CNO Q2 Earnings Beat Estimates on Strong Annuity Collected Premiums

Core Viewpoint - CNO Financial Group, Inc. (CNO) experienced a 2% decline in shares following the release of its second-quarter 2025 results, primarily due to increased total expenses and net investment losses, although strong annuity collected premiums and rising new annualized premiums provided some offset [1][10]. Financial Performance - CNO reported adjusted earnings per share (EPS) of 87 cents, exceeding the Zacks Consensus Estimate by 2.4%, but reflecting a 17% decrease year over year [2][10]. - Operating revenues reached $1.2 billion, marking an 8% year-over-year increase and surpassing the consensus estimate by 19.3% [2]. - Total insurance policy income rose 1.5% year over year to $651.3 million, falling short of the Zacks Consensus Estimate of $653 million [3]. Investment and Premiums - Net investment losses were recorded at $21.8 million, slightly better than the previous year's loss of $21.9 million [4]. - Annuity collected premiums increased by 19% year over year to $520.5 million, while health collected premiums rose 2.3% to $409.5 million [5][10]. - Total collected premiums advanced 8.7% year over year to $1.2 billion [5]. Expense and Financial Ratios - Total benefits and expenses surged 12.9% year over year to $1 billion, driven by higher insurance policy benefits and operating costs [6][10]. - The debt-to-capital ratio improved by 760 basis points to 34.6% at the end of the second quarter [7]. - Book value per common share increased by 4.7% to $25.92, with operating return on equity improving by 120 basis points to 11.2% [8]. Shareholder Returns - CNO returned $100 million to shareholders through share buybacks and $16.7 million in dividends during the second quarter, with a remaining repurchase capacity of $540.4 million [11]. Future Guidance - CNO anticipates operating EPS in the range of $3.70-$3.90 for 2025 and expects excess cash flow between $200-$250 million [12]. - The company projects an expense ratio of 19-19.2%, an improvement from the previous estimate [12].