EX-99.2 3 ex99_2.htm EXHIBIT 99.2 Exhibit 99.2
Exhibit 99.2
 
Protective Life Corporation
Post Office Box 2606
Birmingham, AL 35202
Phone 205-268-1000
  



SUPPLEMENTAL FINANCIAL INFORMATION


The following document contains supplemental quarterly statistical financial information for the quarter ended June 30, 2005. This document is dated August 4, 2005. Protective does not undertake a duty to update such information after such date.

All income per share results are presented on a diluted basis.

The sales statistics given in this document are used by the Company to measure the relative progress of its marketing efforts. These statistics and certain other information reported herein were derived from the Company’s various sales tracking and administrative systems and were not derived from the Company’s financial reporting systems or financial statements. These statistics attempt to measure only one of many factors that may affect future business segment profitability, and therefore are not intended to be predictive of future profitability.

Information About Non-GAAP Financial Measures

Throughout this document, GAAP refers to accounting principles generally accepted in the United States of America. Operating income differs from the GAAP measure, net income, in that it excludes realized investment gains and losses (net of the related amortization of deferred acquisition costs (“DAC”) and participating income from real estate ventures) and the cumulative effect of change in accounting principle. Consolidated and segment operating income excludes net realized investment gains (losses) (net of the related amortization of DAC and participating income from real estate ventures) and the cumulative effect of change in accounting principle. Periodic settlements of interest rate swaps associated with corporate debt and certain investments are included in realized gains (losses) but are considered part of operating income because the swaps are used to mitigate risk in items affecting operating income. Management believes that consolidated and segment operating income (loss) enhances an investor’s and the Company’s understanding of the Company’s results of operations, as it represents the basis on which the performance of the Company’s business is internally assessed.

As prescribed by GAAP, certain investments are recorded at their market values with the resulting unrealized gains (losses) reduced by a related adjustment to deferred policy acquisition costs, net of income tax, reported as a component of share-owners’ equity. The market values of fixed maturities increase or decrease as interest rates rise or fall. The Company believes that an insurance company’s share-owners’ equity may be difficult to analyze without disclosing the effects of recording accumulated other comprehensive income, including unrealized gains (losses) on investments. Therefore, the Company reports the non-GAAP measure share owners’ equity per share excluding accumulated other comprehensive income, including unrealized gains (losses) on investments. This non-GAAP measure may be reconciled to the GAAP measure, share owners’ equity per share by including accumulated other comprehensive income, including unrealized gains (losses) on investments.

From time to time, the Company provides additional financial information, which is available on the Company’s web site at www.protective.com in the Analyst/Investor section under the financial report library titled Company Overview.
 
 
 

 
PROTECTIVE LIFE CORPORATION
                          
Draft
  
Quarterly Financial Highlights
                          
8/2/2005
  
(Dollars in Thousands)
                          
Page 1
  
(Unaudited)
                              
                               
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
   
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
Pretax Operating Income *
                              
                               
                               
                               
Life Marketing
  
$
43,597
  
$
38,818
  
$
41,881
  
$
39,141
  
$
38,332
  
$
85,198
  
$
77,473
  
Acquisitions
    
23,461
   
21,262
   
21,374
   
21,035
   
21,473
   
44,664
   
42,508
 
Annuities
    
4,975
   
4,008
   
4,671
   
4,064
   
8,145
   
7,788
   
12,209
 
Stable Value Contracts
    
13,926
   
13,313
   
14,221
   
14,399
   
13,484
   
25,625
   
27,883
 
Asset Protection
    
4,371
   
5,425
   
4,680
   
6,172
   
6,292
   
8,974
   
12,464
 
Corporate & Other
    
3,128
   
12,325
   
1,802
   
11,645
   
9,380
   
7,433
   
21,025
 
 Total Pretax Operating Income
  
$
93,458
  
$
95,151
  
$
88,629
  
$
96,456
  
$
97,106
  
$
179,682
  
$
193,562
  
                                             
                                             
Balance Sheet Data
                                            
                                             
 Total GAAP Assets
  
$
25,091,026
  
$
25,936,586
  
$
27,211,378
  
$
27,863,074
  
$
28,551,847
              
 Share Owners' Equity
  
$
1,884,869
  
$
2,117,109
  
$
2,166,327
  
$
2,124,402
  
$
2,299,265
              
 Share Owners' Equity (excluding accumulated other comprehensive income) **$
1,763,863
  
$
1,823,064
  
$
1,870,016
  
$
1,925,428
  
$
1,959,487
              
                                             
                                             
Stock Data
                                            
                                             
 Closing Price
  
$
38.67
  
$
39.31
  
$
42.69
  
$
39.30
  
$
42.22
  
$
38.67
  
$
42.22
  
 Average Shares Outstanding
                                            
Basic
    
70,284,893
   
70,337,248
   
70,431,763
   
70,474,337
   
70,517,476
   
70,213,500
   
70,496,026
 
Diluted
    
71,030,983
   
71,115,468
   
71,221,826
   
71,273,760
   
71,279,363
   
70,959,287
   
71,276,577
 
                                             
                                             
* "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating Income" may be compared.
  
See Page 5 for a reconciliation of "Pretax Operating Income" to "Income Before Income Tax".
                                    
                                             
** "Share-owners' equity excluding accumulated other comprehensive income" is a non-GAAP financial measure. "Share-owners' equity" is a GAAP financial measure to which
  
"Share-owners' equity excluding accumulated other comprehensive income" may be compared.
                                  
See Page 4 for a reconciliation of "Share-owners' equity excluding accumulated other comprehensive income" to "Share-owners' equity".
                    
