Prudential Financial, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the Prudential Quarterly Earnings Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. If you should require assistance during the call, please press star followed by the zero. As a reminder, today's conference is being recorded. I would now like to turn the conference over to the head of investor relations, Darren Arita. Please go ahead, sir.

Thank you, Brad. Good morning, and thank you for joining our call. Representing Prudential on today's call are Charlie Lowery, CEO, Rob Thousand, Vice Chairman, Steve Pelletier, Head of Domestic Businesses, Scott Slyster, Head of International Businesses, Ken Tanji, Chief Financial Officer, and Rob Axel, Controller and Principal Accounting Officer. We will start with prepared remarks by Charlie, Rob, and Ken, and then we will take your questions. Today's presentation may include forward-looking statements. It is possible that actual results may differ materially from the predictions we make today. In addition, this presentation may include references to non-GAAP measures. For a reconciliation of such measures to the comparable GAAP measures and a discussion of factors that could cause actual results to differ materially from those in the forward-looking statements, please see the slide titled Forward-Looking Statements and Non-GAAP Measures in the appendix to today's presentation. which can be found on our website at investor.prudential.com. With that, I'll hand it over to Charlie.

Thank you, Darren. Good morning, everyone, and thank you for joining us today. While equity market movements affected our fourth quarter results, our fundamentals remained strong across our businesses, as did our earnings, adjusted for the notable items that Ken will address later. We feel good about our outlook for our business and our ability to continue building the momentum in our business by helping our customers with their financial needs, especially through turbulent times. And we're going to dive into this subject in a little more detail today. For the full year, 2018 marked another important chapter for Prudential as we continue to generate meaningful value for our customers and to grow our business in a sustainable way. As a result, we grew operating earnings and adjusted book value per share, produced a double digit return on equity, and return more than $3 billion via dividends and share repurchases. We also maintained a solid balance sheet, even amid the large equity market movements in the fourth quarter. Looking forward, we are excited about the opportunities to create more value for our existing customers and forge relationships with new customers. Our market-leading businesses, complementary capabilities, and global reach allow us to expand markets and grow in a way that few others can. At the highest level, we're bringing more financial opportunity to more customers. We accomplish this through our US financial wellness businesses, PGM, our asset management business, and our international business. We are also working with institutional clients and distributors around the world to help individuals adopt behaviors that enable financial security. By addressing evolving societal needs for financial advice, services, and solutions, we seek a unique opportunity to reach new market segments across different income brackets, ages, and other demographic groups and to deepen our relationships with existing customers. PGM enables the success of our businesses through its investment capabilities, including proprietary private asset classes. This provides a competitive advantage for Prudential, which allows us to innovate new products and services, such as pension risk transfer, to support our customers. At the same time, PGM benefits from continued growth in affiliate flows and assets under management, which supports its position as the top 10 global asset manager. Our businesses have an established, trusted presence in more than 40 countries, engaging in relationships with approximately 50 million individuals. In addition to this wide reach, our businesses create earnings and capital diversification for our shareholders. Turning to slide three, I'll provide some additional financial highlights on the fourth quarter and full year. Fourth quarter earnings declined from a year-ago period, primarily due to equity market impacts. For the full year, adjusted earnings per share increased by 11% to $11.69. We generated an adjusted return on operating equity for the full year 2018 of 12.7% at the high end of our near to intermediate target of 12 to 13%. And our book, our adjusted book value per share grew by 8.3%. We deployed our capital in growing our business, repurchasing shares and paying dividends. and we achieved all of this while maintaining a robust capital position consistent with our AA standard. As we look to 2019, our share repurchase authorization is $2 billion and we increased the quarterly dividend by 11%. This year's performance was supported by strong drivers across our businesses, including significant milestones. Within our U.S. financial wellness businesses, We achieved record account values in institutional investment products supported by our pension risk transfer capabilities. We also had record full-service retirement sales. Within PGM, we achieved our 16th consecutive year of positive institutional net flows. Within international, we reached a record level of life planners, our highly productive distributors of protection and retirement solutions. Maintaining this growth and executing on our strategy starts from within. We focus on culture and talent enabled by technology to achieve a meaningful purpose, which is a point I'd like to close with as we turn to slide four. There's a growing body of evidence that purpose-driven companies outperform their competition in recruiting and retaining top talent, in strengthening customer loyalty, and in driving business performance. all of which are core elements of our strategy. At the start of this year, we unveiled a new purpose statement to our employees that reflects their collective feedback of our vision for the future, which is, we make lives better by solving the financial challenges of a changing world. We recognize this is a bold and highly aspirational statement, but it reflects who we are and what we do, through our US financial wellness and global businesses. And to that effect, I'm proud to note that we continue to be recognized for our purpose-driven work. Credential was once again ranked as number one on Fortune Magazine's 2019 World's Most Admired Companies list for the fourth consecutive year in our sector, with high marks in areas such as innovation and people management. Additionally, as we noted last quarter, Prudential was named to Fortune's Global Change the World list, where we are the only company in our sector to be recognized. Finally, we were cited as one of the top 50 companies for diversity by Diversity Inc. in 2018 for the 17th year in a row. These distinctions serve as a strong endorsement for the culture we cultivate at Prudential every single day, and which we will continue to build on to drive shareholder value, and make a positive contribution to society. With that, I'll turn it over to Rob, who will provide an update on how our businesses are executing on their key priorities. Rob? Thank you, Charlie.