EX-99.1 4 y77402exv99w1.htm EX-99.1 EX-99.1
 
EXHIBIT 99.1
 
Part II
 
Item 6.   Selected Financial Data
 
The following selected financial data has been derived from the Company’s audited consolidated financial statements which have been updated as described in Item 8.01 of this Current Report on Form 8-K as well as from the Consolidated Financial Statements and Financial Statement Schedules included within Item 8 of Part II of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (the “2008 Annual Report”), as updated by Exhibit 99.3 to this Current Report on Form 8-K. The statement of income data for the years ended December 31, 2008, 2007 and 2006 and the balance sheet data at December 31, 2008 and 2007 have been derived from the Company’s audited financial statements included as Exhibit 99.3 to this Current Report on Form 8-K. The statement of income data for the years ended December 31, 2005 and 2004 and the balance sheet data at December 31, 2006, 2005 and 2004 have been derived from the Company’s audited financial statements not included herein. The selected financial data set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as included in the 2008 Annual Report, portions of which have been updated by Exhibit 99.2 to this Current Report on Form 8-K. Some previously reported amounts have been reclassified due to the implementation of Statement of Financial Accounting Standards (“SFAS”) No. 160, Noncontrolling Interests in Consolidated Financial Statements — An Amendment of ARB No. 51 (“SFAS 160”) discussed in footnote 8.
 
                                         
    Years Ended December 31,  
    2008     2007     2006     2005     2004  
    (In millions)  
 
Statement of Income Data (1)
                                       
Revenues (2), (3):
                                       
Premiums
  $ 25,914     $ 22,970     $ 22,052     $ 20,979     $ 18,842  
Universal life and investment-type product policy fees
    5,381       5,238       4,711       3,775       2,819  
Net investment income
    16,297       18,063       16,247       14,064       11,627  
Other revenues
    1,586       1,465       1,301       1,221       1,152  
Net investment gains (losses)
    1,812       (578 )     (1,382 )     (112 )     114  
                                         
Total revenues
    50,990       47,158       42,929       39,927       34,554  
                                         
Expenses (2), (3):
                                       
Policyholder benefits and claims
    27,437       23,783       22,869       22,236       19,907  
Interest credited to policyholder account balances
    4,788       5,461       4,899       3,650       2,766  
Policyholder dividends
    1,751       1,723       1,698       1,678       1,664  
Other expenses (8)
    11,947       10,405       9,514       8,269       6,843  
                                         
Total expenses
    45,923       41,372       38,980       35,833       31,180  
                                         
Income from continuing operations before provision for income tax (8)
    5,067       5,786       3,949       4,094       3,374  
Provision for income tax (2)(8)
    1,582       1,677       1,029       1,158       930  
                                         
Income from continuing operations, net of income tax (8)
    3,485       4,109       2,920       2,936       2,444  
Income (loss) from discontinued operations, net of income tax (2)(8)
    (207 )     356       3,520       1,875       498  
                                         
Income before cumulative effect of a change in accounting, net of income tax (8)
    3,278       4,465       6,440       4,811       2,942  
Cumulative effect of a change in accounting, net of income tax (3)
    —       —       —       —       (86 )
                                         
Net income (8)
    3,278       4,465       6,440       4,811       2,856  
Less: Net income attributable to noncontrolling interests (8)
    69       148       147       97       98  
                                         
Net income attributable to MetLife, Inc. (8)
    3,209       4,317       6,293       4,714       2,758  
Less: Preferred stock dividends
    125       137       134       63       —  
                                         
Net income available to MetLife, Inc.’s common shareholders
  $ 3,084     $ 4,180     $ 6,159     $ 4,651     $ 2,758  
                                         
 


1

 

                                         
    December 31,  
    2008     2007     2006     2005     2004  
    (In millions)  
 
Balance Sheet Data (1)
                                       
Assets:
                                       
General account assets
  $ 380,839     $ 399,007     $ 383,758     $ 354,857     $ 271,137  
Separate account assets
    120,839       160,142       144,349       127,855       86,755  
                                         
Total assets (2)
  $ 501,678     $ 559,149     $ 528,107     $ 482,712     $ 357,892  
                                         
Liabilities:
                                       
Life and health policyholder liabilities (4)
  $ 286,019     $ 262,652     $ 253,284     $ 244,683     $ 182,443  
Property and casualty policyholder liabilities (4)
    3,126       3,324       3,453       3,490       3,180  
Short-term debt
    2,659       667       1,449       1,414       1,445  
Long-term debt
    9,667       9,100       8,822       9,088       7,006  
Collateral financing arrangements
    5,192       4,882       —       —       —  
Junior subordinated debt securities
    3,758       4,075       3,381       2,134       —  
Payables for collateral under securities loaned and other transactions
    31,059       44,136       45,846       34,515       28,678  
Other (8)
    15,374       33,186       32,277       29,141       24,416  
Separate account liabilities
    120,839       160,142       144,349       127,855       86,755  
                                         
