Summary Financial Results¹

(In millions, except per share data)

Three Months Ended

March 31, 2025

Gross sales

$        2,902

Net sales

$        2,181

$          2,302

Assets under management (AUM)

$      54,546

$        49,787

Average assets under management (AAUM) YTD

$      53,877

$        49,400

AUM before flow reinsurance

$      67,398

$        58,020

Adjusted return on assets

0.68 %

0.87 %

Net earnings (loss)

$            (25)

$             111

Net earnings (loss) per share

$         (0.20)

$            0.88

Adjusted net earnings

$             91

$             108

Adjusted net earnings per share

$          0.72

$            0.86

Book value per common share

$        30.47

$          26.16

Book value per common share, excluding AOCI

$        43.31

$          41.10

¹See definition of non-GAAP measures below

Book value per common share excluding AOCI as of December 31, 2024

$

44.28

Common stock offering

(0.63)

Book value per common share excluding AOCI, after effect of common stock offering

$

43.65

Adjusted net earnings and other

Book value per common share excluding AOCI, before capital actions & mark-to-market

$

44.24

Capital actions

(0.15)

Book value per common share excluding AOCI, before mark-to-market

$

44.09

Mark-to-market movement

Book value per common share excluding AOCI as of March 31, 2025

$

43.31

F&G ANNUITIES & LIFE, INC.

CONSOLIDATED BALANCE SHEETS

(In millions, except per share data)

(Unaudited)

Assets

March 31, 2025

December 31, 2024

Investments

Fixed maturity securities available for sale, at fair value, (amortized cost of $51,026),

net of allowance for credit losses of $80 at March 31, 2025

$                      47,909

$                      46,317

Preferred securities, at fair value

253

270

Equity securities, at fair value

101

145

Derivative investments

702

792

Mortgage loans, net of allowance for credit losses of $73 at March 31, 2025

6,366

5,926

Investments in unconsolidated affiliates (certain investments at fair value of $272 at

March 31, 2025)

4,127

3,565

Other long-term investments

587

580

Policy loans

115

104

Short-term investments

549

2,410

Total investments

$                      60,709

$                      60,109

Cash and cash equivalents

3,293

2,264

Reinsurance recoverable, net of allowance for credit losses of $20 at March 31, 2025

14,746

13,369

Goodwill

2,179

2,179

Prepaid expenses and other assets (certain assets held at fair value of $11 million at

March 31, 2025)

904

950

Other intangible assets, net

5,721

5,572

Market risk benefits asset

187

189

Deferred tax asset, net

268

299

Total assets

$                      88,007

$                      84,931

Liabilities and Equity

Contractholder funds

$                      57,823

$                      56,404

Future policy benefits

9,065

8,749

Market risk benefits liability

635

549

Accounts payable and accrued liabilities

2,314

2,219

Income taxes payable

9

5

Notes payable

2,234

2,171

Funds withheld for reinsurance liabilities

11,442

10,758

Total liabilities

$                      83,522

$                      80,855

Equity

Preferred stock $0.001 par value; authorized 25,000,000 shares as of March 31, 2025;

outstanding and issued shares of 5,000,000 as of March 31, 2025

—

—

Common stock $0.001 par value; authorized 500,000,000 shares as of March 31, 2025;

outstanding and issued shares of 134,707,419 and 135,917,408 as of March 31, 2025,

respectively

—

—

Additional paid-in-capital

3,741

3,464

Retained earnings

2,389

2,440

Accumulated other comprehensive income (loss) (“AOCI”)

(1,734)

(1,923)

Treasury stock, at cost (1,209,989 shares as of March 31, 2025)

(33)

(30)

Total F&G Annuities & Life, Inc. shareholders’ equity

$                       4,363

$                       3,951

Non-controlling interests

122

125

Total equity

$                       4,485

$                       4,076

Total liabilities and equity

$                      88,007

$                      84,931

F&G ANNUITIES & LIFE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

FIRST QUARTER INFORMATION

(In millions, except per share data)

(Unaudited)

Three months ended

March 31, 2025

March 31, 2024

Revenues

Life insurance premiums and other fees

$                                 489

$                                718

Interest and investment income

666

616

Owned distribution revenues

16

23

Recognized gains and (losses), net

(263)

