UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended June 30, 2004
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number: 333-65423
MONY LIFE INSURANCE COMPANY OF AMERICA
(Exact name of Registrant as specified in its charter)
| Arizona | 86-0222062 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
1290 Avenue of the Americas,
New York, New York 10104
(212) 554-1234
(Address, including zip code, and telephone number,
including area code, of Registrant’s principal executive offices)
1740 Broadway,
New York, New York 10019
(212) 708-2000
(Former address, including zip code, and telephone number,
including area code, of Registrant’s principal executive offices)
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
As of August 13, 2004, 2,500,000 shares of the Registrant’s Common Stock were outstanding.
REDUCED DISCLOSURE FORMAT
Registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the Reduced Disclosure Format.
MONY LIFE INSURANCE COMPANY OF AMERICA
FORM 10-Q
| * | Omitted pursuant to General Instruction H of Form 10-Q. |
1
FINANCIAL INFORMATION
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM CONDENSED BALANCE SHEETS
As of June 30, 2004 and December 31, 2003
| June 30, 2004 |
December 31, 2003 | |||||
| ($ in millions) | ||||||
| ASSETS |
||||||
| Investments: |
||||||
| Fixed maturity securities available-for-sale, at fair value |
$ | 1,530.2 | $ | 1,734.0 | ||
| Mortgage loans on real estate |
445.2 | 419.6 | ||||
| Policy loans |
89.1 | 86.1 | ||||
| Real estate held for investment |
2.2 | 2.2 | ||||
| Other invested assets |
14.3 | 16.7 | ||||
| 2,081.0 | 2,258.6 | |||||
| Cash and cash equivalents |
399.4 | 180.4 | ||||
| Accrued investment income |
24.8 | 29.5 | ||||
| Amounts due from reinsurers |
57.7 | 59.6 | ||||
| Deferred policy acquisition costs |
838.3 | 758.1 | ||||
| Current federal income taxes |
57.1 | 27.7 | ||||
| Other assets |
20.2 | 12.2 | ||||
| Separate account assets |
3,603.0 | 3,504.0 | ||||
| Total assets |
$ | 7,081.5 | $ | 6,830.1 | ||
| LIABILITIES AND SHAREHOLDER’S EQUITY | ||||||
| Future policy benefits |
$ | 179.3 | $ | 186.6 | ||
| Policyholders’ account balances |
2,075.6 | 1,962.4 | ||||
| Other policyholders’ liabilities |
84.9 | 86.3 | ||||
| Accounts payable and other liabilities |
165.2 | 108.2 | ||||
| Note payable to affiliate (Note 5) |
38.2 | 39.6 | ||||
| Deferred federal income taxes |
192.1 | 177.4 | ||||
| Separate account liabilities |
3,603.0 | 3,504.0 | ||||
| Total liabilities |
6,338.3 | 6,064.5 | ||||
| Commitments and contingencies (Note 4) |
||||||
| Common stock $1.00 par value; 5.0 million shares authorized, 2.5 million issued and outstanding |
2.5 | 2.5 | ||||
| Capital in excess of par |
599.7 | 599.7 | ||||
| Retained earnings |
128.2 | 139.2 | ||||
| Accumulated other comprehensive income |
12.8 | 24.2 | ||||
| Total shareholder’s equity |
743.2 | 765.6 | ||||
| Total liabilities and shareholder’s equity |
$ | 7,081.5 | $ | 6,830.1 | ||
See accompanying notes to unaudited interim condensed financial statements.
2
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM CONDENSED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
For the Three-month Periods Ended June 30, 2004 and 2003
| 2004 |
2003 | ||||||
| ($ in millions) | |||||||
| Revenues: |
|||||||
| Universal life and investment-type product policy fees |
$ | 38.9 | $ | 43.2 | |||
| Premiums |
37.1 | 31.6 | |||||
| Net investment income |
34.8 | 32.3 | |||||
| Net realized (losses)/gains on investments |
(11.1 | ) | 4.3 | ||||
| Other income |
6.0 | 6.0 | |||||
| 105.7 | 117.4 | ||||||
| Benefits and Expenses: |
|||||||
| Benefits to policyholders |
38.4 | 44.5 | |||||
| Interest credited to policyholders’ account balances |
30.3 | 22.4 | |||||
| Amortization of deferred policy acquisition costs |
17.8 | 10.0 | |||||
| Other operating costs and expenses |
46.4 | 29.6 | |||||
| 132.9 | 106.5 | ||||||
| (Loss)/income from continuing operations before income taxes |
(27.2 | ) | 10.9 | ||||
| Income tax (benefit)/expense |
(10.6 | ) | 3.0 | ||||
| (Loss)/income from continuing operations |
(16.6 | ) | 7.9 | ||||
| Discontinued operations: loss from real estate to be disposed of, net of income tax benefit |
— | — | |||||
| Net (loss)/income |
(16.6 | ) | 7.9 | ||||
| Other comprehensive (loss)/income, net |
(21.6 | ) | 4.3 | ||||
| Comprehensive (loss)/income |
$ | (38.2 | ) | $ | 12.2 | ||
See accompanying notes to unaudited interim condensed financial statements.
