Manulife reports drop in second-quarter core profit
Manulife Financial Corp slightly beat analysts’ estimates for second-quarter core profit but saw earnings drop from a year earlier, due to market volatility that weighed on its asset management unit and COVID-19 restrictions in Asia.
Canada’s largest life insurer reported core earnings of $1.56-billion, or 78 cents a share, in the three months ended June 30, compared with $1.68-billion, or 83 cents a share, a year earlier. Analysts had expected 76 cents a share.
Analysts had forecast a muted second quarter for Canadian life insurers, on expectations that their substantial asset management units would take a hit from equity market declines. They also noted that lingering COVID-19 restrictions in Asia could prove a challenge, a headwind the company had flagged in its previous quarterly results announcement.
Manulife reported core earnings declines of 14% in its global wealth and asset management unit as fee income and assets under management declined; 4.6% in its U.S. business on lower demand for some insurance products due to higher inflation; and 2.5% in Asia, on lower sales, particularly in Hong Kong and Japan.
An 8.5% increase in its Canadian earnings, lifted by growth in new business value, helped offset the declines somewhat.
Net income attributable to shareholders was $1.09-billion or 53 cents per share, compared with $2.65-billion, or $1.33 a share, a year earlier.