Jackson Financial Inc.

My name is Brika and I will be the moderator for today's conference. All lines are on mute for the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question at this time, please press star followed by one on your touch phone keypad. If you change your mind and would like to remove your request to speak, please press star then two. I would now like to pass the conference over to your host, Liz Werner, Head of Investor Relations from Jackson Financial to begin. So, Liz, please go ahead.

Good morning, everyone, and welcome to Jackson's fourth quarter and full year 2023 earnings call. Today's remarks may contain forward-looking statements which are subject to risks and uncertainties. These statements are not guarantees of future performance or events and are based upon management's current expectations. Jackson's filings with the SEC provide details on important factors that may cause actual results or events to differ materially. Except as required by law, Jackson is under no obligation to update any forward-looking statements if circumstances or management's estimates or opinions should change. Today's remarks also refer to certain non-GAAP financial measures. The reconciliation of those measures to the most comparable U.S. GAAP figures is included in our earnings release, financial supplement, and earnings presentation. all of which are available on the Investor Relations page of our website at investors.jackson.com. Joining us today are our CEO, Laura Prescorn, our CFO, Marsha Watson, our Head of Asset Liability Management and Chief Actuary, Steve Ben-Yorris, and our President and Chief Investment Officer of PPM, Craig Smith. At this time, I'll turn the call over to our CEO, Laura Prescorn.

Thank you, Liz. Good morning everyone and welcome to our fourth quarter and full year 2023 earnings call. We have quite a bit to cover today, so we'll allow extra time to provide updates and answer your questions. We'll start with a review of our strong track record of capital return and success in delivering on our financial targets, followed by an overview of our fourth quarter and full year 2023 results. We'll also provide insights into the structure and strategic benefits of Brook Life Reinsurance Company, or Brook Re, our recently formed captive reinsurer. In prior quarters, we discussed our focus on finding a durable solution to the statutory impact of the cash surrender value floor with the goal of better aligning our reserve liability with the economics of our business. By addressing the statutory requirements associated with the cash surrender value floor, BRC provides the ability for more stable capital generation and reduced RBC volatility. It also allows the profitability of our healthy variable annuity book to be more transparent and intuitive in our results. Finally, we'll conclude today's remarks with our 2024 outlook in financial targets. along with our expectations for sustainable capital return to shareholders. Turning to slide three, Jackson's capital return to common shareholders since becoming a standalone public company in 2021 has exceeded $1.2 billion in the form of share repurchases and shareholder dividends. The fourth quarter of 2023 marked our ninth consecutive quarter with share buyback activity, and as of year end 2023, the cumulative common shares repurchased represented over 21% of shares outstanding at separation. We view our cash dividend as a valuable source of sustainable capital return and have cumulatively paid more than $450 million to common shareholders in just over two years. Yesterday, we announced our board's approval of the third increase in our common shareholder quarterly dividend to 70 cents per share, highlighting our confidence in our ability to generate capital, our focus on long-term profitability, and our commitment to increasing shareholder value. Moving to slide four, Maintaining a strong capital position at our operating companies and parent company Jackson Financial remains a priority as evidenced again this quarter. We ended 2023 above our RBC target range with an estimated ratio of 624% and with total adjusted statutory capital of more than $5 billion. In January, We established Brook Re to be self-sustaining from a capital standpoint, both initially and into the future. Pro forma for the transactions with Brook Re, Jackson National Life has an estimated RBC ratio of 543%, consistent with our guidance and our quarterly track record of being within or above our target RBC range. Going forward, we expect Jackson National Life statutory earnings and distribution capacity will more closely align with our adjusted operating earnings. Our holding company liquidity at year end continued to be well above our targeted minimum level and was approximately $600 million. As scheduled, in November, we repaid $600 million in senior debt, further enhancing our financial flexibility and resilient balance sheet. Holding company liquidity supports our capital return goals and provides a buffer for covering holding company expenses. In 2023, we returned $464 million to common shareholders through share repurchases and common dividends. comfortably within our target range for capital return of $450 to $550 million. Our remaining common share repurchase authorization of approximately $300 million combined with our holding company liquidity position us well for reaching our 2024 targets and building on our track record of consistent shareholder return. Jackson has consistently achieved or exceeded its financial target commitments and has maintained a strong capital position throughout. Our first 12-month capital return target was achieved within six months, and we have consistently raised our annual financial target. We are pleased to share we are once again increasing our financial return targets in 2024, and we'll share more details later in the call. Moving to slide five, 2023 was a fantastic year of execution for Jackson, with our financial performance highlighting the strong fundamentals of our business. Net income for the year was nearly $900 million and adjusted operating earnings were $1.1 billion. In 2023, we navigated volatile markets and maintained our resilient capital position, delivering on our commitments and investing in our business. Our statutory capital discipline allowed us to meet and exceed our financial targets while also capitalizing Brook Re in January 2024. Beginning in 2024 and subject to regulatory approval, We intend to have periodic distributions from our operating company throughout the year with the goal of reducing the RBC volatility that occurred from our past practice of sizable annual dividends. Variable annuity sales remained relatively stable over the course of the year, and we have seen VA profitability improve with the rise in interest rates. Consumer preference for protection-oriented products impacted the broader annuity market and Jackson met market demand through our registered index-linked annuity, or RILA product suite. In our second full year selling RILA, sales were nearly $3 billion, up 60% from 2022. Notably, RILA sales in the fourth quarter alone reached $1 billion, accounting for nearly one-third of our total annuity sales and reaching a $4 billion annual run rate. For Jackson, Ryla's value proposition goes beyond sales diversification and positive net flows. Ryla also contributes to hedging efficiency, which in turn positively impacts capital. We have a long history of product innovation, strong distribution partnerships, and industry-leading service. These strengths, combined with the enhancements made to our RILA suite earlier this year, position Jackson well for continued RILA sales momentum. Our consistent ability to execute enables us to achieve our strategic and operational goals and serves as the foundation of our results. Summing it up on slide six, 2023 was a terrific year of progress for Jackson. We met or exceeded all financial targets for the third consecutive time, ended 2023 with robust levels of capital and liquidity, grew our RILA business, and continued to create long-term value for shareholders. I'll now turn the call over to Marcia to review our fourth quarter and full-year financials and provide an overview of our Brooke Reed transaction. Thank you, Laura.