 
 

 
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
GAAP Consolidated Statements Of Income
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 2
  
(Unaudited)
                              
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
REVENUES
                              
Gross Premiums and Policy Fees
  
$
456,088
  
$
460,784
  
$
480,628
  
$
472,143
  
$
488,301
  
$
899,884
  
$
960,444
  
Reinsurance Ceded
    
(285,369
)
  
(276,736
)
  
(331,200
)
  
(284,913
)
  
(314,899
)
  
(534,708
)
  
(599,812
)
Net Premiums and Policy Fees
    
170,719
   
184,048
   
149,428
   
187,230
   
173,402
   
365,176
   
360,632
 
Net investment income
    
265,899
   
279,271
   
274,439
   
287,953
   
282,374
   
530,507
   
570,327
 
RIGL - Derivatives
    
8,740
   
6,287
   
(519
)
  
(6,368
)
  
(26,021
)
  
13,823
   
(32,389
)
RIGL - All Other Investments
    
(923
)
  
8,181
   
4,420
   
27,878
   
12,480
   
15,704
   
40,358
 
Other income
    
37,563
   
40,921
   
41,907
   
43,416
   
44,235
   
74,982
   
87,651
 
Total Revenues
    
481,998
   
518,708
   
469,675
   
540,109
   
486,470
   
1,000,192
   
1,026,579
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
282,469
   
288,455
   
272,197
   
300,434
   
291,636
   
569,785
   
592,070
 
Amortization of deferred policy acquisition costs
    
45,053
   
52,375
   
42,908
   
74,251
   
51,867
   
104,847
   
126,118
 
Amortization of goodwill
    
0
   
0
   
0
   
0
   
0
   
0
   
0
 
Other operating expenses
    
46,769
   
63,177
   
53,419
   
60,456
   
55,911
   
106,495
   
116,367
 
Interest on indebtedness
    
12,337
   
12,435
   
12,985
   
13,098
   
13,614
   
24,296
   
26,712
 
Total Benefits and Expenses
    
386,628
   
416,442
   
381,509
   
448,239
   
413,028
   
805,423
   
861,267
 
                                             
INCOME BEFORE INCOME TAX
    
95,370
   
102,266
   
88,166
   
91,870
   
73,442
   
194,769
   
165,312
 
Income tax expense
    
34,075
   
35,793
   
30,858
   
31,787
   
25,411
   
68,169
   
57,198
 
Change in Accounting Principle
    
0
   
0
   
0
   
0
   
0
   
(15,801
)
  
-
 
NET INCOME
  
$
61,295
  
$
66,473
  
$
57,308
  
$
60,083
  
$
48,031
  
$
110,799
  
$
108,114
  
                                             
PER SHARE DATA FOR QUARTER
                                            
Operating income-diluted *
  
$
0.84
  
$
0.88
  
$
0.80
  
$
0.88
  
$
0.90
              
RIGL - Derivatives net of gains related to corp debt and investments
    
0.03
   
0.02
   
(0.05
)
  
(0.09
)
  
(0.27
)
            
RIGL - All Other Investments, net of participating income
    
(0.01
)
  
0.04
   
0.05
   
0.05
   
0.05
             
Change in Accounting Principle
    
0.00
   
0.00
   
0.00
   
0.00
   
0.00
             
Net income-diluted
  
$
0.86
  
$
0.94
  
$
0.80
  
$
0.84
  
$
0.68
              
Average shares outstanding-diluted
    
71,030,983
   
71,115,468
   
71,221,826
   
71,273,760
   
71,279,363
             
Dividends paid
  
$
0.175
  
$
0.175
  
$
0.175
  
$
0.175
  
$
0.195
              
                                             
PER SHARE DATA FOR YTD
                                            
Operating income-diluted *
  
$
1.64
  
$
2.52
  
$
3.32
  
$
0.88
  
$
1.78
  
$
1.64
  
$
1.78
  
RIGL - Derivatives net of gains related to corp debt and investments
    
0.03
   
0.05
   
0.00
   
(0.09
)
  
(0.36
)
  
0.03
   
(0.36
)
RIGL - All Other Investments, net of participating income
    
0.11
   
0.15
   
0.20
   
0.05
   
0.10
   
0.11
   
0.10
 
Change in Accounting Principle
    
(0.22
)
  
(0.22
)
  
(0.22
)
  
0.00
   
0.00
   
(0.22
)
  
-
 
Net income-diluted
  
$
1.56
  
$
2.50
  
$
3.30
  
$
0.84
  
$
1.52
  
$
1.56
  
$
1.52
  
Average shares outstanding-diluted
    
70,959,287
   
71,011,727
   
71,064,539
   
71,273,760
   
71,276,577
   
70,959,287
   
71,276,577
 
Dividends paid
  
$
0.335
  
$
0.510
  
$
0.685
  
$
0.175
  
$
0.370
  
$
0.335
  
$
0.370
  
                                             
                                             
                                             
* "Operating Income" is a non-GAAP financial measure. "Net Income" is a GAAP financial measure to which "Operating Income" may be compared.
              
 
 

PROTECTIVE LIFE CORPORATION
                  
Draft
  
GAAP Consolidated Balance Sheets
                  
8/2/2005
  
(Dollars in thousands)
                  
Page 3
  
(Unaudited)
                      
                       
   
