Aflac Incorporated (NYSE: AFL) today reported its fourth quarter results.

Total revenues were $5.9 billion in the fourth quarter of 2020, compared with $5.6 billion in the fourth quarter of 2019. Net earnings were $951 million, or $1.35 per diluted share, compared with $782 million, or $1.06 per diluted share a year ago, driven primarily by an increase in net investment gains.

Net earnings in the fourth quarter of 2020 included pretax net investment gains of $268 million, or $0.38 per diluted share, compared with pretax net investment gains of $34 million, or $0.05 per diluted share a year ago, which are excluded from adjusted earnings. The net investment gains were driven by an increase in the fair value of equity securities of $290 million largely due to the investment in Trupanion and net gains from certain derivatives and foreign currency activities of $27 million, offset by net losses of $28 million from sales and redemptions and an increase in the allowances associated with the company's estimate of current expected credit losses (CECL) of $21 million.

The average yen/dollar exchange rate* in the fourth quarter of 2020 was 104.57, or 4.0% stronger than the average rate of 108.79 in the fourth quarter of 2019. For the full year, the average exchange rate was 106.86, or 2.1% stronger than the rate of 109.07 a year ago.

Total investments and cash at the end of December 2020 were $149.8 billion, compared with $138.1 billion at December 31, 2019. In the fourth quarter, Aflac Incorporated repurchased $500 million, or 11.8 million of its common shares. For the full year, Aflac repurchased $1.5 billion, or 37.9 million of its common shares. At the end of December 2020, the company had 99.2 million remaining shares authorized for repurchase.

Shareholders' equity was $33.6 billion, or $48.46 per share, at December 31, 2020, compared with $29.0 billion, or $39.84 per share, at December 31, 2019. Shareholders' equity at the end of the fourth quarter included a net unrealized gain on investment securities and derivatives of $10.3 billion, compared with a net unrealized gain of $8.5 billion at December 31, 2019. Shareholders' equity at the end of the fourth quarter also included an unrealized foreign currency translation loss of $1.1 billion, compared with an unrealized foreign currency translation loss of $1.6 billion at December 31, 2019. The annualized return on average shareholders' equity in the fourth quarter was 11.5% and 15.3% for the full year.

Adjusted earnings* in the fourth quarter were $755 million, compared with $756 million in the fourth quarter of 2019, reflecting a decrease of 0.1%. Adjusted earnings included pretax variable investment income of $63 million on alternative investments, which was $47 millionabove long-term return expectations. This was largely offset by the $43 million expense of the previously announced voluntary separation plan. Adjusted earnings per diluted share* increased 3.9% to $1.07 in the quarter. The stronger yen/dollar exchange rate impacted adjusted earnings per diluted share by $0.02.

For the full year of 2020, total revenues were down 0.7% to $22.1 billion, compared with $22.3 billion for the full year of 2019. Net earnings were $4.8 billion, or $6.67 per diluted share, compared with $3.3 billion, or $4.43 per diluted share, for the full year of 2019. Adjusted earnings for the full year of 2020 were $3.6 billion, or $4.96 per diluted share, compared with $3.3 billion, or $4.44 per diluted share, in 2019. Excluding the positive impact of $0.04 per share from the stronger yen/dollar exchange rate, adjusted earnings per diluted share increased 10.8% to $4.92 for the full year of 2020.

Shareholders' equity excluding AOCI* was $24.6 billion, or $35.56 per share at December 31, 2020, compared with $22.3 billion, or $30.74 per share, at December 31, 2019. The annualized adjusted return on equity excluding foreign currency impact* in the fourth quarter was 12.1% and 15.0% for the full year.