Athene Holding Ltd. (NYSE:ATH) Q4 2019 Earnings Conference Call - Final Transcript

Feb 18, 2020 • 10:00 am ET


Athene Holding Ltd. (NYSE:ATH) Q4 2019 Earnings Conference Call - Final Transcript


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Good morning. My name is Thea and I will be your conference operator today. At this time, I would like to welcome everyone to the Athene's Fourth Quarter and Full Year 2019 Earnings Conference Call and Webcast.

[Operator Instructions] Thank you. I will now turn the call over to Noah Gunn, Head of Investor Relations. Please go ahead.

Noah Gunn

Thanks, Thea, and welcome to our fourth quarter and full year 2019 earnings call. Joining me this morning are Jim Belardi, Chairman and CEO; Bill Wheeler, President; and Marty Klein, our Chief Financial Officer.

As a reminder, this call may include forward-looking statements and projections, which do not guarantee future events or performance. We do not revise or update such statements to reflect new information, subsequent events or changes in strategy. Please refer to our most recent quarterly and annual reports, and other SEC filings for a discussion of the factors that could cause actual results to differ materially from those expressed or implied.

We'll be discussing certain non-GAAP measures on this call, which we believe are relevant in assessing the financial performance of the business. Reconciliations of these non-GAAP measures can be found in our earnings presentation and financial supplement, which are available at

I will now turn the call over to Jim Belardi.

James R. Belardi

Thanks, Noah, and good morning, everyone. Our robust fourth quarter results capped a year of record adjusted operating earnings and record organic growth for Athene. Strong operating performance combined with our focus on effective capital allocation is a powerful tandem in driving long-term shareholder value. 2019 featured numerous accomplishments worth highlighting.

First, our strong financial results drove 18% year-over-year growth in adjusted book value to $54 per share, exceeding our historical compound annual growth rate of 17% since inception. This translated to a consolidated adjusted operating ROE of 14% for the full year, achieving our target of at least mid-teen returns despite our excess equity capital and the challenging macro environment.

Second, we demonstrated the strength of our multi-channel distribution model, generating record organic deposits of $18 billion at very attractive returns that were above our historical average. While retail sales were impacted by low interest rates, we more than made up for it with record deposits across our pension risk transfer and flow reinsurance channels and re-emerging activity in funding agreements.

On the inorganic side, we remained disciplined in evaluating various opportunities. And while there weren't any new deal announcements in 2019, we acted strategically by laying the groundwork for potentially larger and more numerous transactions through the creation of ACRA. As we have demonstrated in the past, Athene's model has great potential for transformative growth when we are able to combine organic and inorganic growth simultaneously.

Third, we continued our track record of top tier investment performance and yield generation. Even in a low interest rate environment, we continued to achieve fixed income yields at a premium to the broader market. Consistent with our philosophy as active asset managers, the yield on our fixed income