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Core Insights - CNO Financial Group, Inc. (CNO) shares increased by 3.5% following the release of its third-quarter 2025 results, driven by strong premium collections from annuity, life, and health products, alongside rising new annualized premiums and higher fee revenues, although partially offset by increased total benefits and expenses [1][10]. Financial Performance - CNO reported adjusted earnings per share (EPS) of 96 cents, exceeding the Zacks Consensus Estimate by 1.1%, and an increase from 92 cents a year ago [2][10]. - Operating revenues reached $1.2 billion, marking a 5.3% year-over-year increase and surpassing the consensus estimate by 26.3% [2][10]. - Total insurance policy income rose 2.1% year over year to $658.4 million, beating the Zacks Consensus Estimate of $653 million [3]. Premiums and Expenses - Collected premiums from annuity, life, and health products totaled $1.1 billion, reflecting a 2.1% year-over-year increase [5]. - New annualized premiums for health products surged by 20.2% year over year, while life products increased by 32.1% [6]. - Total benefits and expenses rose by 3% year over year to $1.2 billion, driven by higher operating costs [6]. Investment and Assets - Net investment losses were reported at $8.8 million, an improvement from the previous year's loss of $11.1 million [4]. - General account assets grew by 4.5% year over year to $382.9 million, while policyholder and other special-purpose portfolios increased by 33.3% to $116.8 million [4]. Shareholder Returns - CNO returned $60 million to shareholders through share buybacks and $16.4 million in dividends during the third quarter, with a remaining repurchase capacity of $480.4 million [11]. Guidance and Projections - For 2025, CNO anticipates operating EPS in the range of $3.75-$3.85, an increase from the previous estimate of $3.70-$3.90 [12]. - The company now estimates excess cash flow to the holding company between $365-$385 million, up from the prior range of $200-$250 million [12]. - The projected expense ratio is around 19%, improved from the previous estimate of 19-19.2% [13].

Core Insights - The CNO Financial Indianapolis Monumental Marathon achieved a record participation of over 17,500 runners, marking its 13th consecutive sellout and establishing itself as a significant event in the national competitive circuit [1][4][11] - Joseph Whelan set a new men's marathon course record with a time of 2:12:29, while Amanda Mosborg won the women's race in 2:32:01, showcasing elite performances [2][6] - The event also saw 14 athletes qualify for the 2028 U.S. Olympic Team Trials, further enhancing its reputation [3] Event Highlights - The marathon featured a new start line on West Street and celebrated the 10th anniversary of CNO Financial Group's title sponsorship [4][10] - Participants represented all 50 states and 22 countries, indicating the event's growing global reach [4][11] - The event included a charity component, with over 240 participants running for various causes, raising funds and awareness [11] Results Overview - Men's Marathon: Joseph Whelan (2:12:29), Ben Decker (2:15:23), Andrew Bowman (2:15:33) [5] - Women's Marathon: Amanda Mosborg (2:32:01), Lucy Dobbs (2:32:42), Anna Benedettini (2:33:12) [6] - Men's Half Marathon: Skylar Stidam (1:02:47), Curtis Eckstein (1:03:06), Alec Basten (1:03:15) [7] - Women's Half Marathon: Carrie Ellwood (1:08:33), Kasandra Parker (1:10:18), Molly Grabill (1:11:00) [8] - Men's 5K: Scott Spaanstra (14:38), Women's 5K: Sammy McClintock (16:17) [8] Future Plans - Plans for the next year's event are already underway, scheduled for November 7, 2026, with registration opening soon [12]

Financial Performance - CNO reported consolidated financial results for the nine months ended September 30, 2025, with a focus on the performance of its insurance product lines: annuity, health, and life[243]. - For the nine months ended September 30, 2025, the total insurance product margin increased to $801.8 million, up from $786.9 million in 2024, representing a growth of 1.1%[263]. - The net operating income for the nine months ended September 30, 2025, was $295.8 million, compared to $291.3 million in 2024, reflecting a slight increase of 1.5%[263]. - The health margin for the nine months ended September 30, 2025, rose to $417.2 million, compared to $386.7 million in 2024, marking an increase of 7.9%[263]. - The annuity margin decreased to $182.2 million for the nine months ended September 30, 2025, down from $219.2 million in 2024, a decline of 16.9%[263]. - The life margin improved to $202.4 million for the nine months ended September 30, 2025, compared to $181.0 million in 2024, an increase of 