Total Revenue (USD, millions)

Cost of Goods Sold (COGS) (USD, millions)

Selling, General, and Administrative Expenses (SG&A) (USD, millions)

Research and Development (R&D) (USD, millions)

Depreciation and Amortization (D&A) (USD, millions)

Interest Expense (USD, millions)

Operating Income (EBIT) (USD, millions)

Net Income (USD, millions)

Earnings Per Share (EPS) - Basic (USD)

Earnings Per Share (EPS) - Diluted (USD)

712d196eb24d67504fa68f862b8b1428da1467cc0b8c87fa37e62dd78e4c8f94

Adjustments for Non-Cash Items (USD, millions)

Proceeds from / Repayments of Debt (USD, millions)

Dividend Payments (USD, millions)

Net Change in Cash (USD, millions)

b57900cba9dcf8b4e384cdc7011db773ff0e5ef594bf911392a2cb00bb850df9

59e8151e6ab59543db8cbcb8512401ad3b8abc27cac5b7977d883a35df58118b

- **Annuity sales decreased by 10% year-over-year**, while competitors reported increases, indicating potential market share loss and increased competition.  **[LNC_3382132_15]**
- **Life Insurance segment reported an operating loss in the quarter**, even after adjusting for notable items, raising concerns about profitability in that segment.  **[LNC_3382132_17]**
- **No significant progress on the affiliated reinsurance initiative in Bermuda**, which may delay expected capital relief.  **[LNC_3382132_11]**

0a4ee04e99f614523941bc56ae2e156d39df6ca51fe3c8f2c9a5d065a3bc02de

20147d182a1f3b0c89329ed5059632c5da3b8790fc4d8681423e1cfc949b0932

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

Lincoln National Corporation (LNC), also known as Lincoln Financial Group, is a holding company that operates multiple insurance and retirement businesses through its subsidiary companies. The company, organized under the laws of Indiana in 1968, is headquartered in Radnor, Pennsylvania. LNC offers a wide range of products and services, including annuities, life insurance, group protection, and retirement plan services, marketed under the brand name "Lincoln Financial Group".  **[0000059558-24-000013_lnc-20231231.htm:2]** **[0000059558-24-000069_a2024_11-formsx3lnlagents4.htm:4]** 

1. **Annuities** - Offers variable annuities, fixed annuities (including indexed), and registered index-linked annuities (RILA).  **[0000059558-24-000048_lnc-20240630.htm:7]** **[0000059558-24-000013_lnc-20231231.htm:150]** 
2. **Life Insurance** - Provides universal life insurance (UL), variable universal life insurance (VUL), linked-benefit UL and VUL, indexed universal life insurance (IUL), and term life insurance.  **[0000059558-24-000048_lnc-20240630.htm:7]** **[0000059558-24-000013_lnc-20231231.htm:150]** 
3. **Group Protection** - Supplies group life, disability, and dental insurance products.  **[0000059558-24-000048_lnc-20240630.htm:7]** **[0000059558-24-000013_lnc-20231231.htm:150]** 
4. **Retirement Plan Services** - Delivers employer-sponsored retirement plans and services.  **[0000059558-24-000048_lnc-20240630.htm:7]** **[0000059558-24-000013_lnc-20231231.htm:150]**

e20e7727b632164c26ed9d6eab8b31ef3495dc59d6da3db3e03fba38373f697f

1. Given the minimal impact of your annual assumption review on the Life business this quarter, can you explain why you are confident in your current mortality and policyholder behavior assumptions, especially considering recent industry studies suggesting potential changes?

2. Despite strong free cash flow generation exceeding expectations and taking a dividend from LNBar, you have not resumed share buybacks; can you provide an updated timeline on when investors might expect a return to capital distributions and elaborate on your capital deployment priorities?

3. Annuity sales remained robust in the third quarter even with a pullback in interest rates; do you anticipate any slowdown in sales due to potential future rate declines, and can you clarify whether recent sales growth is driven by new customer inflows or exchanges from existing customers?

4. With competitors announcing reinsurance transactions for guaranteed universal life blocks, what are your updated thoughts on pursuing similar deals for your remaining ULSG exposure, and what key considerations are influencing your decision?

