American Equity Investment Life Holding Company (AEL) has reported a 257.64 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $120.80 million, or $1.35 a share in the quarter, compared with $33.78 million, or $0.40 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $55.97 million, or $0.63 a share compared with $50.14 million or $0.60 a share, a year ago.
Revenue during the quarter grew 14.94 percent to $622.82 million from $541.88 million in the previous year period. Net premium earned for the quarter increased 14.55 percent or $1.55 million to $12.23 million.
Total expenses come down
Benefits, losses and expenses for the quarter were at $435.22 million, or 3,557.79 percent of premium earned from $488.92 million or 4,578.38 percent of premium earned in the last year period. Operating income for the quarter was $187.59 million, compared with $52.96 million in the previous year period.
Net investment income was at $475.63 million for the quarter, up 8.53 percent or $37.37 million from year-ago period. Meanwhile, income from fees and commission for the quarter jumped 30.11 percent or $11.17 million to $48.28 million. The company has recorded a gain on investments of $86.68 million in the quarter compared with a gain of $55.84 million for the previous year period.
Commenting on sales, John Matovina, chief executive officer and president, said: "While we are proud to report record full year sales of $7.1 billion for 2016, slightly surpassing our previous record set in 2015, we acknowledge that the new record was achieved on the strength of strong sales in the first half of the year and an abnormally high volume of sales from multi-year rate guaranteed annuity (MYGA) products. Although our gross sales continued to slow in the fourth quarter of 2016, our net sales were essentially flat on a sequential basis and we grew invested assets and policyholder funds under management. Total sales by independent agents for American Equity Investment Life Insurance Company (American Equity Life) declined 1% sequentially while total sales by broker-dealers and banks for Eagle Life declined by $138 million or 40% sequentially. Sales of fixed index annuities (FIAs) were down 5.5% sequentially to $1.2 billion with all of the decrease attributable to reduced sales for Eagle Life."
Assets outpace liabilities growth
Total assets increased 14.33 percent or $7,024.08 million to $56,053.47 million on Dec. 31, 2016. On the other hand, total liabilities were at $53,761.88 million as on Dec. 31, 2016, up 14.18 percent or $6,677.02 million from year-ago.
Return on assets stood at 0.23 percent in the quarter, up 0.15 from 0.08 percent in the last year period. At the same time, return on equity was at 5.27 percent in the quarter, up 3.53 from 1.74 percent in the last year period.
Investments move up
Investments stood at $44,757.57 million as on Dec. 31, 2016, up 13.11 percent or $5,187.24 million from year-ago. Meanwhile, yield on investments went down 4 basis points to 1.06 percent in the quarter.
Total debt was at $735.61 million as on Dec. 31, 2016, up 15.90 percent or $100.93 million from year-ago. Shareholders equity stood at $2,291.60 million as on Dec. 31, 2016, up 17.85 percent or $347.06 million from year-ago. As a result, debt to equity ratio went down 1 basis points to 0.32 percent in the quarter from 0.33 percent in the last year period.
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