11.9%[263]. - Operating earnings before taxes for the nine months ended September 30, 2025, were $379.7 million, slightly up from $376.9 million in 2024, an increase of 0.7%[263]. - The net income for the three months ended September 30, 2025, was $23.1 million, compared to $9.3 million in 2024, a significant increase of 148.4%[263]. Investment Performance - The investment segment's profitability is measured by total net investment income not allocated to insurance products, which includes various income sources and expenses related to corporate debt[251]. - Total net investment income increased by 4% to $310.4 million in Q3 2025, compared to $299.5 million in Q3 2024, and by 7% to $911.9 million in the first nine months of 2025, compared to $854.2 million in the same period of 2024[276]. - The investment income not allocated to product lines for the nine months ended September 30, 2025, was $111.3 million, up from $102.6 million in 2024, an increase of 8.5%[263]. - Net realized investment losses from disposals and impairments for the nine months ended September 30, 2025, were $43.8 million, compared to $37.6 million in 2024, an increase of 16.5%[263]. - The company recognized a decrease in pre-tax earnings of $18.1 million in Q3 2025 due to changes in the fair value of embedded derivative liabilities, compared to a decrease of $127.1 million in Q3 2024[307]. Regulatory and Economic Environment - CNO's operations are affected by economic uncertainties, including inflation and market volatility, which may impact financial performance[237]. - Future performance may be influenced by regulatory changes, interest rate risks, and the ability to generate sufficient liquidity for debt obligations[238]. - The company emphasizes the importance of maintaining effective controls over financial reporting and modeling to manage risks[239]. Business Segments - The Consumer Division engages with individual consumers through multiple sales channels, integrating agent sales forces with direct-to-consumer capabilities[249]. - The Worksite Division focuses on selling voluntary benefit life and health insurance products in workplaces, offering services to enhance benefits engagement[250]. Capital Management - The company plans to exit the fee services business, expecting to reduce annual fee revenue by approximately $30 million and increase annual pre-tax income by roughly $20 million[312]. - The expected operating earnings per diluted share for 2025 has been narrowed to a range of $3.75 to $3.85, down from a previous range of $3.70 to $3.90[313]. - The company is increasing its expected excess cash flow to the holding company to a range of $365 million to $385 million, up from $200 million to $250 million[316]. - The run rate operating ROE target is increased to a total improvement of 200 basis points through 2027, with an expected improvement of approximately 50 basis points in 2025[315]. - The company aims to maintain a consolidated RBC ratio of 375 percent for U.S. based insurance subsidiaries and a minimum holding company liquidity of $150 million[317]. Ratings and Financial Strength - Fitch, S&P, Moody's, and AM Best affirmed strong financial strength ratings for the company's primary insurance subsidiaries, indicating stable outlooks[332][333][334][335]. - As of September 30, 2025, the subsidiaries of CLTX reported a deficit of $563.6 million for Colonial Penn and an earned surplus of $1.0 million for Bankers Conseco Life Insurance Company[342]. - Free cash flow generated in the first nine months of 2025 was approximately $131.5 million, with $259.9 million used to repurchase 6.7 million shares of common stock[345]. Investment Portfolio - As of September 30, 2025, the total investment grade fixed maturities available for sale amounted to $22,299.1 million, with gross unrealized losses of $1,972.2 million[354]. - The total fixed maturities available for sale was $23,405.3 million, with an amortized cost of $25,219.3 million as of September 30, 2025[354]. - The company had no amounts outstanding under its $250 million Revolving Credit Agreement as of September 30, 2025, with no scheduled repayments until May 2029[344]. - The carrying value of investments held by VIEs was $296.8 million, with gross unrealized losses of $1.8 million as of September 30, 2025[372]. Expenses and Cost Management - Advertising expenses decreased to $14.8 million in Q3 2025 from $18.5 million in Q3 2024, reflecting a shift to more cost-effective advertising strategies[300]. - Expenses allocated to product lines were $151.0 million in Q3 2025, slightly down from $153.0 million in Q3 2024, while total allocated and unallocated expenses were $173.3 million in Q3 2025 compared to $168.6 million in Q3 2024[278][279].