5. In Retirement Plan Services, you noted that fourth-quarter net flows could be challenged by known plan terminations despite strong sales this quarter; can you provide more details on these terminations and how you plan to mitigate their impact on future earnings?

b36b220944c156c766b6fcee924f62f1927b45ad578ef37e0f104cea9a166e17

Death Claims per In-force

Net Amount at Risk for Guaranteed Minimum Benefits

Weighted-average Duration of Additional Liabilities

Weighted-average Age of Policyholders

Commercial Mortgage Loan Prepayment and Bond Make-whole Premiums

Loan-to-Value Ratios for Commercial Mortgage Loans

Debt-Service Coverage Ratios for Commercial Mortgage Loans

Outflows as a Percentage of Average Gross Account Balances

Variable Annuity Net Flows

Fixed Annuity Net Flows

Average Daily Variable Annuity Account Balances

Average Fixed Account Balances

Fair Value of Separate Account Assets

Securities Pledged under Securities Lending Agreements

f80917ba757e95a3a4a2a383e217ca2adf3f07d17cd601d9fb32b6e45bafbf4d

| Program Details          | Program 1          |
|--------------------------|--------------------|
| **Approval Date**        | November 10, 2021  **[0000059558-24-000065_lnc-20240930.htm:138]**  |
| **End Date/Duration**    | No expiration date  **[0000059558-24-000065_lnc-20240930.htm:138]**  |
| **Total Additional Amount** | $1.5 billion  **[0000059558-24-000065_lnc-20240930.htm:138]**  |
| **Remaining Authorization** | $714 million (as of September 30, 2024)  **[0000059558-24-000065_lnc-20240930.htm:138]**  |
| **Details**              | Purpose is to return value to shareholders through share price accretion, dividends, and repurchases. Timing depends on capital ratios, rating agency expectations, free cash flow, and alternative capital uses.  **[0000059558-22-000038_lnc-20220630x10q.htm:110]** **[0000059558-24-000013_lnc-20231231.htm:70]** **[0000059558-24-000065_lnc-20240930.htm:138]** **[0000059558-24-000024_lnc-20240331.htm:118]**  |

436999e53fb00bfadea54f07cfbaea078b435b99377dfa6a6dfebe9e13c20dd1

---

### **1. Q3 2024 Earnings Call**
- **Issued Period**: Q3 2024  
- **Guided Period**: FY 2026  
- **Guidance**:
  1. **Free Cash Flow and Capital Position**: Tracking well toward **2026 outlook target**.  **[LNC_3405061_9]** 
  2. **Leverage and Debt Repayment**: Achieved a **50 basis point reduction in leverage ratio** and **$100 million in debt repayment** for the year.  **[LNC_3405061_13]** 
  3. **Bermuda Subsidiary (Alpine)**: Plans to fully leverage Alpine for flow agreements in the next year.  **[LNC_3405061_13]** 
  4. **Expense Management**: Focus on **expense efficiencies** as part of operating model optimization.  **[LNC_3405061_1]** 
  5. **Annuities Business**: Anticipates **seasonally higher expenses and elevated reinsurance financing charges** in Q4 2024, but supported by strong fundamentals.  **[LNC_3405061_7]** 
  6. **Retirement Plan Services (RPS)**: Expects **spreads to stabilize at around 100 basis points** in Q4 2024, with net flows impacted by plan terminations.  **[LNC_3405061_7]** 
  7. **Group Protection Sales**: Anticipates **year-over-year sales growth** in Q4 2024, focusing on profitability.  **[LNC_3405061_3]** 
  8. **Life Insurance Business**: Realigning product portfolio to emphasize **accumulation and protection products** with more risk sharing.  **[LNC_3405061_2]** 
  9. **Strategic Priorities**: Focus on maintaining a **strong balance sheet**, improving **free cash flow**, and growing the franchise.  **[LNC_3405061_9]** 

