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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 30, 2024
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Aflac Incorporated
_________________________________________________________________________________________________________________________________________________________
(Exact name of registrant as specified in its charter)
 
Georgia 001-07434    58-1167100
(State or other jurisdiction (Commission    (IRS Employer
of incorporation) File Number)    Identification No.)
1932 Wynnton Road Columbus Georgia 31999
(Address of principal executive offices)    (Zip Code)
706.323.3431
_________________________________________________________________________________________________________________________________________________________
(Registrant’s telephone number, including area code)
 
_________________________________________________________________________________________________________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $.10 Par Value AFL New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨



Item 2.02 Results of Operations and Financial Condition.
On October 30, 2024, Aflac Incorporated (the "Company") issued a press release dated October 30, 2024 in which it reported the Company's 2024 third quarter financial results. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference herein in its entirety. In addition, a copy of the Company's third quarter supplemental earnings materials is furnished as Exhibit 99.2 to this Current Report on Form 8-K and incorporated by reference herein in its entirety.
On October 30, 2024, the Company posted to its investor relations website at investors.aflac.com a video presentation by Max Brodén, the Company's Executive Vice President and Chief Financial Officer, discussing the Company's 2024 third quarter earnings. A copy of the transcript of Mr. Brodén's comments from the Investor Update and a copy of the Investor Presentation are furnished as Exhibit 99.3 and Exhibit 99.4 to this Current Report on Form 8-K, respectively, and are incorporated by reference herein in their entirety. The Investor Update and the Investor Presentation should be read in conjunction with the press release.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
The Company has appointed Virgil R. Miller to serve as President of the Company, effective January 1, 2025, in addition to continuing to serve as President, Aflac U.S. Daniel P. Amos, who has been serving as President of the Company since November 16, 2023, will resign as President effective January 1, 2025, but will continue to serve as the Company’s Chairman and Chief Executive Officer.
Mr. Miller, age 56, joined Aflac U.S. in 2004 and has served as President of Aflac U.S. since 2023. Previously, he served as Deputy President, Aflac U.S., from 2022 until 2023; Executive Vice President, President of Group and Individual Benefits Division, Aflac U.S., from 2021 until 2022; and Executive Vice President, Chief Operating Officer, Aflac U.S., from 2018 until 2021.
Beginning January 1, 2025, Mr. Miller’s initial base salary will be $825,000, and he will be eligible for a target annual bonus of 150% of his base salary. Mr. Miller is also expected to receive an equity award in February 2025 with a grant-date value of approximately $2,475,000 in the form of performance-based restricted stock, with vesting contingent upon the Company’s achievement of performance goals over a three-year period.
There are no family relationships between Mr. Miller and any Company director or executive officer, and no arrangements or understandings between Mr. Miller and any other person pursuant to which either was selected as an officer. Mr. Miller is not a party to any current or proposed transaction with the Company for which disclosure is required under Item 404(a) of Regulation S-K.

Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number Exhibit Title or Description
Press release of Aflac Incorporated dated October 30, 2024
Financial Supplement for Third Quarter 2024
Transcript of comments in video presentation by Max Brodén, Executive Vice President and Chief Financial Officer of Aflac Incorporated.
Slides referenced in video presentation by Max Brodén, Executive Vice President and Chief Financial Officer of Aflac Incorporated.
104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)

1



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
    Aflac Incorporated
October 30, 2024     /s/ Robin L. Blackmon
    (Robin L. Blackmon)
    Senior Vice President, Financial Services
    Chief Accounting Officer


2
EX-99.1 2 aflex991-q32024.htm EX-99.1 Document

    



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News Release

Aflac Incorporated Announces Third Quarter Results,
Reports Third Quarter Net Losses of $93 Million,
Declares Fourth Quarter Cash Dividend

COLUMBUS, Ga. - October 30, 2024 - Aflac Incorporated (NYSE: AFL) today reported its third quarter results.

Total revenues were $2.9 billion in the third quarter of 2024, compared with $5.0 billion in the third quarter of 2023. Net losses were $93 million, or losses of $0.17 per diluted share, compared with earnings of $1.6 billion, or $2.64 per diluted share a year ago, primarily due to increased foreign exchange-related losses from yen strengthening by 12.9% during the quarter.

Net losses in the third quarter of 2024 included net investment losses of $1.4 billion, or $2.51 per diluted share, compared with net investment gains of $423 million, or $0.71 per diluted share a year ago. These net investment losses were driven by net losses of $1.4 billion on certain derivatives and foreign currency activities; net gains from sales and redemptions of $105 million; a $13 million gain from an increase in the fair value of equity securities; an $86 million increase in credit losses; and a $55 million impairment due to the anticipated sale of investments with unrealized losses.

Adjusted earnings* in the third quarter were $1.2 billion, compared with $1.1 billion in the third quarter of 2023, reflecting an increase of 10.6%. Adjusted earnings per diluted share* increased 17.4% to $2.16 in the quarter. Variable investment income ran $27 million below the company's long-term return expectations. The weaker yen/dollar exchange rate negatively impacted adjusted earnings per share by $0.03.

The average yen/dollar exchange rate in the third quarter of 2024 was 147.95, or 2.0% weaker than the average rate of 144.97 in the third quarter of 2023. For the first nine months, the average exchange rate was 150.60, or 8.1% weaker than the rate of 138.38 a year ago.

Shareholders’ equity was $24.8 billion, or $44.60 per share, at September 30, 2024, compared with $22.7 billion, or $38.63 per share, at September 30, 2023. Shareholders’ equity at the end of the third quarter included a cumulative decrease of $67 million for the effect of the change in discount rate assumptions on insurance reserves, compared with a corresponding cumulative decrease of $866 million at September 30, 2023 and a net unrealized gain on investment securities and derivatives of $537 million, compared with a net unrealized loss of $427 million at September 30, 2023. Shareholders’ equity at the end of the third quarter also included an unrealized foreign currency translation loss of $4.1 billion, compared with an unrealized foreign currency translation loss of $4.5 billion at September 30, 2023. The annualized return on average shareholders’ equity in the third quarter was (1.5)%.

For the first nine months of 2024, total revenues were down 9.4% to $13.5 billion, compared with $14.9 billion in the first nine months of 2023. Net earnings were $3.5 billion, or $6.23 per diluted share, compared with $4.4 billion, or $7.28 per diluted share, for the first nine months of 2023. Adjusted earnings for the first nine months of 2024 were $3.2 billion, or $5.64 per diluted share, compared with $3.0 billion, or $4.97 per diluted share, in 2023. Excluding the negative impact of $0.17 per share from the weaker yen/dollar exchange rate, adjusted earnings per diluted share increased 16.9% to $5.81 for the first nine months of 2024.

Shareholders’ equity excluding AOCI (or adjusted book value*) was $28.5 billion, or $51.21 per share at September 30, 2024, compared with $28.4 billion, or $48.44 per share, at September 30, 2023. The annualized adjusted return on equity excluding foreign currency impact* in the third quarter was 17.0%.




    



AFLAC JAPAN

In yen terms, Aflac Japan's net earned premiums were ¥255.4 billion for the quarter, or 10.5% lower than a year ago, mainly due to the changes in deferred profit liability including the impact from actuarial assumption updates, prior year internal cancer reinsurance transactions, as well as limited-pay policies reaching paid-up status. Adjusted net investment income increased 0.1% to ¥99.0 billion. Total adjusted revenues in yen declined 7.8% to ¥355.3 billion. Pretax adjusted earnings in yen for the quarter increased 25.5% on a reported basis to ¥158.7 billion, primarily due to lower benefits and expenses during the quarter, partially offset by lower net earned premiums. Pretax adjusted earnings increased 24.0% on a currency-neutral basis. The pretax adjusted profit margin for the Japan segment increased to 44.7%, compared with 32.8% a year ago, primarily due to higher remeasurement gains of ¥39.7 billion from unlocking assumptions.

For the first nine months, net earned premiums in yen were ¥792.6 billion, or 7.4% lower than a year ago. Adjusted net investment income increased 15.2% to ¥308.5 billion. Total adjusted revenues in yen were down 2.0% to ¥1.1 trillion. Pretax adjusted earnings were ¥413.8 billion, or 20.3% higher than a year ago.

In dollar terms, net earned premiums decreased 13.4% to $1.7 billion in the third quarter. Adjusted net investment income decreased 2.5% to $662 million. Total adjusted revenues declined by 10.6% to $2.4 billion. Pretax adjusted earnings increased 23.5% to $1.1 billion.

For the first nine months, net earned premiums in dollars were $5.2 billion, or 15.6% lower than a year ago. Adjusted net investment income increased 5.7% to $2.0 billion. Total adjusted revenues were down 10.6% to $7.3 billion. Pretax adjusted earnings were $2.7 billion, or 10.8% higher than a year ago.

For the quarter, total new annualized premium sales (sales) increased 12.3% to ¥17.5 billion, or $117 million, primarily reflecting sales of the new first sector product. For the first nine months, total new sales increased 4.4% to ¥46.9 billion, or $309 million.

AFLAC U.S.

Aflac U.S. net earned premiums increased 2.8% to $1.5 billion in the third quarter compared to the prior year, reflecting improved sales and continued improvement in persistency. Adjusted net investment income increased 0.5% to $210 million. Total adjusted revenues were up 1.4% to $1.7 billion. Pretax adjusted earnings were $350 million, 26.8% lower than a year ago, primarily due to higher benefits resulting from lower remeasurement gains and higher incurred claims. As a result, the pretax adjusted profit margin for the U.S. segment was 20.8%, compared with 28.8% a year ago.

For the first nine months, net earned premiums increased 2.7% to $4.4 billion. Adjusted net investment income increased 4.1% to $634 million. Total adjusted revenues were up 1.7% to $5.1 billion. Pretax adjusted earnings were $1.1 billion, or 9.2% lower than a year ago.

Aflac U.S. sales increased 5.5% in the quarter to $379 million, largely driven by premier group life, absence management and disability products, as well as cancer insurance. For the first nine months of the year, total new sales increased 1.0% to $1.0 billion.

CORPORATE AND OTHER

For the quarter, total adjusted revenues increased 95.7% to $225 million compared to the prior year primarily due to increasing total net earned premiums and adjusted net investment income, all of which reflect the impact of reinsurance transactions in the fourth quarter of 2023. Net investment income also benefited from a combination of higher rates and asset balances, as well as continued lower volume of tax credit investments. Total benefits and adjusted expenses increased $47 million compared to the prior year primarily as a result of the increased reinsurance activity. Pretax adjusted earnings were a gain of $15 million, compared with a loss of $49 million a year ago.

For the first nine months, total adjusted revenues increased 88.3% to $723 million. Pretax adjusted earnings were a gain of $36 million, compared with a loss of $107 million a year ago.

DIVIDEND AND CAPITAL RETURNED TO SHAREHOLDERS

The board of directors declared the fourth quarter dividend of $0.50 per share, payable on December 2, 2024 to shareholders of record at the close of business on November 20, 2024.




    



In the third quarter, Aflac Incorporated deployed $500 million in capital to repurchase 4.9 million of its common shares. At the end of September 2024, the company had 54.3 million remaining shares authorized for repurchase.

OUTLOOK

Commenting on the company’s results, Aflac Incorporated Chairman and Chief Executive Officer Daniel P. Amos stated: "I am pleased that Aflac delivered very solid adjusted earnings for the quarter and the first nine months. We have continued to actively concentrate on generating profitable growth in the U.S. and Japan with new products and distribution strategies. We believe our strategy will continue to create long-term value for shareholders.

"Looking at our operations in Japan, we have continued to focus on third sector products as well as introducing these policies to new and younger customers. While still in the very early stages, we were pleased with the initial introduction of our latest life insurance product that offers an asset formation component and a nursing care option. This drove the 12.3% sales increase for the quarter. This approach is in line with our strategy of connecting with younger customers to provide them with integrated financial protection and services through different life stages.

"In the U.S., we achieved 5.5% sales growth for the quarter, which is a welcome result as we enter the fourth quarter, which tends to be the heaviest enrollment period. At the same time, we continue to focus on more profitable growth and are seeing improvement in net earned premiums. We continue our prudent approach to expense management and maintaining a strong pretax margin.

"We continue to generate strong capital and cash flows while maintaining our commitment to prudent liquidity and capital management. We have been very pleased with our investments, which have continued to produce strong net investment income with minimal losses and impairments. I am very pleased that 2024 marks 42 consecutive years of dividend increases, a record we treasure. We remain committed to extending this record, supported by our financial strength. In the quarter, we repurchased $500 million in shares and intend to continue our balanced approach of investing in growth and driving long-term operating efficiencies."

*See Non-U.S. GAAP Financial Measures section for an explanation of foreign exchange and its impact on the financial statements and definitions of the non-U.S. GAAP financial measures used in this earnings release, as well as a reconciliation of such non-U.S. GAAP financial measures to the most comparable U.S. GAAP financial measures.

ABOUT AFLAC INCORPORATED

Aflac Incorporated (NYSE: AFL), a Fortune 500 company, has helped provide financial protection and peace of mind for nearly seven decades to millions of policyholders and customers through its subsidiaries in the U.S. and Japan. In the U.S., Aflac is the No. 1 provider of supplemental health insurance products.1 In Japan, Aflac Life Insurance Japan is the leading provider of cancer and medical insurance in terms of policies in force. The company takes pride in being there for its policyholders when they need us most, as well as being included in the World’s Most Ethical Companies by Ethisphere for 18 consecutive years (2024), Fortune’s World’s Most Admired Companies for 23 years (2024) and Bloomberg’s Gender-Equality Index for the fourth consecutive year (2023). In addition, the company became a signatory of the Principles for Responsible Investment (PRI) in 2021 and has been included in the Dow Jones Sustainability North America Index (2023) for 10 years. To find out how to get help with expenses health insurance doesn't cover, get to know us at aflac.com or aflac.com/espanol. Investors may learn more about Aflac Incorporated and its commitment to corporate social responsibility and sustainability at investors.aflac.com under “Sustainability.”

1 LIMRA 2023 U.S. Supplemental Health Insurance Total Market Report

A copy of Aflac’s financial supplement for the quarter can be found on the “Investors” page at aflac.com.

Aflac Incorporated will webcast its quarterly conference call via the “Investors” page of aflac.com at 8:00 a.m. (ET) on October 31, 2024.

Note: Tables within this document may not foot due to rounding.



    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED INCOME STATEMENT
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
THREE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Total revenues $ 2,949  $ 4,950  (40.4) %
Benefits and claims, net 1,595  1,860  (14.2)
Total acquisition and operating expenses 1,262  1,285  (1.8)
Earnings before income taxes 92  1,805  (94.9)
Income taxes 185  236 
Net earnings $ (93) $ 1,569  (105.9) %
Net earnings per share – basic $ (0.17) $ 2.65  (106.4) %
Net earnings per share – diluted (0.17) 2.64  (106.4)
Shares used to compute earnings per share (000):
Basic 557,899  591,246  (5.6) %
Diluted 560,414  593,596  (5.6)
Dividends paid per share $ 0.50  $ 0.42  19.0  %







    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED INCOME STATEMENT
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
NINE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Total revenues $ 13,524  $ 14,923  (9.4) %
Benefits and claims, net 5,527  6,108  (9.5)
Total acquisition and operating expenses 3,715  3,843  (3.3)
Earnings before income taxes 4,282  4,972  (13.9)
Income taxes 741  581 
Net earnings $ 3,541  $ 4,391  (19.4) %
Net earnings per share – basic $ 6.26  $ 7.31  (14.4) %
Net earnings per share – diluted 6.23  7.28  (14.4)
Shares used to compute earnings per share (000):
Basic 565,757  600,991  (5.9) %
Diluted 568,216  603,419  (5.8)
Dividends paid per share $ 1.50  $ 1.26  19.0  %




    



AFLAC INCORPORATED AND SUBSIDIARIES CONDENSED BALANCE SHEET
(UNAUDITED – IN MILLIONS, EXCEPT FOR SHARE AMOUNTS)
SEPTEMBER 30, 2024 2023 % Change
Assets:
Total investments and cash $ 115,601  $ 111,306  3.9  %
Deferred policy acquisition costs 9,232  8,771  5.3 
Other assets 3,609  5,034  (28.3)
Total assets $ 128,442  $ 125,111  2.7  %
Liabilities and shareholders’ equity:
Policy liabilities $ 87,554  $ 86,028  1.8  %
Notes payable and lease obligations 7,978  6,961  14.6 
Other liabilities 8,080  9,453  (14.5)
Shareholders’ equity 24,830  22,669  9.5 
Total liabilities and shareholders’ equity $ 128,442  $ 125,111  2.7  %
Shares outstanding at end of period (000) 556,717  586,897  (5.1) %





    



NON-U.S. GAAP FINANCIAL MEASURES

This document includes references to the Company’s financial performance measures which are not calculated in accordance with United States generally accepted accounting principles (U.S. GAAP) (non-U.S. GAAP). The financial measures exclude items that the Company believes may obscure the underlying fundamentals and trends in insurance operations because they tend to be driven by general economic conditions and events or related to infrequent activities not directly associated with insurance operations.

Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results. In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported. When the yen strengthens, translating yen into dollars results in more dollars being reported. Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior period. A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S. GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S. GAAP basis. Management evaluates the Company's financial performance both including and excluding the impact of foreign currency translation to monitor, respectively, cumulative currency impacts and the currency-neutral operating performance over time. The average yen/dollar exchange rate is based on the published MUFG Bank, Ltd. telegraphic transfer middle rate (TTM).

