Assurant 2013 Annual Report Download - page 9

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2013 ASSURANT ANNUAL REPORT > 7
Non-GAAP Financial Measures
Assurant uses the following non-GAAP fi nancial measures to analyze the Company’s operating performance
for the years presented in this report. Because Assurant’s calculation of these measures may differ from
similar measures used by other companies, investors should be careful when comparing Assurant’s non-GAAP
fi nancial measures to those of other companies.
1 Assurant uses net operating income as an important measure of
the Company’s operating performance. As shown in the following
reconciliation table, net operating income equals net income, excluding
net realized gains (losses) on investments and other unusual and/or
infrequent items. The Company believes net operating income provides
investors a valuable measure of the performance of the Company’s
ongoing business, because it excludes both the effect of net realized
gains (losses) on investments that tend to be highly variable from period
to period, and those events that are unusual and/or unlikely to recur.
2 Assurant uses operating return on equity (ROE), excluding accumulated
other comprehensive income (AOCI), as an important measure of the
Company’s operating performance. Operating ROE equals net operating
income for the year presented divided by average stockholders’
equity for the year, excluding AOCI. The Company believes operating
ROE, excluding AOCI, 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 from period-to-period, AOCI items and those events that
are unusual and/or unlikely to recur. The comparable GAAP measure
would be GAAP ROE, defi ned as net income, for the year presented,
divided by average stockholders’ equity for the year. Consolidated GAAP
ROE for the twelve months ended Dec. 31, 2013 was 9.8 percent, as
shown in the following reconciliation table.
2013 2012 2011 2010 2009
Assurant Solutions $125.2 $123.8 $136.1 $101.5 $122.1
Assurant Specialty Property 423.6 305.0 303.7 424.5 405.5
Assurant Health 5.9 52.0 40.9 54.9 (29.1)
Assurant Employee Benefi ts 34.6 58.1 43.1 63.6 42.3
Corporate and other (82.9) (62.4) (60.0) (52.4) (48.3)
Amortization of deferred gain on disposal of businesses 10.6 12.0 13.3 6.8 14.6
Interest expense (50.5) (39.2) (39.2) (39.4) (39.4)
Net operating income 466.5 449.3 437.9 559.5 467.7
Adjustments:
Net realized gains (losses) on investments 22.4 41.8 21.1 31.5 (34.8)
Change in tax valuation allowance - - 80.0 (6.0) -
Change in tax liabilities - (7.4) - - -
Legal settlement, net of related expenses - - - - 83.5
Goodwill impairment - - - (306.4) (83.0)
Net income $488.9 $483.7 $539.0 $278.6 $433.4
(dollars in millions, net of tax)
2013
Operating return on average equity (excluding AOCI) 10.6%
Net realized gains on investments 0.5%
Change due to effect of including AOCI (1.3)%
GAAP return on average equity 9.8%