---

### **2. Q2 2024 Earnings Call**
- **Issued Period**: Q2 2024  
- **Guided Period**: FY 2024  
- **Guidance**:
  1. **Group Business Margin Expansion**: Expects a **50 to 100 basis point improvement** in group business margins for 2024, compared to the **5.5% margin in 2023**.  **[LNC_3395704_16]** 
  2. **Retirement Plan Services (RPS) Spreads**: Expects **spreads to stabilize at around 100 basis points** in the second half of 2024.  **[LNC_3395704_5]** 
  3. **Capital and RBC Ratio**: Aims to maintain an **RBC ratio of 420%**, including a 20-point buffer above the 400% target.  **[LNC_3395704_6]** 
  4. **Free Cash Flow Conversion**: Goal to improve free cash flow conversion from **35% in 2023 to 45%-55% over the next few years**.  **[LNC_3395704_18]** 

---

### **3. Q1 2024 Earnings Call**
- **Issued Period**: Q1 2024  
- **Guided Period**: FY 2024  
- **Guidance**:
  1. **Life Insurance Business**: Expects **modest earnings for the full year**, with seasonality impacting Q1 due to mortality trends.  **[LNC_3382132_17]** 
  2. **Expense Management**: Focus on **reducing organizational complexity and discretionary spending**, with benefits emerging in Q2 2024 and beyond.  **[LNC_3382132_8]** 
  3. **Capital Position**: Expects to maintain an **RBC ratio of 400%-410%**, with a **$650 million capital benefit** from the wealth management transaction.  **[LNC_3382132_8]** **[LNC_3382132_10]** 
  4. **General Account Optimization**: Pursuing **incremental yield opportunities** to support earnings and product competitiveness.  **[LNC_3382132_9]** 
  5. **Annuities Business**: Anticipates a **strong pipeline** to support momentum in 2024, focusing on **capital efficiency**.  **[LNC_3382132_2]** 
  6. **Retirement Plan Services (RPS)**: Expects **robust sales levels in 2024**, supported by a strong pipeline of known wins.  **[LNC_3382132_4]** 
  7. **Alternative Investments**: Portfolio expected to deliver **solid risk-adjusted long-term returns**.  **[LNC_3382132_9]** 
  8. **Mortality Trends**: Seasonal improvements in mortality expected to **support results in coming quarters**.  **[LNC_3382132_8]** 

---

### **4. Q4 2023 Earnings Call**
- **Issued Period**: Q4 2023  
- **Guided Period**: FY 2024  
- **Guidance**:
  1. **Free Cash Flow Conversion**: Expected to improve from **35% in 2023 to 45%-55% by 2026**.  **[LNC_3372440_7]** 
  2. **RBC Ratio**: Ended 2023 with an **RBC ratio above 400%**, targeting to sustain **above 420%** going forward.  **[LNC_3372440_1]** **[LNC_3372440_8]** 
  3. **Group Protection Margin**: Achieved a **5.5% margin in 2023**, targeting a **7% sustainable margin** over time, with **50-100 basis points of margin expansion in 2024**.  **[LNC_3372440_5]** 
  4. **Annuities Business**: Expected to remain a **key driver of earnings and free cash flow** in 2024, with spread improvement and sequential account balance growth.  **[LNC_3372440_5]** 
  5. **Retirement Plan Services (RPS)**: Account balances surpassed **$100 billion**, with expected **low single-digit growth** in operating income.  **[LNC_3372440_7]** 
  6. **Life Insurance**: Facing headwinds from the Fortitude Re transaction and higher expenses, but focusing on products with **stable cash flows and higher risk-adjusted returns**.  **[LNC_3372440_5]** **[LNC_3372440_2]** 
  7. **Expense Management**: Addressing **elevated expenses** and optimizing the organizational structure, including a **headcount reduction** in early 2024.  **[LNC_3372440_7]** 
  8. **Capital Efficiency**: Exploring **expanded use of affiliated reinsurance** to improve free cash flow.  **[LNC_3372440_7]** 
  9. **Investment Portfolio**: Continuing to optimize the general account for **incremental risk-adjusted yields**.  **[LNC_3372440_7]** 
  10. **Market Assumptions**: Assumes **6% market appreciation** in estimates for 2026 metrics.  **[LNC_3372440_7]** 

--- 

This table summarizes the issued and guided periods, along with the exhaustive guidance provided in each earnings call.

