Sun Life Financial Inc. (SLF) Q4 2024 Earnings Call Transcript

2025-02-13 16:19:27 ET

Sun Life Financial Inc. (SLF)

Q4 2024 Earnings Conference Call

February 13, 2025 10:00 AM ET

Company Participants

Paul Poon - Assistant Vice President, Investor Relations

Kevin Strain - President & Chief Executive Officer

Tim Deacon - Executive Vice President & Chief Financial Officer

Dan Fishbein - President-Sun Life US

Steve Peacher - Executive Chair, SLC Management

Manjit Singh - President, Sun Life Asia

Ted Maloney - Co-Portfolio Manager & CIO, MFS Investment Management

Kevin Morrissey - Chief Actuary & Senior Vice President

Conference Call Participants

Thomas MacKinnon - BMO Capital

Gabriel Dechaine - National Bank Financial

Meny Grauman - Scotiabank

Doug Young - Desjardin Capital Markets

Nick Blue - Evercore

Paul Holden - CIBC

Mario Mendonca - TD Cowen

Lemar Prasad - Cormark Securities

Alex Scott - Barclays

Darko Mihelic - RBC Capital Markets

Presentation

Operator

Good morning, and welcome to the Sun Life Financial Q4 2024 Conference Call. My name is Galeen, and I will be your conference operator today. All lines have been placed on mute to prevent any background noise and the conference is being recorded.

[Operator Instructions]

The host of the call is Paul Poon, Assistant Vice President, Investor Relations. Please go ahead, Mr. Poon.

Paul Poon

Thank you, and good morning, everyone. Welcome to Sun Life's Earnings Call for the Fourth Quarter of 2024. Our earnings release and the slides for today's call are available on the Investor Relations section of our website at sunlife.com. We will begin today's call with opening remarks from Kevin Strain, President and Chief Executive Officer. Following Kevin; Tim Deacon, Executive Vice President and Chief Financial Officer, will present the financial results for the quarter.

After the prepared remarks, we will move to the question-and-answer portion of the call. Other members of management are also available to answer your questions this morning. Turning to Slide 2. I draw your attention to the cautionary language regarding the use of forward-looking statements and non-IFRS financial measures, which form part of today's remarks. As noted in the slides, forward-looking statements may be rendered inaccurate by subsequent events. And with that, I'll now turn things over to Kevin.

Kevin Strain

Thanks, Paul, and good morning, everyone. Turning to Slide 4, Sun Life's Q4 results highlight our continuing commitment to helping our clients achieve lifetime financial security and live healthier lives.

Fourth quarter underlying earnings saw good results in Canada, Asia and Asset Management, offset by lower U.S. results on weaker stop-loss morbidity claims experience. The stop-loss claims experience in the U.S. was driven by higher claims severity, which we have observed across the industry. Reported earnings were down year-over-year from market-driven factors as well as the negative impacts from several onetime items that we don't expect to reoccur. Tim will go through these onetime items in more detail.

Wealth sales and asset management gross flows were up 33% on strong distribution execution at MFS and SLC. Strong net flows at SLC were more than offset by the negative net flows of MFS, which were consistent with the continued outflows across the industry. Individual protection sales were up driven by strong sales in Asia. Group protection sales were down, reflecting the lower number of large cases coming to market in the quarter and our pricing discipline.

Group sales are lumpy, and we continue to have strong momentum in our Canadian and U.S. group businesses. We ended the quarter with a strong capital position with a LICAT ratio of 152% at SLF. Given our strong capital position, we will continue to execute on our buybacks under our normal course issuer bid....

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