Total liabilities (2) (8)
    477,693       522,164       492,861       452,320       333,923  
                                         
Stockholders’ Equity:
                                       
MetLife, Inc.’s stockholders’ equity:
                                       
Preferred stock, at par value
    1       1       1       1       —  
Common stock, at par value
    8       8       8       8       8  
Additional paid-in capital
    15,811       17,098       17,454       17,274       15,037  
Retained earnings (5)
    22,403       19,884       16,574       10,865       6,608  
Treasury stock, at cost
    (236 )     (2,890 )     (1,357 )     (959 )     (1,785 )
Accumulated other comprehensive income (loss) (6)
    (14,253 )     1,078       1,118       1,912       2,956  
                                         
Total MetLife, Inc.’s stockholders’ equity
    23,734       35,179       33,798       29,101       22,824  
Noncontrolling interests (8)
    251       1,806       1,448       1,291       1,145  
                                         
Total equity (8)
    23,985       36,985       35,246       30,392       23,969  
                                         
Total liabilities and stockholders’ equity
  $ 501,678     $ 559,149     $ 528,107     $ 482,712     $ 357,892  
                                         
 

2

 

                                         
    Years Ended December 31,
    2008   2007   2006   2005   2004
    (In millions, except per share data)
 
Other Data (1)
                                       
Net income available to MetLife, Inc.’s common shareholders
  $ 3,084     $ 4,180     $ 6,159     $ 4,651     $ 2,758  
Return on MetLife, Inc.’s common equity (7)
    11.2 %     12.9 %     20.9 %     18.6 %     12.5 %
Return on MetLife, Inc.’s common equity, excluding accumulated other comprehensive income (loss)
    9.1 %     13.3 %     22.1 %     20.7 %     14.4 %
EPS Data (1)
                                       
Income from Continuing Operations Available to MetLife, Inc.’s Common Shareholders Per Common Share
                                       
Basic
  $ 4.60     $ 5.33     $ 3.65     $ 3.85     $ 3.26  
Diluted
  $ 4.54     $ 5.20     $ 3.60     $ 3.82     $ 3.24  
Income (Loss) from Discontinued Operations Per Common Share
                                       
Basic
  $ (0.41 )   $ 0.29     $ 4.44     $ 2.36     $ 0.52  
Diluted
  $ (0.40 )   $ 0.28     $ 4.39     $ 2.34     $ 0.52  
Cumulative Effect of a Change in Accounting Per Common Share (3) 
                                       
Basic
  $ —     $ —     $ —     $ —     $ (0.11 )
Diluted
  $ —     $ —     $ —     $ —     $ (0.11 )
Net Income Available to MetLife, Inc.’s Common Shareholders Per Common Share
                                       
Basic
  $ 4.19     $ 5.62     $ 8.09     $ 6.21     $ 3.67  
Diluted
  $ 4.14     $ 5.48     $ 7.99     $ 6.16     $ 3.65  
Dividends Declared Per Common Share
  $ 0.74     $ 0.74     $ 0.59     $ 0.52     $ 0.46  
 
 
(1) On July 1, 2005, the Company completed the acquisition of The Travelers Insurance Company, excluding certain assets, most significantly, Primerica, from Citigroup Inc. (“Citigroup”), and substantially all of Citigroup’s international insurance businesses. The 2005 selected financial data includes total revenues and total expenses of $966 million and $577 million, respectively, from the date of the acquisition.
 
(2) Discontinued Operations:
 
Real Estate
 
Income related to real estate sold or classified as held-for-sale is presented as discontinued operations. The following information presents the components of income from discontinued real estate operations:
 
                                         
    Years Ended December 31,  
    2008     2007     2006     2005     2004  
    (In millions)  
 
Investment income
  $ 6     $ 21     $ 243     $ 405     $ 658  
Investment expense
    (3 )     (9 )     (151 )     (246 )     (392 )
Net investment gains (losses)
    8       13       4,795       2,125       146  
                                         
Total revenues
    11       25       4,887       2,284       412  
Interest expense
    —       —       —       —       13  
Provision for income tax
    4       11       1,725       812       140  
                                         
Income from discontinued operations, net of income tax
  $ 7     $ 14     $ 3,162     $ 1,472     $ 259  
                                         

3

 