212

Total revenues

908

1,569

Benefits and expenses

Benefits and other changes in policy reserves

524

1,161

Market risk benefit (gains) losses

109

(11)

Depreciation and amortization

153

123

Personnel costs

67

66

Other operating expenses

41

58

Interest expense

40

30

Total benefits and expenses

934

1,427

Earnings (loss) before income taxes

(26)

142

Income tax expense (benefit)

(5)

26

Net earnings (loss)

(21)

116

Less: Non-controlling interests

—

1

Net earnings (loss) attributable to F&G

(21)

115

Less: Preferred stock dividend

4

4

Net earnings (loss) attributable to F&G common shareholders

$                                 (25)

$                                111

Net earnings (loss) attributable to F&G common shareholders per common share

Basic

$                              (0.20)

$                               0.90

Diluted

$                              (0.20)

$                               0.88

Weighted average common shares used in computing net earnings (loss) per common share

Basic

126

124

Diluted

126

130

Non-GAAP Measures and Other Information

RECONCILIATION OF NET EARNINGS (LOSS) TO ADJUSTED NET EARNINGS (LOSS)

Three months ended

(In millions)

March 31, 2025

March 31, 2024

Reconciliation of net earnings (loss) to adjusted net earnings attributable to

common shareholders ¹

Net earnings (loss) attributable to common shareholders

$                          (25)

$                          111

Non-GAAP adjustments

Recognized (gains) and losses, net

Net realized and unrealized (gains) losses on fixed maturity available-for-sale

securities, equity securities and other invested assets

15

(48)

Change in allowance for expected credit losses

22

1

Change in fair value of reinsurance related embedded derivatives

41

18

Change in fair value of other derivatives and embedded derivatives

(49)

61

Recognized (gains) losses, net

29

32

Market related liability adjustments

103

(55)

Purchase price amortization

15

22

Transaction costs, other and non-recurring items

1

—

Non-controlling interest

(2)

(3)

Income taxes adjustment

(30)

1

Adjusted net earnings attributable to common shareholders ¹

$                           91

$                          108

¹See definition of non-GAAP measures below

RECONCILIATION OF TOTAL EQUITY, TOTAL EQUITY EXCLUDING ACCUMULATED OTHER COMPREHENSIVE INCOME (AOCI), BOOK VALUE PER SHARE AND BOOK VALUE PER SHARE EXCLUDING AOCI

Three months ended

(In millions)

March 31,

2025

December 31,

2024

September 30,

2024

June 30,

2024

Total F&G Annuities & Life, Inc. shareholders’ equity

4,363

3,951

4,346

3,654

Less: Preferred stock

250

250

250

250

Total F&G equity attributable to common shareholders

4,113

3,701

4,096

3,404

Less: AOCI

(1,734)

(1,923)

(1,231)

(1,953)

Total F&G equity attributable to common shareholders, excluding AOCI

$                5,847

$                5,624

$                5,327

$                5,357

Common shares outstanding

135

127

126

126

Book value per common share

$                30.47

$                29.14

$                32.51

$                27.02

Book value per common share, excluding AOCI

$                43.31

$                44.28

$                42.28

$                42.52

ASSETS UNDER MANAGEMENT (AUM) ROLLFORWARD, AVERAGE ASSETS UNDER MANAGEMENT (AAUM) AND AUM BEFORE FLOW REINSURANCE

Three months ended

(In millions)

March 31,

2025

December 31,

2024

September 30,

2024

June 30,

2024

AUM at beginning of period

$               53,817

$               52,464

$               52,208

$               49,787

Net new business asset flows

1,790

2,270

1,726

3,057

Net flow reinsurance to third parties

(1,395)

(1,046)

(1,248)

(930)

Net capital transaction proceeds (disbursements)

334

129

(222)

294

AUM at end of period¹

$               54,546

$               53,817

$               52,464

$               52,208

AAUM YTD¹

$               53,877

$               51,574

$               50,970

$               50,181

AUM before flow reinsurance

$               67,398

$               65,274

$               62,875

$               61,370

SALES HIGHLIGHTS

Three months ended

(In millions)

March 31, 2025

March 31, 2024

Indexed annuities (“FIA/RILA”)

1,461

1,437

Indexed universal life (“IUL”)