Core Insights - The company reported strong financial performance with a return of $76 million to shareholders in the quarter and $310 million year to date, alongside a 6% increase in book value per diluted share to $38.1 [1][2][3] - The Consumer division achieved record total new annualized premiums of $125 million, reflecting a 26% increase, and continued strong insurance sales growth across both divisions [2][4] - The company is focused on improving profitability and has taken strategic actions expected to enhance operating return on equity (ROE) by an additional 50 basis points through 2027 [3][17] Financial Performance - Operating earnings per diluted share rose to $1.29, a 16% increase, driven by favorable insurance product margins and solid investment results [2][14] - The expense ratio was reported at 18.6% for the quarter, with a trailing twelve-month basis of 19% [14] - The company anticipates a favorable impact on earnings and ROE from exiting the worksite fee services business, which has not met financial performance expectations [10][16] Sales and Growth Metrics - The Consumer division has seen its life and health new annualized premiums (NAP) grow by 27%, with total life insurance up 33% and direct-to-consumer life insurance sales up 56% [4][11] - The health NAP increased by 21%, marking 13 consecutive quarters of growth, with Medicare Supplement policies up 33% [6][11] - Annuity collected premiums rose by 2% in the quarter, totaling nearly $475 million, and client assets in brokerage and advisory increased by 28% to surpass $5 billion [7][11] Strategic Initiatives - The company is exiting the worksite fee services business to focus on core insurance products, which have shown strong sales growth [10][12] - Investments in technology have enhanced customer experience and operational efficiency, with an 89% instant decision rate on simplified life products [8][11] - The company is exploring additional reinsurance transactions with Bermuda to improve its capital position and support middle-income consumers [13][17] Future Guidance - The company revised its operating return on equity target for 2027 to an improvement of 200 basis points, up from a previous target of 150 basis points [22][24] - The anticipated exit from the fee services business and the new Bermuda treaty are expected to contribute to a 50 basis point increase in operating ROE starting in Q4 2025 [17][22] - The guidance for excess cash flow to the holding company has been raised to a range of $365 million to $385 million, reflecting the impact of the new Bermuda reinsurance transaction [24]

Financial Data and Key Metrics Changes - Operating earnings per diluted share increased by 16% to $1.29, benefiting from favorable insurance product margins and solid investment results [5][14] - Total new annualized premiums reached a record $125 million, up 26%, marking the 13th consecutive quarter of strong insurance sales [4][5] - Book value per diluted share, excluding AOCI, rose by 6% to $38.10 [5] Business Line Data and Key Metrics Changes - Consumer division reported a 27% growth in Life and Health NAP, with total life insurance up 33% and direct-to-consumer life insurance sales up 56% [6][8] - Worksite division achieved record insurance sales with life and health NAP up 20%, marking the 14th consecutive quarter of overall NAP growth [12][13] - Annuity collected premiums increased by 2%, totaling nearly $475 million, with in-force account values exceeding $13 billion for the first time [8][9] Market Data and Key Metrics Changes - Medicare Supplement policies sold increased by 33%, while Medicare Advantage policies sold decreased by 24%, indicating a shift in consumer preferences [8][9] - Client assets in brokerage and advisory grew by 28%, surpassing $5 billion, with total accounts and average account size each up 13% [9] Company Strategy and Development Direction - The company plans to exit the worksite fee services business to focus on core insurance products, expecting this decision to improve earnings and return on equity [11][16] - A second Bermuda treaty was executed to seed approximately $1.8 billion of supplemental health U.S. statutory reserves, enhancing the company's ability to serve middle-income consumers [14][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth across both divisions, despite tougher comparisons in the consumer segment [75] - The exit from the fee services business is expected to lead to a favorable impact on earnings and return on equity starting in Q4 2025 [16][20] Other Important Information - The company returned $76 million to shareholders in the quarter and $310 million year-to-date [5] - The average yield on allocated investments was 4.91%, up 10 basis points year-over-year, contributing to a 7% increase in net investment income [18] Q&A Session Summary Question: Strong D2C sales contribution from new partnerships - Management noted selective partnerships are contributing to growth, particularly in the Hispanic market, and expects continued growth despite a pull forward in advertising expenses [24][25] Question: Impact of exiting the fee services business - The annual earnings loss from the fee services business will improve the fee income segment by about $20 million [26] Question: Opportunities for additional transactions with Bermuda - Management is exploring opportunities to seed additional business, particularly in life insurance, to enhance diversification [30] Question: Claims trends in Medicare supplement business - Management confirmed that the annual assumption update incorporated current trends, with expectations for a 10% average rate increase in filings for the upcoming year [68][69] Question: Future cash benefits from exiting fee services - Management indicated that the $20 million freed up from the fee services business will have a cash impact, aligning with GAAP accruals [51]

Financial Performance - Operating EPS was $129, up 16% compared to the third quarter of 2024[12, 22] - Operating EPS excluding significant items was $096, up 4% compared to the third quarter of 2024[12, 22] - The operating return on equity excluding significant items was 112%[12] - The company returned $76 million to shareholders in the quarter and $310 million year-to-date[12] - Book value per diluted share excluding AOCI was $3810, up 6%[12] Growth & Sales - Total new annualized premiums (NAP) increased by 26%[12] - Direct-to-consumer (D2C) NAP increased by 56%, reaching record levels[12, 15] - Worksite Division NAP increased by 20%[12, 16] - Client assets in brokerage and advisory increased by 28%[12, 60] Investment & Capital - Average yield on allocated investments was 491%, compared to 481% in the third quarter of 2024, an increase of 10 bps[13, 34] - The new money rate was 620%, compared to 650% in the third quarter of 2024[13, 34] - The consolidated Risk Based Capital (RBC) ratio was 380%[40]

Financial Performance - Total revenues for 2024 YTD reached $4,449.5 million, with Q4 projected revenues of $1,188.7 million[8] - Net income for 2024 YTD was $420.8 million, with Q4 expected net income of $23.1 million[8] - Insurance policy income increased to $2,558.5 million YTD, with Q4 projected income of $658.4 million[8] - Total benefits and expenses for 2024 YTD amounted to $3,909.6 million, with Q4 expected expenses of $1,152.5 million[8] - Net investment income from general account assets was $1,419.4 million YTD, with Q4 projected income of $382.9 million[8] - Realized investment losses totaled $75.6 million YTD, with Q4 losses expected to be $12.9 million[8] - Fee revenue and other income for 2024 YTD was $192.1 million, with Q4 projected income of $33.6 million[8] - Income before income taxes for 2024 YTD was $539.9 million, with Q4 expected income before taxes of $36.2 million[8] - Net operating income for 2024 was $429.3 million, with Q4 showing a significant increase to $138.0 million compared to $57.5 million in Q1[10] - Net income for 2024 totaled $420.8 million, with Q4 contributing $182.9 million, marking a substantial increase from $112.3 million in Q1[10] Asset and Liability Management - Total assets increased to $38,296.2 million in Q3 2025, up from $37,329.1 million in Q2 2025, representing a growth of 2.6%[5] - Total liabilities rose to $35,685.2 million in Q3 2025, compared to $34,806.4 million in Q2 2025, reflecting an increase of 2.5%[5] - Shareholders' equity reached $2,611.0 million in Q3 2025, a slight increase from $2,522.7 million in Q2 2025, marking a growth of 3.5%[5] - Cash and cash equivalents, unrestricted, were reported at $1,218.3 million in Q3 2025, a decrease from $766.0 million in Q2 2025, showing a significant increase of 59.0%[5] - Average net insurance liabilities increased to $12,741.9 million by Q4, up from $12,097.9 million in Q3[14] - Average net insurance liabilities for the year-to-date was $11,849.5 million, reflecting growth from previous quarters[14] Insurance Product Margins - Total insurance product margin for 2024 reached $1,040.0 million, with a quarterly breakdown of $229.6 million in Q1, $275.1 million in Q2, $282.2 million in Q3, and $253.1 million in Q4[10] - Annuity margin for Q3 2024 was $91.1 million, while the total for the year reached $274.2 million[10] - Health margin for Q4 2024 was $130.1 million, contributing to an annual total of $516.8 million[10] - Life margin in Q4 2024 was $68.0 million, with a total of $249.0 million for the year[10] - Total insurance product margin for Q3 2025 is reported at $300.5 million, with significant items impacting it by $41.3 million[43] - The annuity margin for the quarter was $54.5 million, unchanged from the previous quarter, while the health margin decreased to $126.2 million from $130.1 million[45] Investment Income - Net investment income for 2024 is forecasted to total $565.0 million, with quarterly amounts of $134.5 million in Q1, $140.5 million in Q2, $142.2 million in Q3, and $147.8 million in Q4[12] - Total investment income not allocated to product lines reached $167.9 million YTD, with a quarterly increase to $65.3 million in Q4[32] - Investment income from general account assets was $129.2 million