ELF E L Financial Corporation Limited

E-L Financial Corporation Limited (“E-L Financial”) (TSX:ELF) (TSX:ELF.PR.F) (TSX:ELF.PR.G) (TSX:ELF.PR.H) today reported for the quarter ended June 30, 2017, consolidated shareholders' net income of $97.5 million or $23.84 per share compared with $103.2 million or $25.28 per share in 2016. For the six months ended June 30, 2017, E-L Financial earned consolidated shareholders' net income of $361.6 million or $90.10 per share compared with $41.8 million or $8.67 per share in 2016.

E-L Financial’s net equity value per Common Share was $1,241.48 at June 30, 2017, an increase of 7% from $1,159.26 as at December 31, 2016.

E-L Corporate

For the quarter ended June 30, E-L Corporate earned net income of $64.4 million in 2017 compared to $78.6 million in 2016. The decrease in net income is primarily due to E-L Corporate’s net gain on investments of $42.4 million compared to $66.3 million in 2016. E-L Corporate’s investments for the second quarter of 2017 yielded a pre-tax total return of 2% mainly due to positive investment returns compared to 3% in the prior period.

For the six months ended June 30, E-L Corporate earned net income of $278.7 million in 2017 compared to a net loss of $19.8 million in 2016. The increase in net income is due to E-L Corporate’s net gain on investments of $312.1 million compared to a net loss of $87.5 million in 2016. E-L Corporate’s global investment portfolio was positively impacted by the performance of foreign equity markets. The net loss on investments in 2016 is primarily attributable to the impact of the strengthening of the Canadian dollar on the global investment portfolio. At June 30, 2017, 84% (December 31, 2016 - 85%) of E-L Corporate’s investments were denominated in foreign currencies with 44% (December 31, 2016 - 48%) and 12% (December 31, 2016 - 14%) exposed to U.S. and European equities respectively.

Empire Life

The Empire Life Insurance Company ("Empire Life") reported net income attributable to E-L Financial of $33.1 million in the second quarter of 2017 compared to $24.6 million for the comparable period in 2016. The increase in earnings for the second quarter of 2017 compared to 2016 is primarily as a result of lower hedge cost in 2017 and improved operating performance in the Employee Benefits product line, partially offset by lower gains in the Individual Insurance product lines.

For the six months ended June 30, 2017, Empire Life's net income attributable to E-L Financial was $82.9 million compared to $61.6 million for the comparable period in 2016. The increase in net income was primarily due to the above mentioned items and improved operating performance in the Wealth Management product line.

Empire Life's assets under management (including segregated fund and mutual fund assets) increased 9% over June 30, 2016 levels to reach $16.7 billion.

Empire Life’s Minimum Continuing Capital and Surplus Requirements ratio increased to 249% at June 30, 2017 compared to 248% at December 31, 2016.

CONSOLIDATED SUMMARY OF NET INCOME (UNAUDITED)

E-L Financial Consolidated		Second quarter							Year to date
(thousands of dollars)		2017			2016				2017			2016
Contribution to net income (loss)
E-L Corporate1		$	64,353		$	78,556			$	278,697		$	(19,750	)
Empire Life2		33,137			24,622				82,889			61,555
Net income		$	97,490		$	103,178			$	361,586		$	41,805

E-L Corporate		Second quarter							Year to date
(thousands of dollars)		2017			2016				2017			2016
Revenue
Net gain (loss) on investments3		$	42,411		$	66,324			$	312,113		$	(87,535	)
Investment and other income		41,790			37,109				66,059			62,575
Share of associates income		12,064			8,608				12,800			2,280
		96,265			112,041				390,972			(22,680		)
Expenses
Operating		6,726			6,052				13,369			12,160
Income taxes		14,788			10,846				53,546			(4,382		)
Non-controlling interests		10,398			16,587				45,360			(10,708		)
		31,912			33,485				112,275			(2,930		)
Net income (loss)		$	64,353		$	78,556			$	278,697		$	(19,750	)

Empire Life		Second quarter							Year to date
(thousands of dollars)		2017			2016				2017			2016
Revenue
Net premiums		$	204,461		$	210,581			$	406,855		$	440,356
Net gain on investments3		166,220			232,336				247,794			302,999
Investment and other income		69,648			65,343				134,205			126,128
Fee income		63,191			56,330				124,467			111,093
		503,520			564,590				913,321			980,576
Expenses
Benefits and expenses		458,750			526,919				797,591			888,604
Income and other taxes		12,980			12,332				33,073			28,900
Non-controlling and participating policyholders' interests		(1,347		)	717				(232		)	1,517
		470,383			539,968				830,432			919,021
Net income		$	33,137		$	24,622			$	82,889		$	61,555

1 Net of non-controlling interests2 Net of non-controlling interests and participating policyholders' income (loss)3 Includes fair value change on FVTPL investments and realized gains on AFS investments

Non-GAAP Measures

The Company uses non-GAAP measures including net equity value per Common share to provide investors with supplemental measures of its operating performance that may not otherwise be apparent when relying solely on International Financial Reporting Standards ("IFRS") financial measures. Net equity value per Common share provides an indication of the accumulated shareholder value, adjusting shareholders’ equity to reflect investments in associates at fair value, net of tax, as opposed to their carrying value.

The Company also uses assets under management to provide investors with a supplemental measure of Empire Life's performance and to highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. The Company also believes that securities analysts, investors and other interested parties frequently use non-GAAP measures in the evaluation of issuers.

About E-L Financial

E-L Financial operates as an investment and insurance holding company. In managing its operations, E-L Financial distinguishes between two operating segments, E-L Corporate and Empire Life.

E-L Corporate represents investments in stocks and fixed income securities held directly and indirectly through pooled funds, closed-end investment companies and other investment companies. The investment strategy is to accumulate shareholder value through long-term capital appreciation and dividend income from its investments.

Empire Life is a subsidiary of E-L Financial Corporation Limited. Since 1923, Empire Life has provided competitive individual and group life and health insurance, investment and retirement products to Canadians. Empire Life’s mission is to make it simple, fast and easy for Canadians to get the investment, insurance and group benefits coverage they need to build wealth, generate income, and achieve financial security.

For further information please contact:

Scott F. Ewert
Vice President and Chief Financial Officer
E-L Financial Corporation Limited
Telephone: (416) 947-2578
Fax: (416) 362-0792