43

42

Funding agreements (“FABN/FHLB”)

525

105

Pension risk transfer (“PRT”)

311

584

Subtotal, ex. MYGA

2,340

2,168

Fixed rate annuities (“MYGA”)

562

1,327

Gross sales⁽¹⁾

2,902

3,495

Sales attributable to flow reinsurance to third parties

(721)

(1,193)

Net sales⁽¹⁾

$                2,181

$                2,302

¹See definition of non-GAAP measures below

DEFINITIONS

The following represents the definitions of non-GAAP measures used by F&G:

Adjusted Net Earnings attributable to common shareholders

Adjusted net earnings attributable to common shareholders is a non-GAAP economic measure we use to evaluate financial performance each period. Adjusted net earnings attributable to common shareholders is calculated by adjusting net earnings (loss) attributable to common shareholders to eliminate:

(i)   Recognized (gains) and losses, net: the impact of net investment gains/losses, including changes in allowance for expected credit losses and other than temporary impairment (“OTTI”) losses, recognized in operations; and the effects of changes in fair value of the reinsurance related embedded derivative and other derivatives, including interest rate swaps and forwards;

(ii)   Market related liability adjustments: the impacts related to changes in the fair value, including both realized and unrealized gains and losses, of index product related derivatives and embedded derivatives, net of hedging cost; the impact of initial pension risk transfer deferred profit liability losses, including amortization from previously deferred pension risk transfer deferred profit liability losses; and the changes in the fair value of market risk benefits by deferring current period changes and amortizing that amount over the life of the market risk benefit;

(iii)  Purchase price amortization: the impacts related to the amortization of certain intangibles (internally developed software, trademarks and value of distribution asset and the change in fair value of liabilities recognized as a result of acquisition activities);

(iv)  Transaction costs: the impacts related to acquisition, integration and merger related items;

(v)  Other and “non-recurring,” “infrequent” or “unusual items”: Other adjustments include removing any charges associated with U.S. guaranty fund assessments as these charges neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, but result from external situations not controlled by the Company. Further, Management excludes certain items determined to be “non-recurring,” “infrequent” or “unusual” from adjusted net earnings when incurred if it is determined these expenses are not a reflection of the core business and when the nature of the item is such that it is not reasonably likely to recur within two years and/or there was not a similar item in the preceding two years;

(vi)  Non-controlling interest on non-GAAP adjustments: the portion of the non-GAAP adjustments attributable to the equity interest of entities that F&G does not wholly own; and

(vii)  Income taxes: the income tax impact related to the above-mentioned adjustments is measured using an effective tax rate, as appropriate by tax jurisdiction.

While these adjustments are an integral part of the overall performance of F&G, market conditions and/or the non-operating nature of these items can overshadow the underlying performance of the core business. Accordingly, management considers this to be a useful measure internally and to investors and analysts in analyzing the trends of our operations. Adjusted net earnings should not be used as a substitute for net earnings (loss). However, we believe the adjustments made to net earnings (loss) in order to derive adjusted net earnings provide an understanding of our overall results of operations.

Adjusted Weighted Average Diluted Shares Outstanding

Adjusted weighted average diluted shares outstanding is the same as weighted average diluted shares outstanding except for periods in which our preferred stocks are calculated to be dilutive to either net earnings attributable to common shareholders or adjusted net earnings attributable to common shareholders, but not both, or there is a net earnings loss attributable to common shareholders on a GAAP basis, but positive adjusted net earnings attributable to common shareholders using the non-GAAP measure. The above exceptions are made to include relevant diluted shares when dilution occurs and exclude relevant diluted shares when dilution does not occur for adjusted net earnings attributable to common shareholders.

Management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders.

Adjusted Net Earnings attributable to common shareholders per Diluted Share

Adjusted net earnings attributable to common shareholders per diluted share is calculated as adjusted net earnings plus preferred stock dividend (if the preferred stock has created dilution). This sum is then divided by the adjusted weighted-average diluted shares outstanding.

Management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders.