YTD, with Q4 showing a significant rise to $47.8 million[32] - The company reported a net investment income of $1,748.8 million YTD, with Q4 net income at $416.6 million[32] - The company reported a loss of $24.3 million from alternative investments in Q1 2024, with a recovery to $15.8 million by Q3 2025[39] Premiums and Policyholder Accounts - Total collected premiums for 2024 reached $4,378.7 million, with a quarterly increase to $1,152.5 million in Q4[20] - Fixed indexed annuities collected premiums increased to $409.9 million in Q4 2024, up from $398.8 million in Q3 2024[20] - Total health collected premiums for 2024 amounted to $1,627.6 million, with Q4 contributing $419.6 million[20] - New Annualized Premiums (NAP) for the Consumer Division health products totaled $168.7 million for 2024, with Q4 showing $50.5 million[22] - Total NAP for both divisions reached $415.4 million in 2024, with Q4 NAP at $108.6 million[22] Operational Efficiency - Allocated expenses decreased to $146.1 million in Q4 2024, down from $161.6 million in Q1[10] - Advertising expenses decreased to $13.3 million in Q4 2024, down from $18.5 million in Q3 2024[18] - The company experienced a favorable impact of $3.9 million from an out-of-period adjustment in the health margin for the fourth quarter of 2024[49] Future Outlook - The company is focusing on expanding its market presence and enhancing its product offerings through new technology and strategic initiatives[1] - The company anticipates continued growth in insurance policy income and margins in the upcoming quarters[16] - The company anticipates continued growth in annuity products, with a focus on expanding fixed indexed annuities in the upcoming quarters[35]

Core Insights - CNO Financial Group reported a significant increase in net income for Q3 2025, reaching $23.1 million or $0.24 per diluted share, compared to $9.3 million or $0.09 per diluted share in Q3 2024, driven by strong production and solid earnings [1][10][23] - The company has increased its return on equity (ROE) target by 50 basis points, aiming for a total improvement of 200 basis points through 2027, building on a 2024 run rate of 10% [7][10] Financial Performance - Net operating income for Q3 2025 was $127.2 million, or $1.29 per diluted share, up from $119.2 million, or $1.11 per diluted share, in Q3 2024, reflecting a 7% increase [1][10] - Significant items positively impacted net income and net operating income by $32.2 million, or $0.33 per diluted share, in Q3 2025, compared to $21.9 million, or $0.19 per diluted share, in Q3 2024 [2][10] - Total revenues for Q3 2025 were $1,188.7 million, compared to $1,129.6 million in Q3 2024, indicating a growth in revenue [31] Business Strategy and Operations - The company is focusing on its core insurance offerings by exiting the fee services side of its Worksite Division, which is expected to reduce annual fee revenue by approximately $30 million but increase annual pre-tax income by about $20 million [7][10] - CNO executed its second reinsurance transaction with its Bermuda affiliate, reinsuring $1.8 billion of in-force supplemental health statutory reserves, which is expected to enhance financial stability [7][10] Sales and Market Position - Total new annualized premiums (NAP) increased by 26%, with Life NAP up 32% and Health NAP up 20%, indicating strong sales growth across divisions [7][10] - Direct-to-Consumer and Worksite insurance sales reached record levels in Q3 2025, showcasing the effectiveness of the company's business model [3][10] Shareholder Returns - The company returned $76.4 million to shareholders during the quarter, reflecting a commitment to shareholder value [7][10] - Book value per share increased to $27.24, and book value per diluted share, excluding accumulated other comprehensive loss, rose to $38.10, up 6% from the previous year [7][10]

Core Insights - CNO Financial Group, Inc. will report its third quarter results for 2025 after market close on November 3, 2025, with a conference call scheduled for November 4, 2025, at 11:00 a.m. Eastern Time [1] Participation Details - Investors can participate in the conference call by registering online, which will provide call details and a registrant ID for attendance tracking [2] - The conference call will also be available via a live webcast, accessible through the Investors section of the company's website, with registration recommended at least 15 minutes prior to the event [3] - A replay of the conference call will be available on the Investors section of the company's website following the event [4] Company Overview - CNO Financial Group, Inc. focuses on securing the future of middle-income America by providing life and health insurance, annuities, financial services, and workforce benefits solutions through brands such as Bankers Life, Colonial Penn, Optavise, and Washington National [5] - The company manages 3.2 million policies and has total assets amounting to $37.3 billion, supported by a workforce of 3,400 associates, 4,900 exclusive agents, and over 6,000 independent partner agents [5]