American Financial Group Inc. (NYSE:AFG) Q1 2018 Earnings Conference Call - Preliminary Transcript

May 03, 2018 • 11:30 am ET


American Financial Group Inc. (NYSE:AFG) Q1 2018 Earnings Conference Call - Preliminary Transcript


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Good day, ladies and gentlemen, and welcome to the American Financial Group's First Quarter 2018 Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions). As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Ms. Diane Weidner, Assistant Vice President, Investor Relations. Ma'am, you may begin.

Diane Weidner

Thank you. Good morning, and welcome to American Financial Group's first quarter 2018 earnings results conference call. I'm joined this morning by, Carl Lindner III; and Craig Lindner, Co-CEOs of American Financial Group; and Jeff Consolino, AFG's CFO.

Our press release, investor supplement and webcast presentation are posted on AFG's website. These materials will be referenced during portions of today's call.

Before I turn the discussion over to Carl, I would like to draw your attention to the notes on Slide 2 of our webcast. Certain statements made during this call may be considered forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance.

Investors should consider the risks and uncertainties that could cause actual results and/or financial conditions to differ materially from these statements. A detailed description of these risks and uncertainties can be found in AFG's filings with the Securities and Exchange Commission, which are also available on our website.

We may include references to core net operating earnings, a non-GAAP financial measure, in our remarks or responses to questions. A reconciliation of net earnings attributable to shareholders to core net operating earnings is included in our earnings release. And finally, if you are reading a transcript of this call, please note that it may not be authorized or reviewed for accuracy. Thus, it may contain factual or transcription errors that could materially alter the intent or meaning of our statements.

Now I am pleased to turn the call over to Carl Lindner III to discuss our results.

Carl Lindner III

Good morning. We released our 2018 first quarter results yesterday afternoon. Please turn with me to Slide 3 of the webcast slides for an overview. AFG's first quarter results established a new all-time high for core operating earnings of $2.42 per share, up 43% from last year's first quarter. These results include excellent profitability in our Property and Casualty operations and outstanding results in our Annuity segment.

First quarter annualized core operating return on equity was 18.6%. Craig and I thank God, our talented management team and our great employees for helping us to achieve these results. Net earnings per diluted share were $1.60 and included $0.82 per share in realized losses on securities after adopting the new accounting standard related to available for sale equity securities.

Jeff will discuss non-core items and the impact of the new accounting standard on our first quarter results as he recaps the components of our GAAP earnings. Return in capital to our shareholders is an important component