Shares of Manulife Financial Corp closed lower yesterday after its fourth-quarter profit fell short of analysts' expectations.
Canada's largest insurer reported net income of C$1.79 billion (HK$14 billion) for the last quarter of last year, compared with C$868 million for the same period in 2009.
Earnings per share rose to C$1 from 51 cents and return on common shareholders' equity grew to 29 per cent from 13 per cent a year earlier.
Adjusted earnings from operations amounted to C$692 million, slightly below the estimated range of C$700 million to C$800 million, as a result of increased hedging costs.
Manulife said it was close to its hedging objectives for next year and ahead of its original schedule. Chief executive Donald Guloien said the company planned to hedge 60 per cent of equity risk by next year, and 75 per cent by the end of next year.
The lower-than-expected earnings caused Manulife's share price to drop 4.22 per cent to HK$138.40 yesterday. Analysts and brokers said the stock was expected to drop further to about HK$130 amid a market correction following a rally in the previous weeks. The stock shot up from HK$135 at the end of last month to HK$149.80 on Tuesday before weakening.
