Sun Life says on track to look at dividend payout this year
By Andrea Hopkins
TORONTO (Reuters) - Sun Life Financial Inc (SLF.TO: Quote), Canada's third-largest insurer, said on Thursday it was on track to consider a dividend increase in 2015 even though it reported a lower-than-expected fourth-quarter profit.
"We will look at where we are relative to the 40 to 50 percent dividend ratio payout range we've previously communicated," Chief Executive Dean Connor told analysts on a conference call.
"We finished 2014 at the higher end of that range, and as we look through 2015, we expect to move down in that range and so we are still on track to revisit the dividend this year."
Unlike many of its peers, Sun Life did not cut its dividend during the financial crisis. Investors have been hungry to know when the life insurer will increase the payout. The last increase was in 2008.
Sun Life's larger rival Manulife Financial halved its payout in 2009, then increased its dividend in August 2014.
On Wednesday, Sun Life reported weaker-than-expected results but said it was on track to exceed its 2015 earnings target. Its stock was down 6.8 percent at C$39.10 in Toronto on Thursday afternoon.
In an interview, Connor said Sun Life is also considering other capital allocation plans, including its active share buyback program, paying down debt, organic growth and acquisitions.
"There is no sense of rush. It is not burning a hole in anyone's pocket," Connor said. Continued...