The company defines the non-U.S. GAAP financial measures included in this earnings release as follows:

•Adjusted earnings are adjusted revenues less benefits and adjusted expenses. Adjusted earnings per share (basic or diluted) are the adjusted earnings for the period divided by the weighted average outstanding shares (basic or diluted) for the period presented. The adjustments to both revenues and expenses account for certain items that are outside of management’s control because they tend to be driven by general economic conditions and events or are related to infrequent activities not directly associated with insurance operations. Adjusted revenues are U.S. GAAP total revenues excluding adjusted net investment gains and losses. Adjusted expenses are U.S. GAAP total acquisition and operating expenses including the impact of interest from derivatives associated with notes payable but excluding any non-recurring or other items not associated with the normal course of the Company’s insurance operations and that do not reflect the Company's underlying business performance. Management uses adjusted earnings and adjusted earnings per diluted share to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of these financial measures is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The most comparable U.S. GAAP financial measures for adjusted earnings and adjusted earnings per share (basic or diluted) are net earnings and net earnings per share, respectively.

•Adjusted earnings excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. Adjusted earnings per diluted share excluding current period foreign currency impact is adjusted earnings excluding current period foreign currency impact divided by the weighted average outstanding diluted shares for the period presented. The Company considers adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact important because a significant portion of the Company's business is conducted in Japan and foreign exchange rates are outside management’s control; therefore, the Company believes it is important to understand the impact of translating foreign currency (primarily Japanese yen) into U.S. dollars. The most comparable U.S. GAAP financial measures for adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact are net earnings and net earnings per share, respectively.

•Adjusted return on equity is adjusted earnings divided by average shareholders’ equity, excluding accumulated other comprehensive income (AOCI). Management uses adjusted return on equity to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of this financial measure is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The Company considers adjusted return on equity important as it excludes components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity.

•Adjusted return on equity excluding foreign currency impact is adjusted earnings excluding the current period foreign currency impact divided by average shareholders’ equity, excluding AOCI. The Company considers adjusted return on equity excluding foreign currency impact important as it excludes changes in foreign currency and components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity excluding foreign currency impact is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity.

•Amortized hedge costs/income represent costs/income incurred or recognized as a result of using foreign currency derivatives to hedge certain foreign exchange risks in the Company's Japan segment or in Corporate and other. These amortized hedge costs/income are estimated at the inception of the derivatives based on the specific terms of each contract and are recognized on a straight-line basis over the contractual term of the derivative. The Company believes that amortized hedge costs/income measure the periodic currency risk management costs/income related to hedging certain foreign currency exchange risks and are an important component of net investment income. There is no comparable U.S. GAAP financial measure for amortized hedge costs/income.



    




•Adjusted book value is the U.S. GAAP book value (representing total shareholders’ equity), less AOCI as recorded on the U.S. GAAP balance sheet. Adjusted book value per common share is adjusted book value at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value and adjusted book value per common share important as they exclude AOCI, which fluctuates due to market movements that are outside management’s control. The most comparable U.S. GAAP financial measures for adjusted book value and adjusted book value per common share are total book value and total book value per common share, respectively.

•Adjusted book value including unrealized foreign currency translation gains and losses is adjusted book value plus unrealized foreign currency translation gains and losses. Adjusted book value including unrealized foreign currency translation gains and losses per common share is adjusted book value plus unrealized foreign currency translation gains and losses at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value including unrealized foreign currency translation gains and losses, and its related per share financial measure, important as they exclude certain components of AOCI, which fluctuate due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measures for adjusted book value including unrealized foreign currency translation gains and losses and adjusted book value including unrealized foreign currency translation gains and losses per common share are total book value and total book value per common share, respectively.

•Adjusted net investment income is net investment income adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, and ii) net interest income/expense from foreign currency and interest rate derivatives associated with certain investment strategies, which are reclassified from net investment gains and losses to net investment income. The Company considers adjusted net investment income important because it provides a more comprehensive understanding of the costs and income associated with the Company’s investments and related hedging strategies. The most comparable U.S. GAAP financial measure for adjusted net investment income is net investment income.

•Adjusted net investment gains and losses are net investment gains and losses adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, ii) net interest income/expense from foreign currency and interest rate derivatives associated with certain investment strategies, which are both reclassified to net investment income, and iii) the impact of interest from derivatives associated with notes payable, which is reclassified to interest expense as a component of total adjusted expenses. The Company considers adjusted net investment gains and losses important as it represents the remainder amount that is considered outside management’s control, while excluding the components that are within management’s control and are accordingly reclassified to net investment income and interest expense. The most comparable U.S. GAAP financial measure for adjusted net investment gains and losses is net investment gains and losses.





    



RECONCILIATION OF NET EARNINGS TO ADJUSTED EARNINGS
(UNAUDITED – IN MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
THREE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net earnings $ (93) $ 1,569  (105.9) %
Items impacting net earnings:
Adjusted net investment (gains) losses 1,347  (504)
Other and non-recurring (income) loss
—  (3)
Income tax (benefit) expense on items excluded
from adjusted earnings
(43) 33 
Adjusted earnings 1,211  1,095  10.6  %
Current period foreign currency impact 1
16  N/A
Adjusted earnings excluding current period foreign
currency impact 2
$ 1,228  $ 1,095  12.1  %
Net earnings per diluted share $ (0.17) $ 2.64  (106.4) %
Items impacting net earnings:
Adjusted net investment (gains) losses 2.40  (0.85)
Other and non-recurring (income) loss
—  (0.01)
Income tax (benefit) expense on items excluded
from adjusted earnings
(0.08) 0.06 
Adjusted earnings per diluted share 2.16  1.84  17.4  %
Current period foreign currency impact 1
0.03  N/A
Adjusted earnings per diluted share excluding
current period foreign currency impact 2
$ 2.19  $ 1.84  19.0  %
1    Prior period foreign currency impact reflected as “N/A” to isolate change for current period only.
2    Amounts excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes.




    



RECONCILIATION OF NET EARNINGS TO ADJUSTED EARNINGS
(UNAUDITED – IN MILLIONS, EXCEPT FOR PER-SHARE AMOUNTS)
NINE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net earnings $ 3,541  $ 4,391  (19.4) %
Items impacting net earnings:
Adjusted net investment (gains) losses (411) (1,363)
Other and non-recurring (income) loss
(38)
Income tax (benefit) expense on items excluded
from adjusted earnings
76  12 
Adjusted earnings 3,207  3,001  6.9  %
Current period foreign currency impact 1
97  N/A
Adjusted earnings excluding current period foreign
currency impact 2
$ 3,304  $ 3,001  10.1  %
Net earnings per diluted share $ 6.23  $ 7.28  (14.4) %
Items impacting net earnings:
Adjusted net investment (gains) losses (0.72) (2.26)
Other and non-recurring (income) loss
—  (0.06)
Income tax (benefit) expense on items excluded
from adjusted earnings
0.13  0.02 
Adjusted earnings per diluted share 5.64  4.97  13.5  %
Current period foreign currency impact 1
0.17  N/A
Adjusted earnings excluding current period foreign
currency impact 2
$ 5.81  $ 4.97  16.9  %
1 Prior period foreign currency impact reflected as “N/A” to isolate change for current period only.
2    Amounts excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes.



    



RECONCILIATION OF NET INVESTMENT (GAINS) LOSSES TO ADJUSTED NET INVESTMENT (GAINS) LOSSES
(UNAUDITED – IN MILLIONS)
THREE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net investment (gains) losses $ 1,408  $ (423) (432.9) %
Items impacting net investment (gains) losses:
Amortized hedge costs (7) (26)
Amortized hedge income 25  25 
Net interest income (expense) from derivatives associated
     with certain investment strategies
(88) (90)
Impact of interest from derivatives associated with
     notes payable1
10 
Adjusted net investment (gains) losses $ 1,347  $ (504) (367.3) %
1    Amounts are included with interest expenses that are a component of adjusted expenses.



RECONCILIATION OF NET INVESTMENT INCOME TO ADJUSTED NET INVESTMENT INCOME
(UNAUDITED – IN MILLIONS)
THREE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net investment income $ 1,006  $ 1,004  0.2  %
Items impacting net investment income:
Amortized hedge costs (7) (26)
Amortized hedge income 25  25 
Net interest income (expense) from derivatives associated
     with certain investment strategies
(88) (90)
Adjusted net investment income $ 936  $ 915  2.3  %




    



RECONCILIATION OF NET INVESTMENT (GAINS) LOSSES TO ADJUSTED NET INVESTMENT (GAINS) LOSSES
(UNAUDITED – IN MILLIONS)
NINE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net investment (gains) losses $ (239) $ (1,101) (78.3) %
Items impacting net investment (gains) losses:
Amortized hedge costs (19) (148)
Amortized hedge income 87  92 
Net interest income (expense) from derivatives associated
     with certain investment strategies
(265) (239)
Impact of interest from derivatives associated with
     notes payable1
25  33 
Adjusted net investment (gains) losses $ (411) $ (1,363) (69.8) %
1    Amounts are included with interest expenses that are a component of adjusted expenses.


RECONCILIATION OF NET INVESTMENT INCOME TO ADJUSTED NET INVESTMENT INCOME
(UNAUDITED – IN MILLIONS)
NINE MONTHS ENDED SEPTEMBER 30, 2024 2023 % Change
Net investment income $ 3,100  $ 2,946  5.2  %
Items impacting net investment income:
Amortized hedge costs (19) (148)
Amortized hedge income 87  92 
Net interest income (expense) from derivatives associated
     with certain investment strategies
(265) (239)
Adjusted net investment income $ 2,903  $ 2,651  9.5  %



    



RECONCILIATION OF U.S. GAAP BOOK VALUE TO ADJUSTED BOOK VALUE
(UNAUDITED - IN MILLIONS, EXCEPT FOR SHARE AND PER-SHARE AMOUNTS)
SEPTEMBER 30, 2024 2023 % Change
U.S. GAAP book value $ 24,830  $ 22,669 
Less:
Unrealized foreign currency translation gains (losses)
(4,139) (4,484)
Unrealized gains (losses) on securities and derivatives
537  (427)
Effect of changes in discount rate assumptions (67) (866)
Pension liability adjustment
(8) 17 
Total AOCI
(3,677) (5,760)
Adjusted book value $ 28,507  $ 28,429 
Add:
Unrealized foreign currency translation gains (losses)
(4,139) (4,484)
Adjusted book value including unrealized foreign currency translation gains (losses) $ 24,368  $ 23,945 
Number of outstanding shares at end of period (000) 556,717  586,897 
U.S. GAAP book value per common share $ 44.60  $ 38.63  15.5  %
Less:
Unrealized foreign currency translation gains (losses) per common share
(7.43) (7.64)
Unrealized gains (losses) on securities and derivatives per common share
0.96  (0.73)
Effect of changes in discount rate assumptions
     per common share
(0.12) (1.48)
Pension liability adjustment per common share
(0.01) 0.03 
Total AOCI per common share
(6.60) (9.81)
Adjusted book value per common share $ 51.21  $ 48.44  5.7  %
Add:
Unrealized foreign currency translation gains (losses) per common share
(7.43) (7.64)
Adjusted book value including unrealized foreign currency translation gains (losses) per common share $ 43.77  $ 40.80  7.3  %




    



RECONCILIATION OF U.S. GAAP RETURN ON EQUITY (ROE) TO ADJUSTED ROE
(EXCLUDING IMPACT OF FOREIGN CURRENCY)
THREE MONTHS ENDED SEPTEMBER 30, 2024 2023
U.S. GAAP ROE - Net earnings1
(1.5) % 29.1  %
Impact of excluding unrealized foreign currency translation gains (losses)
0.3  (4.5)
Impact of excluding unrealized gains (losses) on securities and derivatives
—  0.8 
Impact of excluding effect of changes in discount rate assumptions —  (3.1)
Impact of excluding pension liability adjustment
—  — 
Impact of excluding AOCI
0.2  (6.8)
U.S. GAAP ROE - less AOCI (1.3) 22.3 
Differences between adjusted earnings and net earnings2
18.0  (6.7)
Adjusted ROE - reported 16.7  15.6 
Less: Impact of foreign currency3
(0.2) N/A
Adjusted ROE, excluding impact of foreign currency 17.0  15.6 
1    U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders' equity.
2    See separate reconciliation of net income to adjusted earnings.
3    Impact of foreign currency is calculated by restating all foreign currency components of the income statement to the weighted average foreign currency exchange rate for the comparable prior year period. The impact is the difference of the restated adjusted earnings compared to reported adjusted earnings. For comparative purposes, only current period income is restated using the weighted average prior period exchange rate, which eliminates the foreign currency impact for the current period. This allows for equal comparison of this financial measure.




    



RECONCILIATION OF U.S. GAAP RETURN ON EQUITY (ROE) TO ADJUSTED ROE
(EXCLUDING IMPACT OF FOREIGN CURRENCY)
NINE MONTHS ENDED SEPTEMBER 30, 2024 2023
U.S. GAAP ROE - Net earnings1
20.2  % 27.4  %
Impact of excluding unrealized foreign currency translation gains (losses)
(2.9) (4.0)
Impact of excluding unrealized gains (losses) on securities and derivatives
0.6  (0.6)
Impact of excluding effect of changes in discount rate assumptions (0.9) (1.5)
Impact of excluding pension liability adjustment
—  — 
Impact of excluding AOCI
(3.3) (6.1)
U.S. GAAP ROE - less AOCI 16.9  21.3 
Differences between adjusted earnings and net earnings2
(1.6) (6.7)
Adjusted ROE - reported 15.3  14.6 
Less: Impact of foreign currency3
(0.5) N/A
Adjusted ROE, excluding impact of foreign currency 15.7  14.6 
1    U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders' equity.
2    See separate reconciliation of net income to adjusted earnings.
3    Impact of foreign currency is calculated by restating all foreign currency components of the income statement to the weighted average foreign currency exchange rate for the comparable prior year period. The impact is the difference of the restated adjusted earnings compared to reported adjusted earnings. For comparative purposes, only current period income is restated using the weighted average prior period exchange rate, which eliminates the foreign currency impact for the current period. This allows for equal comparison of this financial measure.




    



EFFECT OF FOREIGN CURRENCY ON ADJUSTED RESULTS1
(SELECTED PERCENTAGE CHANGES, UNAUDITED)
THREE MONTHS ENDED SEPTEMBER 30, 2024 Including
Currency
Changes
Excluding
Currency
Changes2
Net earned premiums3
(4.3) % (3.1) %
Adjusted net investment income4
2.3  2.7 
Total benefits and expenses (9.2) (8.3)
Adjusted earnings 10.6  12.1 
Adjusted earnings per diluted share 17.4  19.0 
1Refer to previously defined adjusted earnings and adjusted earnings per diluted share.
2Amounts excluding currency changes were determined using the same foreign currency exchange rate for the current period as the comparable period in the prior year, which eliminates dollar-based fluctuations driven solely from currency rate changes.
3Net of reinsurance
4Refer to previously defined adjusted net investment income.




    



EFFECT OF FOREIGN CURRENCY ON ADJUSTED RESULTS1
(SELECTED PERCENTAGE CHANGES, UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30, 2024 Including
Currency
Changes
Excluding
Currency
Changes2
Net earned premiums3
(5.8) % (0.9) %
Adjusted net investment income4
9.5  11.9 
Total benefits and expenses (7.4) (2.6)
Adjusted earnings 6.9  10.1 
Adjusted earnings per diluted share 13.5  16.9 
1Refer to previously defined adjusted earnings and adjusted earnings per diluted share.
2Amounts excluding currency changes were determined using the same foreign currency exchange rate for the current period as the comparable period in the prior year, which eliminates dollar-based fluctuations driven solely from currency rate changes.
3Net of reinsurance
4Refer to previously defined adjusted net investment income.




    



FORWARD-LOOKING INFORMATION

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” to encourage companies to provide prospective information, so long as those informational statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those included in the forward-looking statements. The company desires to take advantage of these provisions. This document contains cautionary statements identifying important factors that could cause actual results to differ materially from those projected herein, and in any other statements made by company officials in communications with the financial community and contained in documents filed with the Securities and Exchange Commission (SEC). Forward-looking statements are not based on historical information and relate to future operations, strategies, financial results or other developments. Furthermore, forward-looking information is subject to numerous assumptions, risks and uncertainties. In particular, statements containing words such as “expect,” “anticipate,” “believe,” “goal,” “objective,” “may,” “should,” “estimate,” “intends,” “projects,” “will,” “assumes,” “potential,” “target,” "outlook" or similar words as well as specific projections of future results, generally qualify as forward-looking. Aflac undertakes no obligation to update such forward-looking statements.

The company cautions readers that the following factors, in addition to other factors mentioned from time to time, could cause actual results to differ materially from those contemplated by the forward-looking statements:

•difficult conditions in global capital markets and the economy, including inflation
•defaults and credit downgrades of investments
•global fluctuations in interest rates and exposure to significant interest rate risk
•concentration of business in Japan
•limited availability of acceptable yen-denominated investments
•foreign currency fluctuations in the yen/dollar exchange rate
•differing interpretations applied to investment valuations
•significant valuation judgments in determination of expected credit losses recorded on the Company's investments
•decreases in the Company's financial strength or debt ratings
•decline in creditworthiness of other financial institutions
•the Company's ability to attract and retain qualified sales associates, brokers, employees, and distribution partners
•deviations in actual experience from pricing and reserving assumptions
•ability to continue to develop and implement improvements in information technology systems and on successful execution of revenue growth and expense management initiatives
•interruption in telecommunication, information technology and other operational systems, or a failure to maintain the security, confidentiality, integrity or privacy of sensitive data residing on such systems
•subsidiaries' ability to pay dividends to the Parent Company
•inherent limitations to risk management policies and procedures
•operational risks of third-party vendors
•tax rates applicable to the Company may change
•failure to comply with restrictions on policyholder privacy and information security
•extensive regulation and changes in law or regulation by governmental authorities
•competitive environment and ability to anticipate and respond to market trends
•catastrophic events, including, but not limited to, as a result of climate change, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, major public health issues, terrorism or other acts of violence, and damage incidental to such events
•ability to protect the Aflac brand and the Company's reputation
•ability to effectively manage key executive succession
•changes in accounting standards
•level and outcome of litigation or regulatory inquiries
•allegations or determinations of worker misclassification in the United States



Analyst and investor contact - David A. Young, 706.596.3264; 800.235.2667 or dyoung@aflac.com

Media contact - Ines Gutzmer, 762.207.7601 or igutzmer@aflac.com


EX-99.2 3 afl93024-fabdocument.htm EX-99.2 Document

FINAL                     10/30/2024
aflaclogoa01a01a01a33.jpg

Financial Supplement
Third Quarter 2024

This document is a statistical supplement to Aflac’s quarterly earnings release. Throughout the presentation, amounts presented may not foot due to rounding. As you review the supplement, please note the non-U.S. GAAP financial measures and definitions found at the back of this document.

