\nJackson Financial Inc. (NYSE: JXN) (Jackson\u00ae) today announced financial results for the first quarter ended March 31, 2023.<\/p>\n
Key Highlights<\/span><\/b><\/p>\n \nLaura Prieskorn, President and Chief Executive Officer of Jackson, stated, \u201cWe are pleased with the performance of Jackson\u2019s business throughout the first quarter of 2023, which keeps us on track with our strategic and operational goals amid ongoing market volatility. In line with our commitments, we returned $124 million to common shareholders through dividends and share buybacks over the first three months of the year, giving us a strong start toward our 2023 capital return target of $450-550 million. We also retained significant financial flexibility with an estimated operating company RBC ratio within our target range and over $1.5 billion of liquidity at the holding company. We continue to be confident in our ability to achieve our 2023 key financial targets and to create value for shareholders over the long-term.\u201d<\/p>\n Consolidated First Quarter 2023 Results<\/span><\/b><\/p>\n \nThe company reported net income (loss) attributable to Jackson Financial Inc. of $(1,497) million, or $(18.11) per diluted share for the three months ended March 31, 2023, compared to $2,194 million, or $24.39 per diluted share for the three months ended March 31, 2022. The current quarter net loss primarily reflects a larger net hedging loss compared to the prior year\u2019s first quarter, driven by higher freestanding derivative losses resulting from comparatively stronger equity market returns in the current quarter, as well as smaller gains on market risk benefits resulting from comparatively unfavorable interest rate movements in the current quarter. The change in the reported fair value of derivatives is not expected to match the change in hedged liabilities on a U.S. GAAP basis period-to-period, which can result in net income volatility. We believe adjusted operating earnings better represent the underlying performance of our business as the figure excludes, among other things, changes in fair value of derivative instruments and market risk benefits tied to market volatility. Additionally, net income in the first quarter reflects a $366 million loss from business reinsured to third parties, while the prior year\u2019s first quarter included a gain of $1,288 million. These figures include the gain\/loss on a funds withheld reinsurance treaty and the related net investment income, which do not impact our statutory capital or free cash flow and can be volatile quarter to quarter.<\/p>\n \nAdjusted operating earnings for the three months ended March 31, 2023 were $271 million, or $3.15 per diluted share, compared to $377 million or $4.19 per diluted share for the three months ended March 31, 2022. The decline in adjusted operating earnings was primarily the result of lower annuity account values driven by lower equity markets over the twelve month period, lower spread income from resetting interest crediting rates on variable annuity fixed rate options in the first quarter of 2023, and a loss on operating derivatives compared to a gain in the prior quarter due to higher short-term interest rates. These were partially offset by improved mortality in closed block life, lower asset based expenses, and higher net investment income.<\/p>\n \nFirst quarter adjusted operating earnings included a negative impact of $20 million from underperformance of private equity and other limited partnership returns relative to a 10% annualized return assumption. This same item resulted in a benefit of $36 million in the first quarter of 2022.<\/p>\n \nTotal common shareholders\u2019 equity was $8.1 billion or $95.70 per diluted share as of March 31, 2023, down from $8.6 billion or $100.56 per diluted share as of year-end 2022. Adjusted book value attributed to common shareholders2<\/sup> was $8.6 billion or $101.32 per diluted share as of March 31, 2023, down from $9.9 billion or $115.36 per diluted share as of year-end 2022. The decrease was primarily the result of non-operating hedging losses partially offset by adjusted operating earnings of $271 million during the first quarter of 2023.<\/p>\n Segment Results \u2013 Pretax Adjusted Operating Earnings<\/span>2<\/sup><\/b><\/p>\n\n
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