Sun Life Financial Tops Analysts' Estimates
February 10 2016 - 7:50PM
Dow Jones News
Sun Life Financial Inc., Canada's third-largest insurance
company by assets, posted a fourth-quarter profit Wednesday that
beat analysts' expectations despite challenges posed by low
interest rates, tumbling commodity prices and stock-market
turbulence.
Toronto-based Sun Life, which reported results after the close
of financial markets, said its results were helped in part by the
weaker Canadian dollar and stronger economic growth outside of its
home market. The sinking currency, for instance, had the effect of
boosting income earned from its U.S. operations.
Sun Life's underlying net income rose to 646 million Canadian
dollars ($462 million) or C$1.05 per share for the
October-to-December quarter. That compared with a profit of C$360
million, or 59 Canadian cents, for the same period a year
earlier.
Analysts polled by Thomson Reuters had expected a profit of 87
Canadian cents a share for the three-month period that ended Dec.
31, 2015.
Sun Life left its quarterly dividend unchanged at 39 Canadian
cents per share.
"Our strong fourth quarter capped off a successful year of
growth and momentum for Sun Life," said President and Chief
Executive Officer Dean Connor in a release.
"In 2015, we achieved underlying net income of C$2.3 billion,
surpassing our 2015 financial objective of C$1.85 billion and ended
the year with assets under management of C$891 billion," he
added.
Sun Life's minimum continuing capital and surplus requirements
ratio, a key measure of capital strength, stood at 240% at the end
of the fourth quarter.
"In the U.S., we made excellent progress this year in improving
the profitability of our group life and disability business, and we
continue to be a leader in medical stop-loss insurance where we
reported a 12% increase in business in-force year over year," said
Mr. Connor.
Persistently low interest rates are making it difficult for
insurers to generate investment returns to fund their liabilities.
Additionally, low oil prices are acting as a drag on Canada's
economic growth and fueling volatility on that country's benchmark
stock index.
Sun Life, meanwhile, is plotting more growth outside Canada
including in the U.S., which is benefitting from a rosier economic
outlook. The insurer's strategy includes its previously announced
acquisition of Assurant, Inc.'s U.S. employee benefits business,
which is expected to close during the first quarter of 2016.
Write to Rita Trichur at rita.trichur@wsj.com
(END) Dow Jones Newswires
February 10, 2016 19:35 ET (00:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Assurant (NYSE:AIZ)
Historical Stock Chart
From Mar 2024 to Apr 2024
Assurant (NYSE:AIZ)
Historical Stock Chart
From Apr 2023 to Apr 2024