Assurant 2009 Annual Report Download - page 24

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22
2. Assurant uses book value per diluted share excluding AOCI, as an important measure of
the Company’s stockholder value. Book value per diluted share, excluding AOCI, equals total
stockholders’ equity excluding AOCI divided by diluted shares outstanding. The company believes
book value per diluted share excluding AOCI provides investors a valuable measure of stockholder
value because it excludes the effect of unrealized gains (losses) on investments which tend to
be highly variable from period to period and other accumulated comprehensive income items.
The comparable GAAP measure for this included measure would be book value per diluted share
dened as total stockholders’ equity divided by diluted shares outstanding. Book value per
diluted share was $41.03 as of December 31, 2009, as shown in the reconciliation below.
As of December 31, 2009
Book value per diluted share (excluding AOCI) $ 40.47
Change due to effect of including AOCI $ 0.56
Book value per diluted share $ 41.03
1. Assurant uses annualized operating return on equity (“ROE”) as an important measure of
the Company’s operating performance. Annualized operating ROE equals net operating income
for the periods presented divided by average stockholders’ equity for the year-to-date period,
excluding AOCI, and then the return is annualized, if necessary. The Company believes annualized
operating ROE provides investors a valuable measure of the performance of the Company’s
ongoing business, because it excludes the effect of net realized gains (losses) on investments
that tend to be highly variable and those events that are unusual and/or unlikely to recur. The
comparable GAAP measure for this included measure would be annualized GAAP return on equity,
denedastheannualizedreturnofnetincomedividedbyaveragestockholders’equityforthe
period. Consolidated annualized GAAP ROE for the twelve months ended December 31, 2009 was
10.1 percent, as shown in the reconciliation table below.
ANNUALIZED OPERATING RETURN ON AVERAGE EQUITY (EXCLUDING AOCI)
For the Year Ended December 31, 2009
Net realized gains (losses) on investments 10.1%
Taxbenetrealizedfromthesaleofaninactivesubsidiary -0.8%
Change in tax valuation allowance —
Legal settlement and related expenses 1.8%
Goodwill impairment -7.7%
Change due to effect of including AOCI 6.7%
Annualized GAAP return on average equity 10.1%
Non-GAAP Financial Measures