2004
  
2004
  
2004
  
2005
  
2005
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
ASSETS
                      
Fixed maturities
  
$
13,295,606
  
$
13,679,358
  
$
14,412,605
  
$
15,263,694
  
$
15,686,373
  
Equity securities
    
57,802
   
59,635
   
58,941
   
59,605
   
115,758
 
Mortgage loans
    
2,836,683
   
2,904,729
   
3,005,418
   
3,042,584
   
3,124,877
 
Investment real estate
    
107,163
   
107,220
   
107,246
   
104,986
   
91,981
 
Policy loans
    
486,661
   
485,282
   
482,780
   
472,345
   
466,701
 
Other long-term investments
    
197,246
   
217,270
   
259,025
   
222,943
   
186,059
 
Long-term investments
    
16,981,161
   
17,453,494
   
18,326,015
   
19,166,157
   
19,671,749
 
Short-term investments
    
694,002
   
1,042,278
   
1,059,557
   
816,335
   
626,795
 
Total investments
    
17,675,163
   
18,495,772
   
19,385,572
   
19,982,492
   
20,298,544
 
Cash
    
105,518
   
117,118
   
130,596
   
53,673
   
98,316
 
Accrued investment income
    
194,403
   
204,977
   
196,076
   
202,008
   
192,454
 
Accounts and premiums receivable
    
53,958
   
51,504
   
44,364
   
50,271
   
348,688
 
Reinsurance receivable
    
2,526,722
   
2,631,037
   
2,750,260
   
2,835,979
   
2,883,648
 
Deferred policy acquisition costs
   
1,886,854
   
1,792,335
   
1,821,972
   
1,913,803
   
1,866,815
 
Goodwill
    
46,619
   
46,619
   
46,619
   
46,619
   
49,423
 
Property and equipment, net
    
46,821
   
46,359
   
45,454
   
44,520
   
46,878
 
Other assets
    
240,139
   
243,972
   
264,512
   
259,622
   
255,413
 
Assets Related to Separate Accounts
                                
Variable Annuity
    
2,121,517
   
2,110,082
   
2,308,858
   
2,256,920
   
2,286,141
 
Variable Universal Life
    
188,963
   
192,478
   
217,095
   
217,167
   
225,527
 
Other
    
4,349
   
4,333
   
0
   
0
   
0
 
TOTAL ASSETS
  
$
25,091,026
  
$
25,936,586
  
$
27,211,378
  
$
27,863,074
  
$
28,551,847
  
                                 
 

PROTECTIVE LIFE CORPORATION
                  
Draft
  
GAAP Consolidated Balance Sheets
                  
8/2/2005
  
(Dollars in thousands)
                  
Page 4
  
(Unaudited)
                      
                       
                       
LIABILITIES AND SHARE-OWNERS' EQUITY
                      
   
2004
  
2004
  
2004
  
2005
  
2005
  
   
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
LIABILITIES                      
Policy liabilities and accruals
                                
Future policy benefits and claims
  
$
9,473,878
  
$
9,682,429
  
$
10,014,106
  
$
10,222,011
  
$
10,499,494
  
Unearned premiums
    
634,779
   
635,364
   
666,560
   
673,841
   
679,916
 
Stable value product deposits
    
4,921,166
   
5,143,367
   
5,562,997
   
5,670,355
   
5,846,120
 
Annuity deposits
    
3,419,225
   
3,429,473
   
3,463,477
   
3,433,293
   
3,447,394
 
Other policyholders' funds
    
157,612
   
155,952
   
151,660
   
151,572
   
149,247
 
Securities sold under repurchase agreements
    
0
   
0
   
0
   
0
   
31,550
 
Other liabilities
    
884,200
   
950,556
   
1,062,706
   
1,556,736
   
1,482,085
 
Accrued income taxes
    
(12,074
)
  
(30,943
)
  
13,195
   
29,213
   
21,701
 
Deferred income taxes
    
210,912
   
329,272
   
312,544
   
256,453
   
311,146
 
Debt
    
385,449
   
401,541
   
451,433
   
451,424
   
469,317
 
Liabilities related to variable interest entities
    
476,591
   
475,953
   
482,434
   
481,921
   
465,078
 
Subordinated debt securities
    
324,743
   
324,743
   
324,743
   
324,743
   
324,743
 
                                 
Minority interest - subsidiaries
    
14,847
   
14,877
   
13,243
   
13,023
   
13,123
 
Liabilities related to separate accounts
                                
Variable annuity
    
2,121,517
   
2,110,082
   
2,308,858
   
2,256,920
   
2,286,141
 
Variable universal life
    
188,963
   
192,478
   
217,095
   
217,167
   
225,527
 
Other
    
4,349
   
4,333
   
0
   
0
   
0
 
TOTAL LIABILITIES
  
$
23,206,157
  
$
23,819,477
  
$
25,045,051
  
$
25,738,672
  
$
26,252,582
  
                                 
                                 
SHARE-OWNERS' EQUITY
                                
Preferred stock
    
0
   
0
   
0
   
0
   
0
 
Common stock
    
36,626
   
36,626
   
36,626
   
36,626
   
36,626
 
Additional paid-in capital
    
423,257
   
425,181
   
426,927
   
433,467
   
433,040
 
Treasury stock
    
(13,783
)
  
(13,684
)
  
(13,632
)
  
(13,041
)
  
(13,011
)
Stock held in trust
    
(2,855
)
  
0
   
0
   
0
   
0
 
Unallocated ESOP shares
    
(1,989
)
  
(1,989
)
  
(1,989
)
  
(1,610
)
  
(1,610
)
Retained earnings
    
1,322,607
   
1,376,930
   
1,422,084
   
1,469,986
   
1,504,442
 
Accumulated other comprehensive income
    
121,006
   
294,045
   
296,311
   
198,974
   
339,778
 
                                 
                                 
Total Share-owners' Equity
    
1,884,869
   
2,117,109
   
2,166,327
   
2,124,402
   
2,299,265
 
                                 
TOTAL LIABILITIES AND EQUITY
  
$
25,091,026
  
$
25,936,586
  
$
27,211,378
  
$
27,863,074
  
$
28,551,847
  
                                 
SHARE-OWNERS' EQUITY PER SHARE
                                
Total Share-owners' Equity
  
$
27.16
  
$
30.49
  
$
31.19
  
$
30.52
  
$
33.02
  
Accumulated other comprehensive income
    
1.75
    
4.23
   
4.26
   
2.86
   
4.88
 
Excluding accumulated other comprehensive income *
  
$
25.41
  
$
26.26
  
$
26.93
  
$
27.66
  
$
28.14
  
                                 
Total Share-owners' Equity
  
$
1,884,869
  
$
2,117,109
  
$
2,166,327
  
$
2,124,402
  
$
2,299,265
  
Accumulated other comprehensive income
    
121,006
   
294,045
   
296,311
   
198,974
   
339,778
 
Share-owners' Equity (excluding accumulated other comprehensive income) *
  
$
1,763,863
  
$
1,823,064
  
$
1,870,016
  
$
1,925,428
  
$
1,959,487
  
                                 
Common shares outstanding
    
69,407,945
   
69,435,440
   
69,449,889
   
69,615,285
   
69,627,244
 
Treasury Stock shares
    
3,844,015
   
3,816,520
   
3,802,071
   
3,636,675
   
3,624,716
 
                                 
* "Share-owners' equity excluding accumulated other comprehensive income" is a non-GAAP financial measure. "Share-owners' equity" is a GAAP financial measure to which
"Share-owners' equity excluding accumulated other comprehensive income" may be compared.
                  
