Newspaper article The Canadian Press
Industrial Alliance Caps Record Year by Swinging to $73.8 Million Q4 Profit
Industrial Alliance swings to profit in Q4
QUEBEC CITY, - Industrial Alliance capped a record year in 2012 by swinging to a profit available to common shareholders of $73.8-million in the fourth quarter, the first period since it sold its U.S. annuities business.
The Quebec City-based insurance giant earned 78 cents per share for the period ended Dec. 31, compared with a loss of 90 cents per share the previous year when net losses reached $81.2 million. Revenues decreased 24 per cent to $1.76 billion, including $1.2 billion for net premiums.
Adjusting for a number of one-time items, including a nearly $20-million strengthening of reserves and the sale of the U.S. business, diluted earnings were $1.03 per share, compared with 78 cents a year ago.
For the full year, Industrial Alliance (TSX:IAG) said its net income attributable to common shareholders tripled to reach a record $311.9 million, or $3.31 per share, up from $103.3 million or $1.18 per share in 2011.
Excluding the gain on the sale of its U.S. annuity business in the third quarter and year-end assumption changes, net income from continuing operations grew nearly 16 per cent to $295.7 million or $3.26 per share. That compared with $255.6 million or $2.95 per share a year ago.
Total annual revenues fell to $7.5 billion. Net premiums were flat at nearly $5 billion, but investment income decreased more than 31 per cent to $1.5 billion, partially offset by an increase in other revenues to $934 million.
Industrial Alliance CEO Yvon Charest described 2012 as "extremely gratifying" as net income grew on improvements in its retail insurance business in Canada and the United States, along with the wealth management operations.
"In terms of business growth, strong momentum continues across the organization," he said in a news release, noting that retail insurance sales grew 16 per cent despite two price increases last year in Canada.
The U.S. operations accounted for 18 per cent of total company life sales, up from 15 per cent in 2011. …