F&G Annuities & Life (NYSE:FG) Q3 2025 Earnings Call November 07, 2025 09:00 AM ET Speaker1Good morning. Welcome to F&G's third quarter 2025 earnings call. During today's presentation, all callers will be placed in a listen-only mode. Following management's prepared remarks, the conference will be open for questions with instructions to follow at that time. I would now like to turn the call over to Lisa Foxworthy-Parker, Senior Vice President, Investor Relations and External Relations. Please go ahead.Speak ...

Financial Data and Key Metrics Changes - The company generated total revenue of $3.6 billion in Q2 2025, compared to $3.2 billion in Q2 2024, excluding net recognized gains and losses [12] - Adjusted net earnings were $318 million or $1.16 per diluted share, down from $338 million or $1.24 per share in Q2 2024 [13] - The title segment contributed $260 million to adjusted net earnings, while the F and G segment contributed $89 million [13] Business Line Data and Key Metrics Changes - The title segment generated $2.2 billion in total revenue in Q2 2025, up from $2 billion in Q2 2024, with direct premiums increasing by 12% [14] - Adjusted pretax title earnings were $337 million, a $13 million or 4% increase from the previous year, with a title margin of 15.5% [5][14] - The F and G segment's assets under management grew to $69.2 billion, a 13% increase year-over-year [10] Market Data and Key Metrics Changes - Daily purchase orders opened increased by 5% compared to Q2 2024, while refinance orders saw a significant 28% increase [6][7] - Commercial volumes showed strong performance with direct commercial revenue of $626 million in the first half of 2025, up 23% from $511 million in the same period of 2024 [8] Company Strategy and Development Direction - The company is focused on long-term growth through strategic investments in security, technology, and recruiting [5] - F and G is pursuing a more fee-based, higher-margin, and less capital-intensive business model, supported by the launch of a new reinsurance vehicle [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about a rebound in transaction volumes and the potential for efficiencies across operations [9] - The company anticipates that elevated health claims will normalize in 2026, and they remain confident in maintaining a 15% to 20% pretax title margin [15][45] Other Important Information - The company repurchased 2.9 million shares for $159 million at an average price of $55.2 per share during Q2 2025 [20] - The company returned nearly $300 million of capital to shareholders through dividends and share repurchases in the second quarter [21] Q&A Session Summary Question: Thoughts on holding separate businesses under the same company - Management is pleased with F and G's performance and sees continued value in the current structure, contributing 32% of adjusted earnings [27][28] Question: Details on personnel expenses - Personnel expenses increased due to active recruiting and elevated health claims, with a significant impact from medical claims [29][32] Question: Margin and expense outlook - Management expects health claims to peak this quarter and then moderate, maintaining confidence in the 15% to 20% margin range [44][45] Question: Commercial order momentum - National open orders were up 22% year-over-year, with strong expectations for continued growth in the back half of the year [49][50] Question: Buyback strategy - The company plans to remain active in share buybacks, particularly if share prices show weakness [55][60] Question: Dividend capacity for the second half - Approximately $250 million is available from regulated entities, with an additional $60 million from F and G [67]