                                 
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Calculation of Operating Earnings Per Share
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 5
  
(Unaudited)
                              
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
                               
CALCULATION OF NET INCOME PER SHARE
                              
                               
Net income
  
$
61,295
  
$
66,473
  
$
57,308
  
$
60,083
  
$
48,031
  
$
110,799
  
$
108,114
  
                                             
Average shares outstanding-basic
    
70,284,893
   
70,337,248
   
70,431,763
   
70,474,337
   
70,517,476
   
70,213,500
   
70,496,026
 
Average shares outstanding-diluted
    
71,030,983
   
71,115,468
   
71,221,826
   
71,273,760
   
71,279,363
   
70,959,287
   
71,276,577
 
                                             
Net income per share-basic
  
$
0.87
  
$
0.95
  
$
0.81
  
$
0.85
  
$
0.68
  
$
1.58
  
$
1.53
  
Net income per share-diluted
  
$
0.86
  
$
0.94
  
$
0.80
  
$
0.84
  
$
0.68
  
$
1.56
  
$
1.52
  
                                             
Income from continuing operations
  
$
61,295
  
$
66,473
  
$
57,308
  
$
60,083
  
$
48,031
  
$
126,600
  
$
108,114
  
EPS (basic)
  
$
0.87
  
$
0.95
  
$
0.81
  
$
0.85
  
$
0.68
  
$
1.80
  
$
1.53
  
EPS (diluted)
  
$
0.86
  
$
0.94
  
$
0.80
  
$
0.84
  
$
0.68
  
$
1.78
  
$
1.52
  
                                             
CALCULATION OF REALIZED INVESTMENT GAINS (LOSSES) PER SHARE
                                            
                                             
RIGL - Derivatives
  
$
8,740
  
$
6,287
  
$
(519
)
$
(6,368
)
$
(26,021
)
$
13,823
  
$
(32,389
)
Derivative Gains related to Corporate Debt and Investments
    
(5,354
)
  
(4,684
)
  
(4,309
)
  
(3,684
)
  
(2,960
)
  
(10,229
)
  
(6,644
)
RIGL - All Other Investments, net of participating income
    
(923
)
  
8,181
   
4,420
   
27,878
   
6,597
    
15,704
   
34,475
  
Related amortization of DAC
    
(551
)
  
(2,669
)
  
(55
)
  
(22,412
)
  
(1,280
)
  
(4,211
)
  
(23,692
)
     
1,912
   
7,115
   
(463
)
  
(4,586
)
  
(23,664
)
  
15,087
   
(28,250
)
Tax effect
   
(669
)
  
(2,491
)
  
162
   
1,605
   
8,283
    
(5,280
)
  
9,888
 
   
$
1,243
  
$
4,624
  
$
(301
)
$
(2,981
)
$
(15,381
)
$
9,807
  
$
(18,362
)
                                             
RIGL - Derivatives per share-diluted
  
$
0.03
  
$
0.02
  
$
(0.05
)
$
(0.09
)
$
(0.27
)
$
0.03
  
$
(0.36
)
RIGL - All Other Investments per share-diluted
  
$
(0.01
)
$
0.04
  
$
0.05
  
$
0.05
  
$
0.05
  
$
0.11
  
$
0.10
  
                                             
                                             
                                             
OPERATING INCOME PER SHARE *
                                            
                                             
Net income per share-diluted
  
$
0.86
  
$
0.94
  
$
0.80
  
$
0.84
  
$
0.68
  
$
1.56
  
$
1.52
  
RIGL - Derivatives per share-diluted
    
0.03
   
0.02
   
(0.05
)
  
(0.09
)
  
(0.27
)
  
0.03
   
(0.36
)
RIGL - All Other Investments, net of participating income per share-diluted
    
(0.01
)
  
0.04
   
0.05
   
0.05
   
0.05
   
0.11
   
0.10
 
Change in accounting principle
    
-
   
-
   
-
   
-
   
-
   
(0.22
)
  
-
 
Operating income per share-diluted
  
$
0.84
  
$
0.88
  
$
0.80
  
$
0.88
  
$
0.90
  
$
1.64
  
$
1.78
  
                                             
                                             
NET OPERATING INCOME *
                                            
                                             
Net income
  
$
61,295
  
$
66,473
  
$
57,308
  
$
60,083
  
$
48,031
  
$
110,799
  
$
108,114
  
RIGL - Derivatives net of tax & gains related to corp debt & investments
    
2,201
   
1,042
   
(3,138
)
  
(6,534
)
  
(18,837
)
  
2,336
   
(25,371
)
RIGL - All Other Investments net of tax, amortization, and participating income
    
(959
)
  
3,583
   
2,838
   
3,553
   
3,456
   
7,470
   
7,009
 
Change in accounting principle
    
-
   
-
   
-
   
-
   
-
   
(15,801
)
  
-
 
Net operating income
  
$
60,053
  
$
61,848
  
$
57,608
  
$
63,064
  
$
63,412
  
$
116,794
  
$
126,476
  
                                             
                                             
PRETAX OPERATING INCOME **
                                            
                                             
Income before income tax
  
$
95,370
  
$
102,266
  
$
88,166
  
$
91,870
  
$
73,442
  
$
194,769
  
$
165,312
  
RIGL - Derivatives
    
8,740
   
6,287
   
(519
)
  
(6,368
)
  
(26,021
)
  
13,823
   
(32,389
)
Derivative Gains related to Corporate Debt and Investments
    
(5,354
)
  
(4,684
)
  
(4,309
)
  
(3,684
)
  
(2,960
)
  
(10,229
)
  
(6,644
)
RIGL - All Other Investments, net of participating income
    
(923
)
  
8,181
   
4,420
   
27,878
   
6,597
   
15,704
   
34,475
 
Related amortization of DAC
    
(551
)
  
(2,669
)
  
(55
)
  
(22,412
)
  
(1,280
)
  
(4,211
)
  
(23,692
)
Pretax operating income
  
$
93,458
  
$
95,151
  
$
88,629
  
$
96,456
  
$
97,106
  
$
179,682
  
$
193,562
  
                                             
                                             
* "Net Operating Income" and "Operating Income Per Share" are non-GAAP financial measures. "Net Income" and "Net Income Per Share" are GAAP
              
financial measures to which "Net Operating Income" and "Operating Income Per Share" may be compared.
                              
