American International Group (AIG) reported after-tax operating income of $773 million, or $0.65 per diluted share, for the first quarter of 2016.
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This compares to $1.7 billion, or $1.22 per diluted share, in the prior-year quarter, reflecting the negative impact of market volatility on investments that totaled $0.48 per diluted share.
On a reported basis, AIG recognized a net loss of $183 million, or $0.16 per diluted share, for the first quarter of 2016, compared to net income of $2.5 billion, or $1.78 per diluted share, in the prior-year quarter, reflecting the impact of market volatility as well as net realized capital losses, restructuring costs, and other items.
In the first quarter of 2016, AIG repurchased $3.5 billion of shares of its common stock and $173 million of warrants to purchase shares of its common stock, and paid $363 million in shareholder dividends.
From the end of the first quarter through May 2, 2016, AIG repurchased an additional $870 million of its common stock.
On May 2, 2016, AIG’s Board of Directors declared a quarterly dividend of $0.32 per share.
During the first quarter of 2016, AIG repurchased, through a cash tender offer, approximately $0.7 billion aggregate principal amount of certain debt issued or guaranteed by AIG for an aggregate purchase price of approximately $0.8 billion.
In the first quarter of 2016, AIG issued $1.5 billion aggregate principal amount of 3.300% Notes due 2021 and $1.5 billion aggregate principal amount of 3.900% Notes due 2026.
AIG Parent liquidity was $7.1 billion at March 31, 2016. On April 30, 2016, AIG priced the sale of 740 million shares of PICC Property and Casualty Company Limited (PICC P&C) by means of a placing to institutional investors and, subject to customary closing conditions, will receive gross proceeds of $1.25 billion.
AIG filed a registration statement on Form S-1 for a planned IPO of up to 19.9% of United Guaranty Corp., subject to regulatory approval and the approval of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation, as a first step towards a full separation.
For the first quarter of 2016, AIG’s tax rate was 27.1% on a reported basis, and 19.2% on an operating basis, reflecting the favorable resolution of certain tax audit items in the quarter.
AIG recorded pre-tax non-operating restructuring costs of $188 million in the first quarter of 2016, which are primarily related to previously announced actions.
The bard declared a quarterly dividend of $0.32 per share on AIG Common Stock, par value $2.50 per share. The dividend is payable on June 27, 2016, to stockholders of record at the close of business on June 13, 2016. ■