Record Net Income and Strategic …
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Underlying EPS: $1.82, up 21% year over year.
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Underlying Net Income: $1.045 billion, a record high.
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Reported Net Income: $928 million.
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Underlying ROE: 17.7%.
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LICAT Ratio: 149%.
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Cash at SLF Holdco: $1.3 billion.
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Share Buybacks: $520 million of common shares repurchased.
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Dividend Increase: 5% increase announced.
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SLC Management Capital Raising: $4.4 billion raised in the quarter.
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MFS Assets Under Management: $604 billion, down 4% year over year.
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Canada Wealth AUM: $190 billion, up 10% year over year.
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Asia Individual Protection Sales Growth: Up 17% year over year.
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Asia Total CSM: $6.2 billion, up 29% year over year.
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Organic Capital Generation: $308 million.
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Book Value Per Share: Increased by 9% over the prior year.
Release Date: May 09, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Sun Life Financial Inc (NYSE:SLF) reported a record underlying net income of $1.045 billion, up 19% year over year.
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The company achieved a 21% increase in underlying earnings per share, reaching $1.82.
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Asset management and wealth segments showed strong earnings growth, particularly in SLC management and Asia.
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Sun Life Financial Inc (NYSE:SLF) announced a 5% increase in its common share dividend and renewed its normal course issuer bid for share buybacks.
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The company maintained a strong capital position with a LICAT ratio of 149% and $1.3 billion in cash at the Holdco level.
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Sun Life Financial Inc (NYSE:SLF) experienced moderately unfavorable morbidity experience in the US Medical stop-loss segment.
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The company faced unfavorable equity markets and adverse real estate experience, impacting market-related returns.
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MFS reported a 2% year-over-year decline in underlying net income due to lower net investment income.
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US group health and protection sales were down 13% year over year, driven by lower government dental sales and lower employee benefit sales.
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The company noted challenges in the dental business, with ongoing pricing and claims management issues.
Q: How is Sun Life’s Asia business performing, and what are the expectations regarding tariffs or tariff uncertainty? A: Manjit Singh, President of Sun Life Asia, noted that sales were up 17% year over year, with growth across multiple markets and channels. Despite the fluid environment, the focus remains on client needs, supported by a strong brand and distribution network, which positions the company well to manage through uncertainties.
Q: What is the outlook for earnings volatility in Sun Life’s US business? A: Daniel Fishbein, President of Sun Life US, explained that the business experiences seasonality and cyclicality rather than volatility. While there are challenges, particularly in the dental business, the company is addressing these issues. The stop-loss business has stabilized, and the company expects some variance quarter-to-quarter, which is natural for these businesses.
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Q: How does the employment environment affect Sun Life’s group businesses in terms of expected profits? A: Kevin Morrissey, Senior Vice President and Chief Actuary, stated that expected profits are based on pricing assumptions and are influenced by economic factors and claims trends. These expectations are updated annually, and while job growth is considered, it is one of many factors incorporated into pricing.
Q: Can you provide insights into the US stop-loss business and the impact of claims emergence? A: Daniel Fishbein noted that the stop-loss business is evaluated by cohorts, with claims experience emerging as expected. The 2025 cohort is primarily a reserve pick, with limited claims data available in the first quarter. The company anticipates more data in subsequent quarters.
Q: What is the impact of the current economic conditions on Sun Life’s capital deployment strategy, particularly regarding share buybacks? A: Timothy Deacon, CFO, explained that while the company has a strong capital position, it is applying for a 10 million share buyback to maintain flexibility for future commitments, such as the planned buy-up of remaining equity in SLC affiliates. Kevin Strain, CEO, emphasized the importance of being prepared for economic uncertainties.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
