Jackson Financial Incorporation Class A ((JXN)) has held its Q2 earnings call. Read on for the main highlights of the call.
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The recent earnings call for Jackson Financial Incorporation Class A painted a picture of strong growth and strategic stability. The company reported robust growth in RILA and fixed annuity sales, a solid capital position, and significant capital returns to shareholders. Despite facing challenges such as market volatility affecting fee income and underwhelming limited partnership results, the overall sentiment was positive, driven by strategic initiatives that are fostering growth and stability.
Record Growth in RILA and Fixed Annuity Sales
Jackson Financial reported record growth in RILA and fixed annuity sales, with RILA account balances increasing by nearly 80% from the second quarter of last year and 26% since the end of 2024. RILA sales approached $1.4 billion, reflecting a 16% increase from the previous quarter. Total Retail Annuity sales reached $4.4 billion, marking a 9% increase over the first quarter and a 4% increase year-over-year.
Strong Capital Position and Shareholder Returns
The company demonstrated a strong capital position with total adjusted capital exceeding $5.3 billion, a 5% increase since year-end 2024. Jackson Financial returned $447 million to shareholders through share repurchases and common shareholder dividends in the first six months, a 41% increase from the previous year.
Improved Variable Annuity Net Outflows
Variable annuity net outflows showed improvement for the second consecutive quarter, returning to 2023 levels. Total retail annuity net outflows were $2.2 billion in the second quarter, down 27% from a year ago and 39% from the first quarter.
Recognition for Product Innovation
Jackson Financial received recognition for its product innovation, with three of its products featured in Barron’s Annual 100 Best Annuities Guide across five categories.
Strong Financial Performance
The company’s adjusted operating earnings were $350 million, bolstered by the expansion of RILA and fixed annuity blocks and higher yields in the bond portfolio. The book value per diluted share increased by 3% to $155.11.
Impact of Market Volatility on Fee Income
Market volatility in April led to lower fee income for the quarter, although variable annuity assets under management rebounded by the end of the quarter.
Limited Partnership Results
The quarter was negatively impacted by a $0.33 adjustment due to limited partnership results falling below the 10% long-term assumption.
Institutional Segment Earnings Decline
The Institutional segment experienced a decline in pretax adjusted operating earnings compared to the second quarter of last year, primarily due to lower spread income.
Forward-Looking Guidance
Looking ahead, Jackson Financial’s guidance reflects a robust financial health and strategic progress. The Retail Annuities segment saw significant growth, contributing to a 9% increase in total Retail Annuity sales for the quarter. The company also highlighted strong capital returns to shareholders and ended the quarter with $5.3 billion in total adjusted capital, maintaining a risk-based capital ratio well above the target minimum. These metrics underscore Jackson’s strategic focus on product diversification, strong capital generation, and commitment to shareholder returns.
In conclusion, Jackson Financial’s earnings call highlighted a positive outlook with strong growth in key areas and strategic initiatives driving stability. Despite some challenges, the company’s robust capital position and commitment to shareholder returns were clear takeaways, signaling a promising future for the company.