CNO Financial Group, Inc. (NYSE:CNO) Q4 2017 Earnings Conference Call Transcript

Feb 14, 2018 • 11:00 am ET


CNO Financial Group, Inc. (NYSE:CNO) Q4 2017 Earnings Conference Call Transcript


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Good morning. My name is Stephanie, and I will be your conference operator today. At this time, I would like to welcome everyone to the CNO Financial Group Inc. Fourth Quarter 2017 Earnings Results Conference Call. (Operator Instructions) Thank you.

Adam Auvil, you may begin your conference.

Adam Auvil

Good morning, and thank you for joining us on CNO Financial Group's fourth quarter 2017 earnings conference call. Today's presentation will include remarks from Gary Bhojwani, Chief Executive Officer; and Erik Helding, Chief Financial Officer.

Following the presentation, we will also have several other business leaders available for the question-and-answer period.

During this conference call, we will be referring to information contained in yesterday's press release. You could obtain the release by visiting the media section of our website at

This morning's presentation is also available in the Investors section of our website and was filed in a Form 8-K earlier today. We expect to file our Form 10-K and post it on our website on or about February 26.

Let me remind you that any forward-looking statements we make today are subject to a number of factors, which may cause actual results to be materially different than those contemplated by the forward-looking statements.

Today's presentation contains a number of non-GAAP measures, which should not be considered as substitutes for the most directly comparable GAAP measures. You'll find a reconciliation of the non-GAAP measures to the corresponding GAAP measures in the appendix.

Throughout this presentation, we will be making performance comparisons, unless otherwise specified, any comparisons made will be referring to changes between fourth quarter 2016 and fourth quarter 2017. With that, I'll turn the call over to Gary.

Gary Chandru Bhojwani

Thanks, Adam, and good morning, everyone. 2017 was another strong year for CNO. We reported solid earnings growth and ongoing financial strength. Operating earnings per share were up 19% for the full year as we continued our disciplined approach to growing the enterprise. Our capital and liquidity metrics remained strong throughout the year. We returned $227 million in capital to shareholders during the year. Book value per diluted share, excluding AOCI, was $21.43 after a reduction of $2.23 due to impacts of the recently enacted US tax reform.

Excluding the impact of tax reform, book value per share was up 7% from year end 2016. Erik will go into the details on the effects of tax reform on our financials. However, I would like to make a few brief comments. Passage, of the reform should provide a meaningful benefit to CNO over time. Unfortunately, the near-term benefits will be modest due to the much discussed life sector provisions included in the final bill. Not all of the direct and indirect impacts of the new legislation are presently known.

We will continue to monitor and assess how CNO will be affected. We continue to grow and diversify the franchise in 2017. The majority of our growth scorecard measures were up for the year, highlighted by total collected premiums up 2% and annuity account values increasing