Highlights from AFLAC’s Earnings Call

Seeking Alpha has the transcript for AFLAC’s earnings call. If you read the whole thing, you clearly get a sense that the company is doing well. Here are some highlights:

As you know, we have made significant progress into proactively derisking our portfolio over the last 3 years to enhance the strength of our balance sheet. In the process, we’ve been reducing our exposure to riskier asset classes including perpetual [indiscernible] and financials especially in Europe. You’ve heard us say many times before that we expect to see volatility in Europe, and that’s exactly what we’ve seen in the second quarter. Our second quarter net after-tax realized investment losses were $272 million. These losses are primarily attributable to the decision to impair 2 Spanish holdings. In addition, we experienced further declines in the value of several securities we’ve previously impaired in the fourth quarter of 2011 related to the intent to sell.

Although our total realized losses in the second quarter were higher than the first quarter of this year, they are significantly lower than the second quarter of last year. We still view Europe as an area of potential risk. And always, we closely monitor and reevaluate our portfolio with the eye for credit issues that may emerge. However, I believe our portfolio is better positioned now to accommodate market volatility.

(…)

We increased our cash dividend to shareholders in 2011 for the 29th consecutive year. Our objective is to grow the dividend at the rate in line with the earnings per share growth before the impact of the yen. I believe dividends are an important component for the value we provide investors. I am confident that the fourth quarter, we will extend the consecutive annual dividend increases to 30 years.

(…)

I want to affirm that even with the historically low interest rates, excluding currency, we expect to achieve our 2012 operating earnings per share of a 3% to 6% increase although toward the end of the low range. We believe it is reasonable.

Looking ahead, I also want to reaffirm 2013 target we gave you at the analyst meeting. We expect operating per diluted share to increase 4% to 7% in 2013 on a currency-neutral basis.

Posted by on July 25th, 2012 at 6:56 pm


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