5e66223724c78b9233ea0daaad909751adc38a553799d5cb0527019e29c397bd

| Name                  | Position                                                                 | Start Date        | Short Bio                                                                                                                                                                                                 |
|-----------------------|--------------------------------------------------------------------------|-------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Ellen G. Cooper       | President, CEO, and Director                                             | May 2022          | Ellen G. Cooper has served as President, CEO, and Director of LNC since May 2022. She joined LNC in 2012 as Executive Vice President and Chief Investment Officer, holding various leadership roles.  **[0000059558-24-000013_lnc-20231231.htm:69]** **[0001193125-24-092543_d649548ddef14a.htm:28]** **[0001193125-23-100016_d433515ddef14a.htm:27]**                                     |
| Craig T. Beazer       | Executive Vice President and General Counsel                             | December 2020     | Craig T. Beazer has served as Executive Vice President and General Counsel at LNC since December 2020. He previously held roles at KeyCorp and The Bank of New York Mellon Corporation.  **[0000059558-24-000013_lnc-20231231.htm:69]**                                                      |
| Jayson R. Bronchetti  | Executive Vice President, Chief Investment Officer, Head of Hedging and Sustainability | May 2023          | Jayson R. Bronchetti serves as Executive Vice President, Chief Investment Officer, Head of Hedging (since May 2023), and Sustainability (since May 2022) at LNC. He has been Chief Investment Officer since November 2021.  **[0000059558-24-000013_lnc-20231231.htm:69]**                   |
| Matthew Grove         | Executive Vice President and President of Retail Solutions               | July 2022         | Matthew Grove joined LNC in July 2022 as the Executive Vice President and President of Retail Solutions. He previously served as CEO and President at Resolution Life USA.  **[0000059558-24-000013_lnc-20231231.htm:69]** **[0001193125-24-092543_d649548ddef14a.htm:39]**                                                                |
| John C. Kennedy       | Executive Vice President and Chief Distribution and Brand Officer, President of LFD | March 2021        | John C. Kennedy is the Executive Vice President and Chief Distribution and Brand Officer at LNC, having assumed the role of head of distribution in March 2021 and the role of head of brand in March 2022.  **[0000059558-24-000013_lnc-20231231.htm:69]**                                   |
| Christopher Neczypor  | Executive Vice President and Chief Financial Officer                     | February 17, 2023 | Christopher Neczypor has served as Executive Vice President and Chief Financial Officer of LNC since February 17, 2023. He was previously Executive Vice President and Chief Strategy Officer.  **[0000059558-24-000013_lnc-20231231.htm:69]** **[0001193125-24-092543_d649548ddef14a.htm:39]**                                            |
| Andrew D. Rallis      | Executive Vice President and Chief Risk Officer                          | May 2023          | Andrew D. Rallis is the Executive Vice President and Chief Risk Officer at LNC, a position he has held since May 2023. He previously served as the Executive Vice President and Global Chief Actuary at MetLife, Inc..  **[0000059558-24-000013_lnc-20231231.htm:69]** **[0001214659-23-007421_xslF345X02/marketforms-61546.xml:0]**                   |
| James Reid            | Executive Vice President and President of Workplace Solutions            | August 2022       | James Reid serves as Executive Vice President and President of Workplace Solutions at LNC. He assumed this role in August 2022. He was previously President and CEO of Versant Health.  **[0000059558-24-000013_lnc-20231231.htm:69]** **[0001193125-24-092543_d649548ddef14a.htm:39]**                                                    |
| Kenneth S. Solon      | Executive Vice President, Chief Information Officer, Head of IT and Digital, and Head of Enterprise Services | July 2018          | Kenneth S. Solon serves as Executive Vice President, Chief Information Officer, Head of IT and Digital, and Head of Enterprise Services at LNC. He has held the role of Executive Vice President, Chief Information Officer since July 2018.  **[0000059558-24-000013_lnc-20231231.htm:69]**  |
| Sean N. Woodroffe     | Executive Vice President and Chief People, Culture, and Communications Officer | May 2023          | Sean N. Woodroffe serves as Executive Vice President and Chief People, Culture, and Communications Officer at LNC. He assumed this role in May 2023. He was previously Senior Executive Vice President and Chief People Officer at TIAA.  **[0000059558-24-000013_lnc-20231231.htm:69]**      |
| Nancy A. Smith        | Senior Vice President and Secretary                                      | February 24, 2023 | Nancy A. Smith serves as Senior Vice President and Secretary at LNC. She is listed as the agent for service and signatory on multiple filings, including registration statements and proxy materials.  **[0001193125-23-048768_d435698ds3asr.htm:0]**                                         |