The Company adopted the Financial Accounting Standards Board’s Accounting Standard Update 2018-12 Financial Services - Insurance: Targeted Improvements to the Accounting for Long-Duration Contracts, as clarified and amended by (i) ASU 2019-09 Financial Services - Insurance: Effective Date, and (ii) ASU 2020-11 Financial Services - Insurance: Effective Date and Early Application (collectively, “LDTI”) as of January 1, 2023. The amended guidance is applied as of the beginning of the earliest period presented in the Company’s quarterly and annual financial statements, which results in a January 1, 2021 Transition Date. In conjunction with the adoption of LDTI, the Company changed its practice of recording the change in the deferred profit liability (DPL) on products with limited-payment features from the benefits and claims, net line item to the net earned premiums line item in the consolidated statement of earnings. This change in presentation has no impact on net earnings. All quarterly and annual amounts for 2021 and 2022 presented herein reflect these changes for LDTI and DPL.
Aflac Incorporated Page
11,12,13
Aflac U.S.
20,21
Aflac Japan
22,23
24,25
28,29,30
Corporate and Other
Non-U.S. GAAP Financial Measures
For more information, contact:
David Young
Phone. 706.596.3264
Aflacir@aflac.com
investors.aflac.com



Aflac Incorporated and Subsidiaries
Share Data
(In Thousands)
Beginning Shares Issued Shares Purchased Ending QTD Weighted Avg. Shares YTD Weighted Avg. Shares
Shares Stk. Bon. Stk. Opt. Treas. Misc. Shares Avg. Dilutive Avg. Avg. Dilutive Avg.
Period Outstanding & DRP & Misc. Shares
Purch.(1)
Outstanding Shares Shares Diluted Shares Shares Diluted
2022 652,132  259  1,308  8,007  343  645,349  649,753  3,074  652,827  649,753  3,074  652,827 
645,349  269  101  11,185  634,526  640,707  2,536  643,243  645,205  2,805  648,010 
634,526  258  144  11,057  623,868  629,350  2,597  631,946  639,862  2,735  642,597 
623,868  222  120  8,938  16  615,256  619,845  3,149  622,994  634,816  2,839  637,655 
2023 615,256  239  1,152  10,348  347  605,952  611,205  2,745  613,950  611,205  2,745  613,950 
605,952  259  225  10,461  595,969  600,742  2,187  602,929  605,945  2,466  608,411 
595,969  210  115  9,390  586,897  591,246  2,350  593,596  600,991  2,427  603,419 
586,897  191  94  8,698  578,479  581,876  3,005  584,881  596,173  2,572  598,745 
2024 578,479  212  1,320  9,276  457  570,278  574,886  2,596  577,482  574,886  2,596  577,482 
570,278  217  186  9,288  24  561,369  564,573  2,265  566,838  569,730  2,430  572,160 
561,369  165  75  4,882  10  556,717  557,899  2,515  560,414  565,757  2,459  568,216 
















(1) Includes previously owned shares used to purchase options (swapped shares) and/or shares purchased for deferred compensation program
2


Aflac Incorporated and Subsidiaries
Summary of Adjusted Results by Business Segment
(In Millions, except per-share data and where noted)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Aflac Japan $ 3,261  $ 3,263  $ 3,755  $ 3,281  $ 3,234  $ 869  $ 1,073  23.5  $ 2,479  $ 2,747  10.8 
Aflac U.S. 1,272  1,268  1,356  1,359  1,501  478  350  (26.8) 1,199  1,089  (9.2)
Corporate and other (1)
(72) (115) (293) (218) (425) (49) 15  (107) 36 
Pretax adjusted earnings 4,461  4,416  4,819  4,422  4,310  1,298  1,438  10.8  3,571  3,872  8.4 
Income taxes (1)
1,147  864  893  808  577  203  227  11.8  570  665  16.7 
Adjusted earnings (2)
3,314  3,552  3,925  3,614  3,733  1,095  1,211  10.6  3,001  3,207  6.9 
Reconciling items:
Adjusted net investment gains (losses) (15) (229) 462  447  914  504  (1,347) 1,363  411 
Other and non-recurring income (loss) (3)
(1) (28) (73) 39  —  38  (1)
Income tax benefit (expense) on items excluded from adjusted earnings (4)
72  (83) 357  (26) (33) 43  (12) (76)
Tax reform adjustment (5)
—  —  —  —  —  —  —  — 
Tax valuation allowance release (6)
—  1,411  —  —  —  —  —  —  — 
Net earnings $ 3,304  $ 4,778  $ 4,231  $ 4,418  $ 4,659  $ 1,569  $ (93) (105.9) $ 4,391  $ 3,541  (19.4)
Effective Tax rate 25.7  % (14.9) % 18.7  % 9.3  % 11.5  % 13.1  % 201.8  % 11.7  % 17.3  %
Earnings per share of common stock:
Net earnings (basic) $ 4.45  $ 6.69  $ 6.28  $ 6.96  $ 7.81  $ 2.65  $ (0.17) (106.4) $ 7.31  $ 6.26  (14.4)
Net earnings (diluted) 4.43  6.67  6.25  6.93  7.78  2.64  (0.17) (106.4) 7.28  6.23  (14.4)
Adjusted earnings (basic) (2)
$ 4.46  $ 4.98  $ 5.83  $ 5.69  $ 6.26  $ 1.85  $ 2.17  17.3  $ 4.99  $ 5.67  13.6 
Adjusted earnings (diluted) (2)
4.44  4.96  5.80  5.67  6.23  1.84  2.16  17.4  4.97  5.64  13.5 
(1)
The change in value of federal historic rehabilitation and solar investments in partnerships of $57 and $64 for the three-month periods and $119 and $169 for the nine-month periods ended September 30, 2024, and 2023, respectively, is included as a reduction to net investment income. Tax credits on these investments of $78 and $63 for the three-month periods and $142 and $171 for the nine-month periods ended September 30, 2024, and 2023, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
(2)
See non-U.S. GAAP financial measures for definition of adjusted earnings.
(3)
Foreign currency gains and losses for all periods have been reclassified from Other and non-recurring income (loss) to Net investment gains and losses.
(4)
Primarily reflects release of $695 in deferred taxes in 2022
(5)
The impact of Tax Reform was adjusted in 2018 for return-to-provision adjustments, various amended returns filed by the Company, and final true-ups of deferred tax liabilities. Further impacts were recorded in 2019 as a result of additional guidance released by the IRS.
(6)
Tax benefit recognized in 2020 represents the release of valuation allowances on deferred tax benefits related to foreign tax credits.
3


Aflac Incorporated and Subsidiaries
Consolidated Statements of Earnings - U.S. GAAP
(In Millions, except per-share data)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Revenues:
Net earned premiums
  Gross premiums $ 19,122  $ 18,955  $ 17,305  $ 15,025  $ 14,318  $ 3,524  $ 3,360  $ 10,885  $ 10,193 
  Assumed (ceded) (342) (333) (210) (124) (195) (48) (32) (148) (84)
    Total net earned premiums (1)
18,780  18,622  17,095  14,901  14,123  3,476  3,328  (4.3) 10,737  10,109  (5.8)
Net investment income 3,578  3,638  3,818  3,656  3,811  1,004  1,006  .2  2,946  3,100  5.2 
Net investment gains (losses) (2)
(135) (270) 468  363  590  423  (1,408) 1,101  239 
Other income (2)
84  157  173  220  177  47  23  139  76 
     Total revenues 22,307  22,147  21,554  19,140  18,701  4,950  2,949  (40.4) 14,923  13,524  (9.4)
Benefits and Claims:
Benefits and claims, net
  Incurred claims -direct 9,279  9,364  8,949  8,271  8,005  1,871  2,064  6,034  6,248 
  Incurred claims -assumed (ceded) (372) (296) (147) (108) (177) (33) (22) (114) (57)
  Increase in FPB (3)-direct
2,952  2,707  1,819  888  594  231  (40) 499  (147)
  Increase in FPB (3)-assumed (ceded)
83  21  51  172  (4) (2)
Total net benefits and claims, excluding
  reserve remeasurement
N/A N/A 10,623  9,102  8,594  2,065  2,003  6,420  6,042 
Reserve remeasurement (gain) loss N/A N/A (147) (215) (383) (205) (408) (312) (515)
    Total net benefits and claims 11,942  11,796  10,476  8,887  8,211  1,860  1,595  (14.2) 6,108  5,527  (9.5)
Acquisition and operating expenses:
   Amortization of DAC (4)
1,282  1,214  835  792  816  201  214  608  638 
   Insurance commissions 1,321  1,316  1,256  1,117  1,052  250  251  797  751 
   Insurance expenses 3,089  3,420  3,541  3,249  3,165  785  747  2,290  2,179 
   Interest expense 228  242  238  226  195  49  50  148  147 
     Total acquisition and operating expenses 5,920  6,192  5,870  5,384  5,228  1,285  1,262  (1.8) 3,843  3,715  (3.3)
     Total benefits and expenses 17,862  17,988  16,346  14,271  13,439  3,145  2,857  (9.2) 9,951  9,242  (7.1)
     Pretax earnings 4,445  4,159  5,208  4,869  5,262  1,805  92  4,972  4,282 
Income tax expense (benefit) (5)
1,141  (619) 977  451  603  236  185  581  741 
     Net earnings $ 3,304  $ 4,778  $ 4,231  $ 4,418  $ 4,659  $ 1,569  $ (93) (105.9) $ 4,391  $ 3,541  (19.4)
(1) Includes a gain (loss) of $(75) and $22 for the three-month periods and $(80) and $22 for the nine-month periods ended September 30, 2024 and 2023, respectively, related to remeasurement of the deferred profit liability for limited-payment contracts.
(2) Foreign currency gains and losses for all periods have been reclassified from Other income to Net investment gains and losses for consistency with current period presentation.
(3) Future policy benefits
(4) Deferred acquisition costs
(5) Primarily reflects release of $695 in deferred taxes in 2022
4


Aflac Incorporated and Subsidiaries
Analysis of Net Earnings and Net Earnings Per Diluted Share
(In Millions, except for per-share data)
Other and Foreign
Net Other and Non- Foreign Net Net Non-Recurring Currency
Net Investment Recurring Currency Earnings Investment Items Impact
Period Earnings
Gains (Losses) (1)
Items (1)(3)(4)
Impact (2)
Per Share
Gains (Losses) (1)
Per Share (1)(3)(4)
Per Share (2)
2019 3,304  (13) 15  4.43  (.02) .01  .02 
2020 4,778  (181) 1,407  31  6.67  (.25) 1.96  .04 
2021 4,231  365  (59) (42) 6.25  .54  (.09) (.06)
2022 4,418  803  (262) 6.93  1.26  —  (.41)
2023 4,659  896  31  (113) 7.78  1.50  .05  (.19)
2022 1 1,047  106  (1) (35) 1.60  .16  —  (.05)
2 1,394  448  —  (59) 2.17  .70  —  (.09)
3 1,781  871  (97) 2.82  1.38  —  (.15)
4 196  (621) —  (70) .31  (1.00) —  (.11)
2023 1 1,188  235  —  (41) 1.94  .38  —  (.07)
2 1,634  653  28  (25) 2.71  1.08  .05  (.04)
3 1,569  472  (33) 2.64  .80  —  (.06)
4 268  (464) —  (14) .46  (.79) —  (.02)
2024 1 1,879  920  (2) (44) 3.25  1.59  —  (.08)
2 1,755  720  —  (37) 3.10  1.27  —  (.07)
3 (93) (1,304) —  (16) (.17) (2.33) —  (.03)
(1) Items are presented net of tax.
(2) See non-U.S. GAAP financial measures for definition of adjusted earnings excluding current period foreign currency impact
(3) Foreign currency gains and losses and amortized hedge costs/income for all periods have been reclassified from Other income to Net investment gains and losses for consistency with current period presentation.
(4 )Tax benefit recognized in the third quarter of 2020 represents the release of valuation allowances on deferred tax benefits related to foreign tax credits.

5


Aflac Incorporated and Subsidiaries
Consolidated Balance Sheets
(In Millions, except per-share data)
December 31, September 30,
Assets: 2019 2020 2021 2022 2023 2023 2024
Investments and cash:
Securities available for sale:
Fixed maturity securities available for sale, at fair value $ 86,950  $ 101,286  $ 94,206  $ 71,936  $ 69,578  $ 66,369  $ 68,261 
Fixed maturity securities available for sale - consolidated variable interest entities, at fair value 4,312  4,596  4,490  3,805  3,712  3,432  4,031 
Fixed maturity securities held to maturity, at amortized cost, net of allowance for credit losses 30,085  24,464  22,000  19,056  17,819  16,899  17,698 
Equity securities, at fair value 802  1,283  1,603  1,091  1,088  990  808 
Commercial mortgage and other loans, net of allowance for credit losses 9,569  10,554  11,786  13,496  12,527  12,873  11,544 
Other investments 1,477  2,429  3,842  4,070  4,530  5,241  7,647 
Cash and cash equivalents 4,896  5,141  5,051  3,943  4,306  5,502  5,612 
   Total investments and cash 138,091  149,753  142,978  117,397  113,560  111,306  115,601 
Receivables, net of allowance for credit losses (1)
816  778  672  647  848  712  814 
Accrued investment income 772  780  737  745  731  687  696 
Deferred policy acquisition costs 10,128  10,441  9,848  9,239  9,132  8,771  9,232 
Property and equipment, net 581  601  538  530  445  445  421 
Other assets, net of allowance for credit losses (1)(2)
2,380  2,733  3,377  3,180  2,008  3,190  1,678 
Total assets $ 152,768  $ 165,086  $ 158,150  $ 131,738  $ 126,724  $ 125,111  $ 128,442 
Liabilities and Shareholders' Equity:
Liabilities:
Total policy liabilities $ 106,554  $ 114,391  $ 126,331  $ 96,910  $ 91,599  $ 86,028  $ 87,554 
Notes payable 6,569  7,899  7,956  7,442  7,364  6,961  7,978 
Income taxes, primarily deferred 5,370  4,661  30  698  154  869  454 
Other liabilities 5,316  4,576  6,802  6,548  5,622  8,584  7,626 
Total liabilities 123,809  131,527  141,119  111,598  104,739  102,442  103,612 
Shareholders' equity:
Common stock 135  135  135  135  136  136  136 
Additional paid-in capital 2,313  2,410  2,529  2,641  2,771  2,729  2,876 
Retained earnings 34,291  37,984  40,963  44,367  47,993  48,257  50,972 
Accumulated other comprehensive income (loss):
Unrealized foreign currency translation gains (losses) (1,623) (1,109) (1,985) (3,564) (4,069) (4,484) (4,139)
Unrealized gains (losses) on fixed maturity securities 8,548  10,361  9,602  (702) 1,139  (403) 557 
Unrealized gains (losses) on derivatives (33) (34) (30) (27) (22) (24) (20)
Effect of change in discount rate assumption(s) N/A N/A (15,832) (2,100) (2,560) (866) (67)
Pension liability adjustment (277) (284) (166) (36) (8) 17  (8)
Treasury stock (14,395) (15,904) (18,185) (20,574) (23,395) (22,693) (25,477)
Total shareholders' equity 28,959  33,559  17,031  20,140  21,985  22,669  24,830 
Total liabilities & shareholders' equity $ 152,768  $ 165,086  $ 158,150  $ 131,738  $ 126,724  $ 125,111  $ 128,442 
(1) Certain reclassifications have been made to prior-year amounts to conform to current-year reporting classifications. These reclassifications had no impact on net earnings or total shareholders' equity.
(2) Includes goodwill of $265 million in 2024, $269 million in 2023, $265 in 2022, $268 in 2021, $269 million in 2020 and $140 million in 2019
6


Aflac Incorporated and Subsidiaries
Quarterly Financial Results
(Dollars In Millions, except per-share data)
Total
Net Net Benefits Acquisitions Total Net EPS
Adj. EPS (1)
Earned Inv. Total & & Pretax Net Adjusted
Period Premiums Income Revenues Claims, Net Adj. Exp. Earn. Earn.
Earn. (1)
Basic Dil. Basic Dil.
2019 18,780  3,578  22,307  11,942  5,920  4,445  3,304  3,314  4.45  4.43  4.46  4.44 
2020 18,622  3,638  22,147  11,796  6,192  4,159  4,778  3,552  6.69  6.67  4.98  4.96 
2021 17,095  3,818  21,554  10,476  5,870  5,208  4,231  3,925  6.28  6.25  5.83  5.80 
2022 14,901  3,656  19,140  8,887  5,384  4,869  4,418  3,614  6.96  6.93  5.69  5.67 
2023 14,123  3,811  18,701  8,211  5,228  5,262  4,659  3,733  7.81  7.78  6.26  6.23 
2022 1 4,079  903  5,173  2,483  1,396  1,294  1,047  942  1.61  1.60  1.45  1.44 
2 3,764  937  5,315  2,274  1,333  1,708  1,394  945  2.18  2.17  1.47  1.47 
3 3,535  920  4,704  2,076  1,299  1,329  1,781  910  2.83  2.82  1.45  1.44 
4 3,523  896  3,948  2,054  1,356  538  196  817  .32  .31  1.32  1.31 
2023 1 3,688  943  4,800  2,150  1,308  1,342  1,188  953  1.94  1.94  1.56  1.55 
2 3,573  999  5,172  2,098  1,249  1,825  1,634  954  2.72  2.71  1.59  1.58 
3 3,476  1,004  4,950  1,860  1,285  1,805  1,569  1,095  2.65  2.64  1.85  1.84 
4 3,385  865  3,777  2,103  1,385  289  268  732  .46  .46  1.26  1.25 
2024 1 3,456  1,000  5,436  2,010  1,256  2,170  1,879  961  3.27  3.25  1.67  1.66 
2 3,325  1,095  5,138  1,921  1,198  2,019  1,755  1,035  3.11  3.10  1.83  1.83 
3 3,328  1,006  2,949  1,595  1,262  92  (93) 1,211  (0.17) (0.17) 2.17  2.16 


















