Globe Life Inc.

Ladies and gentlemen, you are currently on hold for today's conference call. At this time, we're assembling today's audience and plan to be underway shortly. Thank you for your patience and please remain on the line. Ladies and gentlemen, you're currently on hold for today's conference call. At this time, we're assembling today's audience and plan to be underway shortly. Thank you for your patience and please remain on the line. Ladies and gentlemen, you are currently on hold for today's conference call. At this time, we're assembling today's audience and plan to be underway shortly. Thank you for your patience and please remain on the line. Good day and welcome to the fourth quarter 2021 earnings release conference call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mike Majors, Executive Vice President, Administration and Investor Relations. Please go ahead, sir.

Thank you. Good morning, everyone. Joining the call today are Gary Coleman and Larry Hutchison, our co-chief executive officers, Frank Svoboda, our chief financial officer, and Brian Mitchell, our general counsel. Some of our comments or answers to your questions may contain forward-looking statements that are provided for general guidance purposes only. Accordingly, please refer to our earnings release, 2020 10-K, and any subsequent forms 10-Q on file with the SEC. Some of our comments may also contain non-GAAP measures. Please see our earnings release and website for discussion of these and reconciliations to GAAP measures. I'll now turn the call over to Gary Coleman.

Thank you, Mike, and good morning, everyone. In the fourth quarter, net income was $178 million, or $1.76 per share, compared to $204 million, or $1.93 per share, a year ago. Net operating income for the quarter was $172 million, or $1.70 per share, a decline of 2% per share from a year ago. On a GAAP reported basis, return on equity was 8.8% and book value per share is $85.97. Excluding unrealized gains and losses on fixed maturities, return on equity was 12.3% and book value per share is $58.50, up 10% from a year ago. In our life insurance operations, We continue to see improved persistency compared to pre-pandemic levels. In the fourth quarter, premium revenue increased 8% from a year ago to $733 million. Life underwriting margin was $146 million, down 11% from a year ago. The decline in margin is due primarily to higher COVID-related claims, which Frank will discuss further in his comments. In 2022, we expect life premium revenue to grow 6% to 7%, and at the midpoint of our guidance, we expect underwriting margin to grow around 29%, due primarily to an expected decline in COVID claims. In health insurance, premium revenue grew 8% over the year-ago quarter to $313 million, and health underwriting margin was up 12% to $81 million. The increase in underwriting margin is primarily due to increased premium and improved claims experience. In 2022, we expect health premium revenue to grow 6% to 7% and underwriting margin to grow around 3%. Administrative expenses were $70 million for the quarter, up 11% from a year ago. As a percentage of premium, administrative expenses were 6.7% compared to 6.5% a year ago. For the year, administrative expenses were 6.6% of premium, same as last year. In 2022, we expect administrative expenses to grow 9% to 10% and be around 6.8% of premium, due primarily to higher IT and information security costs, employee costs, a gradual increase in travel and facilities costs, and the addition of Globe Life benefits division. I will now turn the call over to Larry for his comments on the fourth quarter marketing operations.