After boosting its core earnings to a record US$142.3 million in 2025, Sagicor is targeting “three robust avenues for growth” to become a more profitable corporation.
The financial services group, which had total assets of US$25.1 billion when its financial year ended on December 31, is planning to build significantly on what Sagicor Financial Company Ltd president and chief executive officer Andre Mousseau called an “exceptional” 2025.
“We believe that we have three robust avenues for growth, all within our control, which can drive return on shareholders’ equity (ROE) expansion going forward well beyond our full guidance,” he told financial analysts in a fourth quarter earnings call on Thursday.
“And these three things are the continued growth in our US annuities business, which we have talked about over the last couple of years, margin expansion in our Canadian business and a huge digital transformation opportunity in our newly combined Caribbean segment.”
Mousseau reported “our full year core earnings delivered record core earnings to shareholders of US$142 million, up 57 per cent over last year and well above our guidance”.
“Our core return on shareholders’ equity for the year was 14.2 per cent, and this was helped by in aggregate about US$15 million of positive emergence from our short-term and long-term insurance portfolio,” he said.
“We believe we’re currently running at approximately US$125 million to US$130 million core earnings to shareholder run rate. What that means is we’ve hit our medium-term target that we issued back in 2024 of a 13 per cent ROE about a year ahead of schedule.
“And this reflects all the work that we’ve done throughout our portfolio of operating companies to enhance our returns on equity there and how we’ve improved our debt cost of funding.”
He called 2025 “a banner year operationally”.
“Our US business continued its asset growth by nearly US$1 billion to $6.8 billion as we continue to get to scale in that market,” Mousseau said.
“Our Canadian subsidiary completed a major milestone in its digital transformation, completing an industry-leading migration of all its admin data for 750 000 in-force policies to a modern cloud-based system that will allow quicker and more efficient product and service launches, better scalability and cost improvement and cost certainty.
“And we capped off the year with the announcement of a definitive agreement to merge our two Caribbean subsidiaries under a single publicly listed entity.
“This incredibly exciting development will allow us to launch a full AI-driven digital transformation initiative in our Caribbean operations at full scale and ultimately create an exciting additional pillar of ROE growth for our shareholders,” the president added.
Looking ahead, Mousseau believes Sagicor has “an enormous opportunity to deliver value through the combination of our Caribbean subsidiaries into one entity called Sagicor Group Caribbean”.
“Prior to this combination, which we believe will close in the fourth quarter of 2026 or thereabouts, our Jamaican subsidiary was constrained from full cooperation with the rest of Sagicor by the dynamic of having a different shareholder base,” he noted.
“Now with this combination, we are working hand-in-hand with our partners in the Caribbean to drive not just a combination with traditional synergies, but to use the combination as a catalyst to run a full digital-enabled transformation of the entire way that we do business in the Caribbean.
“And whether good or lucky, we are doing it at a fabulous time because the emergence of AI powerful enough to tackle the data transformation challenges involved will make this a faster and more comprehensive transition than what we could have embarked on even 12 months ago.”
Without giving figures, he said the Caribbean project would require “a robust investment of time and resources, but we have conviction that we will look up at this business in two or three years and find it a truly transformed champion relative to solidify and build upon our market-leading position in the English-speaking Caribbean and beyond”.
On the US, Sagicor sees that market as the main driver of its future asset growth.
“So we challenged ourselves to deliver over US$1 billion of new annuities in 2025, and we surpassed that while maintaining a laser focus on spread discipline, not compromising on asset quality to do it, all of this in a competitive environment,” Mousseau reported.
“So we grew our assets in that segment to nearly US$7 billion, and we have a clear path over a three-year planning cycle to get that near US$10 billion, where we believe we’ll see some meaningful margin expansion.
“In this past year, we made some additions to its expense base through new systems and executive hires, which has set us up to grow earnings more than proportional to that asset growth going forward.”
Mousseau is also upbeat about the potential to grow earnings in Canada, pointing out that “the financial margins in this segment are strong, and they have outperformed our expectations going back to 2023.
“And in 2025, you really saw that come through the asset growth of the universal life policies and ultimately, through the drivers of earnings and the strong investment earnings performance.”
He said Sagicor believes the Caribbean, Canada and the US together have the opportunity to “contribute between one per cent and two per cent return on equity growth to our overall financial results over the next three to five years”.
