Q1 2025 highlights (compared to Q1 2024)
- Common shareholders’ net income of $70 million (compared to net income of $52 million)
- Earnings per share (basic and diluted) of $71.11 (compared to $52.86)
KINGSTON, ON, April 29, 2025 /CNW/ – Empire Life reported first quarter Common shareholders’ net income of $70 million, an increase of $18 million compared to the first quarter of 2024, driven by an increase in Net investment and insurance finance results in the first quarter of 2025 compared to the same period in 2024, and Net insurance service results which improved over the prior year. These positive results were partly offset by higher workforce costs within Non-insurance operating expenses to support growth and continued investment in the business.
“We’re pleased with our financial results for the first quarter of 2025. Our net income and new sales and deposits in our insurance and investment lines were solid,” says Mark Sylvia, President and Chief Executive Officer. “Our Life Insurance Capital Adequacy Test (LICAT) total ratio also remains strong, in line with our expectations following the implementation of the new LICAT guideline for segregated funds. Our organization will continue to focus our efforts on providing great customer service and supporting the independent financial advisors who sell our products.”
Financial highlights
|
First Quarter |
||
|
(in millions of dollars except per share amounts) |
2025 |
2024 |
|
Common shareholders’ net income (loss) |
$ 70 |
$ 52 |
|
Earnings per share – basic and diluted |
$ 71.11 |
$ 52.86 |
|
Mar 31 |
Dec 31 |
Sep 30 |
Jun 30 |
Mar 31 |
|
|
Other Financial Highlights |
2025 |
2024 |
2024 |
2024 |
2024 |
|
Return on common shareholders’ equity(1) |
18.1 % |
17.4 % |
24.0 % |
12.7 % |
10.4 % |
|
LICAT total ratio |
140 % |
151 % |
154 % |
152 % |
157 % |
|
(1) |
See Non-IFRS measures section. |
The following table provides a summary of Empire Life results for the three months ended March 31, 2025 and 2024.
|
For the three months ended |
||
|
(in millions of dollars) |
March 31, 2025 |
March 31, 2024 |
|
Insurance service result |
||
|
Insurance revenue |
$ 373 |
$ 339 |
|
Insurance service expenses |
(304) |
(282) |
|
Insurance service result |
69 |
57 |
|
Net recovery (expense) from reinsurance contracts held |
(19) |
(18) |
|
Net insurance service result |
50 |
39 |
|
Investment and insurance finance result |
||
|
Investment income (loss), excluding segregated fund account balances |
||
|
Investment income |
165 |
(96) |
|
Change in investment contracts |
(7) |
(2) |
|
Net investment result, excluding segregated fund account balances |
158 |
(98) |
|
Insurance finance income (expense), excluding segregated fund account balances |
||
|
Insurance contracts |
(78) |
149 |
|
Reinsurance contracts held |
— |
4 |
|
Net insurance finance income (expense), excluding segregated fund account balances |
(78) |
153 |
|
Segregated fund account balances net investment and insurance finance result |
||
|
Investment income (loss) on investments for segregated fund account balances |
48 |
442 |
|
Insurance finance income (expenses) segregated fund account balances |
(48) |
(442) |
|
Segregated fund account balances net investment and insurance finance result |
— |
— |
|
Net investment and insurance finance result |
80 |
55 |
|
Other income and expenses |
||
|
Fee and other income |
8 |
7 |
|
Non-insurance expenses |
(36) |
(21) |
|
Interest expenses |
(4) |
(4) |
|
Total other income and expenses |
(32) |
(18) |
|
Net income (loss) before taxes |
98 |
76 |
|
Income taxes |
(24) |
(18) |
|
Net income (loss) after taxes |
74 |
58 |
|
Less: net income (loss) attributable to the participating account |
1 |
3 |
|
Shareholders’ net income (loss) |
73 |
55 |
|
Less: preferred share dividends declared and distributions on other equity instruments |
3 |
3 |
|
Common shareholders’ net income (loss) |
$ 70 |
$ 52 |
Empire Life reported Common shareholders’ net income of $70 million in the first quarter of 2025, an increase of $18 million compared to the first quarter of 2024. The period over period increase was driven by strong Net investment and insurance finance results due to favourable interest rate changes in this period compared to the same period in 2024, as well as improved Net insurance service results in the Individual Insurance product line.
Net insurance service result increased by $11 million in the first quarter compared to the same period in 2024. Contributing factors include improved mortality experience in the Individual Insurance product line relative to the first quarter of 2024, and some modest health claims experience improvements in the Group Solutions product line.
Net investment and insurance finance result increased by $25 million in the first quarter of 2025 compared to the same period in 2024. This was mainly due to the favourable effect of interest rate decreases in the current period compared to the unfavourable effect of interest rate increases in the first quarter in 2024. The positive results due to interest rate changes were partly offset by less favourable net investment gains from non-fixed income assets in the first quarter of 2025 compared to the stronger results on these assets in the first quarter in 2024.
Total other income and expenses was a net expense of $32 million in the first quarter, compared to a net expense of $18 million in the same period in 2024. The increase of $14 million is due to higher Non-insurance operating expenses related to workforce expenses.
The company’s Life Insurance Capital Adequacy Test Total ratio was 140% at March 31, 2025, well above the requirements set by the Office of the Superintendent of Financial Institutions, Canada as well as Empire Life’s internal targets.
Non-IFRS measures
Empire Life uses non-IFRS measures including return on common shareholders’ equity, assets under management, annualized premium sales, 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 financial measures as defined in IFRS Accounting Standards. Empire Life also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Empire Life’s management also uses non-IFRS measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and to determine components of management compensation. Empire Life believes that these measures provide information useful to its shareholders and policyholders in evaluating the Company’s underlying financial results. Further information on these non-IFRS 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 March 31, 2025. Additional information about Empire Life can be found in Empire Life’s latest Management’s Discussion & Analysis and Annual Information Form. These documents are filed on Empire Life’s profile available at www.sedarplus.ca.
About Empire Life
Established in 1923 and a subsidiary of E-L Financial Corporation Limited, Empire Life provides individual and group life and health insurance, investment and retirement products. The company’s mission is to provide expertise and intelligent solutions to help Canadians navigate life with confidence. As of March 31, 2025, Empire Life had total assets under management of $19.6 billion. Follow us on social media @EmpireLife or visit www.empire.ca for more information.
SOURCE The Empire Life Insurance Company
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