** "Pretax Operating Income" is a non-GAAP financial measure. "Income Before Income Tax" is a GAAP financial measure to which "Pretax Operating
              
Income" may be compared.
                                            
                                             
 
 

PROTECTIVE LIFE CORPORATION
                  
Draft
  
Invested Asset Summary
                  
8/2/2005
  
(Dollars in millions)
                  
Page 6
 
(Unaudited)
                      
                       
   
2ND QTR
 
3RD QTR
 
4TH QTR
 
1ST QTR
 
2ND QTR
 
 
 
2004
 
2004
 
2004
 
2005
 
2005
 
Total Portfolio
                      
                       
Fixed Income
  
$
13,295.6
  
$
13,679.4
  
$
14,412.6
  
$
15,263.7
  
$
15,686.4
  
Mortgage Loans
    
2,836.7
    
2,904.7
    
3,005.4
    
3,042.6
    
3,124.9
  
Real Estate
    
107.2
    
107.2
    
107.3
    
105.0
    
92.0
  
Equities
    
57.8
    
59.6
    
58.9
    
59.6
    
115.8
  
Policy Loans
    
486.7
    
485.3
    
482.8
    
472.4
    
466.7
  
Short Term Investments
    
694.0
    
1,042.3
    
1,059.6
    
816.3
    
626.8
  
Other Long Term Investments
    
197.2
    
217.3
    
259.0
    
222.9
    
186.1
  
Total Invested Assets
  
$
17,675.2
  
$
18,495.8
  
$
19,385.6
  
$
19,982.5
  
$
20,298.5
  
                                 
Fixed Income
                                
                                 
Corporate Bonds
  
$
7,051.5
  
$
7,200.4
  
$
7,466.0
  
$
7,209.4
  
$
7,597.3
  
Mortgage Backed Securities
    
4,451.7
    
4,598.3
    
5,070.2
    
6,201.5
    
6,094.3
  
US Govt Bonds
    
77.4
    
79.3
    
86.0
    
94.7
    
88.5
  
Public Utilities
    
1,673.8
    
1,759.2
    
1,745.5
    
1,705.6
    
1,852.7
  
States, Municipals and Political Subdivisions
    
26.9
    
27.7
    
30.4
    
49.6
    
52.2
  
Preferred Securities
    
3.4
    
3.5
    
3.6
    
2.7
    
1.2
  
Convertibles and Bonds with Warrants
    
10.9
    
11.0
    
10.9
    
0.2
    
0.2
  
Total Fixed Income Portfolio
  
$
13,295.6
  
$
13,679.4
  
$
14,412.6
  
$
15,263.7
  
$
15,686.4
  
                                 
Fixed Income - Quality
                                
                                 
AAA
   
34.2
%
  
34.6
%
  
35.9
%
  
40.9
%
  
40.0
%
AA
    
6.4
%
  
6.4
%
  
6.2
%
  
6.0
%
  
3.7
%
A
    
23.5
%
  
23.5
%
  
22.2
%
  
21.0
%
  
17.8
%
BBB
    
28.6
%
  
28.6
%
  
28.9
%
  
25.8
%
  
31.1
%
BB or Less
    
7.3
%
  
6.9
%
  
6.8
%
  
6.3
%
  
7.4
%
Redeemable Preferred Stock
    
0.0
%
  
0.0
%
  
0.0
%
  
0.0
%
  
0.0
%
     
100.0
%
  
100.0
%
  
100.0
%
  
100.0
%
  
100.0
%
                                 
Mortgage Loans - Type
                                
                                 
Retail
    
73.2
%
  
71.2
%
  
70.7
%
  
69.6
%
  
69.2
%
Apartments
    
9.2
%
  
10.1
%
  
10.2
%
  
11.7
%
  
12.5
%
Office Buildings
    
8.7
%
  
8.7
%
  
9.2
%
  
9.4
%
  
9.2
%
Warehouses
    
7.4
%
  
8.5
%
  
8.4
%
  
8.3
%
  
7.9
%
Miscellaneous
    
1.5
%
  
1.5
%
  
1.5
%
  
1.0
%
  
1.2
%
     
100.0
%
  
100.0
%
  
100.0
%
  
100.0
%
  
100.0
%
                                 
Problem Mortgage Loans
                                
                                 
60 Days Past Due
  
$
0.0
  
$
5.4
  
$
1.9
  
$
1.9
  
$
1.9
  
90 Days Past Due
    
3.2
    
1.9
    
1.9
    
8.2
    
2.6
  
Renegotiated Loans
    
5.7
    
5.7
    
5.6
    
5.4
    
8.3
  
Foreclosed Real Estate
    
0.0
    
1.3
    
1.4
    
0.0
    
4.3
  
   
$
8.9
  
$
14.3
  
$
10.8
  
$
15.5
  
$
17.1
  

 
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Life Marketing and Acquisitions - Quarterly Earnings Trends
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 7
 
(Unaudited)
                              
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
LIFE MARKETING
                              
                               
REVENUES
                              
Gross Premiums and Policy Fees
  
$
250,931
  
$
253,952
  
$
286,020
  
$
273,769
  
$
290,333
  
$
486,917
  
$
564,102
  
Reinsurance Ceded
    
(205,072
)
  
(191,228
)
  
(253,121
)
  
(199,746
)
  
(235,968
)
  
(373,858
)
  
(435,714
)
Net Premiums and Policy Fees
    
45,859
   
62,724
   
32,899
   
74,023
   
54,365
   
113,059
   
128,388
 
Net investment income
    
58,929
   
59,985
   
61,339
   
61,153
   
62,541
   
116,869
   
123,694
 
Realized investment gains (losses)
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other income
    
