Empire Life reports third quarter results
Q3 2024 highlights (compared to Q3 2023)
- Common shareholders' net income of
$177 million (compared to net loss of$5 million ) - Earnings per share (basic and diluted) of
$179.88 (compared to negative$5.25 )
"The declining interest rate environment contributed to our favourable earnings in the period, and bolstered our already strong capital position," said
Financial highlights
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Third Quarter |
Year to date |
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(in millions of dollars except per share amounts) |
2024 |
2023 |
2024 |
2023 |
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Common shareholders' net income (loss) |
$ 177 |
$ (5) |
$ 265 |
$ 46 |
|
Earnings per share - basic and diluted |
$ 179.88 |
$ (5.25) |
$ 268.68 |
$ 46.55 |
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Other Financial Highlights |
2024 |
2024 |
2024 |
2023 |
2023 |
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Return on common shareholders' equity(1) |
24.0 % |
12.7 % |
10.4 % |
10.5 % |
3.9 % |
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LICAT total ratio |
154 % |
152 % |
157 % |
155 % |
152 % |
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(1) |
See Non-GAAP Measures section. |
The following table provides a summary of Empire Life results for the third quarter and year to date ended
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Third Quarter |
Year to date |
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(in millions of dollars) |
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Insurance service result |
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Insurance revenue |
$ 357 |
$ 337 |
$ 1,048 |
$ 991 |
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Insurance service expenses |
(271) |
(258) |
(852) |
(806) |
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Insurance service result |
86 |
79 |
196 |
185 |
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Net recovery (expense) from reinsurance contracts held |
(24) |
(19) |
(53) |
(51) |
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Net insurance service result |
62 |
60 |
143 |
134 |
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Investment and insurance finance result |
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Investment income (loss), excluding segregated fund account balances |
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Investment income |
502 |
(547) |
481 |
(147) |
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Change in investment contracts |
(19) |
— |
(25) |
(9) |
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Net investment result, excluding segregated fund account balances |
483 |
(547) |
456 |
(156) |
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Insurance finance income (expense), excluding segregated fund account balances |
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Insurance contracts |
(289) |
479 |
(184) |
139 |
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Reinsurance contracts held |
25 |
22 |
30 |
11 |
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Net insurance finance income (expense), excluding segregated fund account balances |
(264) |
501 |
(154) |
150 |
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Segregated fund account balances net investment and insurance finance result |
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Investment income (loss) on investments for segregated fund account balances |
609 |
(156) |
1,068 |
197 |
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Insurance finance income (expenses) segregated fund account balances |
(609) |
156 |
(1,068) |
(197) |
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Segregated fund account balances net investment and insurance finance result |
— |
— |
— |
— |
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Net investment and insurance finance result |
219 |
(46) |
302 |
(6) |
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Other income and expenses |
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Fee and other income |
8 |
8 |
31 |
21 |
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Non-insurance expenses |
(27) |
(27) |
(81) |
(68) |
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Interest expenses(1) |
(4) |
(4) |
(12) |
(13) |
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Total other income and expenses |
(23) |
(23) |
(62) |
(60) |
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Net income (loss) before taxes |
258 |
(9) |
383 |
68 |
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Income taxes(1) |
(72) |
4 |
(100) |
(12) |
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Net income (loss) after taxes |
186 |
(5) |
283 |
56 |
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Less: net income (loss) attributable to the participating account |
6 |
(3) |
10 |
2 |
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Shareholders' net income (loss) |
180 |
(2) |
273 |
54 |
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Less: preferred share dividends declared and distributions on other equity instruments(1) |
(3) |
(3) |
(8) |
(8) |
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Common shareholders' net income (loss) |
$ 177 |
$ (5) |
$ 265 |
$ 46 |
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(1) Prior year amounts have been revised from those previously presented. |
Common shareholders' net income in the third quarter increased
Net insurance service result increased
Net investment and insurance finance result increased $265 million in the third quarter compared to the same period in 2023. This was mainly due to favourable interest rate movements compared to less favourable interest rate movements in the same period in 2023, as well as the impact of insurance contract liability assumption updates. Net investment gains from non-fixed income assets also supported the favourable third quarter result, driven by favourable market movements.
Total other income and expenses for the third quarter was a net expense of
The company's Life Insurance Capital Adequacy Test (LICAT) Total ratio was 154% at
Non-GAAP measures
Empire Life uses non-generally accepted accounting principles (non-GAAP) measures (including return on common shareholders' equity, assets under management, annualized premium sales, and gross and net sales for segregated funds and fixed annuities) to provide investors with supplemental measures of its operating performance and to highlight trends in its core business that may not otherwise be apparent when relying solely on measures prescribed by International Financial Reporting Standards (IFRS Accounting Standards). Empire Life also believes that securities analysts, investors and other interested parties frequently use non-GAAP measures in the evaluation of issuers. Further information on these non-GAAP measures can be found in Empire Life's latest Management's Discussion & Analysis (MD&A), filed on Empire Life's profile available at www.sedarplus.ca.
Additional information
All amounts are in Canadian dollars and are based on the consolidated financial results of Empire Life for the period ended
About Empire Life
Established in 1923 and a subsidiary of
SOURCE The
