 1,097 | 1,034 | |||||||||
| Interest credited |
323 | 324 | 328 | |||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
413 | 416 | 399 | |||||||||
| Amortization of deferred acquisition costs and intangibles |
284 | 264 | 242 | |||||||||
| Interest expense |
61 | 59 | 60 | |||||||||
| Total benefits and expenses |
2,161 | 2,160 | 2,063 | |||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
375 | 427 | 407 | |||||||||
| Provision for income taxes |
121 | 168 | 136 | |||||||||
| Effective tax rate |
32 | % | 39 | % | 33 | % | ||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 254 | $ | 259 | $ | 271 | ||||||
Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.”
12
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Earnings From Continuing Operations - YTD
(Dollar amounts in millions)
| Three months ended March 31, 2004 |
Six months ended June 30, 2004 |
Nine months ended September 30, 2004 |
||||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 1,619 | $ | 3,259 | $ | 4,782 | ||||||
| Net investment income |
753 | 1,550 | 2,335 | |||||||||
| Net realized investment gains |
15 | 21 | 24 | |||||||||
| Policy fees and other income |
149 | 293 | 452 | |||||||||
| Total revenues |
2,536 | 5,123 | 7,593 | |||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
1,080 | 2,177 | 3,211 | |||||||||
| Interest credited |
323 | 647 | 975 | |||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
413 | 829 | 1,228 | |||||||||
| Amortization of deferred acquisition costs and intangibles |
284 | 548 | 790 | |||||||||
| Interest expense |
61 | 120 | 180 | |||||||||
| Total benefits and expenses |
2,161 | 4,321 | 6,384 | |||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
375 | 802 | 1,209 | |||||||||
| Provision for income taxes |
121 | 289 | 425 | |||||||||
| Effective tax rate |
32 | % | 36 | % | 35 | % | ||||||
| NET EARNINGS FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
$ | 254 | $ | 513 | $ | 784 | ||||||
Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.”
13
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
ADJUSTED PRO FORMA INFORMATION
14
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Statement of Earnings by Segment - QTD
(Dollar amounts in millions)
| Three months ended March 31, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 1,121 | $ | 277 | $ | 195 | $ | 26 | $ | 1,619 | |||||||
| Net investment income |
281 | 377 | 60 | 35 | 753 | ||||||||||||
| Net realized investment gains |
— | — | — | 15 | 15 | ||||||||||||
| Policy fees and other income |
87 | 52 | 8 | 2 | 149 | ||||||||||||
| Total revenues |
1,489 | 706 | 263 | 78 | 2,536 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
694 | 338 | 39 | 9 | 1,080 | ||||||||||||
| Interest credited |
90 | 233 | — | — | 323 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
269 | 61 | 64 | 19 | 413 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
241 | 28 | 12 | 3 | 284 | ||||||||||||
| Interest expense |
3 | — | — | 58 | 61 | ||||||||||||
| Total benefits and expenses |
1,297 | 660 | 115 | 89 | 2,161 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
192 | 46 | 148 | (11 | ) | 375 | |||||||||||
| Provision for income taxes |
69 | 16 | 45 | (9 | ) | 121 | |||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
123 | 30 | 103 | (2 | ) | 254 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (10 | ) | (10 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | — | — | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 123 | $ | 30 | $ | 103 | $ | (12 | ) | $ | 244 | ||||||
| Three months ended June 30, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 1,098 | $ | 321 | $ | 195 | $ | 26 | $ | 1,640 | |||||||
| Net investment income |
288 | 395 | 61 | 53 | 797 | ||||||||||||
| Net realized investment gains |
— | — | — | 6 | 6 | ||||||||||||
| Policy fees and other income |
79 | 53 | 10 | 2 | 144 | ||||||||||||
| Total revenues |
1,465 | 769 | 266 | 87 | 2,587 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
691 | 370 | 27 | 9 | 1,097 | ||||||||||||
| Interest credited |
90 | 234 | — | — | 324 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
262 | 61 | 65 | 28 | 416 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
214 | 35 | 11 | 4 | 264 | ||||||||||||
| Interest expense |
2 | 1 | — | 56 | 59 | ||||||||||||
| Total benefits and expenses |
1,259 | 701 | 103 | 97 | 2,160 | ||||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
206 | 68 | 163 | (10 | ) | 427 | |||||||||||
| Provision for income taxes |
77 | 25 | 49 | 17 | 168 | ||||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
