Fourth-Quarter 2007 Financial Highlights (35 kb)

Consistent strength, stability and superior investment results remain the hallmarks of Penn Mutual's financial performance. The results for the year, highlighted below, underscore our continued focus on excellence. *

Solid Financial Performance

• Consolidated Net Income, which includes income from all of our business segments, was $137.1 million for the year, which represents a 6% decrease from 2006. The insurance products segment had a net income of $80.6 million for the year, which represents a 1% increase from 2006. Earnings' drivers include growth in life and annuity sales, which resulted in higher mortality charges and higher product charges, as well as favorable mortality experience. However, these were offset by higher expenses due to increased operating expenses and increased amortization of deferred acquisition costs. Included in income for the prior year period was non-recurring broker/dealer income related to the exchange of seats on the New York Stock Exchange (NYSE) for NYSE stock. Realized capital losses were $6.9 million.
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• Total Revenue for the year was a strong $1.4 billion, which represents an increase of 7% over 2006.
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• Total Capital was $1.4 billion as of December 31, 2007, which represents a 2% increase from December 31, 2006.**
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• Total Return on Equity, a key measurement of profitability, was 7.2% as of December 31, 2007, down from 8.2% as of December 31, 2006.
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• Surplus-to-Asset Ratio, a clear measurement of capital strength, remained strong at 18.5% as of December 31, 2007and flat compared to December 31, 2006. **
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• Total Assets, a key indicator of financial strength, was $14.5 billion as of December 31, 2007, up from $14.1 billion as of December 31, 2006.
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• Total Liabilities, which primarily represent our obligations to policy and contract holders, was $12.4 billion as of December 31, 2007, up from $12.2 billion as of December 31, 2006.
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• Policyholder Benefits of $1.0 billion were paid out through December 31, 2007, including $162.0 million in death benefits. **
  
  

Sales/Growth

• Individual Life Insurance In Force, the amount of life insurance protection that Penn Mutual currently provides to policyholders, grew to $61.1 billion as of December 31, 2007, which represents a 7% increase from December 31, 2006.
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• Individual New Life Insurance Premiums for the year was a strong $239.0 million representing a 36% increase from 2006.**
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• Annuity Sales for fourth quarter 2007, for the year grew to $581.1 million, which represents a 6% increase over 2006, reflecting the popularity of our annuity products.
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Investing for the Long Term

• Penn Mutual holds a high-quality and well-diversified portfolio of assets with investment-grade bonds representing the single largest class of investments. As of December 31, 2007, investment-grade bonds represented 77.1% of the company's total invested assets. **
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*These financial highlights are the consolidated results of Penn Mutual and its subsidiaries. They are reported according to Generally Accepted Accounting Principles in the United States of America (GAAP), unless otherwise noted.

** Total Capital, surplus-to-asset ratio, policyholder benefits, sales figures and bond averages are reported on a statutory accounting basis.

 

02/08
A8JC-0215-12