3
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM CONDENSED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
For the Six-month Periods Ended June 30, 2004 and 2003
| 2004 |
2003 |
|||||||
| ($ in millions) | ||||||||
| Revenues: |
||||||||
| Universal life and investment-type product policy fees |
$ | 82.7 | $ | 83.7 | ||||
| Premiums |
72.6 | 59.0 | ||||||
| Net investment income |
64.3 | 60.2 | ||||||
| Net realized (losses)/gains on investments |
(5.3 | ) | 3.2 | |||||
| Other income |
16.8 | 12.0 | ||||||
| 231.1 | 218.1 | |||||||
| Benefits and Expenses: |
||||||||
| Benefits to policyholders |
80.8 | 79.8 | ||||||
| Interest credited to policyholders’ account balances |
54.1 | 44.1 | ||||||
| Amortization of deferred policy acquisition costs |
34.7 | 26.4 | ||||||
| Other operating costs and expenses |
86.8 | 58.6 | ||||||
| 256.4 | 208.9 | |||||||
| (Loss)/income from continuing operations before income taxes and cumulative effect of a change in accounting principle |
(25.3 | ) | 9.2 | |||||
| Income tax (benefit)/expense |
(10.5 | ) | 2.6 | |||||
| (Loss)/income from continuing operations before cumulative effect of a change in accounting principle |
(14.8 | ) | 6.6 | |||||
| Discontinued operations: loss from real estate to be disposed of, net of income tax benefit |
— | (0.1 | ) | |||||
| Net (loss)/income before cumulative effect of a change in accounting principle |
(14.8 | ) | 6.5 | |||||
| Cumulative effect on prior periods of the adoption of SOP 03-1, net of income tax expense of $2.1 million (Note 2) |
3.8 | — | ||||||
| Net (loss)/income |
(11.0 | ) | 6.5 | |||||
| Other comprehensive (loss)/income, net |
(11.4 | ) | 4.0 | |||||
| Comprehensive (loss)/income |
$ | (22.4 | ) | $ | 10.5 | |||
See accompanying notes to unaudited interim condensed financial statements.
4
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM CONDENSED STATEMENT
OF CHANGES IN SHAREHOLDER’S EQUITY
For the Six-month Period Ended June 30, 2004
| Common Stock |
Capital In Excess of Par |
Retained Earnings |
Accumulated Other Comprehensive Income |
Total Shareholder’s Equity |
||||||||||||||
| ($ in millions) | ||||||||||||||||||
| Balance, December 31, 2003 |
$ | 2.5 | $ | 599.7 | $ | 139.2 | $ | 24.2 | $ | 765.6 | ||||||||
| Comprehensive loss: |
||||||||||||||||||
| Net loss |
(11.0 | ) | (11.0 | ) | ||||||||||||||
| Other comprehensive loss |
(11.4 | ) | (11.4 | ) | ||||||||||||||
| Comprehensive loss |
(22.4 | ) | ||||||||||||||||
| Balance, June 30, 2004 |
$ | 2.5 | $ | 599.7 | $ | 128.2 | $ | 12.8 | $ | 743.2 | ||||||||
See accompanying notes to unaudited interim condensed financial statements.
5
MONY LIFE INSURANCE COMPANY OF AMERICA
UNAUDITED INTERIM CONDENSED STATEMENTS OF CASH FLOWS
For the Six-month Periods Ended June 30, 2004 and 2003
| 2004 |
2003 |
|||||||
| ($ in millions) | ||||||||
| Net cash used in operating activities |
$ | (12.7 | ) | $ | (52.0 | ) | ||
| Cash flows from investing activities: |
||||||||
| Sales, maturities or repayments of: |
||||||||
| Fixed maturity securities |
431.5 | 143.3 | ||||||
| Mortgage loans on real estate |
43.0 | 23.4 | ||||||
| Other invested assets |
0.1 | — | ||||||
| Acquisitions of investments: |
||||||||
| Fixed maturity securities |
(272.4 | ) | (140.7 | ) | ||||
| Mortgage loans on real estate |
(66.1 | ) | (82.9 | ) | ||||
| Other invested assets |
(0.2 | ) | (0.4 | ) | ||||
| Policy loans, net |
(3.0 | ) | (2.0 | ) | ||||
| Net cash provided by/(used in) investing activities |
$ | 132.9 | $ | (59.3 | ) | |||
| Cash flows from financing activities: |
||||||||
| Repayment of note to affiliate |
(1.4 | ) | (1.3 | ) | ||||
| Receipts from annuity and universal life policies credited to policyholders’ account balances |
433.7 | 393.4 | ||||||
| Return of policyholders’ account balances on annuity and universal life policies |
(333.5 | ) | (257.0 | ) | ||||
| Net cash provided by financing activities |
98.8 | 135.1 | ||||||
| Net increase in cash and cash equivalents |
219.0 | 23.8 | ||||||
| Cash and cash equivalents, beginning of period |
180.4 | 33.2 | ||||||
| </ | ||||||||