129 | 43 | 114 | (27 | ) | 259 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (4 | ) | (4 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | 22 | 22 | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 129 | $ | 43 | $ | 114 | $ | (9 | ) | $ | 277 | ||||||
| Three months ended September 30, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 1,085 | $ | 219 | $ | 197 | $ | 22 | $ | 1,523 | |||||||
| Net investment income |
298 | 393 | 65 | 29 | 785 | ||||||||||||
| Net realized investment gains |
— | — | — | 3 | 3 | ||||||||||||
| Policy fees and other income |
91 | 52 | 10 | 6 | 159 | ||||||||||||
| Total revenues |
1,474 | 664 | 272 | 60 | 2,470 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
698 | 281 | 46 | 9 | 1,034 | ||||||||||||
| Interest credited |
91 | 237 | — | — | 328 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
267 | 59 | 64 | 9 | 399 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
198 | 25 | 12 | 7 | 242 | ||||||||||||
| Interest expense |
4 | — | — | 56 | 60 | ||||||||||||
| Total benefits and expenses |
1,258 | 602 | 122 | 81 | 2,063 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
216 | 62 | 150 | (21 | ) | 407 | |||||||||||
| Provision for income taxes |
81 | 22 | 48 | (15 | ) | 136 | |||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
135 | 40 | 102 | (6 | ) | 271 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (2 | ) | (2 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | — | — | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 135 | $ | 40 | $ | 102 | $ | (8 | ) | $ | 269 | ||||||
15
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Statement of Earnings by Segment - YTD
(Dollar amounts in millions)
| Three months ended March 31, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 1,121 | $ | 277 | $ | 195 | $ | 26 | $ | 1,619 | |||||||
| Net investment income |
281 | 377 | 60 | 35 | 753 | ||||||||||||
| Net realized investment gains |
— | — | — | 15 | 15 | ||||||||||||
| Policy fees and other income |
87 | 52 | 8 | 2 | 149 | ||||||||||||
| Total revenues |
1,489 | 706 | 263 | 78 | 2,536 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
694 | 338 | 39 | 9 | 1,080 | ||||||||||||
| Interest credited |
90 | 233 | — | — | 323 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
269 | 61 | 64 | 19 | 413 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
241 | 28 | 12 | 3 | 284 | ||||||||||||
| Interest expense |
3 | — | — | 58 | 61 | ||||||||||||
| Total benefits and expenses |
1,297 | 660 | 115 | 89 | 2,161 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
192 | 46 | 148 | (11 | ) | 375 | |||||||||||
| Provision for income taxes |
69 | 16 | 45 | (9 | ) | 121 | |||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
123 | 30 | 103 | (2 | ) | 254 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (10 | ) | (10 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | — | — | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 123 | $ | 30 | $ | 103 | $ | (12 | ) | $ | 244 | ||||||
| Six months ended June 30, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 2,219 | $ | 598 | $ | 390 | $ | 52 | $ | 3,259 | |||||||
| Net investment income |
569 | 772 | 121 | 88 | 1,550 | ||||||||||||
| Net realized investment gains |
— | — | — | 21 | 21 | ||||||||||||
| Policy fees and other income |
166 | 105 | 18 | 4 | 293 | ||||||||||||
| Total revenues |
2,954 | 1,475 | 529 | 165 | 5,123 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
1,385 | 708 | 66 | 18 | 2,177 | ||||||||||||
| Interest credited |
180 | 467 | — | — | 647 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
531 | 122 | 129 | 47 | 829 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
455 | 63 | 23 | 7 | 548 | ||||||||||||
| Interest expense |
5 | 1 | — | 114 | 120 | ||||||||||||
| Provision for income taxes |
2,556 | 1,361 | 218 | 186 | 4,321 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
398 | 114 | 311 | (21 | ) | 802 | |||||||||||
| Provision for income taxes |
146 | 41 | 94 | 8 | 289 | ||||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
252 | 73 | 217 | (29 | ) | 513 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (14 | ) | (14 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | 22 | 22 | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 252 | $ | 73 | $ | 217 | $ | (21 | ) | $ | 521 | ||||||
| Nine months ended September 30, 2004 |
Protection Segment |
RI&I Segment |
Mortgage Segment |
Corporate Segment |
Combined |
||||||||||||
| REVENUES: |
|||||||||||||||||
| Premiums |
$ | 3,304 | $ | 817 | $ | 587 | $ | 74 | $ | 4,782 | |||||||
| Net investment income |
867 | 1,165 | 186 | 117 | 2,335 | ||||||||||||
| Net realized investment gains |
