Keith W. Demmings
President and Chief Executive Officer at Assurant
Thanks, Suzanne, and good morning, everyone. Reflecting on my first year as CEO, I couldn't be prouder of the extraordinary dedication and commitment demonstrated by our employees in delivering for our clients and customers around the world. During the year, we made progress in executing our vision to be the leading global business services provider supporting the advancement of the connected world. We continue to grow and strengthen our partnerships with key clients and delivered new innovative solutions, all while navigating more volatile market conditions. Our portfolio of lifestyle and housing businesses proved resilient, but not immune to macroeconomic headwinds.
In 2022, we grew adjusted earnings per share by 11% and delivered over $1.1 billion of adjusted EBITDA, both excluding reportable catastrophes. Adjusting for $27 million of unfavorable foreign exchange, adjusted EBITDA growth was 3%, and 2022 represented our sixth consecutive year of profitable growth. This is a reflection of our compelling strategy and resilient culture. We've held true to our company's purpose of helping people thrive with a steadfast commitment to being a socially responsible company for all of our stakeholders.
I'm proud that we've been recognized as a great place to work in 13 countries, and most recently in the U.S. for the second consecutive year. Our focus remains on engaging and developing our diverse talent pool through enhanced leadership and skills development programs. We also continue to reduce our environmental impact as a core pillar of our ESG strategy.
Building on our progress to date, we announced in December, our goal to reduce greenhouse gas emissions by 40% by 2030. This target aligns with the Paris Agreement and ensures we drive meaningful reductions. We've also taken a number of actions within our businesses to strengthen Assurant for the future.
In Global Housing, we initiated a business transformation, including exiting certain non-core businesses, such as our sharing economy, as well as international cat-exposed business where we did not see a path to leadership positions. More broadly across Assurant, we realigned our organizational structure, as Suzanne referenced, to drive more focus and better deploy talent. We also took decisive action by accelerating several expense initiatives to realize additional efficiencies and position us for continued long-term growth.
As we announced in December, we expect to realize $55 million of annualized gross savings by the end of 2024, through the simplification of our organizational structure and our real-estate consolidation program, given our increasingly hybrid workforce. These actions will help mitigate the impact of higher labor costs and headwinds from the macroeconomic environment as well as fund additional investments including increased automation.
In addition to ensuring a more streamlined organizational and cost structure, we've gained momentum throughout the year in both Global Lifestyle and Global Housing, renewing and winning new clients in each of our major lines of business.
In Global Lifestyle, adjusted EBITDA increased 7% in 2022, with growth from both Connected Living and Global Automotive. On a constant currency basis, adjusted EBITDA expanded by 11%, aligned with our original expectations for the year.
In Connected Living, we grew adjusted EBITDA by 15% on a constant currency basis, driven by mobile protection program growth in North America. Our ability to continuously innovate our products and services has supported a stronger and more differentiated customer experience, resulting in increased net promoter scores.
In addition to key partner renewals, including T-Mobile and Xfinity, we secured new business opportunities and new client partnerships, continuing to diversify our broad client base. In our mobile protection business, we now protect nearly 62 million global devices, driven by the 25 new protection programs we've added since 2015.
We serviced over 28 million devices in 2022, mainly from our mobile trade-in business, as we had scale and further demonstrate our position as a market leader with this important value-added service to our clients. We added several new trading clients and now have over 40 trade-in programs globally. We continue to invest in talent and strengthen supply-chain operations to maintain our competitive advantage.
In Global Automotive, we grew global protected autos in 2022 by 2% to 54.1 million vehicles, helping to generate adjusted EBITDA growth of 5%. Recently, we expanded and enhanced our EV-1 protection offering in the U.S., and coverage is now available for battery-electric vehicles and plug-in hybrid electric vehicles, including comprehensive battery coverage.
In our newly combined leased and finance business, we partnered with CNH industrial in the U.S. and Canada to provide service contracts and physical damage insurance. CNH is the third largest agriculture and construction equipment company in the world. This partnership was made possible by the talent and expertise of our teams, including through the acquisition of EPG.
In Global Housing, we took swift action to mitigate the impact of high inflation within our lender-placed business. We began to see improved performance as we exited the year, reflecting the rate increases implemented over the course of the year. We expect higher rates to roll through our book into 2023 and beyond, while we manage ongoing elevated claims costs.
In 2022, we renewed eight lender-placed clients, including several of our most significant partnerships with multi-year agreements. These renewals represent 36% of our over $31 million loans tracked.
In Multi-Family Housing, we now have over 2.6 million renter's policies. While we've seen slower growth from our affinity partnerships, our volume with property management companies continues to expand, as we signed several new partnerships, including two top PMC's with over 100,000 combined units. We also successfully completed multi-year renewals with six key client relationships.
As we continue to convert clients to our Cover 360 platform, we expect to see ongoing policy growth in that channel. Throughout the year, we maintained a strong balance sheet as we navigated increased macroeconomic uncertainty. Our businesses contributed a total of $550 million in dividends to the holding company or roughly 52% of segment earnings, including catastrophe losses. Together with the remaining net proceeds from the Global Preneed sale, we returned a total of $718 million in share repurchases and common stock dividends.
Looking ahead, we believe we have a compelling vision and strategy that will drive outperformance and shareholder value long-term. As a business services leader, we will continue to pursue profitable growth in more fee-based, capital-light businesses, which continue to account for the majority of our earnings. In addition, we'll continue to optimize results and cash flow generation in our risk-based business.
In 2023, we believe we can drive continued profitable growth though at a more modest pace, given strong '22 results in lifestyle and our near-term view of the broader economy. Specifically, we expect adjusted EBITDA excluding cats to increase low-single digits, with results improving as the year progresses, reflecting trends in the business and the broader market as well as the restructuring actions taken in 2022.
Earnings growth is expected to be driven by improved performance in Global Housing as well as more modest growth in Global Lifestyle. Adjusted earnings per share growth is expected to trail adjusted EBITDA growth, primarily reflecting a higher annual depreciation expense related to several strategic technology investments critical to executing our strategy, a higher consolidated effective tax-rate compared to a favorable 2022, and timing of capital deployment.
We've had a longstanding track record of strong cash flow generation and disciplined capital deployment, and we continue to believe that a balanced capital deployment strategy drives long-term value. Our capital management priorities for this year will be focused on supporting the organic growth of our business and maintaining our investment grade ratings.
We expect share repurchases will remain a core component of our capital deployment strategy, given the attractiveness of our stock. But in light of the continued uncertain macroenvironment, we believe it is prudent to preserve flexibility over the near term. Therefore, based on current market conditions and expected business performance, we anticipate that any share repurchases would occur in the second half of the year and could be below 2022 underlying buyback activity. As the broader environment begins to stabilize and visibility improves, we will re-evaluate levels and timing of capital deployment as part of our overall capital deployment strategy.
Our M&A strategy will continue to focus on compelling deals in Global Lifestyle. However, the hurdle rate for M&A will be high given the attractiveness of our stock.
As we enter 2023, we remain well positioned for long-term growth through our differentiated Lifestyle and Housing portfolio. We are focused on creating new sources of growth, scaling new client wins and deepening current client relationships to continually drive added value for our key clients and customers.
I'll now turn the call over to Richard to review the fourth quarter results and our 2023 outlook in greater detail. Richard?