Exteriors of the Sun Life Financial office building at 150 King St. West photographed Feb. 24 2014. Sun Life will be moving it's staff from this current location to a new one down the road.Fred Lum/The Globe and Mail
Sun Life Financial Inc. reported a drop in fourth-quarter profit, but says it is on target to hit its financial goals.
The Toronto-based insurer's net profit from continuing operations, which strips out the U.S. annuities business it sold, was $502-million or 81 cents per share, down from $571-million or 93 cents per share in the same period last year.
For the full year, Sun Life's net profit from continuing operations reached nearly $1.8-billion, an increase over the $1.7-billion it posted 2013.
Sun Life's chief executive Dean Connor said in a statement that the company's underlying earnings were strong through the year and, "despite a challenging fourth quarter, … we are on track to exceed our 2015 earnings objective." The insurer has targeted annual profit of $1.85-billion by 2015.
Life insurance companies faced a tough environment of low interest rates and volatile markets in the fourth quarter of the year.
There were a few factors that caused net earnings to be lower, including changes in disability and mortality rates, insurance policyholder behaviour, and higher expenses.
Still, Sun Life's global assets under management reached a record $734.4-billion at the end of the year, up 15 per cent from the $640-billion one year earlier. Mr. Connor attributed this growth in part to currency fluctuations and growth of the company's asset management business. The insurer's Asian operations, another area of growth for the company, insurance and wealth sales continued to soar in many regions.
Sun Life's operating profit in the quarter, used as a measure of results without some accounting adjustments and other considerations, was $511-million or 83 cents per share, compared to $642-million at the same time last year.