— | — | — | 24 | 24 | ||||||||||||
| Policy fees and other income |
257 | 157 | 28 | 10 | 452 | ||||||||||||
| Total revenues |
4,428 | 2,139 | 801 | 225 | 7,593 | ||||||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||||||
| Benefits and other changes in policy reserves |
2,083 | 989 | 112 | 27 | 3,211 | ||||||||||||
| Interest credited |
271 | 704 | — | — | 975 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
798 | 181 | 193 | 56 | 1,228 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
653 | 88 | 35 | 14 | 790 | ||||||||||||
| Interest expense |
9 | 1 | — | 170 | 180 | ||||||||||||
| Total benefits and expenses |
3,814 | 1,963 | 340 | 267 | 6,384 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND ACCOUNTING CHANGE |
614 | 176 | 461 | (42 | ) | 1,209 | |||||||||||
| Provision for income taxes |
227 | 63 | 142 | (7 | ) | 425 | |||||||||||
| NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE ACCOUNTING CHANGE |
387 | 113 | 319 | (35 | ) | 784 | |||||||||||
| Net realized investment gains on investments, net of tax |
— | — | — | (16 | ) | (16 | ) | ||||||||||
| One-time tax charge relating to initial public offering |
— | — | — | 22 | 22 | ||||||||||||
| NET OPERATING EARNINGS (LOSS) |
$ | 387 | $ | 113 | $ | 319 | $ | (29 | ) | $ | 790 | ||||||
16
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Segment Net Earnings QTD - Retirement Income and Investments
(Dollar amounts in millions)
| Three months ended March 31, 2004 |
Spread Based Retail Products |
Fee Based |
Spread Based Institutional Products |
Total | |||||||||
| REVENUES: |
|||||||||||||
| Premiums |
$ | 277 | $ | — | $ | — | $ | 277 | |||||
| Net investment income |
296 | 5 | 76 | 377 | |||||||||
| Policy fees and other income |
2 | 50 | — | 52 | |||||||||
| Total revenues |
575 | 55 | 76 | 706 | |||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||
| Benefits and other changes in policy reserves |
333 | 5 | — | 338 | |||||||||
| Interest credited |
163 | 4 | 66 | 233 | |||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
28 | 32 | 1 | 61 | |||||||||
| Amortization of deferred acquisition costs and intangibles |
26 | 2 | — | 28 | |||||||||
| Interest expense |
— | — | — | — | |||||||||
| Total benefits and expenses |
550 | 43 | 67 | 660 | |||||||||
| EARNINGS BEFORE INCOME TAXES |
25 | 12 | 9 | 46 | |||||||||
| Provision for income taxes |
9 | 4 | 3 | 16 | |||||||||
| SEGMENT NET EARNINGS |
$ | 16 | $ | 8 | $ | 6 | $ | 30 | |||||
| Three months ended June 30, 2004 |
Spread Based Retail Products |
Fee Based |
Spread Based Institutional Products |
Total | |||||||||
| REVENUES: |
|||||||||||||
| Premiums |
$ | 321 | $ | — | $ | — | $ | 321 | |||||
| Net investment income |
312 | (1 | ) | 84 | 395 | ||||||||
| Policy fees and other income |
4 | 49 | — | 53 | |||||||||
| Total revenues |
637 | 48 | 84 | 769 | |||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||
| Benefits and other changes in policy reserves |
372 | (2 | ) | — | 370 | ||||||||
| Interest credited |
167 | — | 67 | 234 | |||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
33 | 27 | 1 | 61 | |||||||||
| Amortization of deferred acquisition costs and intangibles |
30 | 5 | — | 35 | |||||||||
| Interest expense |
— | 1 | — | 1 | |||||||||
| Total benefits and expenses |
602 | 31 | 68 | 701 | |||||||||
| EARNINGS BEFORE INCOME TAXES |
35 | 17 | 16 | 68 | |||||||||
| Provision for income taxes |
13 | 6 | 6 | 25 | |||||||||
| SEGMENT NET EARNINGS |
$ | 22 | $ | 11 | $ | 10 | $ | 43 | |||||
| Three months ended September 30, 2004 |
Spread Based Retail Products |
Fee Based Products |
Spread Based Institutional Products |
Total | |||||||||
| REVENUES: |
|||||||||||||
| Premiums |
$ | 219 | $ | — | $ | — | $ | 219 | |||||
| Net investment income |
312 | 3 | 78 | 393 | |||||||||
| Policy fees and other income |
5 | 47 | — | 52 | |||||||||
| Total revenues |
536 | 50 | 78 | 664 | |||||||||
| BENEFITS AND EXPENSES: |
|||||||||||||
| Benefits and other changes in policy reserves |
279 | 2 | — | 281 | |||||||||
| Interest credited |
164 | 2 | 71 | 237 | |||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
31 | 27 | 1 | 59 | |||||||||
| Amortization of deferred acquisition costs and intangibles |
23 | 2 | — | 25 | |||||||||
| Interest expense |
1 | (1 | ) | — | — | ||||||||
| Total benefits and expenses |
498 | 32 | 72 | 602 | |||||||||
| EARNINGS BEFORE INCOME TAXES |
38 | 18 | 6 | 62 | |||||||||
| Provision for income taxes |
14 | 6 | 2 | 22 | |||||||||
| SEGMENT NET EARNINGS |
$ | 24 | $ | 12 | $ | 4 | $ | 40 | |||||
Segment Adjusted Pro Forma Net Operating Earnings is equivalent to Adjusted Pro Forma Segment Net Earnings.
