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Sumitomo Life Q1 net profit drops 36.8% YOY as premium income dips

Japan-based Sumitomo Life Insurance Co. reported a 36.8% year-over-year decline in net profit for the fiscal first quarter ended June 30, due in part to lower premium income and higher losses on its securities holdings, as well as a rise in extraordinary losses.

Consolidated fiscal first-quarter net surplus attributable to the parent company dropped to ¥9.17 billion from ¥14.52 billion in the prior-year period.

Insurance premiums and other declined to ¥623.50 billion from ¥629.33 billion, although investment income increased to ¥223.67 billion from ¥214.78 billion in the prior fiscal year. As a result, ordinary income fell to ¥884.14 billion from ¥889.18 billion.

Ordinary expenses fell to ¥843.66 billion from ¥863.27 billion in the prior fiscal year. However, investment expenses rose to ¥66.06 billion from ¥44.98 billion, as losses on the sales of securities rose to ¥32.27 billion from ¥12.91 billion. The provision for policy reserves fell to ¥136.45 billion from ¥142.57 billion.

Sumitomo Life made an extraordinary loss of ¥30.72 billion in the quarter, mainly the result of a ¥30.61 billion provision for reserves for price fluctuation. Those figures were up from ¥11.18 billion and ¥10.90 billion, respectively, in the year-ago period.

The insurer's ordinary profit rose to ¥40.48 billion from ¥25.91 billion in the year-ago period.

As of June 30, the insurer's consolidated solvency margin ratio was 870.0%, compared to 881.7% as of March 31.

As of Aug. 8, US$1 was equivalent to ¥110.94.