Nationwide Financial Reports Third Quarter Results
Positive Sales Momentum in Individual Products Continues
For Immediate Release
November 2, 2006
Vice President, Investor Relations
Officer, Public Relations
COLUMBUS, Ohio — Nationwide Financial Services, Inc. (NYSE: NFS), a leading provider of long-term savings and retirement products, today reported third quarter 2006 net income of $159.5 million, or $1.06 per diluted share, compared with third quarter 2005 net income of $166.7 million, or $1.08 per diluted share.
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. A table on the top of page 10 reconciles net operating earnings to net income, including the related diluted per share amounts for the periods indicated.
“We’re pleased with our overall performance in the quarter and the solid results we achieved in our three operating segments,” said Jerry Jurgensen, chief executive officer. “We’re on track to meet our full-year expectations, and these results validate the progress we’ve made in strengthening our core businesses, particularly in our individual product lines, where sales have significantly improved over the last several quarters.
“At the same time, we are making meaningful progress toward building new capabilities that naturally complement our existing mix of businesses and that will better serve the emerging needs of our distribution partners and consumers,” Jurgensen added. “These new capabilities include banking, mutual funds and income products to help consumers prepare for and live in retirement.
“In addition, we are particularly pleased that members of the Nationwide Federal Credit Union recently approved a proposal to merge with Nationwide Bank. This merger will provide a solid foundation of customers, deposits and assets and should expedite the bank’s path to profitability.”