17
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Segment Net Earnings YTD - Retirement Income and Investments
(Dollar amounts in millions)
| Three months ended March 31, 2004 |
Spread Based Retail Products |
Fee Based Products |
Spread Based Institutional Products |
Total | ||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 277 | $ | — | $ | — | $ | 277 | ||||
| Net investment income |
296 | 5 | 76 | 377 | ||||||||
| Policy fees and other income |
2 | 50 | — | 52 | ||||||||
| Total revenues |
575 | 55 | 76 | 706 | ||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
333 | 5 | — | 338 | ||||||||
| Interest credited |
163 | 4 | 66 | 233 | ||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
28 | 32 | 1 | 61 | ||||||||
| Amortization of deferred acquisition costs and intangibles |
26 | 2 | — | 28 | ||||||||
| Interest expense |
— | — | — | — | ||||||||
| Total benefits and expenses |
550 | 43 | 67 | 660 | ||||||||
| EARNINGS BEFORE INCOME TAXES |
25 | 12 | 9 | 46 | ||||||||
| Provision for income taxes |
9 | 4 | 3 | 16 | ||||||||
| SEGMENT NET EARNINGS |
$ | 16 | $ | 8 | $ | 6 | $ | 30 | ||||
| Six months ended June 30, 2004 |
Spread Based Retail Products |
Fee Based Products |
Spread Based Institutional Products |
Total | ||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 598 | $ | — | $ | — | $ | 598 | ||||
| Net investment income |
608 | 4 | 160 | 772 | ||||||||
| Policy fees and other income |
6 | 99 | — | 105 | ||||||||
| Total revenues |
1,212 | 103 | 160 | 1,475 | ||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
705 | 3 | — | 708 | ||||||||
| Interest credited |
330 | 4 | 133 | 467 | ||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
61 | 59 | 2 | 122 | ||||||||
| Amortization of deferred acquisition costs and intangibles |
56 | 7 | — | 63 | ||||||||
| Interest expense |
— | 1 | — | 1 | ||||||||
| Total benefits and expenses |
1,152 | 74 | 135 | 1,361 | ||||||||
| EARNINGS BEFORE INCOME TAXES |
60 | 29 | 25 | 114 | ||||||||
| Provision for income taxes |
22 | 10 | 9 | 41 | ||||||||
| SEGMENT NET EARNINGS |
$ | 38 | $ | 19 | $ | 16 | $ | 73 | ||||
| Nine months ended September 30, 2004 |
Spread Based Retail Products |
Fee Based Products |
Spread Based Institutional Products |
Total | ||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 817 | $ | — | $ | — | $ | 817 | ||||
| Net investment income |
920 | 7 | 238 | 1,165 | ||||||||
| Policy fees and other income |
11 | 146 | — | 157 | ||||||||
| Total revenues |
1,748 | 153 | 238 | 2,139 | ||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
984 | 5 | — | 989 | ||||||||
| Interest credited |
494 | 6 | 204 | 704 | ||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
92 | 86 | 3 | 181 | ||||||||
| Amortization of deferred acquisition costs and intangibles |
79 | 9 | — | 88 | ||||||||
| Interest expense |
1 | — | — | 1 | ||||||||
| Total benefits and expenses |
1,650 | 106 | 207 | 1,963 | ||||||||
| EARNINGS BEFORE INCOME TAXES |
98 | 47 | 31 | 176 | ||||||||
| Provision for income taxes |
36 | 16 | 11 | 63 | ||||||||
| SEGMENT NET EARNINGS |
$ | 62 | $ | 31 | $ | 20 | $ | 113 | ||||
Segment Adjusted Pro Forma Net Operating Earnings is equivalent to Adjusted Pro Forma Segment Net Earnings.