Adjusted Return on Assets attributable to Common Shareholders

Adjusted return on assets attributable to common shareholders is calculated by dividing year-to-date annualized adjusted net earnings attributable to common shareholders by year-to-date AAUM.  Return on assets is comprised of net investment income, less cost of funds, flow reinsurance fee income, owned distribution margin and less expenses (including operating expenses, interest expense and income taxes) consistent with our adjusted net earnings definition and related adjustments. Cost of funds includes liability costs related to cost of crediting as well as other liability costs. Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing financial performance and profitability earned on AAUM.

Adjusted Return on Average Common Shareholder Equity, excluding AOCI

Adjusted return on average common shareholder equity is calculated by dividing the rolling four quarters adjusted net earnings attributable to common shareholders, by total average F&G equity attributable to common shareholders, excluding AOCI.  Average equity attributable to common shareholders, excluding AOCI for the twelve month rolling period is the average of 5 points throughout the period. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be a useful internally and for investors and analysts to assess the level return driven by the Company’s adjusted earnings.

Assets Under Management (AUM)

AUM is comprised of the following components and is reported net of reinsurance assets ceded in accordance with GAAP:

(i) total invested assets at amortized cost, excluding investments in unconsolidated affiliates, owned distribution and derivatives;

(ii) investments in unconsolidated affiliates at carrying value;

(iii) related party loans and investments;

(iv) accrued investment income;

(v) the net payable/receivable for the purchase/sale of investments; and

(vi) cash and cash equivalents excluding derivative collateral at the end of the period.

Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio that is retained.

AUM before Flow Reinsurance

AUM before Flow Reinsurance is comprised of AUM plus flow reinsured assets, including certain block reinsured assets that have the characteristics of flow reinsured assets.

Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio including reinsured assets.

Average Assets Under Management (AAUM) (Quarterly and YTD)

AAUM is calculated as AUM at the beginning of the period and the end of each month in the period, divided by the total number of months in the period plus one.  

Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the rate of return on retained assets.

Book Value per Common Share, excluding AOCI

Book value per Common share, excluding AOCI is calculated as total F&G equity attributable to common shareholders divided by the total number of shares of common stock outstanding. Management considers this to be a useful measure internally and for investors and analysts to assess the capital position of the Company.

Debt-to-Capitalization Ratio, excluding AOCI

Debt-to-capitalization ratio is computed by dividing total aggregate principal amount of debt by total capitalization (total debt plus total equity, excluding AOCI). Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing its capital position.

Return on Average F&G common shareholder Equity, excluding AOCI

Return on average F&G common shareholder equity, excluding AOCI  is calculated by dividing the rolling four quarters net earnings (loss) attributable to common shareholders, by total average F&G equity attributable to common shareholders, excluding AOCI. Average F&G equity attributable to common shareholders, excluding AOCI for the twelve month rolling period is the average of 5 points throughout the period. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders.

Sales

Annuity, IUL, funding agreement and non-life contingent PRT sales are not derived from any specific GAAP income statement accounts or line items and should not be viewed as a substitute for any financial measure determined in accordance with GAAP.  Sales from these products are recorded as deposit liabilities (i.e., contractholder funds) within the Company’s consolidated financial statements in accordance with GAAP. Life contingent PRT sales are recorded as premiums in revenues within the consolidated financial statements. Management believes that presentation of sales, as measured for management purposes, enhances the understanding of our business and helps depict longer term trends that may not be apparent in the results of operations due to the timing of sales and revenue recognition.

Total Capitalization, excluding AOCI

Total capitalization, excluding AOCI is based on total equity excluding the effect of AOCI and the total aggregate principal amount of debt.  Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to provide useful supplemental information internally and to investors and analysts to help assess the capital position of the Company.

Total Equity, excluding AOCI

Total equity, excluding AOCI is based on total equity excluding the effect of AOCI. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to provide useful supplemental information internally and to investors and analysts assessing the level of earned equity on total equity.

Total F&G Equity attributable to common shareholders, excluding AOCI

Total F&G equity attributable to common shareholder, excluding AOCI is based on total F&G Annuities & Life, Inc. shareholders’ equity excluding the effect of AOCI and preferred stocks, including additional paid-in-capital. Since AOCI fluctuates from quarter to quarter due to unrealized changes in the fair value of available for sale investments, changes in instrument-specific credit risk for market risk benefits and discount rate assumption changes for the future policy benefits, management considers this non-GAAP financial measure to be useful internally and for investors and analysts to assess the level of return driven by the Company that is available to common shareholders.