Manulife's First Quarter Financial Results for 2025 Highlight Growth and Challenges

Manulife Reports First Quarter 2025 Results

Manulife Financial Corporation, known as Manulife, has announced its financial results for the first quarter of 2025, which ended on March 31, 2025. The company reported significant accomplishments in its insurance segment, demonstrating strong new business metrics and a solid overall growth trajectory despite some challenges faced in specific areas.

Key Highlights from Q1 2025

In the first quarter, Manulife achieved core earnings of CA$1.8 billion, marking a slight decline of 1% when adjusted for constant currency compared to the previous year. Notably, net income attributed to shareholders fell to CA$0.5 billion, a significant drop from CA$0.9 billion in the first quarter of 2024. Core earnings per share increased by 3% to CA$0.99, while general EPS fell by 48% to CA$0.25.

The company's core return on equity (ROE) was reported at 15.6%, and the Life Insurance Capital Adequacy Test (LICAT) ratio remained strong at 137%. In terms of new business sales, Annualized Premium Equivalent (APE) increased by an impressive 37%, along with a 31% rise in new business contractual service margin (CSM) and a 36% increase in new business value.

Insights from Leadership

Roy Gori, the President and Chief Executive Officer of Manulife, expressed pride in the company’s continued momentum, highlighting the record levels of new insurance business results achieved during the quarter. He pointed out that the results underscored Manulife's strong operational performance in an increasingly volatile environment.

Gori also emphasized the collective effort of the company's 37,000 employees, attributing their hard work and commitment to the company’s ability to transform fundamentally. He acknowledged Phil Witherington’s upcoming leadership role as essential in steering the company towards its next chapter.

Colin Simpson, the Chief Financial Officer, noted that while overall business growth remained solid, core EPS was adversely impacted by increased provisions related to expected credit loss and additional provisions for natural disasters, specifically the California wildfires. Book value per common share showed respectable growth of 12% year-over-year, reflecting stable financial health.

Business Performance Analysis

The company's focus on strategic growth opportunities and portfolio optimization was evident in its Global Wealth and Asset Management (Global WAM) sector. Although net inflows decreased from CA$6.7 billion in Q1 2024 to CA$0.5 billion in Q1 2025, core earnings from this sector grew by 24%. This performance was attributed to favorable market conditions and disciplined expense management.

In terms of geographic performance, all regions exhibited varying levels of success. In Asia, net income attributed to shareholders rose by 57%, demonstrating robust insurance sales bolstered by a strong 43% increase in new business value year-on-year.

Challenges and Future Outlook

However, challenges remain, particularly in the U.S. market, which saw significant net losses attributed to shareholders. While sales increased by 6%, the sector faced headwinds from decreased investment spreads and adverse impacts from annual reviews of actuarial methods.

Looking ahead, Manulife is committed to capitalizing on emerging opportunities while maintaining a clear focus on enhancing its digital capabilities and customer engagement. The deployment of advanced AI technologies is expected to foster stronger relationships between sales teams and clients, paving the way for improved service delivery.

The quarterly results conference call is scheduled for May 8, 2025, where Manulife will provide further insights into its operational strategies and financial outlook. Stakeholders will be keen to observe how the company navigates these complex challenges ahead and continues to deliver value to shareholders.

Manulife’s commitment to innovation, including the introduction of a fully digital retirement plan aimed at small businesses in the U.S., also represents a meaningful step toward enhancing its service offerings and strengthening its market position. With a focus on evolving consumer needs and the ongoing expansion of its product portfolio, Manulife is poised to remain a key player in the financial services industry for years to come.