Sun Life Financial Inc. · TSX:SLF
Sun Life Financial — Q4 2019 Earnings Presentation
17 slides from Sun Life Financial's earnings presentation, Feb 13, 2020
Slide 1: 2019 Financial & Q4 Operating Results
2019 Financial & Q4 Operating Results For the period ended December 31, 2019 Sun Life Financial Inc. (unaudited)
Slide 2: Forward-looking statements and non-IFRS financial measures
In this presentation, Sun Life Financial Inc. (“SLF” or “SLF Inc.”), its subsidiaries and, where applicable, its joint ventures and associates are referred to as “we”, “us”, “our”, “Sun Life” and the “Company”. Forward-looking statements Certain statements in this presentation and certain oral state
Slide 3: Dean Connor, President and Chief Executive Officer
DEAN CONNOR President and Chief Executive Officer Q4 2019 | Sun Life | 3
Slide 4: Good Progress Across All Four Pillars
GOOD PROGRESS ACROSS ALL FOUR PILLARS Financial highlights Key accomplishments Doing more for Clients Q4’19 reported net income of $719 million; Announced our intention to acquire a majority Defined Benefit Solutions in Canada assists our Clients in underlying net income(1) of $792 million sta
Slide 5: Executing on Our Ambition to Be One of the Best Insurance and Asset Management Companies Globally
EXECUTING ON OUR AMBITION TO BE ONE OF THE BEST INSURANCE AND AS SET MANAGEMENT COMPANIES GLOBALLY A Leader in Insurance and A Leader in U.S. Wealth Solutions in our CAN US Group Benefits Canadian Home Market A Leader in Asia through A Leader in Global Asset AM ASIA Distribution Excellence in Manage
Slide 6: Kevin Strain, Executive Vice President & Chief Financial Officer
KEVIN STRAIN Executive Vice President & Chief Financial Officer Q4 2019 | Sun Life | 6
Slide 7: Q4'19 Results
Q4’19 RESULTS $ millions (except EPS and ROE) Q4’19 Q3’19 Q4’18 Reported net income 719 681 580 Underlying net income(1) 792 809 718 Reported EPS(2) (C$) 1.22 1.15 0.96 Underlying EPS(1),(2) (C$) 1.34 1.37 1.19 Reported ROE(1) 13.6% 13.0% 10.9% Underlying ROE(1) 15.0% 15.5% 13.6% Underlying EPS(1)
Slide 8: Q4'19 Business Group Performance
Q4’19 BUSINESS GROUP PERFORMANCE UNDERLYING NET INCOME(1) ($ millions) Business growth, higher investing activity, favourable credit experience, higher Impact of currency increased underlying net income by $2M available-for-sale (“AFS”) gains and favourable mortality experience, partially CAN of
Slide 9: Sources of Earnings View
SOURCES OF EARNINGS VIEW Sources of earnings Common shareholders Q4’19 Q4’18 $ millions Expected profit: continued business growth across all pillars Expected profit on in-force business 849 744 Impact of new business: lower strain in Asia driven by higher sales Impact of new business 22 17 Experien
Slide 10: Sales Results by Business Group
SALES RESULTS BY BUSINESS GROUP INSURANCE SALES(1) BY BUSINESS WEALTH SALES(1) BY BUSINESS $1.4B VALUE OF NEW $44.9B BUSINESS(1),(2) +24% YoY +7% YoY +9% YoY Canada U.S. Asia Canada Asset Management Asia Canada insurance sales up 4% driven by individual life insurance Canada wealth s
Slide 11: Operating Expenses
OPERATING EXPENSES Figures are in $ millions 8% on a constant currency basis 35 19 7,033 125 101 173 148 6,432 1 2 3 4 5 6 7 8 Q4 2018 YTD Controllable Contractual Currency Fair Value Impact of Other Q4 2019 YTD Expenses Volumes Adjustments Acquisitions Increase in controllable expenses reflects i
Slide 12: Progress on Medium-Term Financial Objectives
PROGRESS ON MEDIUM-TERM FINANCIAL OBJECTIVES 1-Year 5-Year(2) 14.2% 14.3% 12.8% 12.7% UNDERLYING 12.2% $5.16 ROE(1) $4.86 14.3% 13.2% $0.18 12-14% $4.15 $3.76 $3.80 UNDERLYING 6% 12% EPS GROWTH(1) 10% growth excluding 8-10% the impact of interest on par seed capital in 2018 2015 2016 2017 2018 2019
Slide 13: Appendix
APPENDIX Q4 2019 | Sun Life | 13
Slide 14: Reconciliation of Underlying Net Income
RECONCILIATION OF UNDERLYING NET INCOME Q4’19 Q4’19 $ millions Pre-tax Post-tax Reported net income 719 Net equity market impact (including basis risk impact of $4 million)(1) 49 40 Net interest rate impact (including credit spread impact of $0 and swap spread impact of (24) (11) $(29) million)(1) I
Slide 15: Other Notable Items
OTHER NOTABLE ITEMS Impact of other items on our net income Q4’19 Q4’19 $ millions Pre-tax Post-tax Experience related items Impact of investment activity on insurance contract liabilities 45 34 Credit 58 47 Mortality (5) (3) Morbidity (66) (47) Lapse and other policyholder behaviour (7) (6) Expense
Slide 16: Use of Non-IFRS Financial Measures
Use of Non-IFRS Financial Measures We report certain financial information using non-IFRS financial measures, as we believe that these measure provide information that is useful to investors in understanding our performance and facilitate a comparison of our quarterly and full year results from peri
Slide 17: Forward-Looking Statements
Forward-Looking Statements From time to time, the Company makes written or oral forward-looking statements within the meaning of certain securities laws, including the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities l