Sun Life 2012 Annual Report Download - page 37

Corporate
Corporate had a reported loss from Continuing Operations of $48 million in the fourth quarter of 2012, compared to a reported loss
from Continuing Operations of $20 million in the fourth quarter of 2011. The operating net loss from Continuing Operations was
$44 million in the fourth quarter of 2012, compared to an operating loss from Continuing Operations of $7 million in the fourth quarter of
2011. Operating net income (loss) in Corporate excludes restructuring and other related costs.
SLF U.K.’s reported net income was $28 million in the fourth quarter of 2012, compared to $68 million in the fourth quarter of 2011.
Restructuring and other related costs were nil, compared to $3 million in the fourth quarter of 2011. Operating net income was
$28 million in the fourth quarter of 2012, compared to $71 million in the fourth quarter of 2011. SLF U.K.’s net income in the fourth
quarter of 2012 reflected favourable impacts from tax related items. Net income in the fourth quarter of 2011 included a net tax benefit
related to the reorganization of our U.K. operations, partially offset by the unfavourable impact of investment activity on insurance
contract liabilities.
Corporate Support had a reported loss from Continuing Operations of $76 million in the fourth quarter of 2012, compared to a reported
loss from Continuing Operations of $88 million in the fourth quarter of 2011. Restructuring and other related costs were $4 million,
compared to $10 million in the fourth quarter of 2011. The operating loss from Continuing Operations was $72 million in the fourth
quarter of 2012, compared to an operating loss from Continuing Operations of $78 million in the fourth quarter of 2011. Net income
from Continuing Operations in the fourth quarter of 2012 reflected favourable impact from lower debt financing costs and lower losses
in our run-off reinsurance business, partially offset by higher expenses. Net income from Continuing Operations in the fourth quarter of
2011 included net impairments on AFS securities.
Corporate’s reported net income from Discontinued Operations was $2 million in the fourth quarter of 2012, compared to $3 million in
the fourth quarter of 2011. Corporate’s reported loss (Combined Operations) was $46 million in the fourth quarter of 2012, compared to
a reported loss of $17 million in the fourth quarter of 2011.
Additional Financial Disclosure
Revenue from Continuing Operations for the fourth quarter of 2012 was $4.3 billion, compared to $5.4 billion in the fourth quarter of
2011. Revenue from Continuing Operations decreased primarily as a result of lower net gains in fair value of FVTPL assets and
liabilities, partially offset by higher premium revenue from SLF Canada’s GRS and SLF U.S.’s Life and Investments Products
businesses, higher investment income and increased fee income from MFS. The weakening of the Canadian dollar relative to average
exchange rates in the fourth quarter of 2011 decreased revenue by $59 million. Adjusted revenue from Continuing Operations was
$5.6 billion for the fourth quarter of 2012, compared to $4.7 billion in the fourth quarter of 2011 primarily due to higher premium revenue
from SLF Canada’s GRS and SLF U.S.’s Life and Investments Products businesses, higher investment income and increased fee
income from MFS.
Premiums and deposits from Continuing Operations were $31.9 billion for the quarter ended December 31, 2012, compared to
$21.7 billion for the quarter ended December 31, 2011. Adjusted premiums and deposits from Continuing Operations of $33.7 billion in
the fourth quarter of 2012 increased $11.1 billion from 2011. In both cases, the increase was primarily the result of higher fund sales at
MFS. Adjusted premiums and deposits adjusts for the impact of currency and reinsurance for the insured business in SLF Canada’s
GB operations.
AUM increased $18.0 billion between September 30, 2012 and December 31, 2012. The increase in AUM related primarily to:
(i) favourable market movements on the value of mutual funds, managed funds and segregated funds of $11.1 billion;
(ii) net sales of mutual, managed and segregated funds of $4.0 billion, net of the inflow from Sun Capital Advisers;
(iii) an increase of $3.5 billion from the weakening of the Canadian dollar against foreign currencies compared to the prior period
exchange rates; and
(iv) business growth of $0.4 billion; partially offset by
(v) a decrease of $0.6 billion related to the sale of MFS McLean Budden’s private wealth business; and
(vi) a decrease of $0.4 billion from the change in value of FVTPL assets and liabilities.
Management’s Discussion and Analysis Sun Life Financial Inc. Annual Report 2012 35