BRIGHTHOUSE FINA(US:BHFAP)2025-05-09 20:11Financial Performance - For the three months ended March 31, 2025, Brighthouse Financial reported a net loss available to shareholders of $294 million, an improvement from a net loss of $519 million in the same period of 2024, reflecting a 43.5% reduction in losses [269]. - Adjusted earnings for the same period were $235 million, compared to an adjusted loss of $98 million in 2024, indicating a significant turnaround in performance [269]. - Total revenues for Q1 2025 were $2,390 million, significantly up from $74 million in Q1 2024, indicating a substantial recovery [292]. - Net income attributable to Brighthouse Financial, Inc. for Q1 2025 was a loss of $268 million, an improvement from a loss of $493 million in Q1 2024 [292]. - Adjusted earnings for Q1 2025 were $235 million, a notable increase of $333 million compared to a loss of $98 million in Q1 2024 [298]. - The Annuities segment reported adjusted earnings of $314 million in Q1 2025, slightly up from $313 million in Q1 2024 [301]. - The Life segment reported adjusted earnings of $9 million, an increase of $45 million from a loss of $36 million in the prior year [306]. - The Run-off segment showed an adjusted loss of $64 million, a reduction of $277 million from a loss of $341 million in the previous year [311]. - The Corporate & Other segment recorded an adjusted loss of $24 million, a decrease of $10 million from a loss of $34 million in the prior period [314]. Investment Performance - Adjusted net investment income for Q1 2025 was $1,297 million, compared to $1,254 million in Q1 2024, reflecting a year-over-year increase of 3.4% [291]. - The net investment spread for Q1 2025 was $711 million, down from $733 million in Q1 2024, indicating a decline in investment performance [297]. - The company experienced a significant net derivative gain of $311 million in Q1 2025, compared to a loss of $1,921 million in Q1 2024, highlighting a turnaround in derivative performance [292]. - The investment income yield remained stable at 4.39% for both the first quarter of 2025 and 2024 [329]. - The company manages investment risks through asset-type allocation and diversification strategies to mitigate credit and interest rate risks [318]. Market Conditions - The financial results were impacted by market conditions, including decreasing long-term interest rates, which affected the profitability of variable annuities and other products [272]. - Brighthouse Financial's business is influenced by capital market conditions, with potential adverse effects from volatility and disruptions in financial asset classes [272]. - The Federal Reserve decreased the target range for the federal funds rate three times in 2024, affecting the pricing levels of risk-bearing investments [321]. Economic Factors - The company continues to monitor economic factors such as inflation, which could increase expenses and affect profitability if costs cannot be passed to policyholders [274]. - The company emphasizes the importance of long-term assumptions about capital market returns and interest rates in its annual actuarial review [275]. Liquidity and Capital Management - The company maintained a substantial short-term liquidity position of $4.7 billion as of March 31, 2025, down from $5.2 billion at December 31, 2024 [383]. - Liquid assets totaled $48.0 billion at March 31, 2025, slightly decreasing from $48.1 billion at December 31, 2024 [384]. - The company expects to maintain a target combined risk-based capital (RBC) ratio of 400% to 450% under normal market conditions [389]. - The company has a share repurchase program, with repurchases dependent on capital position, liquidity, and market conditions [390]. - There are currently no plans to declare and pay dividends on common stock, with future declarations subject to the Board's discretion [391]. Debt and Obligations - As of March 31, 2025, the total outstanding debt amounted to $10,074 million, a decrease from $10,962 million as of December 31, 2024, representing a reduction of approximately 8.1% [404]. - The FABCP Program showed a decrease in outstanding debt from $2,962 million in December 2024 to $2,799 million in March 2025, a decline of about 5.5% [404]. - The total obligations outstanding under short-term intercompany loan agreements were $540 million as of March 31, 2025, down from $582 million at December 31, 2024, a decrease of about 7.2% [430]. Risk Management - The company closely monitors investment risks through a comprehensive investment risk management process [394]. - The diversity of funding sources enhances funding flexibility and lowers the cost of funds [396]. - The company manages risk in its mortgage loan portfolio by generally lending up to 75% of the estimated fair value of the underlying real estate collateral [347].