22,348
   
25,151
   
26,053
   
28,556
   
27,107
   
43,491
   
55,663
 
Total Revenues
    
127,136
   
147,860
   
120,291
   
163,732
   
144,013
   
273,419
   
307,745
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
66,692
   
78,361
   
57,505
   
89,783
   
72,994
   
138,718
   
162,777
 
Amortization of deferred policy acquisition costs
    
10,926
   
14,823
   
12,140
   
17,827
   
21,413
   
32,007
   
39,240
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
5,921
   
15,858
   
8,765
   
16,981
   
11,274
   
17,496
   
28,255
 
Total Benefits and Expenses
    
83,539
   
109,042
   
78,410
   
124,591
   
105,681
   
188,221
   
230,272
 
                                             
INCOME BEFORE INCOME TAX
 
$
43,597
  
$
38,818
  
$
41,881
  
$
39,141
  
$
38,332
  
$
85,198
  
$
77,473
  
                                             
                                             
ACQUISITIONS
                                            
                                             
REVENUES
                                            
Gross Premiums and Policy Fees
  
$
69,659
  
$
66,985
  
$
70,281
  
$
65,500
  
$
66,104
  
$
139,128
  
$
131,604
  
Reinsurance Ceded
    
(17,840
)
  
(16,562
)
  
(20,559
)
  
(20,029
)
  
(17,257
)
  
(34,941
)
  
(37,286
)
Net Premiums and Policy Fees
    
51,819
   
50,423
   
49,722
   
45,471
   
48,847
   
104,187
   
94,318
 
Net investment income
    
58,704
   
57,682
   
57,458
   
56,714
   
56,099
   
117,359
   
112,813
 
Realized investment gains (losses)
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other income
    
468
   
655
   
432
   
361
   
453
   
1,185
   
814
 
Total Revenues
    
110,991
   
108,760
   
107,612
   
102,546
   
105,399
   
222,731
   
207,945
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
71,340
   
71,571
   
71,425
   
66,399
   
68,784
   
144,360
   
135,183
 
Amortization of deferred policy acquisition costs
    
7,476
   
7,056
   
6,271
   
7,071
   
7,185
   
15,325
   
14,256
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
8,714
   
8,871
   
8,542
   
8,041
   
7,957
   
18,382
   
15,998
 
Total Benefits and Expenses
    
87,530
   
87,498
   
86,238
   
81,511
   
83,926
   
178,067
   
165,437
 
                                             
INCOME BEFORE INCOME TAX
 
$
23,461
  
$
21,262
  
$
21,374
  
$
21,035
  
$
21,473
  
$
44,664
  
$
42,508
  
                                             
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Life Marketing and Annuities Data
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 8
  
(Unaudited)
                              
                               
                               
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
LIFE MARKETING
                              
                               
                               
SALES BY PRODUCT
                              
Term
  
$
42,208
  
$
41,046
  
$
41,794
  
$
34,508
  
$
26,861
  
$
89,043
  
$
61,369
  
U/L
    
19,266
   
16,360
   
31,276
   
32,747
   
41,638
   
36,963
   
74,385
 
VUL
    
1,474
   
1,492
   
1,145
   
1,138
   
1,197
   
2,599
   
2,335
 
Total
  
$
62,948
  
$
58,898
  
$
74,215
  
$
68,393
  
$
69,696
  
$
128,605
  
$
138,089
  
                                             
SALES BY DISTRIBUTION
                                           
Brokerage general agents
  
$
39,580
  
$
37,843
  
$
40,975
  
$
36,173
  
$
29,495
  
$
82,327
  
$
65,668
  
Independent agents
    
12,570
   
12,615
   
18,004
   
17,309
   
18,746
   
25,310
   
36,055
 
Stockbrokers/banks
    
6,782
   
7,016
   
11,854
   
12,670
   
18,004
   
12,841
   
30,674
 
Direct Response & BOLI
    
4,016
   
1,424
   
3,382
   
2,241
   
3,451
   
8,127
   
5,692
 
Total
  
$
62,948
  
$
58,898
  
$
74,215
  
$
68,393
  
$
69,696
  
$
128,605
  
$
138,089
  
                                             
                                             
ANNUITIES
                                            
                                             
                                             
SALES
                                            
Variable Annuity
 
$
63,317
  
$
74,231
  
$
83,654
  
$
77,003
  
$
90,329
  
$
125,041
  
$
167,332
  
Immediate Annuity
   
33,576
   
23,216
   
150,179
   
32,476
   
21,194
   
44,542
   
53,670
 
Market Value Adjusted Annuity
   
74,729
   
83,175
   
62,201
   
26,483
   
33,065
   
79,857
   
59,548
 
Equity Indexed Annuity
                      
609
   
6,582
   
0
   
7,191
 
Total
  
$
171,622
  
$
180,622
  
$
296,034
  
$
136,571
  
$
151,170
  
$
249,440
  
$
287,741
  
                                             
PRETAX OPERATING INCOME
                                            
Variable Annuity
 
$
3,492
  
$
2,901
  
$
3,417
  
$
3,735
  
$
4,274
  
$
4,117
  
$
8,009
  
Fixed Annuity
   
1,483
   
1,107
   
1,254
   
329
   
3,871
   
3,671
   
4,200
 
Total
  
$
4,975
  
$
4,008
  
$
4,671
  
$
4,064
  
$
8,145
  
$
7,788
  
$
12,209
  
                                             
DEPOSIT BALANCE
                                            
VA Fixed Annuity
 
$
269,353
  
$
269,363
  
$
262,295
  
$
251,822
  
$
250,556
              
VA Separate Account Annuity
   
2,026,781
   
2,023,325
   
2,222,102
   
2,176,065
   
2,210,639
             
Sub-total
    
2,296,134
   
2,292,688
   
2,484,397
   
2,427,887
 
$
2,461,195
              
Fixed Annuity
   
2,930,544
   
2,986,179
   
3,173,862
   
3,195,043
   
3,202,752
             
Total
  
$
5,226,678
  
$
5,278,867
  
$
5,658,259
  
$
5,622,930
  
$
5,663,947
              
                                             
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Annuities, Stable Value Contracts, and Asset Protection
                          
