Prudential Financial has disclosed its results for the second quarter of 2017, revealing a significant slump in its profit for the period.
The life insurance company posted a 47% decline in profit in the second quarter ended June 30. Prudential believes the fall is due to its higher investment losses and other related charges.
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“This review resulted in a pre-tax charge to net income, from updates of reserves and related items and adjustments to amortization of deferred policy acquisition and related costs, of $492 million for ongoing businesses,” the company said in a release. “This represents a pre-tax charge to adjusted operating income of $622 million, partially offset by a pre-tax benefit of $130 million to net realized investment losses and related charges and adjustments.”
Net income sank to $491 million ($1.12 per share) for Q2 2017, from $921 million ($2.04 per share) for the same quarter a year ago.
The company’s after-tax adjusted operating income for the quarter came in at $919 million, or $2.09 per common share, compared to $829 million or $1.84 per share for the same period last year.
“We delivered solid underlying results in the second quarter, as we continue to benefit from our high quality and balanced collection of businesses,” commented Prudential Financial chairman and CEO John Strangfeld in an official statement.
“While we experienced some volatility in reported results following our annual review of actuarial assumptions, the earnings power and capital position of our combined businesses are largely unaffected,” Strangfeld added.
“In addition, our strong cash flows and capital position enabled us to return approximately $640 million to shareholders through dividends and share repurchases. We continue to invest in our businesses where we see attractive long-term opportunities and have recently announced changes to the alignment of our US Businesses to best capture these opportunities within and across our domestic businesses.”
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