Sun Life Financial Inc. · TSX:SLF
Sun Life Financial — Q2 2015 Earnings Presentation
21 slides from Sun Life Financial's earnings presentation, Aug 6, 2015
Slide 1: Financial & Operating Results for the Period Ended June 30, 2015
FINANCIAL & OPERATING RESULTS FOR THE PERIOD ENDED JUNE 30, 2015 Sun Life Financial Inc. (unaudited)
Slide 2: Forward-looking statements
Forward-looking statements Certain statements in this presentation and certain oral statements made during the earnings conference call on August 6, 2015 (collectively, this “presentation”), including, but not limited to, statements that are not historical facts, are forward-looking and are subject
Slide 3: Dean A. Connor, President and Chief Executive Officer
Dean A. Connor President and Chief Executive Officer
Slide 4: Operating Results
SUN LIFE FINANCIAL OPERATING RESULTS • Operating net income of $731 million, up from $488 million in Q2’14 • Underlying net income of $615 million, up from $499 million in Q2’14 • Operating ROE of 16.5% and Underlying ROE of 13.9% • Growth in key earnings drivers: - Expected profit up 15% - Improved
Slide 5: Business Group Performance
SUN LIFE FINANCIAL BUSINESS GROUP PERFORMANCE BY BUSINESS GROUP(1) – Q2 2015 STRONG UNDERLYING EARNINGS GROWTH FROM BOTH Underlying net income $615 million WEALTH(2) AND INSURANCE BUSINESSES (C$ millions) 615 SLF Asia 11% 499 SLF MFS Canada 27% 39% SLF U.S. 16% SLF U.K. 7% Q2'14 Q2'15 Protection Wea
Slide 6: Strong Execution
SUN LIFE FINANCIAL STRONG EXECUTION • Continued improvement in disability results in Group Benefits LEADER in FINANCIAL • Completed the largest ever defined contribution transfer in the GRS market PROTECTION and WEALTH • Insurance sales up 22%; Wealth sales up 61% SOLUTIONS in our Canadian • SLGI re
Slide 7: Colm J. Freyne, Chief Financial Officer
Colm J. Freyne Executive Vice President and Chief Financial Officer
Slide 8: Q2'15 Results
SUN LIFE FINANCIAL Q2’15 RESULTS C$ millions Q2’15 Q1’15 Q2’14 (except EPS and ROE) Operating net income 731 446 488 Underlying net income 615 516 499 Reported net income 726 441 425 Diluted operating EPS (C$) 1.19 0.73 0.80 Diluted underlying EPS (C$) 1.00 0.84 0.81 Operating ROE 16.5% 10.4% 12.6%
Slide 9: Earnings Analysis
SUN LIFE FINANCIAL EARNINGS ANALYSIS Q2’15 Q2’15 C$ millions Pre-tax After-tax Operating net income 731 Net impact of market factors 179 97 Assumption changes and management actions 22 19 Underlying net income 615 Other notable items 79 69 Q2’15 C$ millions Operating net income Underlying net income
Slide 10: Sources of Earnings View
SUN LIFE FINANCIAL SOURCES OF EARNINGS VIEW Sources of earnings Common shareholders Q2’15 Q2’14 Change C$ millions Expected profit on in-force business 672 582 90 Impact of new business (39) (28) (11) Experience gains or (losses) 252 - 252 Assumption changes and management actions 22 14 8 Earnings f
Slide 11: Sales Results
SUN LIFE FINANCIAL SALES RESULTS C$ millions Q2’15 Change over Q2’14 Individual life and health 214 8% Group life and health 213 8% Total Insurance sales 427 8% Wealth sales 6,614 58% MFS sales 24,673 16% SLIM(1) sales 619 nm(2) Total Wealth sales 31,906 25% (1) Sun Life Investment Management ("SLIM
Slide 12: Operating Expenses
SUN LIFE FINANCIAL OPERATING EXPENSES Change Q2 YTD C$ millions (over Q2 2015 YTD 2014) Operating expenses 2,409 162 Currency Impact 159 159 MFS(1) 811 (36) Operating expenses, excluding currency and MFS 1,439 39 Volume-related(2) 41 Inflation, investments in growth (net of productivity (2) gains) a
Slide 13: Stephen C. Peacher, Chief Investment Officer
SUN LIFE FINANCIAL Stephen C. Peacher Executive Vice President and Chief Investment Officer, President, Sun Life Investment Management 13
Slide 14: Growing and Diversifying Sun Life's Asset Management Pillar
SUN LIFE FINANCIAL GROWING AND DIVERSIFYING SUN LIFE’S ASSET MANAGEMENT PILLAR SUN LIFE INVESTMENT MANAGEMENT LIABILITY-DRIVEN INVESTING AND ALTERNATIVE YIELD STRATEGIES SUN LIFE SUN LIFE RYAN LABS PRIME BENTALL INVESTMENT INVESTMENT ASSET ADVISORS, KENNEDY MANAGEMENT OPERATIONS MANAGEMENT INC. INC.
Slide 15: North American Asset Management
SUN LIFE FINANCIAL NORTH AMERICAN ASSET MANAGEMENT • Active management in public markets • A broad range of equity and fixed income products • Solution-based opportunities (multi-sector, target date funds) • Private asset classes and customized solutions • Alternative yield strategies • Private debt
Slide 16: Appendix
SUN LIFE FINANCIAL APPENDIX 16
Slide 17: Wealth Management
SUN LIFE FINANCIAL WEALTH MANAGEMENT(1) Sales Value of new business LTM Q2’15 (C$ billions) C$1.1 billion Wealth 121 114 111 Protection 100 40% 60% 2012 2013 2014 LTM Q2’15 Fee income Assets under management (C$ millions) (C$ billions) 4,425 673 4,053 606 3,339 528 2,632 398 2013 2014 LTM 2012 2013
Slide 18: Reconciliation of Underlying Net Income
SUN LIFE FINANCIAL RECONCILIATION OF UNDERLYING NET INCOME Q2’15 Q2’15 C$ millions Pre-tax After-tax Operating net income 731 Net equity market impact (including basis risk impact of $(6) million) (19) (11) Net interest impact (including credit spread impact of $27 million and 185 97 swap spread imp
Slide 19: Other Notable Items
SUN LIFE FINANCIAL OTHER NOTABLE ITEMS Impact of other items on our net income Q2’15 Q2’15 Pre-tax After-tax C$ millions Experience related items Impact of investment activity on insurance contract liabilities 42 33 Mortality 35 29 Morbidity 13 12 Credit 41 29 Lapse and other policyholder behaviour
Slide 20: Use of Non-IFRS Financial Measures
In this presentation, Sun Life Financial Inc. and its subsidiaries, joint ventures and associates are referred to as “we”, “us”, “our” and the “Company”. Use of Non-IFRS Financial Measures We report certain financial information using non-IFRS financial measures, as we believe that they provide info
Slide 21: Forward-Looking Statements
Forward-Looking Statements Certain statements in this presentation, including statements (i) related to our proposed acquisition of the Bentall group of companies and the expected AUM of Sun Life Investment Management, (ii) statements relating to our growth strategies, (iii) statements concerning ou