Operations
 
In the fourth quarter of 2008, the Company entered into an agreement to sell its wholly-owned subsidiary, Cova, to a third party to be completed in early 2009. In September 2008, the Company completed a tax-free split-off of its majority-owned subsidiary, Reinsurance Group of America, Incorporated (“RGA”). In September 2007, September 2005 and January 2005, the Company sold its MetLife Insurance Limited (“MetLife Australia”) annuities and pension businesses, P.T. Sejahtera (“MetLife Indonesia”) and SSRM Holdings, Inc. (“SSRM”), respectively. The assets, liabilities and operations of Cova, RGA, MetLife Australia, MetLife Indonesia and SSRM have been reclassified into discontinued operations for all years presented. The following tables present these discontinued operations:
 
                                         
    Years Ended December 31,  
    2008     2007     2006     2005     2004  
    (In millions)  
 
Revenues
  $ 4,086     $ 5,932     $ 5,467     $ 4,776     $ 4,492  
Expenses
    3,915       5,640       5,179       4,609       4,286  
                                         
Income before provision for income tax
    171       292       288       167       206  
Provision for income tax
    57       101       99       60       74  
                                         
Income from discontinued operations, net of income tax
    114       191       189       107       132  
Income from discontinued operations, net of income tax attributable to noncontrolling interests
    94       141       137       109       107  
Gain (loss) on sale of subsidiaries, net of income tax
    (422 )     10       32       187       —  
                                         
Income (loss) from discontinued operations, net of income tax available to MetLife, Inc.’s common shareholders
  $ (214 )   $ 342     $ 358     $ 403     $ 239  
                                         
                                         
    December 31,  
    2008     2007     2006     2005     2004  
    (In millions)  
 
General account assets
  $ 946     $ 22,866     $ 21,918     $ 20,150     $ 16,852  
Separate account assets
    —       17       16       14       14  
                                         
Total assets
  $ 946     $ 22,883     $ 21,934     $ 20,164     $ 16,866  
                                         
Life and health policyholder liabilities (4)
    721       15,780       15,557       15,109       12,210  
Debt
    —       528       307       401       425  
Collateral financing arrangements
    —       850       850       —       —  
Junior subordinated debt securities
    —       399       399       399       —  
Shares subject to mandatory redemption
    —       159       159       159       158  
Other
    27       1,411       1,329       995       1,083  
                                         
Total liabilities
  $ 748     $ 19,127     $ 18,601     $ 17,063     $ 13,876  
                                         
 
 
(3) The cumulative effect of a change in accounting, net of income tax, of $86 million for the year ended December 31, 2004, resulted from the adoption of Statement of Position (“SOP”) 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Account.
 
(4) Policyholder liabilities include future policy benefits, other policyholder funds and bank deposits. The life and health policyholder liabilities also include policyholder account balances, policyholder dividends payable and the policyholder dividend obligation.


4

 

 
(5) The cumulative effect of changes in accounting principles, net of income tax, of $329 million, which decreased retained earnings at January 1, 2007, resulted from $292 million related to the adoption of SOP 05-1, Accounting by Insurance Enterprises for Deferred Acquisition Costs in Connection with Modifications or Exchanges of Insurance Contracts, and $37 million related to the adoption of Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109. The cumulative effect of changes in accounting principles, net of income tax, of $27 million, which increased retained earnings at January 1, 2008, resulted from the adoption of SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (“SFAS 159”).
 
(6) The cumulative effect of a change in accounting, net of income tax, of $744 million resulted from the adoption of SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, which decreased accumulated other comprehensive income (loss) at December 31, 2006. The cumulative effect of a change in accounting principle, net of income tax, of $10 million resulted from the adoption of SFAS 159, which decreased accumulated other comprehensive income (loss) at January 1, 2008.
 
(7) Return on common equity is defined as net income available to common shareholders divided by average common stockholders’ equity.
 
(8) As a result of the implementation of SFAS 160, which required retrospective application of presentation requirements, total equity at December 31, 2008, 2007, 2006, 2005 and 2004 increased by $251 million, $1,806 million, $1,448 million, $1,291 million and $1,145 million, respectively, representing noncontrolling interests, and other liabilities and total liabilities at December 31, 2008, 2007, 2006, 2005 and 2004 decreased by $251 million, $1,806 million, $1,448 million, $1,291 million and $1,145 million, respectively, as a result of the elimination of noncontrolling interests. Also as a result of the adoption of SFAS 160, income from continuing operations for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 increased by $69 million, $148 million, $147 million, $97 million and $98 million, respectively, and net income attributable to noncontrolling interests for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 increased by $69 million, $148 million, $147 million, $97 million and $98 million, respectively.


5