(1) See non-U.S. GAAP financial measures for definition of adjusted earnings.
7


Aflac Incorporated and Subsidiaries
Quarterly Book Value Per Share
(Dollars In Millions, except per-share data)
Adjusted BV
Adjusted BV Per Share Incl
Equity AOCI Adjusted BV Per Share Incl Foreign Currency
BV Per BV Per Adjusted BV Per Share Foreign Currency Translation G/(L)
Period Share Share
Per Share (1)
% Change
Translation G/(L)(1)
% Change
2019 39.84 9.10 30.74 8.9% 28.51 10.6%
2020 48.46 12.90 35.56 15.7% 33.96 19.1%
2021 26.12 (12.90) 39.01 9.7% 35.97 5.9%
2022 32.73 (10.45) 43.18 10.7% 37.39 3.9%
2023 38.00 (9.54) 47.55 10.1% 40.51 8.3%
2022 1 27.21 (13.09) 40.31 10.1% 36.53 7.0%
2 30.82 (11.00) 41.82 11.3% 36.75 4.6%
3 31.97 (12.03) 44.00 14.6% 36.99 3.4%
4 32.73 (10.45) 43.18 10.7% 37.39 3.9%
2023 1 32.65 (12.01) 44.66 10.8% 38.69 5.9%
2 34.30 (12.31) 46.61 11.5% 39.48 7.4%
3 38.63 (9.81) 48.44 10.1% 40.80 10.3%
4 38.00 (9.54) 47.55 10.1% 40.51 8.3%
2024 1 41.27 (8.95) 50.22 12.4% 42.04 8.7%
2 46.40 (5.86) 52.26 12.1% 43.19 9.4%
3 44.60 (6.60) 51.21 5.7% 43.77 7.3%














(1) See non-U.S. GAAP financial measures for definition of adjusted book value and adjusted book value including unrealized
foreign currency translation gains and losses.
8


Aflac Incorporated and Subsidiaries
Return on Equity
Year Ended December 31, 3 Months Ended September 30,  9 Months Ended September 30,
2019 2020
2021 (4)
2022 2023 2023 2024 2023 2024
U.S. GAAP ROE (1) - Net earnings
12.6  % 15.3  % 26.7  % 23.8  % 22.1  % 29.1  % (1.5) % 27.4  % 20.2  %
Impact of excluding unrealized foreign currency translation gains (losses) (1.0) (0.9) (1.7) (2.5) (3.1) (4.5) 0.3  (4.0) (2.9)
Impact of excluding unrealized gains (losses) on securities and derivatives 3.6  6.2  10.7  4.1  0.2  0.8  —  (0.6) 0.6 
Impact of excluding effect on change in discount rate assumptions N/A N/A (18.5) (8.2) (1.9) (3.1) —  (1.5) (0.9)
Impact of excluding pension liability adjustment (0.1) (0.2) (0.2) (0.1) —  —  —  —  — 
Impact of excluding AOCI 2.5  5.1  (9.7) (6.8) (4.9) (6.8) 0.2  (6.1) (3.3)
U.S. GAAP ROE - less AOCI 15.1  20.3  17.0  17.0  17.2  22.3  (1.3) 21.3  16.9 
Differences between adjusted earnings and net earnings (2)
—  (5.2) (1.2) (3.1) (3.4) (6.7) 18.0  (6.7) (1.6)
Adjusted ROE - reported (3)
15.2  15.1  15.8  13.9  13.8  15.6  16.7  14.6  15.3 
(1) U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders' equity.
(2) See separate reconciliation of net income to adjusted earnings.
(3) See non-U.S. GAAP financial measures for definition of adjusted return on equity
(4) Return on equity calculations for 2021 use beginning retained earnings and accumulated other comprehensive income adjusted for the adoption of LDTI.
9


Aflac Incorporated and Subsidiaries
Adjusted Earnings Per Share Excluding Current Period Foreign Currency Impact (1)
(Diluted Basis)
Change
QTD YTD Excluding Excluding
Foreign Foreign Foreign Foreign
Adjusted Currency Currency Currency Currency
Period
EPS(1)
Growth
Impact(1)
Impact(1)
Impact(1)
Impact
2019 $ 4.44  6.7  % N/A .02  $ 4.42  6.3  %
2020 $ 4.96  11.7  % N/A .04  $ 4.92  10.8  %
2021 $ 5.80  16.9  % N/A (.06) $ 5.86  18.1  %
2022 $ 5.67  (2.2) % N/A (.41) $ 6.08  4.8  %
2023 $ 6.23  9.9  % N/A (.19) $ 6.43  13.4  %
2022 1 $ 1.44  .7  % (.05) (.05) $ 1.50  4.9  %
2 1.47  —  (.09) (.15) 1.56  6.1 
3 1.44  (8.3) (.15) (.30) 1.59  1.3 
4 1.31  (.8) (.11) (.41) 1.43  8.3 
$ 5.67  (2.2) % $ 6.08  4.8  %
2023 1 $ 1.55  7.6  % (.07) (.07) $ 1.62  12.5  %
2 1.58  7.5  (.04) (.11) 1.62  10.2 
3 1.84  27.8  (.06) (.17) 1.90  31.9 
4 1.25  (4.6) (.02) (.19) 1.28  (2.3)
$ 6.23  9.9  % $ 6.43  13.4  %
2024 1 $ 1.66  7.1  % (.08) (.08) $ 1.74  12.3  %
2 1.83  15.8  (.07) (.14) 1.89  19.6 
3 2.16  0.17  (.03) (.17) 2.19  0.19 
$ 5.64  13.5  % $ 5.81  16.9  %
(1) See non-U.S.GAAP financial measures for definition of adjusted earnings and adjusted earnings excluding current period foreign currency impact
10


Aflac Incorporated and Subsidiaries
Composition of Invested Assets
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Fixed Maturity Securities(1)
$ 109,456  $ 116,056  $ 107,369  $ 94,525  $ 88,508  $ 86,060  $ 88,117 
Commercial mortgage and other loans, net of allowance for credit losses (1)
Transitional Real Estate (floating rate) 5,450  5,231  5,246  6,455  5,998  6,439  5,249 
Middle Market Loans (floating rate) 2,412  3,635  4,601  5,028  4,531  4,712  4,408 
Commercial Mortgage Loans 1,707  1,688  1,854  1,775  1,697  1,422  1,545 
Other Loans —  —  20  238  301  300  342 
Total Commercial mortgage and other loans, net of allowance for credit losses(1)
9,569  10,554  11,721  13,496  12,527  12,873  11,544 
Equity Securities, at FV through net earnings 802  1,283  1,603  1,091  1,088  990  808 
Alternatives(2)
551  919  1,703  2,107  2,619  2,498  2,967 
Total Portfolio $ 120,378  $ 128,812  $ 122,396  $ 111,219  $ 104,742  $ 102,421  $ 103,436 
Unrealized Gains (Losses) on Invested Assets
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Fixed Maturity Securities
     Available For Sale - Gross Gains $ 12,266  $ 14,771  $ 13,566  $ 4,800  $ 6,050  $ 5,061  $ 5,748 
     Available For Sale - Gross Losses (375) (481) (239) (4,528) (3,449) (4,421) (3,875)
     Total Available For Sale 11,891  14,290  13,327  272  2,601  640  1,873 
     Held to Maturity - Gross Gains 7,519  5,935  4,869  2,154  1,838  1,561  1,277 
     Held to Maturity - Gross Losses (10) —  —  —  —  —  — 
     Total Held to Maturity $ 7,509  $ 5,935  $ 4,869  $ 2,154  $ 1,838  $ 1,561  $ 1,277 
Credit Ratings on Fixed Maturities
(At Amortized Cost)
December 31, September 30,
Credit Rating 2019 2020 2021 2022 2023 2023 2024
AAA 1.1  % 1.0  % 1.0  % 1.6  % 1.6  % 1.5  % 1.4  %
AA 4.3  4.5  5.1  5.2  5.7  5.7  6.0 
A 68.6  69.3  68.9  68.0  68.1  68.0  68.5 
BBB 23.1  21.9  22.5  23.0  22.9  22.8  22.7 
BB or Lower 2.9  3.3  2.5  2.2  1.7  2.0  1.4 
100.0  % 100.0  % 100.0  % 100.0  % 100.0  % 100.0  % 100.0  %
(1) Presented at amortized cost, net of reserves beginning in 2020

(2) Presented at carrying value; includes asset classes such as private equity and real estate funds managed by Global Investments; excludes Corporate driven activity, policy loans, short-term investments, real estate owned assets and FHLB equity balances
11


Aflac Incorporated and Subsidiaries
Supplemental Investment Data by Segment
3 Months Ended 9 Months Ended
December 31, September 30, September 30,
2019 2020 2021 2022 2023 2023 2024 2023 2024
Aflac Japan:
   Invested assets (in millions)(1)
¥ 11,784,586  ¥ 11,936,087  ¥ 12,405,531  ¥ 12,617,181  ¥ 12,127,531  ¥ 12,945,618  ¥ 12,367,665  ¥ 12,945,618  ¥ 12,367,665 
   Return on average invested assets(2)
2.33  % 2.38  % 2.72  % 2.78  % 2.90  % 3.07  % 3.16  % 2.80  % 3.31  %
   Portfolio book yield at end of period(3)
2.64  % 2.59  % 2.60  % 3.06  % 3.18  % 3.19  % 3.21  % 3.19  % 3.21  %
   Total purchases for period (in millions)(3)
¥ 1,003,885  ¥ 714,124  ¥ 952,038  ¥ 716,964  ¥ 378,541  ¥ 70,531  ¥ 190,132  ¥ 317,355  ¥ 647,176 
   New money yield(3)(4)
3.83  % 3.75  % 3.50  % 4.48  % 5.18  % 4.28  % 6.21  % 4.84  % 5.85  %
Aflac U.S.:
   Invested assets (in millions)(1)
$ 14,036  $ 14,848  $ 15,841  $ 16,772  $ 17,075  $ 16,861  $ 17,337  $ 16,861  $ 17,337 
   Return on average invested assets(2)
5.70  % 4.90  % 4.87  % 4.72  % 4.88  % 5.04  % 4.94  % 4.84  % 5.00  %
   Portfolio book yield at end of period(3)
5.40  % 5.18  % 4.94  % 5.39  % 5.53  % 5.52  % 5.63  % 5.52  % 5.63  %
   Total purchases for period (in millions)(3)
$ 1,835  $ 1,050  $ 2,130  $ 1,701  $ 907  $ 217  $ 158  $ 748  $ 886 
   New money yield(3)(4)
4.51  % 3.04  % 3.41  % 5.16  % 7.56  % 7.21  % 6.00  % 7.38  % 6.76  %
Hedge Costs/Income Metrics (5)(6)
3 Months Ended 9 Months Ended
December 31, September 30, September 30,
2019 2020 2021 2022 2023 2023 2024 2023 2024
Aflac Japan:
FX hedged notional at end of period (in billions) - forwards (7)
$ 8.8  $ 6.0  $ 6.4  $ 4.1  $ —  $ —  $ —  $ —  $ — 
FX hedged notional at end of period (in billions) - put options 9.2  13.1  11.6  13.5  24.7  24.4  24.7  24.4  24.7 
Amortized hedge costs for period (in millions) (257) (206) (76) (112) (157) (26) (7) (148) (19)
Corporate and Other (Parent Company):
FX hedged notional at end of period (in billions) - forwards (7)
$ 4.9  $ 5.0  $ 5.0  $ 5.0  $ 2.6  $ 2.4  $ 1.9  $ 2.4  $ 1.9 
FX hedged notional at end of period (in billions) - put options 2.0  2.0  1.9  2.6  0.5  0.9  —  0.9  — 
Amortized hedge income (costs) for period (in millions) 89  97  57  68  122  25  25  92  87 
(1) Invested assets, including cash and short term investments, are stated at amortized cost; except for equities, which are at fair value.
(2) Net of investment expenses and amortized hedge costs, year-to-date number reflected on a quarterly average basis
(3) Includes fixed maturity securities, commercial mortgage and other loans, equity securities, and excludes alternative investments in limited partnerships, and any impacts from hedging activities
(4) Reported on a gross yield basis; excludes investment expenses, external management fees, and amortized hedge costs
(5) See non-U.S. GAAP financial measures for definition of amortized hedge costs/income. Further, the metrics in this table are split to show the hedging of the market value of a portion of the USD investments in Japan
     Segment’s "USD Program" in the "Japan Segment Portfolio Allocation by Currency" table on page 13 of this supplement as well as the corporate hedging activities at Aflac Incorporated
(6) Aflac Japan and the Parent Company utilize foreign currency forwards and options to hedge foreign currency exchange rate risk. The hedge cost/income on the table above reflects our FX forward protection of the hedged
    USD portfolio, and hedge costs on one sided options used as caps, and on tail-risk put options.
(7) Notional is reported net of any offsetting positions within Aflac Japan or the Parent Company, respectively.
12


Aflac Incorporated and Subsidiaries
Japan Segment Portfolio Allocation by Currency (1)
(Dollars In Millions, U.S. GAAP Basis)
December 31, 2023 September 30, 2024
Amortized
Cost (3)
Fair
Value
Amortized
Cost (3)
Fair
Value
JGB $ 39,151  $ 40,222  $ 38,280  $ 37,942 
Other 19,517  20,285  18,691  19,155 
Total yen denominated 58,668  60,507  56,971  57,097 
USD Program 23,384  25,254  25,632  27,363 
Other 2,081  2,902  2,063  2,957 
US dollar denominated 25,465  28,156  27,695  30,320 
Total $ 84,133  $ 88,663  $ 84,666  $ 87,417 
Distribution of Consolidated Fixed Maturities by Sector (2)
September 30, 2024
(In millions)
Amortized Cost (3)
% of
Total
Government and agencies $ 39,471  44.8  %
Municipalities 2,443  2.8 
Mortgage- and asset-backed securities 3,595  4.1 
Public utilities 7,060  8.0 
Electric 5,631  6.4 
Natural Gas 889  1.0 
Other 540  .6 
Sovereign and supranational 862  1.1 
Banks/financial institutions 9,391  10.6 
Banking 5,589  6.3 
Insurance 1,886  2.1 
Other 1,916  2.2 
Other corporate 25,295  28.6 
Basic Industry 2,156  2.4 
Capital Goods 3,001  3.4 
Communications 2,723  3.1 
Consumer Cyclical 1,996  2.3 
Consumer Non-Cyclical 5,861  6.7 
Energy 2,233  2.5 
Other 1,176  1.3 
Technology 3,216  3.6 
Transportation 2,933  3.3 
        Total fixed maturity securities $ 88,117  100.0  %
(1) The entire U.S. segment investment portfolio is U.S. dollar denominated.
(2)In the first quarter of 2023, the Utility/Energy subsector was combined with the Natural Gas subsector to better reflect the risk characteristics of those issuers and align more closely with industry
  benchmarks.
(3) Net of reserves
13


Aflac Incorporated and Subsidiaries
Long-Term Debt Data
Adjusted Leverage Ratios
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Notes payable $ 6,569  $ 7,899  $ 7,956  $ 7,442  $ 7,364  $ 6,961  $ 7,978 
50% of subordinated debentures and perpetual bonds (408) (432) (389) (337) (315) (299) (313)
Pre-funding of debt maturities (348) —  —  —  (211) —  — 
Adjusted debt (1)
5,814  7,467  7,568  7,105  6,839  6,663  7,666 

Total Shareholders' Equity 28,959  33,559  17,031  20,140  21,985  22,669  24,830 
Accumulated other comprehensive (income) loss:
Unrealized foreign currency translation (gains) losses 1,623  1,109  1,985  3,564  4,069  4,484  4,139 
Unrealized (gains) losses on fixed maturity securities (8,548) (10,361) (9,602) 702  (1,139) 403  (557)
Unrealized (gains) losses on derivatives 33  34  30  27  22  24  20 
Effect on change in discount rate assumptions N/A N/A 15,832  2,100  2,560  866  67 
Pension liability adjustment 277  284  166  36  (17)
Adjusted book value (1)
22,344  24,625  25,442  26,569  27,505  28,429  28,507 
Adjusted capitalization ex-AOCI(1)(2)
$ 28,565  $ 32,524  $ 33,398  $ 34,011  $ 34,658  $ 35,390  $ 36,485 
Adjusted debt to adjusted capitalization ex-AOCI 20.4  % 23.0  % 22.7  % 20.9  % 19.7  % 18.8  21.0  %
Adjusted capitalization(1)(3)
$ 26,665  $ 31,131  $ 31,247  $ 30,411  $ 30,581  $ 30,923  $ 32,338 
Adjusted debt to adjusted capitalization 21.8  % 24.0  % 24.2  % 23.4  % 22.4  % 21.5  23.7  %
Debt Maturities(4)
(In Millions)
September 30, 2024
≤ 1 year 1 > 5 years 5 > 10 years 10 > 20 years 20 years + Total
Senior Notes $ —  $ 1,880  $ 2,995  $ 1,107  $ 1,310  $ 7,292 
Subordinated debt —  —  —  —  631  631 
Total $ —  $ 1,880  $ 2,995  $ 1,107  $ 1,941  $ 7,923 

(1) See non-U.S. GAAP financial measures for definition of: adjusted debt; adjusted book value; adjusted debt, including 50% of subordinated debentures and perpetual bonds; and adjusted book value, including unrealized foreign currency translation gains and losses and pension liability adjustment
(2) Adjusted capitalization ex-AOCI is the sum of adjusted debt, including 50% of subordinated debentures and perpetual bonds, plus adjusted book value
(3)Adjusted capitalization is sum of adjusted debt, including 50% of subordinated debentures and perpetual bonds, plus adjusted book value, including unrealized foreign currency translation gains and losses and pension liability adjustment
(4) Debt maturity amounts do not include discounts, premiums, deferred charges, or capital lease obligations.
14


Aflac Incorporated and Subsidiaries

Insurer Financial Strength Ratings
AM Best Moody's S&P JCR R&I
U.S. Operating Companies
Aflac of Columbus A+ Aa3 A+ AA AA
Aflac of New York A+ _ A+ _ _
Continental American Insurance Company A+ _ _ _ _
Japan Operating Company
Aflac Life Insurance Japan Ltd. A+ Aa3 A+ AA AA
Bermuda Operating Company
Aflac Re Bermuda Ltd. _ _ _ AA _
Issuer Credit Ratings
AM Best Moody's S&P JCR R&I
Aflac Incorporated
Long-term Senior Debt a A3 A- A+ A+
Junior Subordinated Debt a- Baa1 BBB _ A-
Aflac of Columbus
Long-term Senior Debt aa _ A+ AA _
Aflac Life Insurance Japan, Ltd.
Long-term Senior Debt aa _ A+ AA _
Subordinated Bonds _ _ _ AA- _
The outlook for all ratings assigned by A.M. Best, S&P, Moody's and R&I is stable. The outlook for all ratings assigned by JCR is positive.

