Magazine article American Banker

Lincoln Rides Deal for Jefferson-Pilot to 76% Profit Rise

Magazine article American Banker

Lincoln Rides Deal for Jefferson-Pilot to 76% Profit Rise

Article excerpt

Lincoln National Corp.'s April 3 closing of its purchase of Jefferson-Pilot Corp. allowed it to report an enormous second-quarter profit increase, but analysts said that, without the deal, the results were up only mildly.

The Philadelphia insurer announced late Tuesday that earnings had risen 76.4%, to $349 million, or $1.23 per diluted share, compared with the second quarter last year. It beat the average of analysts' earnings estimates by nine cents, according to Thomson First Call.

The company posted a record quarter for variable annuity sales, including a 79% increase in the bank channel.

Jefferson-Pilot contributed about $145 million of the earnings. Lincoln agreed last year to pay more than $7 billion for Jefferson-Pilot, a rival based in Greensboro, N.C. The second quarter was the first that combined the two businesses' results.

Analysts said that, without the Jefferson-Pilot merger and better than expected investment results, Lincoln's quarter was fairly flat. Excluding Jefferson's contribution, Lincoln's earnings were up 4.1%, to $206 million.

Jon A. Boscia, Lincoln's chairman and chief executive officer, said during the quarterly earnings call Wednesday that the purchase was important for his company's strong results but that all of Lincoln's major businesses had strong organic growth.

Consolidated domestic retail deposits, which include individual annuities, mutual funds, life insurance, and other personal wealth-accumulation products together with retirement products sold in the employer-sponsored marketplace, grew 6%, to $7. …

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