Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

The Canadian life insurer Sun Life Financial Inc. (SLF - Analyst Report) announced operating earnings $457.1 million (C$453 million), compared to an operating loss of $216 million (C$221 million) in the fourth quarter of 2011.

Adjusted revenue was $5.7 billion (C$5.6 billion), compared to $4.6 billion (C $4.7 billion) in the year ago quarter. The increase in revenue came on the back of higher premium revenue from SLF Group Retirement Services in Canada and SLF Life and Investment Products businesses in the U.S., higher investment income and increased fee income from Mutual Fund Segment (MFS).
 
Total benefits and expenses was $ 3.9 billion (C$3.9 billion) down from $5.4 billion (C$5.5 billion) in the year ago quarter. 
 
Full Year Highlights 
 
The company reported operating earnings of $1.6 billion (C$1.6 billion), compared to loss of $361 million (C$370 million) in 2011. 
 
Adjusted revenue of $19.5 billion (C$19.5 billion) was up from $ 18.7 billion (C$19.1 billion) in full year 2011. The increase was driven by higher fee income from MFS and favorable impact from currency movements.
 
Segment Results 
 
During the quarter SLF Canada reported operating income of $149 million (C$149 million), down 18% year over year, led by favorable impact of investment activity on insurance contract liabilities in Individual Insurance & Investments and Group Retirement Services, and positive morbidity and mortality experience in Group Benefits. 
 
SLF U.S. operating income during the quarter was $93 million (C$93 million), compared to an operating loss of $75 million (C$77 million) in the year ago quarter. Results were favorably impacted by the refinement of certain actuarial assumption updates from the prior quarter, partially offset by unfavorable morbidity experience in Employee Benefits Group as well as an investment in voluntary benefits capabilities. 
 
MFS Investment Management reported operating net income of $85 million (C$85 million) compared to $66 million (C$68 million) in the year ago quarter.
 
SLF Asia reported operating income was $50 million (C$50 million), compared to $43 million (C$44 million) in the year ago quarter
 
Corporate segment reported operating net loss of (C$44 million), compared to an operating loss of $6.8 million (C$7 million) in the year ago quarter
 
The company reported operating return on equity of 12.9%, compared to a negative 6.5% in the year ago quarter. 
 
Sun Life Assurance's MCCSR ratio was 209% as at Dec 31, 2012, compared to 211% as at Dec 31, 2011. The decline in capital ratio was due to low interest rates and volatile equity markets.
 
In an effort to shed its variable annuity exposure, during the fourth quarter the company entered into an agreement to sell off its U.S. annuities business. It also made agreement to sell certain of its U.S. life insurance businesses including all of the issued and outstanding shares of Sun Life Assurance Company of Canada.
 
Results reflect the company’s consistent effort towards its growth strategy. We expect favorable results from the company going forward.
 
Other players in the same field StanCorp Financial Group Inc. (SFG - Analyst Report), Lincoln National Corporation (LNC - Analyst Report), Protective Life Corp. (PL - Analyst Report) all reported fourth quarter earnings ahead of the Zacks Consensus Estimate.    

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%