8/2/2005
  
Quarterly Earnings Trends (Dollars in thousands)
                          
Page 9
  
(Unaudited)
                              
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
ANNUITIES
                              
                               
REVENUES
                              
Gross Premiums and Policy Fees
  
$
7,594
  
$
7,370
  
$
7,749
  
$
7,840
  
$
7,866
  
$
15,222
  
$
15,706
  
Reinsurance Ceded
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Net Premiums and Policy Fees
    
7,594
   
7,370
   
7,749
   
7,840
   
7,866
   
15,222
   
15,706
 
Net investment income
    
51,523
   
52,854
   
54,923
   
56,150
   
54,786
   
103,111
   
110,936
 
RIGL - Derivatives
    
-
   
-
   
-
   
(162
)
  
-
   
-
   
(162
)
RIGL - All Other Investments
    
290
   
3,524
   
55
   
27,624
   
1,474
   
6,294
   
29,098
 
Other income
    
1,555
   
1,556
   
2,108
   
1,726
   
2,264
   
3,340
   
3,990
 
Total Revenues
    
60,962
   
65,304
   
64,835
   
93,178
   
66,390
   
127,967
   
159,568
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
44,456
   
46,526
   
46,243
   
48,080
   
48,687
   
90,502
   
96,767
 
Amortization of deferred policy acquisition costs
    
7,119
   
8,459
   
7,636
   
29,638
   
3,453
   
16,176
   
33,091
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
4,673
   
5,456
   
6,285
   
6,346
   
5,911
   
11,418
   
12,257
 
Total Benefits and Expenses
    
56,248
   
60,441
   
60,164
   
84,064
   
58,051
   
118,096
   
142,115
 
                                             
INCOME BEFORE INCOME TAX
   
4,714
   
4,863
   
4,671
   
9,114
   
8,339
   
9,871
   
17,453
 
                                             
Adjustments to Reconcile to Operating Income:
                                            
Less: RIGL - Derivatives
    
-
   
-
   
-
   
(162
)
  
-
   
-
   
(162
)
Less: RIGL - All Other Investments
    
290
   
3,524
   
55
   
27,624
   
1,474
   
6,294
   
29,098
 
Add back: Related amortization of deferred policy acquisition costs
    
551
   
2,669
   
55
   
22,412
   
1,280
   
4,211
   
23,692
 
                                             
PRETAX OPERATING INCOME
  
$
4,975
  
$
4,008
  
$
4,671
  
$
4,064
  
$
8,145
  
$
7,788
  
$
12,209
  
                                             
STABLE VALUE CONTRACTS
                                            
                                             
REVENUES
                                            
Gross Premiums and Policy Fees
  
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
$
-
  
Reinsurance Ceded
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Net Premiums and Policy Fees
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Net investment income
    
66,666
   
66,472
   
71,013
   
73,875
   
76,081
   
130,699
   
149,956
 
RIGL - Derivatives
    
135
   
700
   
53
   
292
   
(310
)
  
406
   
(18
)
RIGL - All Other Investments
    
1,887
   
6,292
   
279
   
327
   
2,395
   
5,495
   
2,722
 
Other income
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Total Revenues
    
68,688
   
73,464
   
71,345
   
74,494
   
78,166
   
136,600
   
152,660
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
50,720
   
50,301
   
54,378
   
57,169
   
60,084
   
100,489
   
117,253
 
Amortization of deferred policy acquisition costs
    
803
   
894
   
1,022
   
1,084
   
1,121
   
1,564
   
2,205
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
1,217
   
1,964
   
1,392
   
1,223
   
1,392
   
3,021
   
2,615
 
Total Benefits and Expenses
    
52,740
   
53,159
   
56,792
   
59,476
   
62,597
   
105,074
   
122,073
 
                                             
INCOME BEFORE INCOME TAX
    
15,948
   
20,305
   
14,553
   
15,018
   
15,569
   
31,526
   
30,587
 
                                             
Adjustments to Reconcile to Operating Income:
                                            
Less: RIGL-Derivatives
    
135
   
700
   
53
   
292
   
(310
)
  
406
   
(18
)
Less: RIGL-All Other Investments
    
1,887
   
6,292
   
279
   
327
   
2,395
   
5,495
   
2,722
 
                                             
PRETAX OPERATING INCOME
  
$
13,926
  
$
13,313
  
$
14,221
  
$
14,399
  
$
13,484
  
$
25,625
  
$
27,883
  
                                             
ASSET PROTECTION
                                            
                                             
                                             
REVENUES
                                            
Gross Premiums and Policy Fees
  
$
115,354
  
$
120,558
  
$
105,190
  
$
114,004
  
$
113,504
  
$
233,533
  
$
227,508
  
Reinsurance Ceded
    
(62,120
)
  
(68,755
)
  
(57,362
)
  
(65,063
)
  
(61,621
)
  
(125,226
)
  
(126,684
)
Net Premiums and Policy Fees
    
53,234
   
51,803
   
47,828
   
48,941
   
51,883
   
108,307
   
100,824
 
Net investment income
    
7,500
   
7,922
   
7,976
   
7,600
   
8,602
   
15,041
   
16,202
 
Realized investment gains (losses)
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other income
    
9,117
   
9,565
   
8,732
   
8,537
   
11,462
   
18,179
   
19,999
 
Total Revenues
    
69,851
   
69,290
   
64,536
   
65,078
   
71,947
   
141,527
   
137,025
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
33,363
   
29,226
   
26,219
   
26,529
   
29,851
   
65,562
   
56,380
 
Amortization of deferred policy acquisition costs
    
17,522
   
20,042
   
14,753
   
17,546
   
17,669
   
37,478
   
35,215
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
14,595
   
14,597
   
18,884
   
14,831
   
18,135
   
29,513
   
32,966
 
Total Benefits and Expenses
    
65,480
   
63,865
   
59,856
   
58,906
   
65,655
   
132,553
   
124,561
 
                                             
INCOME BEFORE INCOME TAX
 
$
4,371
  
$
5,425
  
$
4,680
  
$
6,172
  
$
6,292
  
$
8,974
  
$
12,464
  
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Stable Value Contracts and Asset Protection Data
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 10
  
