Sun Life Financial (SLF) Q4 2024 earnings summary

Executive summary

• Q4 underlying net income was $965 million, down 2% year-over-year, while reported net income fell 68% to $237 million due to market-driven impacts, lower tax-exempt investment income, and a Vietnam impairment.

• Full-year underlying net income rose 3% to $3,856 million, with reported net income at $3,049 million, down 1% year-over-year.

• Assets under management reached $1.54 trillion, up 10% year-over-year, marking a new milestone.

• Business mix remains diversified: 42% wealth & asset management, 30% individual protection, 28% group health & protection.

• SLC Management achieved record capital raising and net inflows, while MFS saw continued industry-wide outflows.

Financial highlights

• Q4 underlying EPS was $1.68, unchanged year-over-year; reported EPS was $0.41, down 68%.

• Underlying ROE for Q4 was 16.5%; reported ROE was 4.0%.

• Full-year underlying EPS was $6.66, up 5% year-over-year.

• Wealth sales and asset management gross flows rose 33% year-over-year to $61.0 billion in Q4'24.

• New business CSM for Q4'24 was $306 million, down from $381 million in Q4'23.

Outlook and guidance

• Medium-term objectives for earnings growth remain unchanged, with underlying EPS growth target increased to 10% and underlying ROE target to 20%.

• Continued pressure on U.S. stop-loss loss ratios expected, but pricing actions (14% increase plus 2% more planned) and additional modest pricing actions (~2%) for 2025 should help restore margins.

• Expense efficiency program on track, with 80% of CAD 200 million target expected by end of 2025.

• Focus on client-centric innovation, digital solutions, and expanding health and asset management offerings.