E-L Financial Corporation Limited Announces December 31, 2013 Year End Financial Results
March 04 2014 - 2:34PM
Marketwired
E-L Financial Corporation Limited Announces December 31, 2013 Year
End Financial Results
TORONTO, ONTARIO--(Marketwired - Mar 4, 2014) - 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 year ended December 31, 2013, consolidated net operating
income from continuing operations1 of $140.6 million or $31.84 per
share2 in 2013 compared with $71.4 million or $14.53 per share in
2012. The $69.2 million increase in net operating income in 2013
versus 2012 is mainly attributable to the $44.5 million increase in
life insurance operation's ("Empire Life's") net operating income
resulting primarily from the Individual Insurance product line. The
increase is due mainly to the favourable impact of long-term
interest rate movements and stock market movements in 2013. E-L
Corporate's net operating income increased $24.6 million
principally due to the recovery of refundable dividend taxes
resulting from the $301.5 million payment of the special dividend
to Common shareholders.
Net income
E-L Financial earned
consolidated net income from continuing operations of $596.6
million compared with $432.3 million in 2012. The $164.3 million
increase in net income is due primarily to a $396.0 million
increase in E-L Corporate's fair value through profit or loss
("FVTPL") investments during the year compared to $125.8 million in
2012, an increase of $131.6 million from United Corporations
Limited's ("United") investments and the favourable impact of stock
market movements during 2013. In 2012, the Company recognized a
$142.2 million gain on the consolidation of United.
On November 1, 2013,
the Company completed the sale of its formerly wholly-owned
subsidiary, The Dominion, to The Travelers Companies, Inc. for
gross proceeds of $1.08 billion, resulting in an after-tax gain of
$266.4 million. This gain combined with The Dominion's ten month
earnings for 2013 of $44.7 million resulted in $311.1 million
earned from discontinued operations.
Net income from
continuing and discontinued operations resulted in E-L Financial
earning total consolidated net income of $907.7 million or $227.18
per share compared with $479.6 million or $118.41 per share in
2012.
Comprehensive income
E-L Financial earned
consolidated comprehensive income of $871.6 million or $217.99 per
share in 2013 compared with $469.4 million or $115.82 per share in
2012. Consolidated other comprehensive loss ("OCL") was $36.1
million or $9.19 per share compared with $10.2 million or $2.59 per
share in 2012.
The $25.9 million
increase in OCL for 2013 is mainly due to the reclassification of
significant gains relating to The Dominion's liquidation of its
common share portfolio.
E-L Financial's net
equity value per Common Share1 at December 31, 2013 was
$872.45.
"We are pleased with
2013's exceptional results," said Duncan Jackman, Chairman,
President and CEO of E-L Financial. "This year saw a continuation
of strong performance by equity markets globally and an increase in
long-term bond yields. As a result, our investment portfolio
benefited from positive equity market performance and the life
insurance business reported record net income on the heels of an
improving yield environment. In addition, the year culminated with
the sale of our general insurance business, generating a
significant gain. Many things went right for us this year, leaving
the company in a strong financial position to continue building
shareholder value over the long-term."
CONSOLIDATED SUMMARY
OF COMPREHENSIVE INCOME
|
2013 |
|
Continuing Operations |
Discontinued |
|
|
(thousands of dollars) |
E-L Corporate |
Empire Life |
Total |
The Dominion |
Total |
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
$ |
47,913 |
$ |
92,678 |
$ |
140,591 |
|
|
|
|
Realized gain (loss) on available for sale investments including
impairment write downs |
|
11,061 |
|
(2,459) |
|
8,602 |
|
|
|
|
Share of income of associates |
|
51,337 |
|
- |
|
51,337 |
|
|
|
|
E-L Corporate's fair value change in fair value through profit or
loss investments |
|
396,023 |
|
|
|
396,023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
506,334 |
|
90,219 |
|
596,553 |
|
311,126 |
|
907,679 |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss) |
|
32,834 |
|
(5,235) |
|
27,599 |
|
(63,701) |
|
(36,102) |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
$ |
539,168 |
$ |
84,984 |
$ |
624,152 |
$ |
247,425 |
$ |
871,577 |
|
|
|
2012 |
Restated 3 |
Continuing Operations |
Discontinued |
|
|
(thousands of dollars) |
E-L Corporate |
Empire Life |
Total |
The Dominion |
Total |
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
$ |
23,301 |
$ |
48,154 |
$ |
71,455 |
|
|
|
|
Realized gain on available for sale investments
including impairment write downs |
|
4,310 |
|
15,690 |
|
20,000 |
|
|
|
|
Share of income of associates |
|
72,823 |
|
- |
|
72,823 |
|
|
|
|
E-L Corporate's fair value change in fair value
through profit or loss investments |
|
125,810 |
|
|
|
125,810 |
|
|
|
|
Gain on the consolidation of United |
|
142,241 |
|
- |
|
142,241 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
368,485 |
|
63,844 |
|
432,329 |
|
47,275 |
|
479,604 |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss) |
|
5,863 |
|
(16,800) |
|
(10,937) |
|
753 |
|
(10,184) |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
$ |
374,348 |
$ |
47,044 |
$ |
421,392 |
$ |
48,028 |
$ |
469,420 |
1Use of non-GAAP
measures:
"net operating
income" is net income excluding realized gain on available for sale
investments including impairment write downs, the Company's share
of income from associates and the fair value change in fair value
through profit or loss investments in the E-L Corporate portfolio,
all net of tax. The term net operating income does not have any
standardized meaning according to GAAP and therefore may not be
comparable to similar measures presented by other companies.
"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.
2 All earnings per
share figures are net of dividends paid on First Preference
shares.
3 Net operating
income and other comprehensive income (loss) for December 31, 2012
have been restated to reflect the impact of the prior period
adjustment related to the remeasurement of defined benefit plans
resulting in a $6,863 increase in net operating income and a
$12,354 decrease in other comprehensive income for the year ended
December 31, 2012.
E-L Financial Corporation LimitedMark M. TaylorExecutive
Vice-President and Chief Financial Officer(416) 947-2578(416)
362-2592
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