Nationwide Financial Reports Second Quarter Results
Variable annuity sales of $1.4 billion highest in 5 years
FOR IMMEDIATE RELEASE
August 1, 2007
Mark Barnett (614) 249-8437
Erica Lewis (704) 896-5652
COLUMBUS, Ohio — Nationwide Financial Services, Inc. (NYSE: NFS), a leading provider of long-term savings and retirement products, today reported second quarter 2007 net income of $197.3 million, or $1.37 per diluted share, compared with second quarter 2006 net income of $262.7 million, or $1.75 per diluted share. As described below, second quarter 2007 results include an after-tax benefit from several significant items totaling $37.5 million, or $0.26 per diluted share. Additionally, the second quarter 2006 results included $126.3 million, or $0.84 per diluted share, of significant items as described below. Excluding the impact of these items from both periods, second quarter 2007 net income per diluted share increased 22 percent over the prior year quarter.
Nationwide Financial analyzes operating performance using a non-GAAP financial measure called “net operating earnings,” which the Company believes enhances understanding and comparability of its performance by highlighting its results from continuing operations and the underlying profitability drivers. See Exhibit 3 for a description of non-GAAP financial measures included in this earnings announcement, a reconciliation of non-GAAP financial measures to GAAP financial measures, and the substantive reasons why the Company believes presentation of these non-GAAP financial measures provides useful information to investors regarding its financial condition and results of operations. The table on the top of page 12 reconciles net operating earnings to net income, including the related diluted per share amounts for the periods indicated.
“Our results reflect another solid quarter of improved operating and financial performance and are indicative of the progress we’re making on our long-term strategic plan to improve profitability and increase shareholder returns,” said Jerry Jurgensen, chief executive officer.
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