Jackson First-Half Revenue Tops $2 Billion; Retail Sales Climb 22%

Business Wire, August 1, 2007

Company Achieves First $1-Billion Retail Sales Month in May

LANSING, Mich. -- Jackson National Life Insurance Company([R]) (Jackson) recorded $2.1 billion in GAAP revenue in the first half of 2007, up 3 percent from the same period a year ago primarily due to an increase in fee income. Record sales of variable annuities (VAs) and strong market appreciation increased Jackson's fee income by 39 percent over the first half of 2006. Retail sales of Jackson's core life and annuity products rose 22 percent over the first half of 2006 to $5.4 billion, and total sales (which include institutional products) rose 20 percent to $6.8 billion. In May 2007, Jackson's monthly retail sales exceeded $1 billion for the first time.

"Jackson's relationship-based distribution model, innovative products, speed to market, and award-winning customer service have allowed us to grow faster than the market," said Clark Manning, Jackson's president and chief executive officer. "While our competitors may have developed some of these components, it is the combination of these attributes that makes Jackson's value proposition unique."

Jackson, an indirect wholly owned subsidiary of the United Kingdom's Prudential plc (NYSE:PUK), generated GAAP net income of $371 million in the first half of 2007, compared to $382 million in the same period a year ago, as first-half 2006 net income was boosted by higher levels of short-term derivative income. Jackson's total GAAP assets grew to $79.8 billion as of June 30, 2007, up from $70.7 billion at June 30, 2006 and $74.4 billion at December 31, 2006.1

In the first half of 2007, Jackson's VA sales rose 31 percent over the prior year period to $4.4 billion. The company's second quarter VA sales were 15 percent higher than the first quarter. Jackson's VA sales growth was achieved in a market that grew 6 percent year over year in the first quarter of 2007.2 Jackson achieved its 12th consecutive quarter of VA market share growth in the first quarter of 2007, with a market share of 5.1 percent, up from 4.2 percent in first quarter 2006 and 4.6 percent for full-year 2006.2 In the independent broker-dealer channel, Jackson's primary distribution channel for its VA products, the company's market share of VA sales increased to 11.7 percent in first quarter 2007, up from 10.4 percent in first quarter 2006.2

During the first half of 2007, Jackson increased its external wholesaling force by 30 percent in an effort to increase market penetration in the company's chosen distribution channels. Jackson also launched a new fixed index annuity offering a choice of indices and index option periods and, through a subsidiary, introduced a line of retail mutual funds based on the popular disciplined investment strategies available in the company's variable annuities. Additionally, Jackson added four new portfolios subadvised by Mellon Capital Management, its first guaranteed minimum accumulation benefit and three new guaranteed minimum withdrawal benefits to its variable annuities.

"Jackson was able to increase sales in nearly all of its retail product lines in the first half of 2007 and end the half with two consecutive billion-dollar retail sales months," said Clifford Jack, executive vice president and chief distribution officer for Jackson. "Jackson's sales keep growing because our wholesalers offer innovative, flexible products and practical solutions to financial professionals that help them meet their clients' retirement planning needs and grow their business."

Jackson sold $573 million in fixed annuities in first-half 2007, compared to $560 million in first-half 2006. Sales of Jackson's fixed index annuities (FIAs) totaled $434 million during the first half of the year, versus $524 million in first-half 2006.

Life insurance sales of $24 million during the first half of 2007 were 6 percent higher than the same period last year. Sales of Jackson's institutional products, a market in which the company participates on an opportunistic basis, grew 14 percent to $1.3 billion.

Jackson subsidiary Curian Capital([R]), a registered investment advisor, attracted $624 million in deposits during first-half 2007, an increase of 48 percent over the prior year period. As of June 30, 2007, Curian had amassed $3.0 billion in assets under management, up from $2.4 billion at the end of 2006.

Jackson's US affiliate, National Planning Holdings([R]), Inc. (NPH), a network of four independent broker-dealers, delivered a strong first-half performance, with gross product sales up 14 percent over first-half 2006 to $6.9 billion, GAAP revenues up 15 percent to $289 million and GAAP pre-tax income up 68 percent to nearly $11 million. The network also expanded its representative base to 2,819, up from 2,628 at year-end 2006.

"Jackson's fundamentals are solid, our capital formation remains robust and we continue to produce outstanding financial results," Manning said. "Jackson will build upon its past success to capitalize on emerging opportunities in the US retirement market and generate profitable growth for our parent company and its shareholders."