Sun Life rebounds to profit on investments
TORONTO (Reuters) - Sun Life Financial Inc (SLF.TO: Quote), Canada's No. 3 insurer, said on Wednesday it rebounded to a stronger-than-expected fourth quarter profit from a year-earlier loss on the back of strong investments.
Volatile markets in the wake of the 2008 financial crisis have prompted Sun Life to take several quarterly losses over the past five years.
But signs of economic optimism, particularly in Europe, prompted investors to push the shares up by nearly 40 percent last year, although they are still trading at barely half of the company's all-time high set in 2007.
The stock closed at C$30.00 on the Toronto Stock Exchange.
The Toronto-based company earned C$395 million ($394.03 million), or 65 Canadian cents a share, in the quarter ended December 31. That compared with a year ago loss of C$525 million, or 90 Canadian cents, which was due to an accounting charge.
On an operating basis, Sun Life earned 76 Canadian cents a share. Analysts had expected a profit of 63 Canadian cents a share, according to Thomson I/B/E/S.
Profit was boosted by strong equity markets and increases in the fair value of real estate investments, the company said.
Sun Life has spent the last year working to reduce its market exposure and announced in December it will sell its U.S. annuity business - which carries sizable market exposures - for $1.35 billion.
Total premiums and deposits rose to C$31.9 billion from C$21.7 billion. Return on equity was 11.3 percent, compared with a negative 15.4 percent in the fourth quarter of 2011. Continued...