Sun Life Financial has announced its results for the fourth quarter of 2017. Fourth quarter reported net income was $207 million and underlying net income was $641 million. This compares to reported net income of $728 million for the same quarter in 2016 and underlying net income of $560 million. For the year 2017, reported net income was $2,149 million and underlying net income was $2,546 million, compared to $2,485 million and $2,335 million in the same categories for 2016.
Insurance sales were $1,106 million in the fourth quarter of 2017 ($1,071 million in the fourth quarter of 2016) and $3,042 million in 2017 ($2,758 million in 2016). Wealth sales were $35.3 billion in the fourth quarter of 2017 ($37.3 billion in the fourth quarter of 2016) and $145.3 billion in 2017 ($138.3 billion in 2016) Global assets under management increased to $975 billion compared to $903 billion as at the end of 2016
The firm also declared a common share dividend declared of $0.455 per share
"2017 was a year of strong financial performance for Sun Life,” said Dean Connor, president & CEO, Sun Life Financial. “We grew underlying net income 9% in the year to over $2.5 billion, raised our common share dividend 8% in the year, and generated a 12.7% underlying return on equity."
He added: "Our fourth quarter capped off a year of continued momentum on a number of fronts," said Connor. "We launched new digital offerings in Canada, improved the profitability of our US Group Benefits business, continued building out our wealth and asset management businesses, and invested to grow our distribution capabilities in Asia."
Like its peers, tax reform in the US had an impact on earnings, with a net charge of $251 million ($444 million pre-tax) related to the US Tax Cuts and Jobs Act. Reported net income also included the previously announced restructuring charge of $44 million ($60 million pre-tax), related to its enhancement of business processes and organizational structures and capabilities.
Sun Life’s Canadian business had reported net income of $172 million in the quarter, down 57% compared to the same period in 2016. Underlying net income was $232 million, down 5% from the same period in 2016, which the company attributed to the release of a litigation provision which increased 2016 underlying net income.
Insurance sales were down 26% mainly due to a decrease in individual insurance sales compared to strong sales in the fourth quarter in 2016 in anticipation of the Canadian life insurance tax legislation changes that came into effect on January 1, 2017. Group benefits sales were in line with the fourth quarter of 2016, reaching $10 billion of business in-force driven by strong sales in 2017.
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