Manulife Financial (MFC) Q4 2024 earnings summary

Executive summary

• Achieved record core earnings of $7.2B in 2024, up 8% year-over-year, with Asia and Global WAM contributing significantly and highest potential businesses accounting for 70% of total core earnings.

• Delivered record APE sales, new business CSM, and new business value in Asia, with Global WAM generating $13.3B in net inflows.

• Executed milestone reinsurance transactions, including the largest-ever LTC and Canadian UL deals, unlocking ~$2.8B in capital and 0.4 percentage point accretion to core ROE.

• Launched digital and AI-driven initiatives, resulting in $600M in benefits and a record-high NPS of 27.

• Returned $6.1B to shareholders in 2024 via dividends and buybacks, including a 10% dividend increase and a new buyback program for up to 3% of shares.

Financial highlights

• Core EPS grew 11% to $3.87 (14% excluding global minimum taxes), surpassing medium-term targets.

• Core ROE expanded to 16.4% for 2024, progressing toward the 2027 target of 18%+.

• Adjusted book value per share rose 15% to $37.02, with a stable LICAT ratio of 137% and leverage ratio of 23.7%.

• Efficiency ratio improved to 44.8%, meeting the medium-term target of below 45%.

• Remittances reached a record $7.0B, benefiting from capital optimization and reinsurance deals.

Outlook and guidance

• Management confident in sustained growth, citing robust digital transformation, capital optimization, and strong cash generation.

• On track to achieve 2027 targets: core ROE ≥18%, cumulative remittances ≥$22B, new business CSM growth 15%, and core EPS growth 10–12%.

• Asia segment expected to sustain mid-teens core earnings growth, normalizing for global minimum tax impacts.

• 60%-70% of core earnings anticipated to materialize as cash remittances going forward.

• No anticipated changes in CSM allocation or investment income methodology for 2025.