18
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Net Earnings by Quarter
(Dollar amounts in millions)
| 2004 |
||||||||||||||||
| Q1 |
Q2 |
Q3 |
YTD |
|||||||||||||
| REVENUES: |
||||||||||||||||
| Premiums |
$ | 1,619 | $ | 1,640 | $ | 1,523 | $ | 4,782 | ||||||||
| Net investment income |
753 | 797 | 785 | 2,335 | ||||||||||||
| Net realized investment gains |
15 | 6 | 3 | 24 | ||||||||||||
| Policy fees and other income |
149 | 144 | 159 | 452 | ||||||||||||
| Total revenues |
2,536 | 2,587 | 2,470 | 7,593 | ||||||||||||
| BENEFITS AND EXPENSES: |
||||||||||||||||
| Benefits and other changes in policy reserves |
1,080 | 1,097 | 1,034 | 3,211 | ||||||||||||
| Interest credited |
323 | 324 | 328 | 975 | ||||||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
413 | 416 | 399 | 1,228 | ||||||||||||
| Amortization of deferred acquisition costs and intangibles |
284 | 264 | 242 | 790 | ||||||||||||
| Interest expense |
61 | 59 | 60 | 180 | ||||||||||||
| Total benefits and expenses |
2,161 | 2,160 | 2,063 | 6,384 | ||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
375 | 427 | 407 | 1,209 | ||||||||||||
| Provision for income taxes |
121 | 168 | 136 | 425 | ||||||||||||
| NET EARNINGS FROM CONTINUING OPERATIONS |
254 | 259 | 271 | 784 | ||||||||||||
| Net realized investment gains on investments, net of tax |
(10 | ) | (4 | ) | (2 | ) | (16 | ) | ||||||||
| One-time tax charge relating to initial public offering |
— | 22 | — | 22 | ||||||||||||
| NET OPERATING EARNINGS |
$ | 244 | $ | 277 | $ | 269 | $ | 790 | ||||||||
Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.”
19
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
Adjusted Pro Forma Segment Net Earnings by Quarter - Retirement Income and Investments
(Dollar amounts in millions)
| 2004 | ||||||||||||
| Q1 |
Q2 |
Q3 |
YTD | |||||||||
| REVENUES: |
||||||||||||
| Premiums |
$ | 277 | $ | 321 | $ | 219 | $ | 817 | ||||
| Net investment income |
377 | 395 | 393 | 1,165 | ||||||||
| Policy fees and other income |
52 | 53 | 52 | 157 | ||||||||
| Total revenues |
706 | 769 | 664 | 2,139 | ||||||||
| BENEFITS AND EXPENSES: |
||||||||||||
| Benefits and other changes in policy reserves |
338 | 370 | 281 | 989 | ||||||||
| Interest credited |
233 | 234 | 237 | 704 | ||||||||
| Underwriting, acquisition and insurance expenses, net of deferrals |
61 | 61 | 59 | 181 | ||||||||
| Amortization of deferred acquisition costs and intangibles |
28 | 35 | 25 | 88 | ||||||||
| Interest expense |
— | 1 | — | 1 | ||||||||
| Total benefits and expenses |
660 | 701 | 602 | 1,963 | ||||||||
| EARNINGS BEFORE INCOME TAXES |
46 | 68 | 62 | 176 | ||||||||
| Provision for income taxes |
16 | 25 | 22 | 63 | ||||||||
| SEGMENT NET EARNINGS |
$ | 30 | $ | 43 | $ | 40 | $ | 113 | ||||
Segment Adjusted Pro Forma Net Operating Earnings is equivalent to Adjusted Pro Forma Segment Net Earnings.
Note: Pro forma segment net earnings for the Protection, Mortgage Insurance and Corporate and Other segments are not affected by the upcoming change in the assumed effective date of the pro forma adjustments. As a result, pro forma segment net earnings for these segments are the same as adjusted pro forma segment net earnings. In the Retirement Income and Investments segment, the upcoming change in the assumed effective date results in the adjustments described in note (d) on page 8 and shown on pages 5, 6 and 7 under the heading “Adjustments for change in assumed effective date.”
20
GENWORTH FINANCIAL
1Q, 2Q & 3Q 2004 SELECTED FINANCIAL INFORMATION
About Genworth Financial
Genworth is a leading insurance holding company, serving the lifestyle protection, retirement income, investment and mortgage insurance needs of more than 15 million customers, and has operations in 20 countries, including the U.S., Canada, Australia, the U.K. and more than a dozen other European countries. For more information, visit www.genworth.com
Inquiries:
Genworth Financial, Inc., Richmond
Jean Peters, 804/662-2693
jean.peters@genworth.com
Alicia Charity, 804/662-2248
alicia.charity@genworth.com
21