Sun Life 2015 Annual Report Download - page 32

SLIM’s reported net income and operating net income was C$9 million in the fourth quarter of 2015. SLIM’s net income in the fourth
quarter of 2015 primarily reflected the 2015 acquisitions in SLIM.
SLF Asia
SLF Asia’s reported net income and operating net income was $73 million in the fourth quarter of 2015, compared to reported net
income and operating net income of $62 million in the fourth quarter of 2014. There were no operating net income adjustments in SLF
Asia in 2015 or 2014. The favourable impact of the weakening Canadian dollar in the fourth quarter of 2015 relative to average
exchange rates in the fourth quarter of 2014 increased operating net income by $9 million.
Underlying net income was $52 million, compared to $50 million in the fourth quarter of 2014. Underlying net income excludes from
operating net income market related impacts and assumption changes and management actions, which are set out in the table above.
The favourable effect of market related impacts in the fourth quarter of 2015 were primarily driven by interest rate and equity market
changes, compared to the unfavourable effect in the fourth quarter of 2014, primarily driven by interest rate and equity market changes.
Net income in the fourth quarter of 2015 reflected business growth partially offset by lower gains from the sale of AFS assets compared
to the fourth quarter of 2014.
Corporate
Corporate had reported net loss of $24 million in the fourth quarter of 2015, compared to reported loss of $2 million in the fourth quarter
of 2014. Operating net loss was $21 million in the fourth quarter of 2015, compared to an operating net income of $2 million in the
same period in the prior year. Operating net income (loss) excludes acquisition, integration and restructuring costs in 2015 and 2014,
which are set out in the table above. The favourable impact of the weakening Canadian dollar in the fourth quarter of 2015 relative to
average exchange rates in the fourth quarter of 2014 decreased operating net loss by $3 million.
Underlying net loss was $16 million, compared to underlying net loss of $40 million in the fourth quarter of 2014. Underlying net income
(loss) excludes from operating net income (loss) market related impacts and assumption changes and management actions, which are
set out in the table above. The unfavourable effect of market related impacts in the fourth quarter of 2015 were primarily driven by
equity markets partially offset by interest rates, compared to the favourable effect in the fourth quarter of 2014, primarily driven by
interest rates.
SLF U.K.’s operating net income was $22 million in the fourth quarter of 2015, compared to $65 million in the fourth quarter of 2014.
SLF U.K.’s net income in the fourth quarter of 2015 reflected unfavourable equity markets and the impact of a tax rate change partially
offset by the impact of interest rates. Net income in the fourth quarter of 2014 reflected the favourable impact of assumption changes
and management actions and market related impacts.
Corporate Support had an operating net loss of $43 million in the fourth quarter of 2015, compared to an operating net loss of
$63 million in the fourth quarter of 2014. Net loss in the fourth quarter of 2015 declined relative to the same period in 2014, primarily
due to lower operating expenses.
Additional Financial Disclosure
Revenue for the fourth quarter of 2015 was $5.6 billion, compared to $7.4 billion in the fourth quarter of 2014. Revenues decreased
primarily as a result of decreases in the fair value of FVTPL assets, partially offset by higher net premium revenue in SLF Canada and
SLF Asia, favourable currency impact from the weakening Canadian dollar, and higher fee income in SLF Asset Management and SLF
Canada. The weakening of the Canadian dollar relative to average exchange rates in the fourth quarter of 2014 increased revenue by
$393 million. Adjusted revenue was $7.0 billion for the fourth quarter of 2015, compared to $6.3 billion in the fourth quarter of 2014
primarily due to increased net premium revenue in SLF Canada and SLF Asia, and higher fee income in SLF Asset Management and
SLF Canada.
Premiums and deposits were $33.8 billion for the quarter ended December 31, 2015, compared to $31.8 billion for the quarter ended
December 31, 2014. The weakening of the Canadian dollar relative to average exchange rates in the fourth quarter of 2014 increased
total premiums and deposits by approximately $4.0 billion. Total adjusted premiums and deposits in the fourth quarter of 2015 were
down $2.0 billion compared to the same period in the prior year on an adjusted basis. The decrease was mainly due to SLF Asset
Management, with lower fund sales in MFS partially offset by fund sales in SLIM including the 2015 acquisitions, and increased net
premium revenue and segregated fund deposits in SLF Canada.
30 Sun Life Financial Inc. Annual Report 2015 Management’s Discussion and Analysis