55792293f2e99e65c34fbf3575d9930c0a221afc165cccd004be5fb050688e1e

- **Increased competition in the group protection market**, with new entrants potentially impacting pricing and margins in the small market segment.  **[LNC_3395704_11]**
- **Expected moderation in group protection earnings** in the second half due to seasonality and timing of experience refunds, potentially leading to lower margins compared to the strong first half results.  **[LNC_3395704_16]**
- **Challenges in improving free cash flow conversion**, as the company needs to take significant steps over the next few years, including capital investments and expense optimization, which may affect capital return and operating efficiency.  **[LNC_3395704_18]** ,  **[LNC_3395704_9]**

7f9c5f37013810a477bebdcc53578dfe7297fc49d10696cf837e17ca0098eb19

- **The company lacks specific guidance on future free cash flow, creating uncertainty about meeting 2026 targets**.  **[LNC_3405061_10]**
- **Sustainability of annuity sales growth is uncertain, especially if current sales reflect a pull-forward effect or if interest rates change**.  **[LNC_3405061_11]**
- **Remaining exposure to universal life secondary guarantee (ULSG) products without plans for further reinsurance transactions may pose risks**.  **[LNC_3405061_14]**

616db18b6935c75ca03c670de970fcc042c9b1580bff4578c67bd71a05e74397

- **Lincoln National Corporation (LNC) is improving its capital position**, moving towards completing the Osaic transaction, which will help reach their **RBC buffer target of 420**, providing additional financial flexibility.  **[LNC_3382132_18]** **[LNC_3382132_14]**
- **The hedging program for variable annuities is performing well**, with excess capital from a regulatory perspective, and is working as intended, enhancing financial stability.  **[LNC_3382132_12]**
- **LNC is committed to deleveraging and improving its capital structure**, including plans to **repay preferred debt due in 2027**, reducing the cost of capital and strengthening the balance sheet.  **[LNC_3382132_14]**

74dd0234a0c2082bbf4808d10f7e96fe5487be1bec1bb47277604e94162a98e7

- **Significant decline in Life Insurance segment earnings**: The Life Insurance business saw earnings decrease from about **$600 million** a few years ago to nearly zero in 2023 due to factors like assumption resets, lower prepay income, and reinsurance impacts. While some improvement is expected, earnings are not anticipated to return to previous levels in the near term.  **[LNC_3372440_18]**
- **Elevated debt levels and upcoming expensive capital obligations**: The company acknowledges elevated leverage and the presence of an expensive preferred stock coming due in a couple of years, which could strain capital and liquidity despite plans to deleverage over time.  **[LNC_3372440_11]**
- **Uncertainty around share buyback timing**: Management is not providing any specific timing for the resumption of share buybacks, focusing instead on strengthening the balance sheet and improving free cash flow, which may limit shareholder returns in the near term.  **[LNC_3372440_15]**

4eebb15f3eb0deee875fcf85214fd6b006ef196a74a357ed7fb078bf5b20c82b

- Lincoln Financial's **Group Protection business** has experienced strong growth, with **supplemental health sales more than doubling in 2023** and **small market sales increasing by 15%**, driven by strategic realignment and tailored offerings for different employer levels.  **[LNC_3372440_21]** **[LNC_3372440_19]**
- The company has **significantly improved Group Protection margins from 1% to over 5%**, a **400 basis point increase year-over-year**, due to strategic investments and operational improvements, with confidence in further expansion towards peer levels above 10%.  **[LNC_3372440_19]**
- Lincoln is **strengthening its balance sheet**, increasing its **RBC ratio from 377% to between 400% and 410%**, with plans to **delever** and **increase financial flexibility**, which will support **increasing shareholder returns** in the future.  **[LNC_3372440_15]** **[LNC_3372440_11]**

b1361bcbe12070edffe3c88f28dd8e5214a904d36ef433abade098b188da3ddb

1. **Free Cash Flow Progress**  
   **Q:** How is free cash flow tracking toward 2026 targets?  
   **A:** Management feels confident, with free cash flow conversion exceeding expectations and tracking well toward the **45-55%** target by 2026.  **[LNC_3405061_10]**  They generated above-expected free cash flow, repaid **$100 million** of debt, spent **$140-150 million** on severance and legal charges, and are on track to pay a **$300 million** dividend.  **[LNC_3405061_10]**  Actions like expense reductions and capitalizing the Bermuda subsidiary are supporting this progress.  **[LNC_3405061_10]** 

