TORCHMARK CORPORATION REPORTS Fourth Quarter 2016 Results

MCKINNEY, Texas, Feb. 1, 2017

Net income for the year ended December 31, 2016 was $4.49 per diluted common share, compared with $4.16 per diluted common share for the year-ago period. Net operating income from continuing operations for the year ended December 31, 2016 was $4.49 per diluted common share compared with $4.13 per diluted common share for the prior year. 

Net income and net operating income for 2016 reflect the impact of new accounting guidance implemented on a prospective basis at the beginning of 2016.

HIGHLIGHTS:

• Net income as a ROE was 12.0%. Net operating income as a ROE excluding net unrealized gains on fixed maturities was 14.6%.
• American Income life premiums increased 11% over the year-ago quarter.
• At Liberty National, net life sales increased 15% over the year-ago quarter.
• Net health sales increased 8% at Family Heritage over the year-ago quarter.
• Average agent counts increased over the year-ago quarter by 16% at Liberty National and 8% at Family Heritage.
• 1.0 million shares of common stock were repurchased during the quarter and 5.2 million shares were repurchased during the year.

FINANCIAL SUMMARY
Quarter End
(Dollar amounts in millions, except per share data)
(unaudited)

Net operating income, a non-GAAP financial measure, has been used consistently by Torchmark's management for many years to evaluate the operating performance of the Company, and is a measure commonly used in the life insurance industry. It differs from net income primarily because it excludes certain non-operating items such as realized investment gains and losses and certain nonrecurring items included in net income. Management believes an analysis of net operating income is important in understanding the profitability and operating trends of the Company's business. Net income is the most directly comparable GAAP measure.