15


Aflac U.S.
Statements of Pretax Adjusted Earnings
(Before Management Fee)
(In Millions)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Revenues:
Net earned premiums
  Gross premiums $ 5,818  $ 5,762  $ 5,540  $ 5,467  $ 5,669  $ 1,418  $ 1,480  $ 4,256  $ 4,440 
  Assumed (ceded) (11) (4) 73  103  (21) 16  (51)
    Total net earned premiums 5,808  5,758  5,614  5,570  5,675  1,419  1,459  2.8  4,272  4,388  2.7 
Adjusted net investment income 720  705  754  755  820  209  210  .5  609  634  4.1 
Other income excl. realized foreign
     exchange gains (losses) 22  102  121  161  128  33  15  102  46 
     Total adjusted revenues 6,550  6,565  6,489  6,486  6,623  1,661  1,684  1.4  4,983  5,068  1.7 
Benefits and claims:
Benefits and claims, net
  Incurred claims -direct 2,611  2,498  2,183  2,245  2,423  602  744  1,796  2,164 
  Incurred claims -assumed (ceded) (5) (1) 89  104  17  (17) 20  (42)
  Increase in FPB -direct 268  271  463  326  280  74  (18) 234 
  Increase in FPB -assumed (ceded) (2) (3) (11) (5) (1) (3)
Total benefits and claims, net, excluding
  reserve remeasurement
N/A N/A 2,724  2,679  2,715  682  711  2,048  2,130 
 Reserve remeasurement (gain) loss N/A N/A (85) (124) (283) (172) (17) (242) (71)
        Total benefits and claims, net 2,871  2,765  2,639  2,555  2,431  510  694  36.1  1,805  2,059  14.1 
Adjusted expenses:
Amortization of deferred policy
     acquisition costs 573  570  442  455  490  122  132  8.2  361  396  9.7 
Insurance commissions 590  576  550  553  561  138  141  2.2  420  422  .5 
Insurance and other expenses 1,244  1,386  1,502  1,564  1,640  414  367  (11.4) 1,198  1,102  (8.0)
Total adjusted expenses 2,407  2,532  2,494  2,573  2,691  674  640  1,979  1,920 
     Total benefits and adjusted expenses 5,279  5,297  5,132  5,127  5,122  1,183  1,334  12.8  3,784  3,979  5.2 
     Pretax adjusted earnings $ 1,272  $ 1,268  $ 1,356  $ 1,359  $ 1,501  $ 478  $ 350  (26.8) $ 1,199  $ 1,089  (9.2)
l
16


Aflac U.S.
Balance Sheets
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Assets:
Investments and cash $ 16,141  $ 17,949  $ 18,324  $ 15,987  $ 16,718  $ 15,641  $ 17,336 
Receivables, net of allowance for credit losses (1)
650  667  574  584  688  681  728 
Accrued investment income 174  172  169  184  183  181  180 
Deferred policy acquisition costs 3,544  3,450  3,366  3,463  3,573  3,530  3,616 
Other assets (1)
436  626  758  784  698  718  641 
Total assets $ 20,945  $ 22,864  $ 23,191  $ 21,002  $ 21,861  $ 20,751  $ 22,501 
Liabilities and Shareholders' Equity:
Future policy benefits $ 9,404  $ 9,674  $ 14,212  $ 10,870  $ 11,234  $ 10,319  $ 11,266 
Policy and contract claims 1,779  2,010  151  200  258  246  376 
Other policy liabilities 111  126  119  117  107  111  106 
Deferred income taxes 51  235  (328) (243) (311) (226) (342)
Other liabilities 1,803  2,016  2,010  2,080  2,062  1,845  2,030 
Shareholders' equity 7,796  8,803  7,027  7,978  8,510  8,457  9,065 
Total liabilities & shareholders' equity $ 20,945  $ 22,864  $ 23,191  $ 21,002  $ 21,861  $ 20,751  $ 22,501 
(1) Certain reclassifications have been made to prior-year amounts to conform to current-year reporting classifications. These reclassifications had no impact on net earnings or total shareholders' equity.

17


Aflac U.S.
Quarterly Statements of Pretax Adjusted Earnings and Percentage Changes
(Restated to conform to current classifications)
(Dollars In Millions)
Net Total Benefits Total Pretax
Earned % Adjusted % Adjusted % & % % Adjusted % Adjusted %
Period Premiums Change NII Change Revenues Change Claims, Net Change Amort. Change Expenses Change Earn. Change
2019 5,808  1.8  720  (1.0) 6,550  1.7  2,871  (.6) 573  7.3  2,407  6.0  1,272  (1.0)
2020 5,758  (.9) 705  (2.1) 6,565  .2  2,765  (3.7) 570  (.5) 2,532  5.2  1,268  (.3)
2021 5,614  (2.5) 754  7.0  6,489  (1.2) 2,639  (4.6) 442  (22.5) 2,494  (1.5) 1,356  6.9 
2022 5,570  (.8) 755  .1  6,486  —  2,555  (3.2) 455  2.9  2,573  3.2  1,359  .2 
2023 5,675  1.9  820  8.6  6,623  2.1  2,431  (4.9) 490  7.7  2,691  4.6  1,501  10.4 
2022 1 1,413  (.6) 184  4.5  1,639  .7  666  (4.3) 114  2.7  640  6.7  333  .6 
2 1,394  (1.0) 193  2.1  1,628  .1  658  (4.6) 113  1.8  627  4.7  343  1.5 
3 1,375  (1.3) 185  (3.1) 1,598  (1.1) 616  4.1  114  3.6  638  3.2  345  (14.8)
4 1,388  (.2) 192  (2.5) 1,621  .1  614  (7.0) 115  4.5  667  (1.3) 339  20.2 
2023 1 1,428  1.1  197  7.1  1,660  1.3  651  (2.3) 119  4.4  657  2.7  352  5.7 
2 1,425  2.2  203  5.2  1,663  2.1  645  (2.0) 120  6.2  648  3.3  369  7.6 
3 1,419  3.2  209  13.0  1,661  3.9  510  (17.2) 122  7.0  674  5.6  478  38.6 
4 1,403  1.1  211  9.9  1,639  1.1  626  2.0  129  12.2  712  6.7  302  (10.9)
2024 1 1,475  3.3  206  4.6  1,699  2.3  686  5.4  132  10.9  658  .2  356  1.1 
2 1,455  2.1  218  7.4  1,684  1.3  680  5.4  132  10.0  621  (4.2) 383  3.8 
3 1,459  2.8  210  .5  1,684  1.4  694  36.1  132  8.2  640  (5.0) 350  (26.8)














18


Aflac U.S.
Operating Ratios
(Before Management Fee)
12-Mo. Rolling Total Adjusted Combined Pretax
Premium Tot. Ben./ Amort./ Expenses/ Ratio/ Profit
 Period
Persistency (1)
Premium Premium Total Adj. Rev. Total Adj. Rev. Margin
2019 77.7  49.4  9.9  36.7  80.6  19.4 
2020 79.3  48.0  9.9  38.6  80.7  19.3 
2021 79.7  47.0  7.9  38.4  79.1  20.9 
2022 77.3  45.9  8.2  39.7  79.0  21.0 
2023 78.6  42.8  8.6  40.6  77.3  22.7 
2024 YTD 78.9  46.9  9.0  37.9  78.5  21.5 
2022 1 78.7  47.1  8.1  39.0  79.7  20.3 
2 78.1  47.2  8.1  38.5  78.9  21.1 
3 77.9  44.8  8.3  39.9  78.4  21.6 
4 77.3  44.2  8.3  41.1  79.1  20.9 
2023 1 77.9  45.6  8.3  39.6  78.8  21.2 
2 78.2  45.3  8.4  39.0  77.8  22.2 
3 78.7  35.9  8.6  40.6  71.2  28.8 
4 78.6  44.6  9.2  43.4  81.6  18.4 
2024 1 78.7  46.5  8.9  38.7  79.0  21.0 
2 78.7  46.7  9.1  36.9  77.3  22.7 
3 78.9  47.6  9.0  38.0  79.2  20.8 
(1) Includes Network Dental & Vision, Consumer Markets, and Group Premier Life, Absence Management, and Disability Solutions products
   beginning in the first quarter of 2021











19


Aflac U.S.
Aflac U.S. Sales Results
(Dollars In Millions)
Annl. New Annl.
Prem. % Prem. %
Period In Force Change Sales Change
2019 6,301  1.1  1,580  (1.3)
2020 6,099  (3.2) 1,093  (30.8)
2021 6,003  (1.6) 1,278  16.9 
2022 5,967  (.6) 1,483  16.1 
2023 6,161  3.3  1,558  5.0 
2022 1 5,942  (1.4) 299  19.0 
2 5,926  (1.0) 305  15.6 
3 5,889  (.7) 334  11.8 
4 5,967  (.6) 545  17.4 
2023 1 6,023  1.4  315  5.3 
2 6,064  2.3  324  6.4 
3 6,062  2.9  359  7.5 
4 6,161  3.3  559  2.6 
2024 1 6,211  3.1  298  (5.2)
2 6,239  2.9  331  2.0 
3 6,265  3.3  379  5.5 




20


Aflac U.S.
Aflac U.S. Product Mix
(New Annualized Premium Sales, Dollars in Millions)
% of % of % of Critical % of Hospital % of Dental/ % of
Period Disability Total Life  Total Accident  Total
Care(1)
Total Indemnity Total Vision Total Total
2019 355  22.5  97  6.1  450  28.5  346  21.9  263  16.6  69  4.4  1,580
2020 243  22.3  80  7.3  285  26.1  242  22.2  197  18.0  45  4.1  1,093
2021 296  23.1  114  9.0  321  25.1  273  21.3  209  16.4  65  5.1  1,278
2022 378  25.5  156  10.5  338  22.8  299  20.1  226  15.3  85  5.8  1,483
2023 399  25.6  188  12.0  326  20.9  322  20.7  225  14.5  98  6.3  1,558
2022 1 70  23.3  24  7.9  75  25.3  63  21.2  50  16.7  17  5.6  299
2 77  25.2  26  8.3  75  24.6  63  20.6  45  14.9  19  6.4  305
3 97  28.9  33  10.0  76  22.6  60  18.1  47  14.1  21  6.3  334
4 135  24.9  73  13.4  112  20.5  112  20.6  84  15.4  28  5.2  545
2023 1 79  25.2  26  8.3  74  23.5  64  20.5  50  15.9  21  6.6  315
2 80  24.8  35  10.7  73  22.4  66  20.4  46  14.3  24  7.4  324
3 101  28.2  54  15.0  72  19.9  67  18.6  45  12.6  20  5.7  359
4 139  24.8  73  13.0  107  19.2  124  22.2  83  14.9  33  5.9  559
2024 1 69  23.0  32  10.8  67  22.5  66  22.1  45  15.1  19  6.5  298
2 85  25.7  41  12.4  70  21.2  70  21.1  45  13.7  19  5.9  331 
3 109  28.8  69  18.3  67  17.7  71  18.6  45  11.9  18  4.7  379 
Aflac U.S. Sales Force Data
 Average Productivity
Weekly (Production/
Recruited Agents Producer Avg. Weekly
Period Career Broker Total Equivalents Producers)
2019 15,227  3,603  18,830  8,184  193,120 
2020 11,826  1,861  13,687  5,918  184,706 
2021 10,641  5,445  16,086  5,993  213,235 
2022 9,550  1,500  11,050  6,186  239,786 
2023 10,103  1,463  11,566  6,239  249,663 
2022 1 1,987  455  2,442  6,061  49,322 
2 2,937  391  3,328  6,067  50,264 
3 2,358  339  2,697  6,010  55,599 
4 2,268  315  2,583  6,607  82,538 
2023 1 2,676  348  3,024  6,108  51,525 
2 2,801  399  3,200  6,196  52,361 
3 2,407  431  2,838  6,044  59,425 
4 2,219  285  2,504  6,608  84,645 
2024 1 2,330  346  2,676  5,800  51,432 
2 3,113  422  3,535  6,098  54,262 
3 2,553  335  2,888  5,890  64,336 

(1) Includes cancer, critical illness, and hospital intensive care products
21


Aflac Japan
Statements of Pretax Adjusted Earnings
(Before Management Fee)
(In Millions)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Revenues:
Net earned premiums
  Gross premiums ¥ 1,450,586  ¥ 1,409,134  ¥ 1,290,527  ¥ 1,246,657  ¥ 1,212,654  ¥ 304,456  ¥ 280,795  ¥ 913,996  ¥ 869,962 
  Assumed (ceded) (57,974) (55,926) (50,864) (48,578) (84,838) (19,151) (25,398) (58,265) (77,387)
    Total net earned premiums 1,392,612  1,353,208  1,239,663  1,198,079  1,127,816  285,305  255,397  (10.5) 855,731  792,575  (7.4)
Net investment income (1)
   Yen denominated 142,473  138,397  138,513  149,449  138,073  35,175  32,110  (8.7) 104,158  101,787  (2.3)
   US$ denominated 157,717  167,541  202,905  215,171  247,277  67,001  67,816  1.2  182,941  209,442  14.5 
Net investment income 300,191  305,938  341,419  364,621  385,352  102,176  99,953  (2.2) 287,100  311,258  8.4 
Amortized hedge costs on foreign investments (2)
(28,938) (22,816) (8,391) (13,155) (19,773) (3,310) (984) (70.3) (19,340) (2,751) (85.8)
Adjusted net investment income 271,253  283,122  333,028  351,466  365,579  98,866  98,969  .1  267,760  308,507  15.2 
Other income excl. realized foreign
currency gains (losses) 4,869  4,497  4,512  4,442  4,720  1,192  966  3,561  3,024 
     Total adjusted revenues 1,668,734  1,640,827  1,577,203  1,553,988  1,498,115  385,363  355,332  (7.8) 1,127,052  1,104,106  (2.0)
Benefits and claims:
Benefits and claims, net
  Incurred claims -direct 727,491  734,471  743,247  788,572  781,774  184,015  196,886  584,820  617,063 
  Incurred claims -assumed (ceded) (45,657) (37,806) (31,798) (36,141) (70,748) (14,754) (18,570) (47,148) (56,754)
  Increase in FPB -direct 292,444  260,200  149,084  73,592  44,121  22,311  (2,445) 36,954  (22,084)
  Increase in FPB -assumed (ceded) (6,497) (11,377) (11,425) (5,618) 2,226  (690) 3,389  (681) 8,573 
   Total benefits and claims, net, excluding reserve
      remeasurement
N/A N/A 849,108  820,405  757,373  190,881  179,260  573,945  546,798 
   Reserve remeasurement (gain) loss N/A N/A (6,879) (13,337) (13,072) (5,027) (53,712) (9,510) (61,474)
            Total benefits and claims, net 967,782  945,487  842,229  807,068  744,301  185,855  125,548  (32.4) 564,435  485,325  (14.0)
Adjusted expenses:
Amortization of deferred policy
    acquisition costs 77,286  68,818  43,131  44,123  45,840  11,435  12,257  7.2  34,074  36,541  7.2 
Insurance commissions 79,661  79,036  77,449  73,482  68,751  16,113  16,372  1.6  51,934  49,784  (4.1)
Insurance and other expenses 189,203  199,606  202,586  198,493  182,364  45,521  42,410  (6.8) 132,493  118,626  (10.5)
Total adjusted expenses 346,150  347,460  323,166  316,097  296,955  73,068  71,039  218,501  204,950 
      Total benefits and adjusted expenses 1,313,932  1,292,947  1,165,395  1,123,165  1,041,256  258,923  196,587  (24.1) 782,935  690,274  (11.8)
Pretax adjusted earnings ¥ 354,802  ¥ 347,881  ¥ 411,808  ¥ 430,823  ¥ 456,859  ¥ 126,440  ¥ 158,745  25.5  ¥ 344,117  ¥ 413,832  20.3 
(1) Includes the net interest cash flows from derivatives associated with certain investment strategies
(2) See non-U.S. GAAP financial measures for the definition of amortized hedge costs/income
22


