E-L Financial Corporation Limited
TSX : ELF
TSX : ELF.PR.F
TSX : ELF.PR.G
TSX : ELF.PR.H

E-L Financial Corporation Limited

August 07, 2015 14:00 ET

E-L Financial Corporation Limited Announces June 30, 2015 Interim Financial Results

TORONTO, ONTARIO--(Marketwired - Aug. 7, 2015) - E-L Financial Corporation Limited ("E-L Financial") (TSX:ELF)(TSX:ELF.PR.F)(TSX:ELF.PR.G)(TSX:ELF.PR.H) today reported for the quarter ended June 30, 2015, consolidated shareholder net income of $36.6 million or $8.33 per share compared with $77.2 million or $18.66 per share in 2014. The $40.6 million decrease in net income is mainly due to the fair value change on global equities during the second quarter of 2015 compared to the second quarter of 2014. E-L Corporate's net income decreased $45.8 million during the second quarter of 2015 mainly due to a net loss on investments of $43.0 million compared to net gains on investments of $28.6 million in the prior year. Empire Life's net income increased $5.2 million compared to the prior year primarily due to the growth in segregated fund management fees and segregated fund guarantee fees related to guaranteed minimum withdrawal benefit products within the Wealth Management business and increased earnings on surplus.

Consolidated net income for the first six months of 2015 was $298.7 million or $74.08 per share compared with $181.9 million or $44.35 per share in 2014. The $116.8 million increase in net income for the period is mainly due to a $105.2 million increase in E-L Corporate's net income resulting from the positive impact of global equities during the six month period compared to the same period in 2014. Empire Life's net income increased $11.6 million during the six month period of 2015 primarily due to the same reasons noted above for the second quarter.

E-L Financial's net equity value per Common Share increased to $1,047.42 at June 30, 2015 from $970.65 as of December 31, 2014.

Comprehensive income

E-L Financial earned consolidated comprehensive income of $8.2 million or $1.10 per share for the second quarter of 2015 compared with $76.2 million or $18.42 per share in 2014. The decrease in comprehensive income is primarily due to weaker equity markets in 2015 along with the impact of a marginally stronger Canadian dollar relative to the U.S. dollar in the second quarter of 2015.

Consolidated comprehensive income for the first six months of 2015 was $296.5 million or $73.53 per share compared with $199.5 million or $48.82 per share in 2014. The $97.0 million increase in comprehensive income is mainly due to the fair value gain on investments resulting from growth in the investment portfolio and the strengthening of the U.S. dollar during the first quarter of 2015.

CONSOLIDATED SUMMARY OF COMPREHENSIVE INCOME

E-L Financial Consolidated Second quarter Year to date
(thousands of dollars) 2015 2014 2015 2014
Contribution to net income
E-L Corporate1 $ 641 $ 46,392 $ 242,151 $ 136,991
Empire Life2 35,951 30,769 56,542 44,931
Net income 36,592 77,161 298,693 181,922
Other comprehensive (loss) income2 (28,403 ) (931 ) (2,152 ) 17,555
Comprehensive income $ 8,189 $ 76,230 $ 296,541 $ 199,477

CONSOLIDATED SUMMARY OF COMPREHENSIVE INCOME

E-L Corporate Second quarter Year to date
(thousands of dollars) 2015 2014 2015 2014
Revenue
Net (loss) gains on investments3 $ (42,984 ) $ 28,581 $ 302,867 $ 150,275
Investment and other income 36,596 31,877 59,442 51,774
Share of associates income 8,375 6,793 10,090 1,097
1,987 67,251 372,399 203,146
Expenses
Operating 5,648 4,650 11,682 10,059
Income taxes 3,698 11,329 53,691 28,342
Non-controlling interests (8,000 ) 4,880 64,875 27,754
1,346 20,859 130,248 66,155
Net income 641 46,392 242,151 136,991
Other comprehensive (loss) income, net of taxes2 (16,035 ) (3,982 ) (230 ) 5,519
Comprehensive (loss) income $ (15,394 ) $ 42,410 $ 241,921 $ 142,510
Empire Life Second quarter Year to date
(thousands of dollars) 2015 2014 2015 2014
Revenue
Net premiums $ 202,975 $ 213,851 $ 420,549 $ 443,206
Net (loss) gains on investments3 (283,907 ) 157,996 28,915 349,059
Investment and other income 121,577 108,669 234,258 212,243
40,645 480,516 683,722 1,004,508
Expenses
Benefits and expenses (20,401 ) 425,070 590,300 925,270
Income and other taxes 15,961 15,996 25,535 23,108
Non-controlling and participating policyholders' interests 9,134 8,681 11,345 11,199
4,694 449,747 627,180 959,577
Net income 35,951 30,769 56,542 44,931
Other comprehensive (loss) income, net of taxes2 (12,368 ) 3,051 (1,922 ) 12,036
Comprehensive income $ 23,583 $ 33,820 $ 54,620 $ 56,967

1 Net of non-controlling interests
2 Net of non-controlling interests and participating policyholders' income (loss)
3 Includes fair value change on FVTPL investments and realized gains on AFS investments

Non-GAAP Measures

The Company uses non-GAAP measures including net equity value per Common share to provide investors with supplemental measures of its operating performance that may not otherwise be apparent when relying solely on IFRS financial measures. Net equity value per Common share provides an indication of the accumulated shareholder value, adjusting shareholders' equity to reflect investments in associates at fair value, net of tax, as opposed to their carrying value.

About E-L Financial

E-L Financial operates as an investment and insurance holding company. In managing its operations, E-L Financial distinguishes between two operating segments, E-L Corporate and The Empire Life Insurance Company ("Empire Life").

E-L Corporate represents investments in stocks and fixed income securities held directly and indirectly through pooled funds, closed-end investment companies and other investment companies.

Empire Life, a subsidiary of E-L Financial Corporation Limited and in business since 1923, helps Canadians build wealth and protect their financial security with competitive individual and group life and health insurance, investment and retirement products. The company's vision is to become Canada's most convenient life insurance and investment company by being simple, fast and easy to do business with.

Contact Information

  • E-L Financial Corporation Limited
    Scott F. Ewert
    Vice President and Chief Financial Officer
    (416) 947-2578
    (416) 362-0792 (FAX)