TORONTO – Manulife Financial Corp. saw a 62 per cent drop in its fourth-quarter profit, which it blamed on losses in its oil and gas investments.
The Toronto-based company reported net income of $246 million or 11 cents a share for the three-month period ended Dec. 31, 2015.
This compared with a profit of $640 million or 33 cents per share for the same period a year earlier. Core earnings amounted to $859 million in the fourth quarter, up 28 per cent from $713 million year over year.
Manulife (TSX:MFC) says a decline in its investments in energy resulted in a $250-million charge for the fourth quarter and a $876 million charge for 2015.
The insurer says volatility in energy prices is a factor that could make it difficult for the company to meet its core profit goal of $4 billion this year.
Manulife president and CEO Donald Guloien says despite the outlook, the company remains confident about the “underlying fundamentals” of its business. It announced that it has raised its dividend by nine per cent to 18.5 cents — the third increase in seven quarters.
“This was a disappointing year in terms of net income, largely due to sharp mark-to-market declines in oil and gas prices, diminishing an otherwise great year,” he said in a statement.
The insurer says it saw insurance sales grow by 20 per cent to US$416 million in Asia and increase by 76 per cent to US$303 million in Canada for the fourth quarter year over year. Insurance sales in the U.S. fell 17 per cent to US$127 million in the same period.