Aflac Japan
Statements of Pretax Adjusted Earnings
(Before Management Fee)
(In Millions)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Revenues:
Net earned premiums
  Gross premiums $ 13,304  $ 13,193  $ 11,765  $ 9,558  $ 8,649  $ 2,105  $ 1,880  $ 6,629  $ 5,753 
  Assumed (ceded) (532) (524) (463) (372) (602) (132) (171) (422) (512)
    Total net earned premiums 12,772  12,670  11,301  9,186  8,047  1,973  1,709  (13.4) 6,207  5,241  (15.6)
Net investment income (1)
   Yen denominated 1,307  1,296  1,262  1,140  985  243  215  (11.5) 755  673  (10.9)
   US$ denominated 1,446  1,569  1,845  1,641  1,755  462  453  (1.9) 1,320  1,382  4.7 
      Net investment income 2,753  2,865  3,107  2,782  2,739  705  668  (5.2) 2,075  2,055  (1.0)
Amortized hedge costs on foreign investments (2)
(257) (206) (76) (112) (157) (26) (7) (73.1) (148) (19) (87.2)
Adjusted net investment income 2,496  2,659  3,031  2,669  2,582  679  662  (2.5) 1,927  2,036  5.7 
Other income excl. realized foreign
currency gains (losses) 45  42  41  35  35  26  20 
     Total adjusted revenues 15,313  15,371  14,373  11,890  10,664  2,660  2,378  (10.6) 8,160  7,297  (10.6)
Benefits and claims
Benefits and claims, net
  Incurred claims -direct 6,671  6,875  6,776  6,038  5,582  1,273  1,319  4,250  4,085 
  Incurred claims -assumed (ceded) (419) (354) (290) (275) (502) (102) (124) (342) (376)
  Increase in FPB -direct 2,684  2,437  1,356  562  314  157  (22) 265  (153)
  Increase in FPB -assumed (ceded) (60) (107) (104) (43) 15  (9) 24  (9) 58 
Total benefits and claims, net, excluding reserve
      remeasurement
N/A N/A 7,738  6,282  5,409  1,319  1,197  4,164  3,614 
Reserve remeasurement (gain) loss N/A N/A (62) (91) (96) (33) (369) (68) (421)
Total benefits and claims, net 8,877  8,851  7,675  6,191  5,313  1,286  828  (35.6) 4,097  3,193  (22.1)
Adjusted expenses:
Amortization of deferred policy
    acquisition costs 709  644  393  338  326  79  82  3.8  247  242  (2.0)
Insurance commissions 731  740  706  563  491  112  110  (1.8) 377  330  (12.5)
Insurance and other expenses 1,734  1,873  1,843  1,517  1,299  315  285  (9.5) 960  785  (18.2)
Total adjusted expenses 3,174  3,257  2,942  2,417  2,117  506  477  1,585  1,357 
     Total benefits and adjusted expenses 12,051  12,108  10,618  8,609  7,430  1,791  1,305  (27.1) 5,682  4,550  (19.9)
     Pretax adjusted earnings $ 3,261  $ 3,263  $ 3,756  $ 3,281  $ 3,234  $ 869  $ 1,073  23.5  $ 2,479  $ 2,747  10.8 
(1) Includes the net interest cash flows from derivatives associated with certain investment strategies
(2) See non-U.S. GAAP financial measures for definition of amortized hedge costs/income
23


Aflac Japan    

        
Balance Sheets
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Assets:
Investments and cash ¥ 12,847,994  ¥ 13,080,154  ¥ 13,645,902  ¥ 12,777,746  ¥ 12,566,939  ¥ 13,282,202  ¥ 12,658,627 
Receivables, net of allowance for credit losses 28,219  20,782  22,439  23,138  24,848  21,270  25,916 
Accrued investment income 65,485  62,722  67,493  76,489  74,666  73,446  69,705 
Deferred policy acquisition costs 721,341  723,579  745,510  766,506  788,394  783,890  801,575 
Other assets 308,411  320,351  386,832  387,065  946,644  708,507  878,775 
   Total assets ¥ 13,971,450  ¥ 14,207,588  ¥ 14,868,176  ¥ 14,030,944  ¥ 14,401,491  ¥ 14,869,316  ¥ 14,434,598 
Liabilities and Shareholders' Equity:
Future policy benefits ¥ 8,924,868  ¥ 9,175,501  ¥ 11,755,704  ¥ 10,315,140  ¥ 10,444,044  ¥ 10,264,585  ¥ 9,921,238 
Policy and contract claims 315,477  328,778  —  28  465  433  679 
Unearned premiums 453,133  361,010  284,045  227,732  192,595  200,677  187,927 
Other policyholders' funds 801,588  808,429  877,690  880,989  874,854  879,922  869,954 
Income taxes (prim. deferred) 618,901  478,969  36,166  114,688  95,297  136,978  149,851 
Other liabilities 357,135  253,219  502,633  575,554  576,879  1,010,041  785,070 
Shareholders' equity 2,500,349  2,801,682  1,411,938  1,916,812  2,217,357  2,376,680  2,519,880 
   Total liabilities & shareholders' equity ¥ 13,971,450  ¥ 14,207,588  ¥ 14,868,176  ¥ 14,030,944  ¥ 14,401,491  ¥ 14,869,316  ¥ 14,434,598 

24


Aflac Japan

        
        
Balance Sheets
(In Millions)
December 31, September 30,
2019 2020 2021 2022 2023 2023 2024
Assets:
Investments and cash $ 117,269  $ 126,378  $ 118,639  $ 96,290  $ 88,606  $ 88,797  $ 88,689 
Receivables, net of allowance for credit losses 258  201  195  174  175  142  182 
Accrued investment income 598  606  587  576  526  491  488 
Deferred policy acquisition costs 6,584  6,991  6,482  5,776  5,559  5,241  5,616 
Other assets 2,815  3,095  3,363  2,917  6,675  4,737  6,157 
   Total assets $ 127,523  $ 137,271  $ 129,266  $ 105,734  $ 101,541  $ 99,407  $ 101,132 
Liabilities and Shareholders' Equity:
Future policy benefits $ 81,461  $ 88,652  $ 102,206  $ 77,733  $ 73,638  $ 68,623  $ 69,511 
Policy and contract claims 2,879  3,177  —  — 
Unearned premiums 4,136  3,488  2,470  1,716  1,358  1,341  1,317 
Other policyholders' funds 7,316  7,811  7,631  6,639  6,169  5,883  6,095 
Income taxes (prim. deferred) 5,650  4,630  314  781  619  876  1,009 
Other liabilities 3,260  2,447  4,369  4,337  4,067  6,753  5,500 
Shareholders' equity 22,820  27,068  12,276  14,528  15,687  15,929  17,696 
   Total liabilities & shareholders' equity $ 127,523  $ 137,271  $ 129,266  $ 105,734  $ 101,541  $ 99,407  $ 101,132 

25


Aflac Japan
Quarterly Statements of Pretax Adjusted Earnings and Percentage Changes
(Yen In Millions)
Net Total Benefits Total Pretax
Earned % Adjusted % Adjusted % & % % Adjusted % Adjusted %
Period Premiums Change NII Change Revenues Change Claims, Net Change Amort. Change Expense Change Earn. Change
2019 1,392,612  (1.1) 271,253  2.2  1,668,734  (.6) 967,782  (1.6) 77,286  (1.5) 346,150  1.6  354,802  .2 
2020 1,353,208  (2.8) 283,122  4.4  1,640,827  (1.7) 945,487  (2.3) 68,818  (11.0) 347,459  .4  347,881  (2.0)
2021 1,239,663  (8.4) 333,028  17.6  1,577,203  (3.9) 842,229  (10.9) 43,131  (37.3) 323,166  (7.0) 411,808  18.4 
2022 1,198,079  (3.4) 351,466  5.5  1,553,988  (1.5) 807,068  (4.2) 44,123  2.3  316,097  (2.2) 430,823  4.6 
2023 1,127,816  (5.9) 365,579  4.0  1,498,115  (3.6) 744,301  (7.8) 45,840  3.9  296,955  (6.1) 456,859  6.0 
2022 1 304,884  (2.8) 79,042  5.9  385,000  (1.2) 206,890  (4.0) 10,886  3.3  77,095  (.8) 101,015  4.7 
2 302,213  (3.1) 94,004  8.4  397,358  (.5) 204,807  (3.7) 10,964  2.5  79,022  (.3) 113,529  5.5 
3 293,667  (4.5) 92,241  9.8  387,113  (1.4) 196,121  (4.8) 11,073  2.9  77,498  (4.0) 113,494  7.4 
4 297,315  (3.1) 86,180  (1.7) 384,517  (2.8) 199,250  (4.3) 11,201  .6  82,482  (3.5) 102,785  .8 
2023 1 287,048  (5.9) 80,931  2.4  369,145  (4.1) 192,270  (7.1) 11,281  3.6  72,625  (5.8) 104,251  3.2 
2 283,377  (6.2) 87,963  (6.4) 372,544  (6.2) 186,310  (9.0) 11,359  3.6  72,808  (7.9) 113,426  (.1)
3 285,305  (2.8) 98,866  7.2  385,363  (.5) 185,855  (5.2) 11,435  3.3  73,068  (5.7) 126,440  11.4 
4 272,085  (8.5) 97,819  13.5  371,063  (3.5) 179,866  (9.7) 11,766  5.0  78,454  (4.9) 112,742  9.7 
2024 1 269,859  (6.0) 96,551  19.3  367,593  (.4) 180,873  (5.9) 12,289  8.9  66,157  (8.9) 120,564  15.6 
2 267,319  (5.7) 112,987  28.4  381,181  2.3  178,904  (4.0) 11,995  5.6  67,754  (6.9) 134,523  18.6 
3 255,397  (10.5) 98,969  .1  355,332  (7.8) 125,548  (32.4) 12,257  7.2  71,039  (2.8) 158,745  25.5 




















26


Aflac Japan
Operating Ratios
(Before Management Fee)
12-Mo. Rolling Tot. Ben./ Tot. Adj. Combined Pretax
Premium Tot. Ben./ Premiums Amort./ Expenses/ Ratio/ Profit
 Period
Persistency(1)
Premium (3rd sector) Premium Total Adj. Rev. Total Adj. Rev. Margin
2019 94.4 69.5 59.3 5.5 20.7 78.7 21.3
2020 95.1 69.9 59.7 5.1 21.2 78.8 21.2
2021 94.3 67.9 58.7 3.5 20.5 73.9 26.1
2022 94.1 67.4 58.5 3.7 20.3 72.3 27.7
2023 93.4 66.0 56.2 4.1 19.8 69.5 30.5
2024 93.3 61.2 52.4 4.6 18.6 62.5 37.5
2022 1 94.3 67.9 58.5 3.6 20.0 73.8 26.2
2 94.3 67.8 58.5 3.6 19.9 71.4 28.6
3 94.3 66.8 59.4 3.8 20.0 70.7 29.3
4 94.1 67.0 57.7 3.8 21.5 73.3 26.7
2023 1 93.9 67.0 57.7 3.9 19.7 71.8 28.2
2 93.8 65.7 56.2 4.0 19.5 69.6 30.4
3 93.5 65.1 54.8 4.0 19.0 67.2 32.8
4 93.4 66.1 56.2 4.3 21.1 69.6 30.4
2024 1 93.4 67.0 57.5 4.6 18.0 67.2 32.8
2 93.3 66.9 57.8 4.5 17.8 64.7 35.3
3 93.3 49.2 41.8 4.8 20.0 55.3 44.7















(1) Premium persistency presented on a 12-month rolling basis for all periods, rather than year to date

27


Aflac Japan

Aflac Japan Sales Results
(Yen In Millions, unless otherwise noted)
Annl. Third Sector
Prem. New Annl. Total
In Force % Prem. % New Annual. %
Period (Billions) Change Sales Change Premium Sales Change
2019 1,489.3  (2.5) 72,836  (18.0) 79,697  (16.9)
2020 1,426.5  (4.2) 45,110  (38.1) 50,852  (36.2)
2021 1,360.6  (4.7) 48,977  8.6  54,764  7.7 
2022 1,301.0  (4.4) 47,998  (2.0) 54,765  — 
2023 1,246.4  (4.2) 52,234  8.8  60,730  10.9 
2022 1 1,345.6  (4.6) 10,679  (19.0) 11,925  (14.8)
2 1,332.0  (4.3) 11,372  (6.2) 12,731  (6.4)
3 1,315.7  (4.3) 12,639  12.1  13,884  10.2 
4 1,301.0  (4.4) 13,308  1.7  16,224  11.4 
2023 1 1,281.4  (4.8) 10,952  2.6  13,213  10.8 
2 1,268.4  (4.8) 13,964  22.8  16,112  26.6 
3 1,257.4  (4.4) 13,606  7.7  15,600  12.4 
4 1,246.4  (4.2) 13,711  3.0  15,805  (2.6)
2024 1 1,232.6  (3.8) 10,767  (1.7) 12,534  (5.1)
2 1,222.5  (3.6) 12,712  (9.0) 16,833  4.5 
3 1,216.7  (3.2) 11,925  (12.4) 17,522  12.3 

28


Aflac Japan
Aflac Japan Product Mix
(New Annualized Premium Sales, Yen In Billions)
% of % of Income    % of Child    % of % of Ordinary % of % of
Period Cancer Total Medical Total Support Total Endowment Total WAYS Total Life Other Total Other Total Total
2019 47.2  59.2  24.6  31.0  1.0  1.2  .2  .2  .4  .5  5.9  7.4  .4  .5  79.7 
2020 28.8  56.6  15.9  31.2  .5  1.0  .2  .4  .4  .7  4.8  9.5  .3  .6  50.9 
2021 27.0  49.2  20.4  37.2  .3  .5  .2  .3  .4  .8  4.9  9.0  1.6  3.0  54.8 
2022 30.9  56.5  14.6  26.6  .7  1.3  .2  .3  1.9  3.5  4.5  8.1  2.0  3.7  54.8 
2023 38.9  64.1  12.3  20.2  .3  .4  .2  .4  4.1  6.8  3.9  6.5  1.0  1.6  60.7 
2022 1 6.4  53.0  3.8  31.4  .1  1.1  .1  .3  .1  .7  1.1  9.0  .5  4.5  11.9 
2 6.8  53.4  3.8  29.9  .3  2.2  —  .2  .1  .8  1.2  9.2  .6  4.3  12.7 
3 8.4  60.1  3.7  26.4  .2  1.2  —  .2  .1  .6  1.0  7.7  .5  3.8  13.9 
4 9.5  58.2  3.4  20.8  .1  .8  .1  .4  1.6  10.1  1.1  7.2  .4  2.5  16.2 
2023 1 7.9  59.9  2.7  20.8  .1  .6  .1  .6  1.2  8.9  1.0  7.3  .2  1.9  13.2 
2 10.9  67.7  2.8  17.5  .1  .4  .1  .4  1.0  6.6  1.0  6.1  .2  1.3  16.1 
3 10.3  65.6  3.1  20.0  .1  .4  .1  .4  .9  6.0  .9  6.1  .2  1.5  15.6 
4 9.9  62.5  3.6  22.8  .1  .4  —  .3  .9  6.0  1.1  6.6  .2  1.4  15.8 
2024 1 7.9  63.2  2.7  21.1  —  .3  —  .3  .7  5.3  1.0  8.1  .2  1.7  12.5 
2 9.9  58.8  2.7  15.8  —  .2  —  .2  .4  2.3  3.7  21.8  .1  .9  16.8 
3 9.7  55.1  2.2  12.2  —  .2  —  .1  .1  .8  5.4  30.8  .1  .8  17.5 


















29



Aflac Japan

Aflac Japan Sales Force Data
Number of Agencies by Type Sales Contribution by Agency Type
Period  Individual/ Independent Corporate Affiliated
Corporate
Bank Total  Individual/ Independent Corporate Affiliated
Corporate
Bank
Licensed Sales
Associates(1)
Recruited
Agencies
2019 7,683  1,343  367  9,393  45.7  50.0  4.3  109,265  77 
2020 7,231  1,312  361  8,904  52.3  42.6  5.1  111,886  48 
2021 6,779  1,283  360  8,422  51.1  43.7  5.2  111,854  62 
2022 6,159  1,239  359  7,757  49.5  46.5  4.0  110,259  38 
2023 5,751  1,203  360  7,314  46.7  50.0  3.3  113,010  24 
2022 1 6,447  1,266  360  8,073  48.9  46.5  4.6  109,873 
2 6,335  1,255  359  7,949  48.4  48.1  3.5  110,096  12 
3 6,260  1,246  359  7,865  49.3  46.2  4.5  110,400  12 
4 6,159  1,239  359  7,757  51.2  45.4  3.4  110,259 
2023 1 6,056  1,232  359  7,647  50.9  45.4  3.7  109,769 
2 5,947  1,219  360  7,526  44.8  52.5  2.7  112,593 
3 5,843  1,211  360  7,414  44.4  51.9  3.7  112,795 
4 5,751  1,203  360  7,314  47.7  49.2  3.1  113,010 
2024 1 5,659  1,191  360  7,210  48.9  48.0  3.1  112,645  12 
2 5,542  1,180  360  7,082  49.5  48.4  2.1  114,424  12 
3 5,464  1,176  360  7,000  46.2  50.2  3.6  114,473  19 















(1) Excludes Dai-ichi Life, banks, Japan Post Group and Daido Life
30



Aflac Japan
Yen/Dollar Exchange Rates
Yearly
Closing Qtr Cum %
Period
Rate(1)
Avg Avg Change
2019 109.56  N/A 109.07  1.2 
2020 103.50  N/A 106.86  2.1 
2021 115.02  N/A 109.79  (2.7)
2022 132.70  N/A 130.17  (15.7)
2023 141.83  N/A 140.57  (7.4)
2022 1 122.39  116.18  116.18  (8.9)
2 136.68  129.39  122.79  (12.2)
3 144.81  137.08  126.65  (14.3)
4 132.70  141.87  130.17  (15.7)
2023 1 133.53  132.30  132.30  (12.2)
2 144.99  137.53  134.97  (9.0)
3 149.58  144.97  138.38  (8.5)
4 141.83  148.11  140.57  (7.4)
2024 1 151.41  148.67  148.67  (11.0)
2 161.07  155.70  152.30  (11.4)
3 142.73  147.95  150.60  (8.1)
(1) Closing rate is based on the latest available and published MUFG Bank
    Ltd. TTM mid-day exchange rate.
31


Corporate and Other

Statements of Pretax Adjusted Earnings
(Before Management Fee)
(In Millions)
Years Ended December 31, 3 Months Ended September 30, 9 Months Ended September 30,
% %
2019 2020 2021 2022 2023 2023 2024 Change 2023 2024 Change
Revenues:
Total net earned premiums $ 200  $ 194  $ 180  $ 145  $ 400  $ 83  $ 160  92.8  $ 258  $ 479  85.7 
Net investment income (1)
88  80  (73) 30  (77) 39  1,850.0  24  146  508.3 
    Amortized hedge income (2)
89  97  57  68  121  25  25  —  92  87  (5.4)
Adjusted net investment income 177  177  (16) 98  44  27  64  137.0  116  233  100.9 
Other income 15  13  11  24  15  (75.0) 11  22.2 
     Total adjusted revenues 393  384  175  267  460  115  225  95.7  384  723  88.3 
Benefits and expenses:
Total net benefits and claims 194  180  161  141  467  65  74  13.8  206  275  33.5 
Interest expense 133  164  165  162  144  39  39  —  109  113  3.7 
Other adjusted expenses 137  155  142  181  273  59  97  64.4  176  299  69.9 
     Total benefits and adjusted expenses 464  499  469  485  885  163  210  28.8  490  687  40.2 
     Pretax adjusted earnings $ (72) $ (115) $ (293) $ (218) $ (425) $ (49) $ 15  130.6  $ (107) $ 36  133.6 
(1)
The change in value of federal historic rehabilitation and solar investments in partnerships of $57 and $64 for the three-month periods and $119 and $169 for the nine-month periods ended September 30, 2024, and 2023, respectively, is included as a reduction to net investment income. Tax credits on these investments of $78 and $63 for the three-month periods and $142 and $171 for the nine-month periods ended September 30, 2024, and 2023, respectively, have been recorded as an income tax benefit in the consolidated statement of earnings.
(2)
See non-U.S. GAAP financial measures for the definition of amortized hedge cost/income


32


Non-U.S. GAAP Financial Measures

This document includes references to the Company’s financial performance measures which are not calculated in accordance with United States generally accepted accounting principles (U.S. GAAP) (non-U.S. GAAP). The financial measures exclude items that the Company believes may obscure the underlying fundamentals and trends in insurance operations because they tend to be driven by general economic conditions and events or related to infrequent activities not directly associated with insurance operations.

Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results. In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported. When the yen strengthens, translating yen into dollars results in more dollars being reported. Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior period. A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S. GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S. GAAP basis. Management evaluates the Company's financial performance both including and excluding the impact of foreign currency translation to monitor, respectively, cumulative currency impacts and the currency-neutral operating performance over time. The average yen/dollar exchange rate is based on the published MUFG Bank, Ltd. telegraphic transfer middle rate (TTM).

The Company defines the non-U.S. GAAP financial measures included in this document as follows:

Adjusted book value is the U.S. GAAP book value (representing total shareholders’ equity), less AOCI as recorded on the U.S. GAAP balance sheet. Adjusted book value per common share is adjusted book value at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value and adjusted book value per common share important as they exclude AOCI, which fluctuates due to market movements that are outside management’s control. The most comparable U.S. GAAP financial measures for adjusted book value and adjusted book value per common share are total book value and total book value per common share, respectively.
Adjusted book value including unrealized foreign currency translation gains and losses is adjusted book value plus unrealized foreign currency translation gains and losses. Adjusted book value including unrealized foreign currency translation gains and losses per common share is adjusted book value plus unrealized foreign currency translation gains and losses at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value including unrealized foreign currency translation gains and losses, and its related per share financial measure, important as they exclude certain components of AOCI, which fluctuate due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measures for adjusted book value including unrealized foreign currency translation gains and losses and adjusted book value including unrealized foreign currency translation gains and losses per common share are total book value and total book value per common share, respectively.
Adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment is adjusted book value plus unrealized foreign currency translation gains and losses and pension liability adjustment. The Company considers adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment important as it excludes certain components of AOCI, which fluctuates due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measure for adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment is total book value.

Adjusted debt is the sum of notes payable, as recorded on the U.S. GAAP balance sheet, excluding 50% of subordinated debentures and perpetual bonds and all pre-funding of debt maturities. The Company considers adjusted debt important as it measures outstanding debt consistently with expectations of the Company’s rating agency stakeholders. The most comparable U.S. GAAP financial measure for adjusted debt is notes payable.
Adjusted debt including 50% of subordinated debentures and perpetual bonds is the sum of notes payable, as recorded on the U.S. GAAP balance sheet, excluding pre-funding of debt maturities. The Company considers adjusted debt including 50% of subordinated debentures and perpetual bonds important as it measures outstanding debt consistently with expectations of the Company’s rating agency stakeholders. The most comparable U.S. GAAP financial measure for adjusted debt including 50% of subordinated debentures and perpetual bonds is notes payable.
33


Adjusted earnings are adjusted revenues less benefits and adjusted expenses. Adjusted earnings per share (basic or diluted) are the adjusted earnings for the period divided by the weighted average outstanding shares (basic or diluted) for the period presented. The adjustments to both revenues and expenses account for certain items that are outside of management’s control because they tend to be driven by general economic conditions and events or are related to infrequent activities not directly associated with insurance operations. Adjusted revenues are U.S. GAAP total revenues excluding adjusted net investment gains and losses. Adjusted expenses are U.S. GAAP total acquisition and operating expenses including the impact of interest from derivatives associated with notes payable but excluding any non-recurring or other items not associated with the normal course of the Company’s insurance operations and that do not reflect the Company's underlying business performance. Management uses adjusted earnings and adjusted earnings per diluted share to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of these financial measures is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The most comparable U.S. GAAP financial measures for adjusted earnings and adjusted earnings per share (basic or diluted) are net earnings and net earnings per share, respectively.
Adjusted earnings excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. Adjusted earnings per diluted share excluding current period foreign currency impact is adjusted earnings excluding current period foreign currency impact divided by the weighted average outstanding diluted shares for the period presented. The Company considers adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact important because a significant portion of the Company's business is conducted in Japan and foreign exchange rates are outside management’s control; therefore, the Company believes it is important to understand the impact of translating foreign currency (primarily Japanese yen) into U.S. dollars. The most comparable U.S. GAAP financial measures for adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact are net earnings and net earnings per share, respectively.
Amortized hedge costs/income represent costs/income incurred or recognized as a result of using foreign currency derivatives to hedge certain foreign exchange risks in the Company's Japan segment or in Corporate and other. These amortized hedge costs/income are estimated at the inception of the derivatives based on the specific terms of each contract and are recognized on a straight-line basis over the contractual term of the derivative. The Company believes that amortized hedge costs/income measure the periodic currency risk management costs/income related to hedging certain foreign currency exchange risks and are an important component of net investment income. There is no comparable U.S. GAAP financial measure for amortized hedge costs/income.
Adjusted net investment gains and losses are net investment gains and losses adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, ii) net interest income/expense from foreign currency and interest rate derivatives associated with certain investment strategies, which are both reclassified to net investment income, and iii) the impact of interest from derivatives associated with notes payable, which is reclassified to interest expense as a component of total adjusted expenses. The Company considers adjusted net investment gains and losses important as it represents the remainder amount that is considered outside management’s control, while excluding the components that are within management’s control and are accordingly reclassified to net investment income and interest expense. The most comparable U.S. GAAP financial measure for adjusted net investment gains and losses is net investment gains and losses.
Adjusted net investment income is net investment income adjusted for i) amortized hedge cost/income related to foreign currency exposure management strategies and certain derivative activity, and ii) net interest income/expense from foreign currency and interest rate derivatives associated with certain investment strategies, which are reclassified from net investment gains and losses to net investment income. The Company considers adjusted net investment income important because it provides a more comprehensive understanding of the costs and income associated with the Company’s investments and related hedging strategies. The most comparable U.S. GAAP financial measure for adjusted net investment income is net investment income.
Adjusted return on equity is adjusted earnings divided by average shareholders’ equity, excluding accumulated other comprehensive income (AOCI). Management uses adjusted return on equity to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of this financial measure is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The Company considers adjusted return on equity important as it excludes components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity.

34
EX-99.3 4 aflex993teleconferencespee.htm EX-99.3 Document






aflac-incorporatedx4xpro.jpg






Third Quarter 2024
Earnings Call
Video Update
Max K. Brodén







October 30, 2024



For more information contact:
Investor and Rating Agency Relations
800.235.2667
aflacir@aflac.com
Aflac Worldwide Headquarters
1932 Wynnton Road
Columbus, GA 31999
1


Preliminary note: Forward-Looking Information and Non-U.S. GAAP Financial Measures

Forward-Looking Information

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” to encourage companies to provide prospective information, so long as those informational statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those included in the forward-looking statements. The company desires to take advantage of these provisions. This transcript contains cautionary statements identifying important factors that could cause actual results to differ materially from those projected herein, and in any other statements made by company officials in communications with the financial community and contained in documents filed with the Securities and Exchange Commission (SEC). Forward-looking statements are not based on historical information and relate to future operations, strategies, financial results or other developments. Furthermore, forward-looking information is subject to numerous assumptions, risks and uncertainties. In particular, statements containing words such as “expect,” “anticipate,” “believe,” “goal,” “objective,” “may,” “should,” “estimate,” “intends,” “projects,” “will,” “assumes,” “potential,” “target,” "outlook" or similar words as well as specific projections of future results, generally qualify as forward-looking. Aflac undertakes no obligation to update such forward-looking statements.

The company cautions readers that the following factors, in addition to other factors mentioned from time to time, could cause actual results to differ materially from those contemplated by the forward-looking statements:

•difficult conditions in global capital markets and the economy, including inflation
•defaults and credit downgrades of investments
•global fluctuations in interest rates and exposure to significant interest rate risk
•concentration of business in Japan
•limited availability of acceptable yen-denominated investments
•foreign currency fluctuations in the yen/dollar exchange rate
•differing interpretations applied to investment valuations
•significant valuation judgments in determination of expected credit losses recorded on the Company's investments
•decreases in the Company's financial strength or debt ratings
•decline in creditworthiness of other financial institutions
•the Company's ability to attract and retain qualified sales associates, brokers, employees, and distribution partners
•deviations in actual experience from pricing and reserving assumptions
•ability to continue to develop and implement improvements in information technology systems and on successful execution of revenue growth and expense management initiatives
•interruption in telecommunication, information technology and other operational systems, or a failure to maintain the security, confidentiality, integrity or privacy of sensitive data residing on such systems
•subsidiaries' ability to pay dividends to the Parent Company
•inherent limitations to risk management policies and procedures
•operational risks of third-party vendors
•tax rates applicable to the Company may change
•failure to comply with restrictions on policyholder privacy and information security
•extensive regulation and changes in law or regulation by governmental authorities
•competitive environment and ability to anticipate and respond to market trends
•catastrophic events, including, but not limited to, as a result of climate change, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, major public health issues, terrorism or other acts of violence, and damage incidental to such events
•ability to protect the Aflac brand and the Company's reputation
•ability to effectively manage key executive succession
•changes in accounting standards
•level and outcome of litigation or regulatory inquiries
•allegations or determinations of worker misclassification in the United States

Non-U.S. GAAP Financial Measures and Reconciliations

This document includes references to the Company’s financial performance measures which are not calculated in accordance with United States generally accepted accounting principles (U.S. GAAP) (non-U.S. GAAP).



The financial measures exclude items that the Company believes may obscure the underlying fundamentals and trends in insurance operations because they tend to be driven by general economic conditions and events or related to infrequent activities not directly associated with insurance operations.

Definitions of the Company’s non-U.S. GAAP financial measures and applicable reconciliations to the most comparable U.S. GAAP measures are provided in the presentation slides that accompany this transcript.

Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results. In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported. When the yen strengthens, translating yen into dollars results in more dollars being reported. Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior period. A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S. GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S. GAAP basis. Management evaluates the Company's financial performance both including and excluding the impact of foreign currency translation to monitor, respectively, cumulative currency impacts and the currency-neutral operating performance over time. The average yen/dollar exchange rate is based on the published MUFG Bank, Ltd. telegraphic transfer middle rate (TTM).





Max K. Brodén
Q3 2024 CFO Video Update
October 30, 2024

Thank you for joining me as I provide a financial update on Aflac Incorporated's results for the third quarter of 2024.

For the quarter, adjusted earnings per diluted share increased 17.4% year over year to $2.16, with a $0.03 negative impact from FX in the quarter. In this quarter, remeasurement gains on reserves totaled $408 million reducing benefits while an offsetting unlock of the deferred profit liability in Japan reduced earned premium by $75 million. Variable investment income ran $27 million below our long-term return expectations.

Adjusted book value per share including foreign currency translation gains and losses increased 7.3%, and the adjusted ROE was 16.7%, an acceptable spread to our cost of capital. Overall, we view these results in the quarter as solid.

Starting with our Japan segment, net earned premiums for the quarter declined 10.5%. This decline reflects a ¥7.3 billion negative impact from an internal cancer reinsurance transaction1 executed in fourth quarter 2023 and ¥4.6 billion negative impact from paid up policies. In addition, there is a ¥13.3 billion negative impact from deferred profit liability, the majority of which is a one-time impact from unlocking of LDTI assumptions. At the same time, policies in force declined 2.3%.

Japan’s total benefit ratio came in at 49.2% for the quarter, down 15.9 percentage points year over year and the third sector benefit ratio was 41.8%, down approximately 13 percentage points year over year. We estimate the impact from remeasurement gains to be approximately 18 percentage points favorable to the benefit ratio in Q3 2024. Long-term experience trends, as it relates to treatments of cancer and hospitalization, continue to be in place, leading to continued favorable underwriting experience. Given the impact from unlocking, we now expect the full year benefit ratio to end up in the range of 62% to 63%.

Persistency remained solid with a rate of 93.3%, which was down 20 basis points year over year. This change in persistency is in line with our expectations.

Our expense ratio in Japan was 20.0%, up 100 basis points year over year, driven primarily by decline in revenues.

Adjusted net investment income in yen terms was up 0.1%, as the benefits from lower hedge costs and favorable impact from foreign currency on USD investments in yen terms were largely offset by lower floating rate income and lower volume as we have continued to shift assets from Aflac Japan to Aflac Re Bermuda.

The pretax margin for Japan in the quarter was 44.7%, up 11.9 percentage points year over year; a very good result. For the full year, we now expect the pretax margin to be in the range of 35% to 36%.

Turning to U.S. results, net earned premium was up 2.8%. Persistency increased 20 basis points year over year to 78.9%. Considering our year to date results, we now expect full year net earned premiums to be towards the lower end of our guidance range of 3% to 5%.

Our total benefit ratio came in at 47.6%, 11.7 percentage points higher than Q3 2023, driven by lower remeasurement gains than a year ago. We estimate that remeasurement gains impacted the benefit ratio by approximately 120 basis points in the quarter. Claims utilization has rebounded from depressed levels during the pandemic and are now more in line with our long term expectations. For the full year we would expect the benefit ratio to be towards the higher end of our guidance range of 45% to 47%.
1 Excludes the impact from reinsurance novated to Aflac Re Bermuda in December 2023 whereby Aflac Re Bermuda assumed the duties, obligations and liabilities through a reinsurance of business ALIJ previously ceded to an external reinsurer.




Our expense ratio in the U.S. was 38.0%, down 260 basis points year over year, primarily driven by platforms improving scale and strong expense management. Given business seasonality, we would expect an uptick in the expense ratio for Q4, but to remain within our guidance range of 38% to 40% for the full year.

Our growth initiatives – group life & disability, network dental and vision and direct to consumer – increased our total expense ratio by 100 basis points. This is in line with our expectations, and we would expect this impact to decrease going forward as these businesses grow to scale and improve their profitability.

Adjusted net investment income in the U.S. was up 0.5%, mainly driven by higher fixed rate income.

Profitability in the U.S. segment was solid, with a pretax margin of 20.8%, also a good result.

Our total commercial real estate loan watchlist remains approximately $1.0 billion, with less than $250 million in process of foreclosure currently. As a result of these current low valuation marks, we increased our CECL reserves associated with these loans by $3 million in this quarter net of charge offs. We had one loan foreclosure moved into real estate owned. We continue to believe that the current distressed market does not reflect the true intrinsic value of our portfolio, which is why we are confident in our ability to take ownership of these assets, manage them through this cycle and maximize our recoveries.

Our portfolio of first lien senior secured middle market loans continued to perform well, with losses below our expectations for this point in the cycle.

In our corporate segment, we recorded a pretax gain of $15 million. Adjusted net investment income was $37 million higher than last year due to a combination of higher rates and asset balances, which included the impact of reinsurance transactions in Q4 2023, as well as continued lower volume of tax credit investments. These tax credit investments impacted the corporate net investment income line for U.S. GAAP purposes negatively by $57 million in the quarter with an associated credit to the tax line. The net impact to our bottom line was a positive $5 million in the quarter. To date, these investments are performing well and in line with our expectations.

We are continuing to build out our internal reinsurance platform, and I am pleased with the outcome and performance. In the fourth quarter, we intend to execute another tranche with similar structure and economics in yen terms to our October 2023 transaction.

Our capital position remains strong, and we ended the quarter with an SMR above 1,100%, and our combined RBC, while not finalized, we estimate to be greater than 650%. These are strong capital ratios, which we actively monitor, stress and manage to withstand credit cycles as well as external shocks. U.S. statutory impairments were $58 million, and there were no additional Japan FSA impairments in Q3. This is well within our expectations and with limited impact to both earnings and capital.

As we hold approximately 60% of our debt in yen, our leverage increased to 21.0%, as a result of the move in the yen/dollar exchange rate – well within our target range of 20% to 25%. Our leverage will fluctuate with movements in the yen/dollar rate. This is intentional and part of our enterprise hedging program – protecting the economic value of Aflac Japan in U.S. dollar terms.

