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Canada : Manulife reports 1Q16 core earnings of $905 million and net income of $1,045 million, strong top line growth, and continued positive net flows in its wealth and asset management businesses.

Manulife Financial Corporation fMFC") today announced net income attributed to shareholders of $1,045 million for the first quarter of 2016 ("1Q16"), fully diluted earnings per common share of $0.51 and return on common shareholders' equity ("ROE") of 10.8%, compared with $723 million, $0.36, and 8.4%, respectively, for the first quarter of 2015 ("1Q15"). The increase in net income attributed to shareholders was primarily due to gains from interest rate movements and higher core earnings, partially offset by lower than expected returns on alternative long-duration assets. In 1016, MFC generated core earnings of $905 million, diluted core earnings per common share of $0.44 and core return on common shareholders' equity fCore ROE") of 9.3%, compared with $797 million, $0.39, and 9.3%, respectively, for 1015.

Donald Guloien, President and Chief Executive Officer, stated, "This was a strong quarter, by almost any measure. Core earnings grew by 14% from the prior year- despite zero contribution from investment gains during the quarter- a testimony to the strong operating performance from our operations around the world. We are also delivering excellent results from our DBS, Standard Life and New York Life transactions; managing our equity exposure exceedingly well, even in highly volatile markets; and achieved our 25th consecutive quarter of positive net flows into our global Wealth and Asset Management businesses."

"Net income was up 45%, as a result of a variety of market-related gains, which more than offset depressed oil and gas prices in the quarter, serving as a useful reminder that markets will fluctuate both in our favour and against us, but we should focus on long-term positioning and shareholder wealth creation rather than short-term market fluctuations," added Mr. Guloien.

Steve Roder, Chief Financial Officer, said, "We achieved a 70% increase in new business value, which speaks to the quality of sales we generated this quarter. This bodes well for our future profitability, as new business value represents the expected present value of future earnings from this quarter's sales. Today, we published our 2015 Embedded Value Report highlighting a 21% increase in the value of our insurance-related businesses to $47.8 billion."

"We successfully completed a US$1.75 billion bond offering in the United States and finished the quarter with strong capital levels. This was Manulife's first bond issuance outside the Canadian market in 5 years, and was an important step in our path to diversify our funding sources," added Mr. Roder.

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Publication:Mena Report
Article Type:Financial report
Date:May 6, 2016
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