NYSE$AFL

Aflac Inc · Q1 2021 earnings

Q1 2021 earnings · · Investor relations

Briefing

Aflac reported first quarter net earnings driven by higher net investment gains.

Aflac Incorporated reported a strong first quarter with total revenues of $5.9 billion, a 13.7% increase from the previous year. Net earnings reached $1.3 billion, or $1.87 per diluted share, significantly higher than the $566 million, or $0.78 per diluted share, reported in the first quarter of 2020. The results were driven by higher net investment gains and lower-than-expected benefit ratios in the U.S.

  • Total revenues increased by 13.7% to $5.9 billion compared to Q1 2020.
  • Net earnings increased to $1.3 billion, or $1.87 per diluted share.
  • Adjusted earnings increased by 20.0% to $1.1 billion.
  • The company repurchased $650 million of its common shares during the quarter.

Headline financials

Total Revenue

$5.87B

Previous: $5.16B+13.7%
EPS (adj)

$1.53

Previous: $1.21+26.4%
Annualized ROE

15.8%

Previous: 8.2%+92.7%
Free Cash Flow

$1.29B

Previous: $566M+128.4%
Net Income

$1.29B

Previous: $566M+128.4%
Operating Income

$1.31B

Previous: $1.18B+10.4%
Gross Profit

$2.82B

Previous: $1.89B+49.4%
Cash & Equivalents

$143B

Previous: $137B+4.6%
Total Assets

$158B

Previous: $152B+4.3%

Revenue & EPS history

Aflac · Revenue · Quarterly

$5.87B

Q1 2021+13.7%vs Q1 2020
Beat estimate in 15 of 16 quarters(94%)
ActualEstimate

Revenue by segment

Aflac · $5.07B total across 3 segments · Q1 2022

  • Aflac Japan Revenue
    $3.4B
  • Aflac U.S. Revenue
    $1.6B
  • Corporate and Other Revenue
    $74M-10.8%

Forward guidance

Aflac anticipates pandemic conditions will continue to impact sales results through the first half of 2021, with expected improvements in the second half as communities and businesses reopen. The company remains cautiously optimistic, focusing on prudent liquidity and capital management, dividend growth, and tactical share repurchases.

Tailwinds

  • Expect continued strength in medical sales in Japan.
  • Japan Post Group's resumption of proactive sales in April is expected to gradually improve Aflac cancer insurance sales in the second half of the year.
  • Committed to prudent liquidity and capital management.
  • Treasure our 38-year track record of dividend growth and remain committed to extending it, supported by the strength of our capital and cash flows.
  • Will continue to tactically repurchase shares, focused on integrating the growth investments we have made in our platform.

Headwinds

  • Earnings are largely supported by low benefit ratios associated with pandemic conditions.
  • Pandemic conditions continue to impact sales results in the United States and Japan.
  • Pandemic conditions also impact earned premium and revenues.
  • Small businesses in the U.S. are still in recovery mode and are expected to be for most of 2021.
  • Larger businesses remain focused on returning employees to the worksite, rather than modifying the benefits for their employees.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2021

Historical avgQ1 2021

+0.6%

Avg return

Earnings day

-0.1%

Avg return

5 days after

+1.7%

Avg return

30 days after

63%

46 / 73 earnings

Positive

+9.4%

Q1 2012

Best reaction

-11.1%

Q4 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.6%-1.5%-3.3%
Q4 2025+3.4%+2.0%-2.1%
Q3 2025+2.3%+4.4%+0.4%
Q2 2025+3.4%+5.3%+8.1%
Q1 2025-4.7%-2.6%-4.7%
Q4 2024-3.9%-4.0%+1.0%
Q3 2024-4.7%-5.0%+3.6%
Q2 2024+6.6%+1.9%+15.7%
Q1 2024+0.5%+1.3%+7.4%
Q4 2023-11.1%-11.0%-6.2%
Q3 2023+4.6%+4.2%+5.8%
Q2 2023+5.4%+6.2%+3.1%
Q1 2023+5.6%+7.0%-1.9%
Q4 2022-6.3%-5.3%-6.9%
Q3 2022+3.1%+3.7%+11.0%
Q2 2022+2.5%+3.7%+3.7%
Q1 2022-2.5%-5.7%-0.6%
Q4 2021+1.4%+3.8%-4.4%
Q3 2021-3.1%-4.0%-2.7%
Q2 2021+3.4%+1.7%+6.1%
Q1 2021+1.3%+1.8%+5.9%
Q4 2020-1.2%-0.1%+7.9%
Q3 2020-7.1%-7.7%+24.0%
Q2 2020+0.2%-2.4%+1.2%
Q1 2020-1.5%-5.4%-3.5%
Q4 2019+2.4%+1.8%-20.1%
Q3 2019+1.5%+2.1%+2.9%
Q2 2019-0.1%-1.9%-10.3%
Q1 2019+1.3%+3.0%+6.4%
Q4 2018+1.2%+1.8%+3.8%
Q3 2018-4.7%-4.5%+0.5%
Q2 2018+5.8%+6.3%+6.6%
Q1 2018+1.1%+0.9%+0.4%
Q4 2017+1.3%-2.7%-1.2%
Q3 2017-1.1%-0.9%+0.5%
Q2 2017+2.6%+4.6%+4.6%
Q1 2017+0.1%+0.3%+0.1%
Q4 2016-4.5%-2.5%+2.6%
Q3 2016-1.8%-2.0%+2.8%
Q2 2016-1.5%-2.4%-0.8%
Q1 2016+2.1%
Q4 2015-1.2%
Q3 2015+0.7%
Q2 2015+4.9%
Q1 2015-0.2%
Q4 2014+4.3%
Q3 2014+1.9%
Q2 2014-3.6%
Q1 2014+1.4%
Q4 2013+1.7%
Q3 2013-2.2%
Q2 2013+1.1%
Q1 2013+3.7%
Q4 2012-3.2%
Q3 2012-1.5%
Q4 2011+4.2%
Q2 2012-2.7%
Q1 2012+9.4%
Q3 2011-0.1%
Q2 2011-10.8%
Q1 2011+1.9%
Q4 2010+2.9%
Q3 2010-1.2%
Q2 2010+0.3%
Q1 2009+7.5%
Q1 2010+1.8%
Q4 2007+1.7%
Q4 2009+1.7%
Q3 2009+3.1%
Q3 2008+3.1%
Q2 2008+2.9%
Q4 2008+2.9%
Q2 2009+2.9%

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