Unencumbered holding company liquidity stood at $3.9 billion, $2.1 billion above our minimum balance.

We repurchased $500 million of our own stock and paid dividends of $280 million in Q3, offering good relative IRR on these capital deployments. We will continue to be flexible and tactical in how we manage the balance sheet and deploy capital in order to drive strong risk-adjusted ROE with a meaningful spread to our cost of capital.

Thank you, and I look forward to discussing our results in further detail on tomorrow's earnings call.



EX-99.4 5 a3q24maxsteleconferencep.htm EX-99.4 a3q24maxsteleconferencep




Forward-Looking Statements and Non-GAAP Financial Measures The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” to encourage companies to provide prospective information, so long as those informational statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those included in the forward-looking statements. The company desires to take advantage of these provisions. This document contains cautionary statements identifying important factors that could cause actual results to differ materially from those projected herein, and in any other statements made by company officials in communications with the financial community and contained in documents filed with the Securities and Exchange Commission (SEC). Forward-looking statements are not based on historical information and relate to future operations, strategies, financial results or other developments. Furthermore, forward-looking information is subject to numerous assumptions, risks and uncertainties. In particular, statements containing words such as “expect,” “anticipate,” “believe,” “goal,” “objective,” “may,” “should,” “estimate,” “e,” “intends,” “projects,” “will,” “assumes,” “potential,” “target,” "outlook" or similar words as well as specific projections of future results, generally qualify as forward-looking. Aflac undertakes no obligation to update such forward-looking statements. The company cautions readers that the following factors, in addition to other factors mentioned from time to time, could cause actual results to differ materially from those contemplated by the forward-looking statements: Non-U.S. GAAP Financial Measures and Reconciliations This document includes references to the Company’s financial performance measures which are not calculated in accordance with United States generally accepted accounting principles (U.S. GAAP) (non-U.S. GAAP). The financial measures exclude items that the Company believes may obscure the underlying fundamentals and trends in insurance operations because they tend to be driven by general economic conditions and events or related to infrequent activities not directly associated with insurance operations. Definitions of the Company’s non-U.S. GAAP financial measures and applicable reconciliations to the most comparable U.S. GAAP measures are provided as appropriate. Due to the size of Aflac Japan, where the functional currency is the Japanese yen, fluctuations in the yen/dollar exchange rate can have a significant effect on reported results. In periods when the yen weakens, translating yen into dollars results in fewer dollars being reported. When the yen strengthens, translating yen into dollars results in more dollars being reported. Consequently, yen weakening has the effect of suppressing current period results in relation to the comparable prior period, while yen strengthening has the effect of magnifying current period results in relation to the comparable prior period. A significant portion of the Company’s business is conducted in yen and never converted into dollars but translated into dollars for U.S. GAAP reporting purposes, which results in foreign currency impact to earnings, cash flows and book value on a U.S. GAAP basis. Management evaluates the Company's financial performance both including and excluding the impact of foreign currency translation to monitor, respectively, cumulative currency impacts and the currency-neutral operating performance over time. The average yen/dollar exchange rate is based on the published MUFG Bank, Ltd. telegraphic transfer middle rate (TTM). • difficult conditions in global capital markets and the economy, including inflation • defaults and credit downgrades of investments • global fluctuations in interest rates and exposure to significant interest rate risk • concentration of business in Japan • limited availability of acceptable yen-denominated investments • foreign currency fluctuations in the yen/dollar exchange rate • differing interpretations applied to investment valuations • significant valuation judgments in determination of expected credit losses recorded on the Company's investments • decreases in the Company's financial strength or debt ratings • decline in creditworthiness of other financial institutions • the Company's ability to attract and retain qualified sales associates, brokers, employees, and distribution partners • deviations in actual experience from pricing and reserving assumptions • ability to continue to develop and implement improvements in information technology systems and on successful execution of revenue growth and expense management initiatives • interruption in telecommunication, information technology and other operational systems, or a failure to maintain the security, confidentiality, integrity or privacy of sensitive data residing on such systems • subsidiaries' ability to pay dividends to the Parent Company • inherent limitations to risk management policies and procedures • operational risks of third-party vendors • tax rates applicable to the Company may change • failure to comply with restrictions on policyholder privacy and information security • extensive regulation and changes in law or regulation by governmental authorities • competitive environment and ability to anticipate and respond to market trends • catastrophic events, including, but not limited to, as a result of climate change, epidemics, pandemics, tornadoes, hurricanes, earthquakes, tsunamis, war or other military action, major public health issues, terrorism or other acts of violence, and damage incidental to such events • ability to protect the Aflac brand and the Company's reputation • ability to effectively manage key executive succession • changes in accounting standards • level and outcome of litigation or regulatory inquiries • allegations or determinations of worker misclassification in the United States 2


 
Max K. Brodén Executive Vice President CFO, Aflac Incorporated


 
3Q24 Earnings Per Share $2.64 $(0.17) 3Q23 3Q24 Net EPS (diluted) (106.4)% $1.84 $2.16 3Q23 3Q24 Adjusted EPS (diluted)* +17.4% $1.84 $2.19 3Q23 3Q24 Adjusted EPS ex-FX* +19.0% *Non-GAAP financial measure. See appendix for information about this measure. 4


 
ROE View 29.1% (1.5)% 15.6% 16.7% ROE (%) Adjusted ROE* (%) 3Q23 3Q24 *Non-GAAP financial measure. See appendix for information about this measure. 5


 
Aflac Japan Maintains Solid Persistency 93.5% 93.4% 93.4% 93.3% 93.3% 3Q23 4Q23 1Q24 2Q24 3Q24 6


 
Aflac Japan 3Q24: Favorable experience leading to better than expected margin Benefit Ratio % 63 62 Expense Ratio % 21 19 Pretax Profit Margin % 36 35 49.2% 20.0% 44.7% 2024 Revised Outlook Ranges QTD Actual Operating Ratios 7


 
Aflac U.S. Maintains Solid Persistency 78.7% 78.6% 78.7% 78.7% 78.9% 3Q23 4Q23 1Q24 2Q24 3Q24 8


 
Aflac U.S. 3Q24: Providing customers value, scaling growth and solid margin Benefit Ratio % 47 45 Expense Ratio % 40 38 Pretax Profit Ratio % 21 19 47.6% 38.0% 20.8% 2024 Outlook Ranges QTD Actual Operating Ratios 9


 
Strong Capital Ratios Solvency Margin Ratio (Fiscal year ending March 31,%) 881 917 941 889 1136 2020 2021 2022 2023 2024 9/24e Combined Risk-Based Capital Ratio1 (Fiscal year ending December 31,%) 531 550 659 732 710 2019 2020 2021 2022 2023 9/24e >650 1Combined RBC ratio is the aggregated ratio of four subsidiaries: American Family Life Assurance Company of Columbus (Aflac); Continental American Insurance Company (CAIC), branded as Aflac Group Insurance (AGI); American Family Life Assurance Company of New York (Aflac New York); and Tier One Insurance Company (TOIC) >1100 10


 
Adjusted Leverage Ratio*: Within the 20-25% range 18.8% 19.7% 20.4% 19.5% 21.0% 3Q23 4Q23 1Q24 2Q24 3Q24 *Adjusted Leverage ratio is computed as: Adjusted debt to Adjusted capitalization ex-AOCI. See appendix for information about this measure. 11


 
Continued Tactical Capital Deployment 248 245 288 283 280 700 700 750 800 500 Dividends Repurchase 3Q23 4Q23 1Q24 2Q24 3Q24 Dividends and Share Repurchase ($ millions) 12


 




Appendix


 
Glossary of Non-U.S. GAAP Measures The Company defines these non-U.S. GAAP financial measures as follows: • Adjusted earnings are adjusted revenues less benefits and adjusted expenses. Adjusted earnings per share (basic or diluted) are the adjusted earnings for the period divided by the weighted average outstanding shares (basic or diluted) for the period presented. The adjustments to both revenues and expenses account for certain items that are outside of management’s control because they tend to be driven by general economic conditions and events or are related to infrequent activities not directly associated with insurance operations. Adjusted revenues are U.S. GAAP total revenues excluding adjusted net investment gains and losses. Adjusted expenses are U.S. GAAP total acquisition and operating expenses including the impact of interest from derivatives associated with notes payable but excluding any non- recurring or other items not associated with the normal course of the Company’s insurance operations and that do not reflect the Company's underlying business performance. Management uses adjusted earnings and adjusted earnings per diluted share to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of these financial measures is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The most comparable U.S. GAAP financial measures for adjusted earnings and adjusted earnings per share (basic or diluted) are net earnings and net earnings per share, respectively. • Adjusted earnings excluding current period foreign currency impact are computed using the average foreign currency exchange rate for the comparable prior-year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. Adjusted earnings per diluted share excluding current period foreign currency impact is adjusted earnings excluding current period foreign currency impact divided by the weighted average outstanding diluted shares for the period presented. The Company considers adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact important because a significant portion of the Company's business is conducted in Japan and foreign exchange rates are outside management’s control; therefore, the Company believes it is important to understand the impact of translating foreign currency (primarily Japanese yen) into U.S. dollars. The most comparable U.S. GAAP financial measures for adjusted earnings excluding current period foreign currency impact and adjusted earnings per diluted share excluding current period foreign currency impact are net earnings and net earnings per share, respectively. • Adjusted book value including unrealized foreign currency translation gains and losses is adjusted book value plus unrealized foreign currency translation gains and losses. Adjusted book value including unrealized foreign currency translation gains and losses per common share is adjusted book value plus unrealized foreign currency translation gains and losses at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value including unrealized foreign currency translation gains and losses, and its related per share financial measure, important as they exclude certain components of AOCI, which fluctuate due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measures for adjusted book value including unrealized foreign currency translation gains and losses and adjusted book value including unrealized foreign currency translation gains and losses per common share are total book value and total book value per common share, respectively. • Adjusted return on equity is adjusted earnings divided by average shareholders’ equity, excluding accumulated other comprehensive income (AOCI). Management uses adjusted return on equity to evaluate the financial performance of the Company’s insurance operations on a consolidated basis and believes that a presentation of this financial measure is vitally important to an understanding of the underlying profitability drivers and trends of the Company’s insurance business. The Company considers adjusted return on equity important as it excludes components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity. 15


 
Glossary of Non-U.S. GAAP Measures (cont’d) The Company defines these non-U.S. GAAP financial measures as follows: • Adjusted return on equity excluding foreign currency impact is adjusted earnings excluding the current period foreign currency impact divided by average shareholders’ equity, excluding AOCI. The Company considers adjusted return on equity excluding foreign currency impact important as it excludes changes in foreign currency and components of AOCI, which fluctuate due to market movements that are outside management's control. The most comparable U.S. GAAP financial measure for adjusted return on equity excluding foreign currency impact is return on average equity (ROE) as determined using net earnings and average total shareholders’ equity. • Adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment is adjusted book value plus unrealized foreign currency translation gains and losses and pension liability adjustment. The Company considers adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment important as it excludes certain components of AOCI, which fluctuates due to market movements that are outside management's control; however, it includes the impact of foreign currency as a result of the significance of Aflac’s Japan operation. The most comparable U.S. GAAP financial measure for adjusted book value including unrealized foreign currency translation gains and losses and pension liability adjustment is total book value. • Adjusted debt is the sum of notes payable, as recorded on the U.S. GAAP balance sheet, excluding 50% of subordinated debentures and perpetual bonds and all pre-funding of debt maturities. The Company considers adjusted debt important as it measures outstanding debt consistently with expectations of the Company’s rating agency stakeholders. The most comparable U.S. GAAP financial measure for adjusted debt is notes payable. • Adjusted debt including 50% of subordinated debentures and perpetual bonds is the sum of notes payable, as recorded on the U.S. GAAP balance sheet, excluding pre-funding of debt maturities. The Company considers adjusted debt including 50% of subordinated debentures and perpetual bonds important as it measures outstanding debt consistently with expectations of the Company’s rating agency stakeholders. The most comparable U.S. GAAP financial measure for adjusted debt including 50% of subordinated debentures and perpetual bonds is notes payable. • Adjusted book value is the U.S. GAAP book value (representing total shareholders’ equity), less AOCI as recorded on the U.S. GAAP balance sheet. Adjusted book value per common share is adjusted book value at the period end divided by the ending outstanding common shares for the period presented. The Company considers adjusted book value and adjusted book value per common share important as they exclude AOCI, which fluctuates due to market movements that are outside management’s control. The most comparable U.S. GAAP financial measures for adjusted book value and adjusted book value per common share are total book value and total book value per common share, respectively. 16


 
Reconciliation of Net Earnings Per Diluted Share to Adjusted Earnings per Diluted Share Three Months Ended September 30 2024 2023 %Change Net Earnings per diluted share $(0.17) $2.64 (106.4)% Items impacting net earnings Adjusted net investment (gains) losses 2.40 (0.85) Other and non-recurring (income) loss — (0.01) Income tax (benefit) expense on items excluded from adjusted earnings (0.08) 0.06 Adjusted earnings per diluted share 2.16 1.84 17.4% Current period foreign currency impact1 0.03 N/A Adjusted earnings per diluted share excluding current period foreign currency impact2 $2.19 $1.84 19.0% 1Prior period foreign currency impact reflected as “N/A” to isolate change for current period only 2 Amounts excluding current period foreign currency impacts are computed using the average foreign currency exchange rate for the comparable prior year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. 17


 
1Prior period foreign currency impact reflected as “N/A” to isolate change for current period only 2 Amounts excluding current period foreign currency impacts are computed using the average foreign currency exchange rate for the comparable prior year period, which eliminates fluctuations driven solely by foreign currency exchange rate changes. Reconciliation of Net Earnings to Adjusted Earnings1 Three Months Ended September 30, in millions of Dollars 2024 2023 %Change Net Earnings $(93) $1,569 (105.9)% Items impacting net earnings Adjusted net investment (gains) losses 1,347 (504) Other and non-recurring (income) loss — (3) Income tax (benefit) expense on items excluded from adjusted earnings (43) 33 Adjusted earnings 1,211 1,095 10.6% Current period foreign currency impact1 16 N/A Adjusted earnings excluding current period foreign currency impact2 $1,228 $1,095 12.1% 18


 
Reconciliation of U.S. GAAP Return on Equity to Adjusted ROE1 Three Months Ended September 30, in millions of Dollars 1Amounts presented may not foot due to rounding 2 U.S. GAAP ROE is calculated by dividing net earnings (annualized) by average shareholders’ equity 3See separate reconciliation of net income to adjusted earnings 4Impact of foreign currency is calculated by restating all foreign currency components of the income statement to the weighted average foreign currency exchange rate for the comparable prior year period. The impact is the difference of the restated adjusted earnings compared to reported adjusted earnings. For comparative purposes, only current period income is restated using the weighted average prior period exchange rate, which eliminates the foreign currency impact for the current period. This allows for equal comparison of this financial measure 2024 2023 U.S. GAAP ROE - Net earnings2 (1.5)% 29.1% Impact of excluding unrealized foreign currency translation gains (losses) 0.3 (4.5) Impact of excluding unrealized gains (losses) on securities and derivatives — 0.8 Impact of excluding effect of changes in discount rate assumptions — (3.1) Impact of excluding pension liability adjustment — — Impact of excluding AOCI 0.2 (6.8) U.S. GAAP ROE - less AOCI (1.3) 22.3 Differences between adjusted earnings and net earnings3 18.0 (6.7) Adjusted ROE - reported 16.7 15.6 Less: Impact of foreign currency4 (0.2) N/A Adjusted ROE, excluding impact of foreign currency 17.0 15.6 19


 
1Amounts may not foot due to rounding 2 Adjusted book value in the U.S. GAAP book value (representing total shareholder’s equity), excluding AOCI (as recorded on the U.S. GAAP balance sheet). 3Adjusted book value including unrealized foreign currency translation gains (losses) is adjusted book value plus unrealized foreign currency translation gains (losses). Reconciliation of U.S. GAAP Book Value per Share1 Three Months Ended September 30, in millions of Dollars 2024 2023 %Change U.S. GAAP book value per common share $44.60 $38.63 15.5% Less: Unrealized foreign currency translation gains (losses) per common share (7.43) (7.64) Unrealized gains (losses) on securities and derivatives per common share 0.96 (0.73) Effect of changes in discount rate assumptions per common share (0.12) (1.48) Pension liability adjustment per common share (0.01) 0.03 Total AOCI per common share (6.60) (9.81) Adjusted book value per common share2 $51.21 $48.44 5.7% Add: Unrealized foreign currency translation gains (losses) per common share (7.43) (7.64) Adjusted book value including unrealized foreign currency translation gains (losses) per common share3 $43.77 $40.80 7.3% 20


 
Adjusted Leverage Ratios (In millions) 2024 2023 Notes Payable $7,978 $6,961 50% of subordinated debentures and perpetual bonds (313) (299) Pre-funding of debt maturities — — Adjusted debt1 7,666 6,663 Total Shareholders’ Equity 24,830 22,669 Accumulated other comprehensive (income)loss: Unrealized foreign currency translation (gains) losses 4,139 4,484 Unrealized (gains) losses on fixed maturity securities (557) 403 Unrealized (gains) losses on derivatives 20 24 Effect on change in discount rate assumptions 67 866 Pension liability adjustment 8 (17) Adjusted book value1 28,507 28,429 Adjusted capitalization ex-AOCI2 $36,485 $35,390 Adjusted debt to adjusted capitalization ex-AOCI 21.0% 18.8% 1) See non-U.S. GAAP financial measures for definition of: adjusted debt; adjusted book value; adjusted debt, including 50% of subordinated debentures and perpetual bonds; adjusted book value, including unrealized foreign currency translation gains and losses and pension liability adjustment 2) Adjusted capitalization ex-AOCI is the sum of adjusted debt, including 50% of subordinated debentures and perpetual bonds, plus adjusted book value 21