2. **Share Buyback Outlook**  
   **Q:** When might share buybacks resume?  
   **A:** Management prioritizes repaying preferred securities and deleveraging before resuming share buybacks.  **[LNC_3405061_13]**  The leverage ratio decreased by **50 basis points** this quarter, and **$100 million** of debt has been repaid this year.  **[LNC_3405061_13]**  No update was provided beyond existing guidance, but they feel they are tracking well toward their targets.  **[LNC_3405061_13]** 

3. **ULSG Block Disposition**  
   **Q:** Any plans to sell remaining ULSG exposure?  
   **A:** While acknowledging an attractive market for these liabilities, management is not relying on another deal and believes they can improve free cash flow from the Legacy Life Block without selling.  **[LNC_3405061_14]**  They continue to evaluate options but focus on priorities like operating the Bermuda affiliate and deleveraging.  **[LNC_3405061_14]** 

4. **Annuity Sales Drivers**  
   **Q:** What's driving strong annuity sales?  
   **A:** Broad-based annuity sales remain strong due to higher rates and demographics with more individuals approaching retirement.  **[LNC_3405061_11]**  Despite a rate pullback in Q3, rates have risen again, and there's increased advisor focus on annuities as solutions for clients.  **[LNC_3405061_11]** 

5. **RILA Market Position**  
   **Q:** How is the new RILA product performing?  
   **A:** The refreshed RILA product, Lincoln Level Advantage 2.0, led to **$1.2 billion** in sales—the strongest quarter in nearly two years.  **[LNC_3405061_15]**  New features enable competition on product features rather than price, and despite increased competition, they see a growing market.  **[LNC_3405061_15]** 

6. **Assumption Review Impact**  
   **Q:** Why were there no significant assumption changes?  
   **A:** The assumption review resulted in a modest **$8 million** positive impact on operating income.  **[LNC_3405061_12]**  Mortality and policyholder behavior assumptions align with experience, and individual items were less significant than in prior years.  **[LNC_3405061_12]** 

d56b4df167d3abee2f5b2d2a62db1b0f02de39af49315a8c22e506d42334e0e3

- **Annuity sales increased by 48% year-over-year to $3.8 billion**, driven by significant growth in fixed annuities and successful operational enhancements, indicating strong customer demand and effective strategy execution.  **[LNC_3395704_12]**
- LNC is successfully shifting towards a more balanced product mix, with **over 70% of annuity sales** coming from spread and spread-like products, which enhances risk-adjusted returns and capital efficiency.  **[LNC_3395704_12]**
- The establishment of an affiliated **Bermuda reinsurance subsidiary**, which is **overcapitalized relative to its long-term target**, positions the company to improve free cash flow and competitiveness in key product markets.  **[LNC_3395704_10]**

7023edc8513930960d3c7731ed44b1a21002943438dfd17c6886019d93217bab

- **Lincoln Financial is generating free cash flow above expectations and is on track to meet or exceed their 2026 targets, including improving free cash flow conversion ratios from 35% in 2023 toward 45%-55% by 2026, and they have repaid $100 million of debt this year, reducing leverage ratios.**  **[LNC_3405061_10]** **[LNC_3405061_13]**
- **The company is experiencing strong annuity sales, particularly in Registered Index-Linked Annuities (RILA), with $1.2 billion in RILA sales—the strongest in nearly two years—driven by the launch of Lincoln Level Advantage 2.0 with new features that are resonating with customers.**  **[LNC_3405061_15]**
- **Their annual assumption review resulted in a favorable $8 million impact on operating income in the life business, indicating that policyholder behavior and mortality assumptions are now in line with experience and expectations.**  **[LNC_3405061_12]**

92c94ad53c036c1d9c8e7c7ea8bed9e922ccaf472aef44930a3982bf92acc70f

Lincoln National Corp (LNC)

Financials