MetLife 2005 Annual Report Download - page 124

METLIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Three Months Ended
March 31, June 30, September 30, December 31,
(In millions, except per share data)
2004
Total revenues ******************************************************************* $ 9,415 $ 9,467 $ 9,972 $ 9,950
Total expenses ******************************************************************* $ 8,487 $ 8,402 $ 9,003 $ 9,246
Income from continuing operations ************************************************** $ 638 $ 828 $ 679 $ 492
Income from discontinued operations, net of income taxes ****************************** $ 46 $ 126 $ 16 $ 19
Income before cumulative effect of a change in accounting, net of income taxes ************ $ 684 $ 954 $ 695 $ 511
Net income available to common shareholders **************************************** $ 598 $ 954 $ 695 $ 511
Basic earnings per share:
Income from continuing operations, per common share ******************************* $ 0.84 $ 1.10 $ 0.91 $ 0.66
Income from discontinued operations, net of income taxes, per common share *********** $ 0.06 $ 0.17 $ 0.02 $ 0.03
Income before cumulative effect of a change in accounting, net of income taxes, per
common share *************************************************************** $ 0.90 $ 1.26 $ 0.93 $ 0.69
Net income available to common shareholders, per common share ********************* $ 0.79 $ 1.26 $ 0.93 $ 0.69
Diluted earnings per share:
Income from continuing operations, per common share ******************************* $ 0.84 $ 1.09 $ 0.90 $ 0.66
Income from discontinued operations, net of income taxes, per common share *********** $ 0.06 $ 0.17 $ 0.02 $ 0.03
Income before cumulative effect of a change in accounting, net of income taxes, per
common share *************************************************************** $ 0.90 $ 1.26 $ 0.92 $ 0.68
Net income available to common shareholders, per common share ********************* $ 0.79 $ 1.26 $ 0.92 $ 0.68
18. Business Segment Information
The Company provides insurance and financial services to customers in the United States, Asia Pacific, Latin America, and Europe. The Company’s
business is divided into five operating segments: Institutional, Individual, Auto & Home, International and Reinsurance, as well as Corporate & Other.
These segments are managed separately because they either provide different products and services, require different strategies or have different
technology requirements.
As a part of the Travelers acquisition, management realigned certain products and services within several of the Company’s segments to better
conform to the way it manages and assesses its business. Accordingly, all prior period segment results have been adjusted to reflect such product
reclassifications. Also in connection with the Travelers acquisition, management has utilized its economic capital model to evaluate the deployment of
capital based upon the unique and specific nature of the risks inherent in the Company’s existing and newly acquired businesses and has adjusted such
allocations based upon this model.
Economic Capital is an internally developed risk capital model, the purpose of which is to measure the risk in the business and to provide a basis
upon which capital is deployed. The Economic Capital model accounts for the unique and specific nature of the risks inherent in Metlife’s businesses. As
a part of the economic capital process a portion of net investment income is credited to the segments based on the level of allocated equity.
Institutional offers a broad range of group insurance and retirement & savings products and services, including group life insurance, non-medical
health insurance, such as short and long-term disability, long-term care, and dental insurance, and other insurance products and services. Individual
offers a wide variety of protection and asset accumulation products, including life insurance, annuities and mutual funds. Auto & Home provides personal
lines property and casualty insurance, including private passenger automobile, homeowners and personal excess liability insurance. International
provides life insurance, accident and health insurance, annuities and retirement & savings products to both individuals and groups. Through the
Company’s majority-owned subsidiary, RGA, Reinsurance provides reinsurance of life and annuity policies in North America and various international
markets. Additionally, reinsurance of critical illness policies is provided in select international markets.
Corporate & Other contains the excess capital not allocated to the business segments, various start-up entities, including MetLife Bank and run-off
entities, as well as interest expense related to the majority of the Company’s outstanding debt and expenses associated with certain legal proceedings
and income tax audit issues. Corporate & Other also includes the elimination of all intersegment amounts, which generally relate to intersegment loans,
which bear interest rates commensurate with related borrowings, as well as intersegment transactions. Additionally, the Company’s asset management
business, including amounts reported as discontinued operations, is included in the results of operations for Corporate & Other. See Note 19 for
disclosures regarding discontinued operations, including real estate.
MetLife, Inc.
F-62