E-L Financial Corporation Limited Announces March 31, 2013 Interim Financial Results
May 10 2013 - 10:40AM
Marketwired Canada
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
quarter ended March 31, 2013, consolidated net operating income(1) of $21.4
million or $4.47 per share(2) compared with $45.1 million or $10.83 per share in
2012.
The $23.7 million decrease in net operating income in 2013 versus 2012 is
principally attributable to the general insurance operation ("The Dominion")
which reported a $17.4 million decrease in net operating income in the first
quarter resulting mainly from higher claims expense for automobile and
weather-related personal property losses, partly offset by lower claims expense
for commercial property. The life insurance operation's ("Empire Life") net
operating income decreased $4.4 million due to the unfavourable impact of
long-term interest rate movements on the Individual Insurance product line in
2013 compared to a favourable impact in 2012.
Net income
E-L Financial earned consolidated net income of $146.0 million or $36.20 per
share for the first three months of 2013 compared with $155.9 million or $39.02
per share in 2012.
In addition to the decrease in net operating income described above, income from
associates decreased $28.6 million, as income from United Corporations Limited
("United") in 2013 is now reported on a consolidated basis versus as income from
associates in 2012. Offsetting the declines for the period, fair value through
profit or loss ("FVTPL") investments held at E-L Corporate increased $113.6
million compared to $70.3 million in 2012 reflecting an increase of $43.9
million in United's investments.
Comprehensive income
E-L Financial earned consolidated comprehensive income of $197.5 million or
$49.30 per share for the first three months of 2013 compared to $165.7 million
or $41.51 per share in 2012. Consolidated other comprehensive income ("OCI") was
$51.4 million or $13.10 per share compared with $9.8 million or $2.49 per share
in 2012. The improvement in OCI for the quarter reflected a larger unrealized
fair value increase on available for sale investments compared to the prior
period.
E-L Financial's net equity value per Common Share (1) at March 31, 2013 was $790.90.
"The first quarter reflected insurance operation results that were lower
relative to the same period in the prior year, offset by an increase in the
investment portfolio primarily driven by continued momentum in global equity
markets," said Duncan Jackman, Chairman, President and CEO of E-L Financial.
CONSOLIDATED SUMMARY OF COMPREHENSIVE INCOME
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Period ended March 31, 2013
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E-L The Empire
(thousands of dollars) Corporate Dominion Life Total
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Net operating income $ 5,426 $ 8,061 $ 7,948 $ 21,435
Realized gain on available
for sale investments
including impairment write
downs 2,286 5,684 219 8,189
Share of income of
associates 2,803 - - 2,803
E-L Corporate's fair value
change in fair value
through profit or loss
investments 113,611 113,611
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Net income 124,126 13,745 8,167 146,038
Other comprehensive income 13,137 33,628 4,673 51,438
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Comprehensive income $ 137,263 $ 47,373 $ 12,840 $ 197,476
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Restated (3) Period ended March 31, 2012
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E-L The Empire
(thousands of dollars) Corporate Dominion Life Total
----------------------------------------------------------------------------
Net operating income $ 7,241 $ 25,491 $ 12,342 $ 45,074
Realized gain on available
for sale investments
including impairment write
downs 528 7,099 1,485 9,112
Share of income of
associates 31,370 - - 31,370
E-L Corporate's fair value
change in fair value
through profit or loss
investments 70,304 70,304
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Net income 109,443 32,590 13,827 155,860
Other comprehensive income
(loss) 8,072 4,110 (2,378) 9,804
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Comprehensive income $ 117,515 $ 36,700 $ 11,449 $ 165,664
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(1) Use 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 for March 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 $132
increase in net operating income and a $3,049 decrease in other
comprehensive income for the first quarter of 2012.
FOR FURTHER INFORMATION PLEASE CONTACT:
E-L Financial Corporation Limited
Mark M. Taylor
Executive Vice-President and Chief Financial Officer
(416) 947-2578
(416) 362-2592 (FAX)
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