Sun Life Financial Inc. (TSX:SLF) has reported a drop fourth-quarter net income but says it remains on track to meet 2015 earnings objectives.
The Toronto-based insurance and wealth management company said net income dropped to $502 million or 81 cents per diluted share from $550 million or 90 cents in the same 2013 period as higher gross claims and benefit payments and an increase in insurance contract liabilities offset higher total revenue.
Total revenue was $7.38 billion, up from $4.71 billion in the same 2013 quarter, which included a $385-million loss on fair value changes on assets and liabilities versus an almost $2.2 billion gain in the most recent period.
On an adjusted basis, Sun Life reported underlying net income from continuing operations of $360 million or 59 cents per share, down from $375 million or 61 cents in the fourth quarter of 2013.
That missed analyst estimates as compiled by Thomson Reuters of 78 cents per share on total revenue of $491.2 million.
For the full year, Sun Life reported net income of $1.76 billion or $2.86 per diluted share, up from $942 million or $1.55 per share on total for all of 2013, when the company booked a loss of $754 million or $1.23 per share on discontinued operations.
Assets under management rose 15 per cent to a record $734.4 billion from $639.8 billion at the end of 2013.
President and CEO Dean Connor said "despite a challenging fourth quarter" the company, is on track to "exceed our 2015 earnings objective."
Connor said Canadian operations delivered strong sales results in the quarter, with insurance sales up 78 per cent and wealth sales up 64 per cent year over year, although earnings growth was negatively impacted by market factors, policyholder experience and group benefits morbidity.
"In the U.S., business in-force in our stop-loss business in the fourth quarter rose 13 per cent compared to the same period last year, solidifying our position as an industry leader," Connor said.
However, he described U.S. group life and disability earnings as "disappointing" and said action was being taken to improve results in 2015.
Meanwhile, company operations in Asia had a strong quarter with individual insurance sales increasing 26 per cent compared with the same period in the prior year, spurred by contributions from the Philippines, Hong Kong, Indonesia, China and Malaysia.
"Asia continues to have strong momentum in the wealth business, particularly in Hong Kong," Connor said.
This content appears as provided to The Globe by the originating wire service. It has not been edited by Globe staff.