Primerica : Presentation Q1 2025

Published: 2025-05-12 10:19:07 ET PRI

Published on 05/12/2025 at 10:19

Quarter Ended March 31, 2025

Financial Highlights

Delivered solid earnings and return, with 19% EPS growth (20% operating EPS) and 30.0% ROE (30.4% ROAE)

Term Life business result demonstrated the stability of our large in force block of policies

Momentum from strong client demand drove continued growth in ISP sales

Capital deployment

Repurchased $118 million of common stock

Paid $35 million in regular stockholder dividends

The Board declared a $1.04 per share dividend payable June 13, 2025

GAAP Financial Results

($ in millions, except per share amounts)

Q1 2025

Q1 2024

% Change

Revenues

$804.8

$735.9

Income from continuing operations

$169.1

$148.4

14%

Loss from discontinued operations, net of tax

($10.5)

Net income

$169.1

$137.9

23%

Stockholders' equity(1)

$2,256.4

$2,185.9

Diluted earnings per share from continuing operations(2)

$5.05

$4.23

19%

Book value per share(1) (3)

$68.33

$63.16

Adjusted Operating Financial Results

($ in millions, except per share amounts)

Q1 2025

Q1 2024

% Change

Adjusted operating revenues

$803.6

$734.8

Adjusted net operating income

$168.1

$147.5

14%

Adjusted stockholders' equity(1)

$2,218.6

$2,274.6

(2%)

Diluted adjusted operating EPS(2)

$5.02

$4.20

20%

Adjusted book value per share(1) (3)

$67.18

$65.72

For a reconciliation of GAAP to non-GAAP financial measures, refer to the Financial Supplement

At period end

33.3 million weighted average common shares outstanding for Q1 2025

33.0 million common shares outstanding as of March 31, 2025

Distribution Highlights

Recruiting and licensing remained strong relative to historical levels, contributing to continued growth in sales force

Slower compared to a record level of growth rate in 2024

Market conditions potentially prompted more cautious decision-making

Business model offers an attractive entrepreneurial opportunity that supports sales force expansion

Life-licensed sales force grew 7% vs prior year period

Sales Force

Distribution

Q1 2025

Q1 2024

% Change

Recruits

100,867

110,710

(9%)

New life-licensed representatives

12,339

12,949

(5%)

Life-licensed sales force(1)

152,167

142,855

(1) At period end

Life-Licensed Sales Force

141.6

151.6

152.2

(in thousands)

YE 2023 YE 2024 Q1 2025

Production Highlights

Term Life Insurance

Issued over 86,000 life insurance policies during Q1 2025

Cost of living pressures remained a headwind for middle-income families

Remained near historical high levels

Production

($ in billions)

Q1 2025

Q1 2024

% Change

Issued life insurance policies

86,415

86,587

Productivity(1)

0.19

0.20

Issued face amount(2)

$28.5

$28.7

Life insurance face amount in force(3)

$957.0

$947.1

Issued Term Life Policies*

(in thousands)

Added $28 billion of new term life protection for a total of $957 billion in force protection at quarter end

Productivity of 0.19 was slightly below

358.9

370.4

86.4

86.6

84.6

100.8

97.0

88.6

93.4

88.8

89.7

86.4

historical range

2023 2024 2025

* Items may not add due to rounding

The average monthly rate of new policies issued per life-licensed independent sales representative

Includes face amount of issued term life insurance policies, additional riders added to existing policies and face amount increases under increasing benefit riders

5 (3) At period end

Production Highlights

Investment and Savings Products

Record product sales of $3.6 billion, up 28% year-over-year

($ in billions)

Q1 2025

Q1 2024

% Change

Total product sales

$3.6

$2.8

28%

Client asset values(1)

$109.9

$103.3

Average client asset values

$113.0

$99.5

14%

Production

Strong investor demand for mutual funds, annuities and managed accounts

Clients' continued focus on long-term retirement savings goals

Ending client asset values up 6% vs prior year

Net client inflows were $839 million

Reflecting strong sales and the importance of investing despite heightened market uncertainty

At period end

ISP Sales*

$3.6

$2.8

$2.3

$2.4

$3.1

$2.2

$2.9

$2.4

$3.3

($ in billions)

$9.2

$12.1

$3.6

2023 2024 2025

* Items may not add due to rounding

Operating Results

($ in millions)

Q1 2025

Q1 2024

% Change

Direct premiums

$854.4

$836.3

Premium ceded to IPO coinsurers(1)

($191.5)

($206.5)

Adjusted direct premiums (ADP)(2)

$663.0

$629.8

Operating revenues

$457.8

$440.4

Operating income before income taxes

$146.8

$138.4

Term Life Segment

Operating revenues rose 4%, driven by 5% ADP growth

Key financial ratios in line with prior year

Benefits and claims ratio 58.2%

DAC ratio 12.0%

Insurance expense ratio 7.7%

Key Ratios

Q1 2025

Q1 2024

Benefits and claims, net(3)

58.2%

58.0%

DAC amortization & insurance commissions

12.0%

12.2%

Insurance expenses, net(4)

7.7%

7.8%

Term life income before income taxes

22.1%

22.0%

Operating margin 22.1%

Lapse rates remain elevated vs long-term expectations, with a stabilizing trend

Persistency for policies issued during the last year in line with our assumptions

Claims experience favorable to expectations

Premiums ceded to IPO coinsurers under the IPO coinsurance transactions excluding any reimbursements from IPO coinsurers on previously existing reinsurance agreements

Direct premiums net of premiums ceded to IPO coinsurers

Benefits & claims and remeasurement (gain)/loss net of other ceded premiums which are largely YRT

Insurance expenses net of other, net revenues

Operating Results

($ in millions, except as noted)

Q1 2025

Q1 2024

% Change

Sales-based revenues

$111.3

$88.7

25%

Asset-based revenues

$152.0

$128.5

18%

Account-based revenues

$24.2

$23.2

Other, net

$3.3

Total operating revenues

$290.8

$243.7

19%

Benefits and expenses

$209.5

$178.2

18%

Operating income before income taxes

$81.3

$65.6

24%

Sales-based variable margin as % of revenue-generating sales(1)

1.28%

1.19%

Asset-based revenue variable margin as % of average asset values(2)

0.053%

0.051%

Account-based variable margin per average fee generating position(3)

$3.57

$3.67

Investment & Savings Products Segment

Operating revenues increased 19%, while operating income before taxes up 24%

Strong client demand continued to fuel growth in product sales

Average client asset values up 14% year-over-year

Growth in sales-based revenues driven by higher demand for variable annuities

Asset-based revenues benefited from favorable mix-shift toward products with higher asset-based fees

Commission and fee revenue less commissions paid to the independent sales force based on product sales activity

Commission and fee revenue less administration and advisory fees paid to third-party providers and commissions paid to the independent sales force earned based on product account values including amortization of deferred acquisition costs for segregated funds

Fee revenue less recordkeeping fees paid to third-party providers based on fee-generating positions and certain direct general expenses

Insurance & Operating Expense Highlights

($ in millions)

Q1 2025

Q1 2024

% Change

Term Life

$63.6

$62.0

ISP

$51.4

$46.5

10%

Corporate & Other

$48.1

Consolidated Insurance & Other Operating Expenses*

$163.1

$156.6

Consolidated insurance and other operating expenses were $163 million, up 4% year-over-year

Increased variable costs driven by production and sales growth in the Term Life and ISP segments

Higher employee compensation costs due to annual merit increases

* Items may not add due to rounding

Disclaimer

Primerica Inc. published this content on May 12, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 12, 2025 at 14:18 UTC.