Exhibit 99.1

 

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American Financial Group, Inc. Announces Fourth Quarter and Full Year Results

 

   

Net earnings of $5.85 per share for the full year; fourth quarter net loss of $0.33 per share includes ($2.08) per share in realized losses on securities

 

   

Fourth quarter core net operating earnings per share of $1.75, compared to $2.20 per share in the prior year period

 

   

Record core net operating earnings per share of $8.40 for the full year; up 28% from 2017

 

   

Full year 2018 ROE of 10.9%; 2018 core operating ROE of 15.6%

 

   

Full year 2019 core net operating earnings guidance between $8.35 - $8.85 per share

CINCINNATI – January 30, 2019 – American Financial Group, Inc. (NYSE: AFG) today reported a 2018 fourth quarter net loss attributable to shareholders of $29 million ($0.33 per share) compared to earnings of $166 million ($1.84 per share) for the 2017 fourth quarter. Results for the fourth quarter of 2018 include $188 million ($2.08 per share) in

non-core net realized losses on securities; net realized losses included $179 million ($2.00 per share) to adjust to fair value equity securities that the Company continued to own at December 31, 2018. For GAAP reporting purposes, all equity securities are required to be reported at fair value, with holding gains and losses recognized in net earnings. Comparatively, net earnings in the 2017 fourth quarter were adversely impacted by $31 million ($0.36 per share) in net non-core items. Net earnings attributable to shareholders for the year were $5.85 per share, compared to $5.28 per share in 2017. The change in the U.S. corporate tax rate from 35% to 21%, enacted by the Tax Cuts and Jobs Act of 2017 and effective January 1, 2018, contributed to a lower effective tax rate in 2018 as compared to 2017. Other details may be found in the table below. Book value per share was $55.66 per share at December 31, 2018. AFG paid cash dividends of $1.90 per share during the quarter, which included a $1.50 per share special dividend. Return on equity was 10.9% and 10.3% for 2018 and 2017, respectively.

Core net operating earnings were $159 million ($1.75 per share) for the 2018 fourth quarter, compared to $197 million ($2.20 per share) in the 2017 fourth quarter. Lower fourth quarter 2018 operating profitability was primarily the result of lower year-over-year earnings in our Annuity Segment, largely due to the significant downturn in financial markets during the fourth quarter, and to a lesser extent, lower underwriting profits in our Property and Casualty (“P&C”) Insurance Segment. The benefit of a lower corporate income tax rate partially offset these results. Book value per share, excluding unrealized gains related to fixed maturities, was $54.86 per share at December 31, 2018. For the twelve months ended December 31, 2018, AFG’s growth in adjusted book value per share plus dividends was 10.8%. Core net operating earnings for the fourth quarters of 2018 and 2017 generated annualized returns on equity of 12.6% and 17.2%, respectively. Core operating return on equity was 15.6% and 12.7% for 2018 and 2017, respectively.

During the fourth quarter of 2018, AFG repurchased approximately 65,600 shares of common stock for $6 million (average price per share of $93.38).

AFG’s net earnings attributable to shareholders, determined in accordance with U.S. generally accepted accounting principles (GAAP), include certain items that may not be indicative of its ongoing core operations. The table below identifies such items and reconciles net earnings attributable to

 

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The following information was filed by American Financial Group Inc (AFG) on Thursday, January 31, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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