(Unaudited)
                              
                               
                               
                               
                               
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
 
  
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
STABLE VALUE CONTRACTS
                              
                               
SALES
                              
GIC
  
$
39,000
  
$
15,000
  
$
5,000
  
$
24,050
  
$
5,000
  
$
39,000
  
$
29,050
  
GFA - Direct Institutional
    
960
   
-
   
66,060
   
-
   
-
   
960
   
0
 
GFA - Non-Registered
    
-
   
-
   
-
   
-
   
-
   
0
   
0
 
GFA - Registered - Institutional
    
-
   
625,000
   
-
   
350,000
   
350,000
   
300,000
   
700,000
 
GFA - Registered - Retail
    
68,250
   
135,520
   
106,290
   
31,845
   
96,795
   
289,750
   
128,640
 
Total
 
$
108,210
  
$
775,520
  
$
177,350
  
$
405,895
  
$
451,795
  
$
629,710
  
$
857,690
  
                                             
                                             
DEPOSIT BALANCE
                                            
Quarter End Balance
  
$
4,921,166
  
$
5,143,367
  
$
5,562,997
  
$
5,670,355
  
$
5,846,120
              
Average Daily Balance
  
$
5,062,014
  
$
5,112,019
  
$
5,455,427
  
$
5,716,571
  
$
5,808,943
  
$
4,956,987
  
$
5,763,519
  
                                             
OPERATING SPREAD
    
1.13
%
  
1.07
%
  
1.07
%
  
1.04
%
  
0.95
%
  
1.06
%
  
0.99
%
                                             
                                             
     
2004
    
2004
    
2004
    
2005
    
2005
    
6 MOS
    
6 MOS
  
 
     2ND QTR     
3RD QTR
    
4TH QTR
    
1ST QTR
    
2ND QTR
    
2004
    
2005
  
                                             
                                             
ASSET PROTECTION
                                            
                                             
SALES
                                           
Credit
  
$
59,035
  
$
59,543
  
$
47,761
  
$
50,106
  
$
51,421
  
$
110,281
  
$
101,527
  
Service Contracts
    
54,861
   
56,627
   
47,220
   
47,138
   
62,437
   
99,136
   
109,575
 
Other
    
8,940
   
8,883
   
13,780
   
9,075
   
13,567
   
17,091
   
22,642
 
Total
  
$
122,836
  
$
125,053
  
$
108,761
  
$
106,319
  
$
127,425
  
$
226,508
  
$
233,744
  
                                             
 

PROTECTIVE LIFE CORPORATION
                          
Draft
  
Corporate & Other Segment - Quarterly Earnings Trends
                          
8/2/2005
  
(Dollars in thousands)
                          
Page 11
  
(Unaudited)
                              
   
2004
  
2004
  
2004
  
2005
  
2005
  
6 MOS
  
6 MOS
  
   
2ND QTR
  
3RD QTR
  
4TH QTR
  
1ST QTR
  
2ND QTR
  
2004
  
2005
  
                               
                               
REVENUES
                              
Gross Premiums and Policy Fees
  
$
12,550
  
$
11,919
  
$
11,373
  
$
11,030
  
$
10,494
  
$
25,084
  
$
21,524
  
Reinsurance Ceded
    
(337
)
  
(191
)
  
(143
)
  
(75
)
  
(53
)
  
(683
)
  
(128
)
Net Premiums and Policy Fees
    
12,213
   
11,728
   
11,230
   
10,955
   
10,441
   
24,401
   
21,396
 
Net investment income
    
22,577
   
34,356
   
21,730
   
32,461
   
24,265
   
47,428
   
56,726
 
RIGL - Derivatives
    
8,605
   
5,587
   
(572
)
  
(6,498
)
  
(25,711
)
  
13,417
   
(32,209
)
RIGL - All Other Investments
    
(3,100
)
  
(1,635
)
  
4,086
   
(73
)
  
8,611
   
3,915
   
8,538
 
Other income
    
4,075
   
3,994
   
4,582
   
4,236
   
2,949
   
8,787
   
7,185
 
Total Revenues
    
44,370
   
54,030
   
41,056
   
41,081
   
20,555
   
97,948
   
61,636
 
                                             
BENEFITS & EXPENSES
                                            
Benefits and settlement expenses
    
15,898
   
12,470
   
16,427
   
12,474
   
11,236
   
30,154
   
23,710
 
Amortization of deferred policy acquisition costs
    
1,207
   
1,101
   
1,086
   
1,085
   
1,026
   
2,297
   
2,111
 
Amortization of goodwill
    
-
   
-
   
-
   
-
   
-
   
-
   
-
 
Other operating expenses
    
23,986
   
28,866
   
22,536
   
26,132
   
24,856
   
50,961
   
50,988
 
Total Benefits and Expenses
    
41,091
   
42,437
   
40,049
   
39,691
   
37,118
   
83,412
   
76,809
 
                                             
INCOME BEFORE INCOME TAX
   
3,279
   
11,593
   
1,007
   
1,390
   
(16,563
)
  
14,536
   
(15,173
)
                                             
Adjustments to Reconcile to Operating Income:
                                            
Less: RIGL-Derivatives
    
8,605
   
5,587
   
(572
)
  
(6,498
)
  
(25,711
)
  
13,417
   
(32,209
)
Less: RIGL-All Other Investments, net of participating income
    
(3,100
)
  
(1,635
)
  
4,086
   
(73
)
  
2,728
   
3,915
   
2,655
 
Add back: Derivative gains related to corporate debt and investments
    
5,354
   
4,684
   
4,309
   
3,684
   
2,960
   
10,229
   
6,644
 
                                             
PRETAX OPERATING INCOME
  
$
3,128
  
$
12,325
  
$
1,802
  
$
11,645
  
$
9,380
  
$
7,433
  
$
21,025